In the media: Government warns banks of 'Carbon Bubble' risk
Süddeutsche Zeitung
Interview with Chancellor on Climate Summit
In an interview with the Süddeutsche Zeitung, Germany’s Chancellor Angela Merkel said that preparing for the climate summit in Paris was one of the most important topics for her at the G7 meeting in Elmau this weekend. She said it would be difficult to limit gobal warming to 2 degrees celsius but that the target remained important. The agreement in Paris could for the first time include commitments by emerging nations. “If you had asked me five years ago if China would be ready to declare that it will reduce its greenhouse gas emissions as of 2030, I would have thought it hardly possible,” Merkel said. Talking about emissions reduction in Germany, she said that not only the brown coal sector had to do its bit, but also the heating sector, and that the main reason for rising German emissions from brown coal were the increased export of power and the insufficient price signal from the European Emissions Trading System (EU ETS).
Read excerpts on climate policy from the interview in German here.
Reuters
“Merkel’s bumpy road back onto the climate path”
Of all countries and all leaders, it is Germany, Chancellor Merkel and her deputy and energy minister Sigmar Gabriel who are not getting their act together on CO2 reductions, writes Markus Wacket in an analysis for Reuters. As it stands, Germany will fall short of its target to reduce CO2 emissions by 40 percent by 2020, Wacket says. The opposition and numerous environmental groups are voicing their concerns ahead of the G7 summit in Elmau next weekend. “The chancellor finds grand words when on the international climate stage […] but in her own country she keeps quiet while the coal lobby sabotages climate protection,” Wacket quotes Greenpeace energy expert Susanne Neubronner as saying. Germany’s energy transition is stuck on several fronts, including the construction of new power lines from the windy north to the industrial south and reducing emissions from the brown coal sector. Merkel will have to present something at the latest at the Paris climate summit in December, he writes, or as her Environment Minister Barbara Hendricks has put it: “No country can act with credibility at international climate negotiations when it doesn’t achieve its targets at home.”
Frankfurter Allgemeine Zeitung
“Government warns banks of climate risks”
The German government has warned banks they should be careful with investments in companies vulnerable to a shift to a low-carbon economy, reports the Frankfurter Allgemeine Zeitung. Financial institutions should incorporate so-called megatrends such as climate change and resource scarcity into their risk analyses, the paper cites a government response to a question by the Green Party as saying. It was unclear whether a sudden drop in fossil fuel companies’ market capitalisation could pose a danger to financial markets, according to the government, which said it supported unbiased examinations of such risks. It also said the finance ministry is considering commissioning its own study on the subject of a ‘carbon bubble’, according to the paper.
German banks have invested around two percent of their total lending in companies heavily involved in fossil fuels such as oil and gas producers and utilities, according to numbers from financial authorities cited by the FAZ. “Against this backdrop, the German banking authority does not see an increased risk to financial stability due to a sudden devaluation of assets from the fossil sector,” state secretary Michael Meister from the finance ministry wrote, according to the paper.
Find the article in German here.
Handelsblatt
Op-ed: Economic opportunities in climate protection
In the debate about climate protection, economic opportunities are becoming a central focus, Caio Koch-Weser, Vice Chairman of the Deutsche Bank and supervisory board chairman of the European Climate Foundation* and Paul Polman, CEO of Unilever and Chairman of the World Business Council for Sustainable Development write in the Handelsblatt. Climate protection and economic growth can be conducive to each other, the two authors say. Global climate protection isn’t proceeding fast enough but it is certain that we are in the midst of it, and Europe will have to adapt its economy accordingly, they say. Warnings against a CO2 investment bubble should be taken seriously. Climate protection and a better understanding of risks should start playing a more important role in the finance sector, particularly when it comes to company assessments, financial analysis and credit assessments.
Frankfurter Allgemeine Zeitung
“Swabians fear British nuclear power station”
Five municipal utilities from the southern German region of Swabia are considering suing the EU commission because of its agreement to subsidies for the British nuclear power station Hinkley Point. Together with Greenpeace Energy and Austrian green electricity provider Ökostrom AG, the utilities argue that heavily subsidised electricity from Hinkley Point would lower power prices on the European markets because it will be fed into the grids, according to the paper. This scenario posed a critical danger to the economic viability of combined power to heat plants, according to the utilities, who first want to assess the chances of the lawsuit before pursuing it.
Read the article in German here.
Frankfurter Allgemeine Zeitung
“Energiewende: Headed down a dead end street”
Germany’s transition to a low-carbon economy is too expensive, misses its targets, and overdue amendments are not tackled, write Jürgen Hambrecht, chair of the supervisory board at Germany’s chemical giant BASF, and Michael Vassiliades, head of the trade union for mining, chemicals and energy industries (IG BCE). “The Energiewende is barely managed. Decisions are postponed, previous mistakes ignored, and wrong decisions regarding the future are tolerated,” Hambrecht and Vassiliades write in an opinion piece in the Frankfurter Allgmeine Zeitung. “The project Energiewende is headed down a dead end street,” warn the authors, demanding a wider focus beyond renewables to include neglected areas such as heating, transport and infrastructure, as well as more money to fund research into energy storage. “Who, if not us here in Germany, could provide an internationally respected example for a truly sustainable Energiewende? This is our big and global responsibility. For better or for worse.”
Süddeutsche Zeitung
“Brussels urges Germany to speed up grid expansion”
Germany’s “insufficient internal electricity transmission capacities” are a weakness, and delays in building power lines from north to south are threats to implementing a European Energy Union, a paper by the EU Commission states, according to the Süddeutsche Zeitung. The paper says that “local and regional resitance” to the power lines will “further increase network congestion.” Similar SWOT (strengths, weaknesses, opportunities, threats) analysis are currently being sent to several EU member states as the Commission pushes ahead with its plans for a stronger Energy Union, the paper writes. The Commission lists Germany’s diverse gas supply and innovation in low carbon technologies as strengths, the article says.
Read the article in German here.
Reuters
“RWE ready to discuss nuclear decommissioning fund – Boersen-Zeitung”
RWE is open to a public foundation that would secure the money needed for decommissioning nuclear power plants, reports Reuters. “There has to be a judicious balance of give and take,” Bernhard Guenther told the Boersen-Zeitung, according to Reuters. “We've always said we are ready for talks anytime.” He insisted that assets underpinning the 10 billion euros in provisions that RWE has set aside for dismantling its power plants were not at risk of losing their value. He also said that earnings from RWE's fossil power plants would likely decline in 2015 and 2016 but not beyond, according to Reuters.
Read the article in English here.
* The European Climate Foundation is one of the sponsors of the Clean Energy Wire.
