Leading German Daily Writes: Germany’s Energy Transformation Is A Flop, Government Takeover Looms

What subsidies and government meddling in the free market could not accomplish, will probably soon be attempted by a government takeover.

Flagship daily the Frankfurter Allgemeine Zeitung (FAZ) here writes that there are 4 main obstacles in Germany’s energy transformation:

1. Wind supply is unpredictable.

2. There’s no good way to store electricity.

3. Increasing energy efficiency to reduce consumption by 10% by 2020 and 25% by 2050 appear unrealistic.

4. Expansion of the national power distribution grid is stuck.

One problem is that Germany is made up of 16 different states, which are all pulling in different directions, thus leading to disharmony in the country’s effort to convert over to renewable energy. While the rural northern regions are installing hundreds of wind parks, the populated markets to the south who need the power are blockading the expansion of the power transmission network. How does one coordinate sixteen different plans to produce and consume electricity, with most of them ignoring market principles? Right now in Germany it’s chaos.

The FAZ is hardly optimistic and reminds us that there will not be any grid expansion before next year’s national elections. There’s not a major power company out there that is willing to invest amid such uncertainty.

The FAZ writes:

The biggest setback for the energy transformation came at the beginning of the year: The state-run Dutch grid operator Tennet, without whom nothing will function at the German north coast, announced that it did not have the money – 15 billion euros – for connecting to the offshore windparks . Thus not only are Lower Saxony’s wonderful energy plans finished with a single blow, but so are those of the entire Federal Republic along with them.”

To come up with the money, Tennet requested state support. But Tennet competitors cried foul and claimed the Tennet proposal was a “socialization attempt.” But as FAZ writes, it’s probably going to come to that anyway. The City of Hamburg has already taken the step, calling their 25.1% takeover a “remunicipalization” of the energy supply. Already Germany’s northern state of Lower Saxony, soon to be home to dozens of huge offshore wind parks, is thinking along the same lines. The FAZ writes:

At the state government in Hannover, where it is not the socialists and green central planners who have the say, it’s the conservative and free democrats, and they are on the verge of breaking a taboo. To rescue Germany’s energy transformation, perhaps the only thing left to do is to pull the emergency brakes: a rapid takeover of the power distribution grid by the state.”

As the Germans like to day: “Socialize the hardships, privatize the benefits.” It’ll be interesting to see if the Free Democrats will go along with that plan.

 

10 responses to “Leading German Daily Writes: Germany’s Energy Transformation Is A Flop, Government Takeover Looms”

  1. Bernd Felsche

    Wow.

    They have to spend all their wealth, and mortgage the grandchildren to learn a lesson that they could have learnt by simply listening to the people who did the arithmetic; 20 years ago.

    Performance data for wind “turbines” was available by the end of the 1980’s. They weren’t commercially viable where other grid power was easy to connect. In remote areas, it could save some generator fuel; but the (un)reliability and maintenance costs of the extra machinery made for decades-long returns on investment.

  2. Bernd Felsche

    Regarding the takeovers of failing “utilities”, it’d be cheaper to let them rust. Taxpayers don’t have a choice about paying taxes; short of packing up and moving away.

    But government has the solution when it’s running short of tax revenue:
    http://www.faz.net/aktuell/hollande-als-vorbild-lafontaine-will-75-prozent-einkommenssteuer-11686820.html

    75% rate income tax for those earning more than a million Euros a year. Which of course results in a reduction in tax takings as the big income earners are the most-mobile and flexible. They are generally not as stupid as most politicians.

    1. DirkH

      Lafontaine and his Stalinist lover Sarah Wagenknecht have great entertainment value; and their party clown Gregor Gysi.

  3. Casper

    The paper is patient. The politicians may write down anything what they want, but only the life is real!

  4. DirkH

    Here’s my completely simple and serious proposal to solve the problem.
    If the wind turbine owners can’t get their produced energy into the grid, force them to store the energy on site or lose the subsidy.
    Guarantee them a price equal to the subsidy times the energy content of their storage when you take the energy. Don’t pay that subsidy before you get the stored energy.
    They can simply get themselves an electrolysis unit, produce H2 and convert it to Methane. Methane is good old NatGas and a welcome fuel.
    Much easier than building all these high voltage lines nobody wants or needs; after all only 1/5 or 1/7 of our energy needs are electric anyway.

  5. R. de Haan

    Why not leave it up to the market.
    Stop subsidizing and let bankruptcies do it’s market cleansing work.

    Nobody is going to pay 100 billion Euro’ for the next 3% of solar fiction contributions to the energy mix and nobody is going to pay for the the next batch of centrally planned (EU directive) wind farms.

    We really have te end this Green nonsense and remember the right use of the word “sustainable” again.

    Energy must be affordable, reliable and plentiful in order to sustain our industrial society. That means base load power 24/7.

    “Sustainable” energy does not meet that criteria.

    Just for the record:

    We have 1.000 sun hours and 2000 wind hours in a year and no storage capacity.

    This makes wind and solar power “unsustainable” even if we had the storage capacity.

    Especially if we want to keep melting steel, producing aluminum and building bricks, produce food, clothing, plastics, electronics and fuel our cars, trucks, ships, trains and planes.

    I really wonder when we’re going to put an end to the green fairy tales and resolve to the order of the day again and kick the EU and UN plans for an all mighty Environmentalist Totalitarian Doctrine into the garbage can of history.

    … Unless you want to give up on a perfectly good civilization
    http://endoftheamericandream.com/archives/proposed-un-environmental-constitution-for-the-world-would-establish-an-incredibly-repressive-system-of-global-governance.

    Oh Yes, before I forget it, stop spreading lies about the state of our environment and our climate.

  6. Ulrich Elkmann

    There’s a real kicker in the essay that has been missed: that bit about “nationalizing as the only way to tackle the problem”. Most of the wind turbines have been installed in the north of Germany, and the grid is operated by TenneT – which is a DUTCH firm.

    http://en.wikipedia.org/wiki/TenneT
    “TenneT B.V. is the national electricity transmission system operator of the Netherlands, headquartered in Arnhem. Controlled and owned by the Dutch government, it is responsible for overseeing the operation of the 380 and 220 kV high-voltage grid throughout the Netherlands and its interconnections with neighbouring countries. It is additionally responsible for the 150 kV grid in South Holland. In Germany, it is one of the four transmission system operators operating through its subsidiary TenneT TSO GmbH.”

    http://de.wikipedia.org/wiki/Tennet_(Unternehmen)
    “Tennet befindet sich vollständig im Besitz des niederländischen Staats.”
    (Tennet is owned cmopletely by the Dutch state.)

    http://www.tennet.org/tennet/index.aspx
    “Als dé elektriciteitstransporteur is onze belangrijkste taak het bewaken van de betrouwbaarheid en de continuïteit van de elektriciteitsvoorziening in Nederland en een belangrijk deel van Duitsland: 24 uur per dag, 365 dagen per jaar.”

    Well, if the German governments really sets about nationalizing Dutch firms, I suppose it will not only be the Greeks who will regularly picture Frau Merkel or her successor with Der Fuehrer’s moustache…

    1. DirkH

      The idea is of course to buy the grid from them; not nationalization by pointing a gun at them.
      In a very similar vein, the state of Baden-Württemberg has acquired 50% of EnBW from private owners (already under the CDU government before the current Green-Red Kretschmann government).

      But I think the FAZ is really speculating there.

  7. Pascvaks

    “Government Takeover Looms”
    One would have thought that “She” would have learned something, even a little something, about Government Takeovers. Germans definitely have a longterm memory problem. And ‘it’ is a VERY BIG problem. Seems to destroy everyone and everything in the process. ‘Those who cannot learn from the past are doomed to repeat it.’ Zum Voll!

  8. TheJollyGreenMan

    It seems as people forgot the old saying: Everything the state touches turns to shite.