A Secret Success Story

By Chris Nelder31.05.2013Economics

Germany’s energy transition is already a success story. If only the rest of the world paid attention.

Germany has become the world leader in solar power generation in just 12 years, while phasing out its nuclear power, yet few people in the United States seem to be aware of its success.

Nuclear power fell from 31 percent of Germany’s electricity consumption in 2000 to under 23 percent in 2011 “as its renewable power capacity grew”:http://www.ag-energiebilanzen.de/viewpage.php?idpage=227. Not only did the feared blackouts that opponents of renewable energy had trumpeted fail to materialize, but the grid actually became _more_ stable as the transition proceeded. Instead of power disruptions, Germany’s grid “became the most reliable”:http://www.bundesnetzagentur.de/cln_1931/DE/Sachgebiete/ElektrizitaetGas/Sonderthemen/SAIDIWerteStrom/SAIDIWerteStrom_node.html of the EU member states, with just 15 minutes of unplanned interruptions in 2011. In 2007, Germany had 19 minutes of downtime, while nuclear-heavy France had 62 minutes and the US had 240 — more than 12 times as much as Germany.

Germany intends to complete its phase-out of nuclear power by 2022. Under its “Energiewende” (energy transition) program, it could achieve far more than that, and obtain 100% of its electricity from renewable sources by 2030.

The growth of Germany’s solar capacity has been nothing short of astonishing, adding as much PV in the first half of 2012 as the US has in total cumulative installed capacity. Two key drivers have been responsible for this rapid growth. The first is its use of feed-in tariffs (FiTs), which pay renewable energy generators an above-market rate for power put onto the grid under contracts with a 15 to 25 year duration. FiTs have been responsible for a rapid deployment of wind and solar in over 40 countries, including most of Europe, and accounted for nearly all new solar PV systems there since 1997.

The second is good grid planning. Germany has carefully planned for accommodating intermittent power onto its grid, and installed advanced monitoring and forecasting technology to manage that power effectively. If proponents of always-on “baseload” power like coal and nuclear plants were correct, then we might expect countries with the highest levels of renewable penetration to have the most trouble managing their grids. In reality, “a survey”:http://www.eclareon.eu/sites/default/files/res_integration_final_report.pdf of EU countries by the consultancy “eclareon GmbH” found that the countries which planned for adequate grid capacity generally didn’t have a problem accommodating renewables.

The benefits of Germany’s energy transition strategy are manifest and manifold. Their FiTs have driven solar adoption at a far faster rate than any other policy. The maturation of their market has driven the installed cost of solar down to half that of the US. Because the FiTs have encouraged distributed generation, more than half of Germany’s renewable generation capacity is owned by everyday citizens, which has increased its popularity. The sun is shining at its brightest precisely when demand is highest, at noon. Solar power now meets one-third of midday demand, shaving off the peaks in grid power prices and driving down the price of grid power overall. And because it’s clean power, it displaces fossil fuels and reduces carbon emissions.

Incorporating more renewable power into its grid has contributed partially to higher electricity costs for Germany in the short term, but studies indicate that in 2030, a 100% renewable mix will likely deliver electricity at a lower cost than a fossil-nuclear mix. The cost of renewable generation has been falling rapidly and is set to continue falling, while the cost of coal and nuclear power continues to rise worldwide. In Europe, natural gas is already too expensive to compete with renewables.

The installed price of rooftop solar in Germany has fallen by 66% since 2006, and by 2018, solar power is expected to be the absolute cheapest way to generate power in Latin America, Africa, the Middle East, Australia, India, and much of Asia. On current trends, the price of unsubsidized solar in the US will hit grid parity by 2020.

Propaganda and energy illiteracy

With such stunning success — driving nuclear power out of their grid while reducing long-term and peak power costs, slashing carbon emissions, and doing so in a democratic and popular way — it’s a wonder that most Americans don’t know anything about Germany’s energy transition. That is, until you look at what American media have been telling them.

More wind generation capacity was installed in the US than any other power source in 2012. Solar installations have been booming, with solar capacity nearly doubling in 2011 and growing by another 40% in 2012. And yet on February 7, News Corp.’s television show Fox & Friends said that the future of solar energy “looks dim as investments into green energy are beginning now to dry up.” They went on to promote domestic natural gas, and assert that Germany’s solar generation has surpassed that of the US because “they’ve got a lot more sun”:http://mediamatters.org/blog/2013/02/07/fox-cedes-solar-industry-to-germany/192568 than we do.” In fact, the entire continental US (with the exception of Seattle, Washington) gets far more sun than Germany.

Or consider how “Business Insider”:http://www.businessinsider.com/europe-solar-energy-demand-cliff-2013-1 interpreted Germany’s lower solar installations in December 2012 compared to the previous year: “It Looks Like Europe Is Going Off The Solar Energy Demand Cliff,” read the headline. In fact, 2012 was the third record year in a row for PV installations in Germany, and the decline in December was mainly due to scheduled reductions in the FiT, the high penetration of PV that Germany has achieved, and other factors.

Then there was the August 31 editorial in “Forbes”:http://www.forbes.com/sites/jamesconca/2012/08/31/germany-insane-or-just-plain-stupid/ entitled “Germany — Insane or Just Plain Stupid?” As Craig Morris wrote in “Renewables International”:www.renewablesinternational.net/germany-sane-and-just-plain-smart/150/537/56251/, the “Forbes” author mistakenly believed that Germany is switching to coal, did not understand the details of Germany’s Renewable Energy Act, misunderstood the role of nuclear power on the German grid, asserted that “Germany’s poor and unemployed are on fixed energy credits” (they are not), and said that “the grid can’t handle it, the transmission system is not there, and the power disruptions and brownouts are wreaking havoc on the country’s energy reliability.”

“The fact is that none of what is happening in Germany fits what Americans think,” Morris muses. “Germany is switching to renewables quickly, without raising its carbon emissions, with probably the most reliable grid in the world, on a market with freedoms Americans don’t even know they lack, with a job market that continues to strengthen (even during the ongoing economic crisis), and in combination with a nuclear phaseout. None of this makes sense to Americans, who respond not by accepting the facts and changing their minds but by getting the picture wrong.”

From the perspective of this American energy journalist, I believe Morris is correct. Much of the energy journalism in American media is unfiltered propaganda perpetrated by the fossil fuel industry. One need look no further than the recent rash of stories about incipient US “energy independence” to see that. Yes, the US is enjoying a boom in shale gas production, but it also remains a net importer of gas — a fact that no one ever mentions in the press. And yes, the US is now producing around one million barrels a day of new oil from hydrofracked shales, but that new production hasn’t even been able to stem the decline of non-OPEC oil output, and the US is still the world’s largest oil importer.

Apart from industry propaganda, many of the other mistaken notions about Germany’s energy transition, and where the US stands in its own energy situation, are simply the result of energy illiteracy within the ranks of writers and editors.

So carry on, Germany. You’re on the right course with your energy transition, and offering the rest of the world an immensely valuable model. We will thank you later.



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