In Germany’s election campaign, the Energiewende is a sideshow

Germany’s election campaign is in full swing. While all of the parties agree on the Energiewende in principle, there are deep differences of opinion on energy policy. Whether in its leafy suburbs or along Berlin’s narrow inner-city streets around Alexanderplatz, ubiquitous billboards and placards announce that the campaign for the nationwide parliamentary election on September 22 is in high gear. Given the wide-ranging significance of the clean energy revolution and the charged domestic debate around it in Germany, you’d think some of the campaign ads would refer to it. Well, think again.

The Energiewende: at a crossroads
(c) gruene-fraktion-bayern.de
Most of the major parties – with the notable exception of the Greens – are doing their best to ignore the topic, touching upon it only in terms of the costs to consumers. But dig a little deeper into the party platforms and campaign-trail speeches, and you’ll find positions – even among potential coalition partners – that signal very different approaches to Germany’s energy transition. Germany is at a critical juncture in the Energiewende, and the stakes are high. From Day One, Germany’s next administration will be faced with pressing issues – from redesigning the energy market to the plight of the offshore wind industry—that will impact the country’s energy profile for years to come.

In terms of consensus, all of the relevant parties say they want to further the Energiewende, it’s just a question of how and how fast to do it. All, for example, agree that transmission grids have to be expanded and that developing storage capacity is a priority. Moreover, costs to consumers have to be cut, energy efficiency promoted, the seminal Renewable Energy Act (EEG) updated, and the energy market reformed. None of the parties advocate altering the Merkel administration’s 2022 date for abandoning nuclear power altogether.

The Price of Electricity in Germany

This, though, is where the harmony ends. Every party, for example, has a different take of the rising consumer costs for electricity, the topic that has dominated discourse for over a year now. The Social Democrats (SPD) and the Greens both want to pass the current low price of electricity on the wholesale market (which only industry and suppliers can purchase from) onto consumers. The SPD would demand that suppliers register their incumbent tariffs (Grundversorgertarife) with the Federal Network Agency (BNetzA). The supervisory authority would intervene – and stipulate a lower rate – when the lowest rates in a given region differ from the incumbent tariff by more than ten percent. The SPD also wants to cut the electricity tax (Stromsteuer), known also as the environmental tax, by 25 percent and accelerate the decline of the clean energy surcharge (die EEG-Umlage). This, maintains the SPD, could save consumers 300 euros a year.

Meanwhile, the Greens want to end the state of affairs where new customers are automatically signed up with the incumbent supplier,

Germany is at a critical juncture in the Energiewende, and the stakes are high
whose rates are usually higher than those of competitors. About 40 percent of Germans have never switched suppliers, which means they are still with the incumbent. The Greens (and the SPD, too) say they would also vet the list of companies that are exempt from the clean energy surcharge, scratching from the list those firms whose international competitiveness is are not truly endangered by high energy prices.

The pro-business Free Democrats (FDP) and the Christian Democrats (CDU), on the other hand, want to save consumers money primarily by altering the Renewable Energy Act, in particular by lowering or even doing away with the feed-in tariff for onshore wind power and PV. The FDP wants to scratch all subsidies, thus enabling the market alone to determine energy prices. It is the only party that wants to replace the current system with a quota system like those in Sweden and the UK. However, even the FDP underscores its opposition to retroactive cuts in feed-in tariffs. In the same vein, the liberals are – again the only German party – against tinkering with the EU Emissions Trading Scheme, which puts an – at the moment very low – price on burning coal. As for the democratic socialist Left Party (Die Linke), it wants to decouple electricity prices from the market and allot a minimum of free electricity to households.

Fracking is another source of contention. The Greens and the Left Party rule it out, as they do CCS. The CDU and the SPD take a wait-and-see approach, while the FDP is positively included toward it – if it proves safe and environmentally friendly.

Moreover, the Greens and the SPD want to create an Energiewende ministry with all of the key competencies for energy in this ministry’s portfolio. Both, however, want to run it in the event of a red-green coalition.

The Greens are the only party that wants to pro-actively drive the Energiewende forward; it is also thus understandably the party with the most explicit proposed energy policies.

Fracking is another source of contention
While the Greens concede that the Renewable Energy Act needs revising, the party would do so in a way to encourage as much clean energy production as Germany’s energy mix can handle. The ecological party wants to accelerate the pace by setting new goals, for example that half of the country’s electricity come from renewable sources by 2022 and 100 percent by 2030. (The current government target is 80 percent by 2050.)

The Greens want to adopt a greenhouse gas emissions law that would require a 40 percent cut in emission by 2020 and 95 percent by 2050 (compared to 1990). The law would include specific targets for industry, transportation, agriculture, and forestry. In terms of coal, they also want to change the mining law in order to prevent any new lignite mines. The Greens want to phase-out coal as an energy source altogether by 2030. (The Left Party advocates the same but by 2040.)

The Social Democrats remain, in part at least, wedded to the coal industry, a historical bastion of support in places like the Ruhr Valley. (Today it’s more likely to be Brandenburg, where substantial coal extraction is happening.) “While the CDU has managed to move away from nuclear power, the SPD cannot so easily be separated from the coal,“ noted one German journalist. The party sees coal as a “bridge technology” useful until green energy sources can stand on their own. Noticeably lacking these days is the strong voice of someone like the late Herman Scheer, a vocal proponent of renewable energies. Nevertheless, the party’s climate and green power goals exceed those of the current government, while falling short of the Greens and the Left Party.

Unfortunately, there has been precious little discussion about one of the most – if not the most – pressing issues, namely the reform of the energy market and measures to insure reserve capacity to back up weather-bound renewables, above all PV and onshore wind.

Will regulators create a second market for energy-supply security?
The topic is complex, perhaps thus unsuited to electoral campaigning. But the magnitude of the questions looming warrant debate: Will regulators create a second market for energy-supply security? Will they auction strategic reserve capacities in peak times, as in Sweden? Or guarantee the funding of windfall profits at peak energy demand times? Or will providers have to buy supply certificates to guarantee the future electricity supply for their customers? What role will demand management, smart metering, and power-to-gas play?

As for the German Volk, polls regularly show that there is high acceptance of the Energiewende among Germans, usually upwards of 80 percent. But they also show Germans increasingly fed up with its unclear direction and poor organization. Nearly half of all Germans are unhappy with its implementation. Their biggest gripe, though, is the ever higher price of power. The two parties Germans say they most trust with the Energiewende are the CDU and the Greens. The FDP is trusted by less than one percent of those surveyed.

On September 22 when Germans go to the polls, they’ll be casting votes that are likely to have an enormous impact on Germany’s energy policies in the coming decades. The country’s politicos, however, have done a poor job outlining and speaking to these issues. It’s reminiscent of a time not so long ago when such decisions on energy policy weren’t part of public debate at all. Now they are, though, and the political elite has to honor that with a serious and honest discussion about Germany’s energy future.