- How Germany positions itself to to meet the Energy Challenge head-on
This world is changing, faster than ever. If every generation has it's smaller or larger 'revolution', it is the tremendous momentum behind a green future that we are in right now. Or in short: we are living an energy revolution!
But why now? First of all, many countries' electricity distribution grid is outdated and needs re-modernization . The costs for it? In the 10's of billions of dollars. Moreover, many countries dislike the notion of being dependent on some other country. And with an increasing energy demand this dependency is certainly not declining, if we are to continue with business-as-usual (BAU). Again, why now? Well, when pretty much one year ago a trembling earth-quake and an raging tsunami wasted large area of japan and multiple nuclear reactors had melt-downs, the German policy leaders had enough. Almost overnight (in political timescales) Germany past what critics see as the 'largest decision since WWII', namely to abandon nuclear power bu the end of the decade (plus 2 years). Noteworthy is also that this decision is founded on a broad consensus in German society with the German green-party tripping in size to becoming the 3rd largest party in the parliament.
However, the decision to abandon nuclear is just the tip of an long growing iceberg; from 1990 to 2010 Germany cut emissions of carbon dioxide by about 25 percent, while the economy grew at a constant rate. Interestingly, Germany has realized that cutting greenhouse gas emissions does not harm the economy - quite contrary in fact. Renewable energies are a driving force in the German industry, generating 37.5 billion Euros in turnover in 2010. The number of people employed in the renewable energy sector will go up to 500,000 by 2020 from today’s 367,000 people. And let me add that these jobs are highly trained, well-paid jobs, those who will pay decent taxes.
But why now? First of all, many countries' electricity distribution grid is outdated and needs re-modernization . The costs for it? In the 10's of billions of dollars. Moreover, many countries dislike the notion of being dependent on some other country. And with an increasing energy demand this dependency is certainly not declining, if we are to continue with business-as-usual (BAU). Again, why now? Well, when pretty much one year ago a trembling earth-quake and an raging tsunami wasted large area of japan and multiple nuclear reactors had melt-downs, the German policy leaders had enough. Almost overnight (in political timescales) Germany past what critics see as the 'largest decision since WWII', namely to abandon nuclear power bu the end of the decade (plus 2 years). Noteworthy is also that this decision is founded on a broad consensus in German society with the German green-party tripping in size to becoming the 3rd largest party in the parliament.
However, the decision to abandon nuclear is just the tip of an long growing iceberg; from 1990 to 2010 Germany cut emissions of carbon dioxide by about 25 percent, while the economy grew at a constant rate. Interestingly, Germany has realized that cutting greenhouse gas emissions does not harm the economy - quite contrary in fact. Renewable energies are a driving force in the German industry, generating 37.5 billion Euros in turnover in 2010. The number of people employed in the renewable energy sector will go up to 500,000 by 2020 from today’s 367,000 people. And let me add that these jobs are highly trained, well-paid jobs, those who will pay decent taxes.
The CO2 emission reduction goals of Germany are also worth mentioning. Germany stays committed to its target of a 40 percent reduction of CO2 emissions by 2020. Note that these climate targets will remain unaffected by the accelerated nuclear phasing-out. In addition, the energy supply is secure during the transition to a carbon-free energy supply: even with eight reactors offline now, Germany is still a net exporter of electricity.
A major contribution to Germany’s successful energy policy is the "Feed-in Tariff" - an incentive structure to encourage the adoption of renewable energy. Utilities are obliged to buy electricity from renewable sources at a fixed price which is higher than the market price. Consumers pay the difference as part of their electricity bill (presently 3.5 ct per KWh). 80 percent of Germans consider it (although adding to the electricity price) appropriate or even too low.
However, the long-term vision and price guarantee are certainly key for investment decisions in the renewables sector. Germany's renewable energy generation has already reached 20% of its electricity production and is expected to become the dominant source by the middle of the century. Phasing out nuclear power will be achieved by significantly increasing the country's energy efficiency as well as through all renewable energies, especially wind energy. In short, this project means Germany may be the first large industrialized country to have a highly efficient energy supply system based on renewable energies. And the German's are confident to do it as Chancellor Merkel pointed out: if anyone can demonstrate that this is possible, it is Germany.
In conclusion, it is a bold but forward thinking move what Germany is experimenting with. Nonetheless, the decision to greener go where not many have gone before is a signal to the world that change is possible for a smarter and cleaner planet.
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