Not long ago, all of Germany’s political parties and media, whether socialist, green, liberal or conservative, embraced and voted into law the green energy feed-in act (EEG). The few remaining outspoken opponents were marginalized as political Neanderthals and climate deniers.
Now fast-forward 5 years to today. My oh my how perceptions have changed. As the costs and the technical folly become more apparent, major back-pedaling is beginning. Once the darling of the media, Germany’s renewable energy feed-in act (EEG) is now coming under heavy fire. Energy prices have been skyrocketing, and CO2 emissions aren’t going down by any measure.
The latest to fire harsh criticism is leading political daily, the Frankfurter Allgemeine Zeitung (FAZ) in an online piece titled: Too much is too much. The introduction:
The transition to renewable energy is becoming a giant re-distribution machine. The subsidy is careening out of control. There’s far more green energy than planned. The price for emission certificates are plunging. Coal is experiencing a Renaissance. And the world is emitting more CO2 than ever.”
Granted the FAZ still is in favor or green energies, but not like this. The FAZ calls the current implementation of Germany’s green energy feed-in act a “giant redistribution machine” that is “dividing the nation“, where a “majority now fear further rising energy costs“. The surcharge for green energy will soon rise to 7 cents per kilowatt-hour, almost “double what power is traded for on the power commodity exchanges“. Consumers are now paying 30 euro-cents ($0.38) per kilowatt-hour.
The FAZ adds that the green energy subsidy “has completely gone out of control“. Worse, the lobby of those who have benefitted massively from these subsidies has turned into a behemoth that no politician dares to challenge. The German green energy feed-in act does not only impact the German power market, but “grotesquely distorts” the European power market, writes the FAZ.
And because green energies have been massively subsidized to the detriment of other power sources, other subsidies have to enacted to counter the market distortions. The result: more subsidies for power companies to keep reserve plants on stand-by, or to pay wind park operators to shut down when there’s too much power being fed in. The green energy revolution has turned into a subsidy bonanza where investors have no risks.
Another massive error described by the FAZ article was the belief that fossil fuels would get more expensive. That hasn’t happened The opposite is true. New oil and gas reserves, thanks to fracking, for example, have caused these fuels to plummet in price. The FAZ writes:
The gas price there has already fallen 75%. Because coal there is being replaced gas, the emissions of carbon dioxide in the USA has fallen to the lowest level in 20 years. That’s perverse. Through fracking, America reaches its climate targets which it never signed on to while self anointed model climate student Germany is emitting more CO2 than last year.”
Now that the opposition greens and socialists are plummeting in German opinion polls, look for Angela Merkel and her government to take steps to shut down the ruinous renewable energy subsidy orgy soon after next weekend’s national elections.