Germany must implement fast-tracked energy transition in 2023 – energy industry

The new year must bring a fast implementation of Germany’s ambitious energy transition targets regarding renewable energy sources, grid infrastructure and hydrogen production, the German Association of Energy and Water Industries (BDEW) has said at its annual review. Although renewables occupied a greater share in the power mix than ever before, the return of some coal-fired power plants due to the energy crisis meant that the energy production sector’s greenhouse gas emissions rose for the first time in many years in 2022, the BDEW said. “2023 has to bring new thrust for investments in renewable energy, in hydrogen and hydrogen-ready gas plants and in energy grids,” said BDEW head Kerstin Andreae. A new market design that makes investments in renewables more profitable is necessary to create momentum for new projects, the energy lobby executive said. “The good news is: Germany can be fast,” Andreae added, pointing to the fast opening of the country’s first liquefied natural gas (LNG) terminal in mid-December. Renewable energy investors are looking for a market environment which is stable in the long-term, which could be facilitated by increasing the speed of licensing procedures. A lack of licensed turbine construction spaces continued to obstruct the fast expansion of wind power, Andreae said, adding that administrations at all levels in the country have to join the effort to speed up the energy system transformation. The country should designate two percent of its land area for wind power by 2025, seven years sooner than the current 2032 goal currently scheduled by the government to achieve its 2030 renewable power targets. The potential of roof-mounted solar PV would also need more support in order to meet the target. Regarding hydrogen production, Andreae added that the scramble to compete in this budding market had begun to take off. Thanks to its investment incentives in the Inflation Reduction Act (IRA), “the US is well positioned” in this race, Andreae said. Germany should therefore quickly introduce a dedicated Hydrogen Act that ensures a fast scaling-up of the technology, she added.

The German government coalition has aimed to bring the share of renewables in the power mix to 80 percent by 2030, up from about 46 percent in 2022, a massive undertaking that will require industry, policymakers and citizens alike to collaboratively support the roll-out. While the energy crisis and the war on Ukraine have forced Olaf Scholz’s coalition government to re-structure its energy policy in many respects, it has created a much greater impetus for society as a whole to speed up the shift away from fossil fuels.