German-Austrian power zone split / EU: no plans to tighten CO2 goal

The European Commission has given up plans to tighten the European emissions reduction goal for 2030 ahead of the UN climate conference COP24 in Katowice as member states did not voice sufficient support for the ambitious target to reduce CO2 levels by 45 percent instead of just 40 percent compared to 1990 levels, the Frankfurter Allgemeine Zeitung reports. The Commission insisted that EU energy commissioner Miguel Arias Canete never announced an official target increase but according to the article, both Canete and commission president Jean-Claude Juncker were in favour of tighter reduction goals to sharpen the EU’s environmental protection profile. Together with other European lobby groups, the Federation of German Industries (BDI) opposed tighter targets while German Chancellor Angela Merkel had said: “I don’t think that constantly coming up with new targets makes sense.” Canete, however, argues that these are a logical consequence of a greater share of renewables that the EU states agreed on in spring, the article says.

For background, read the CLEW dossier Germany's energy transition in the European context.

A gradual reduction of coal-fired power production and the parallel expansion of renewable energy sources to 65 percent of Germany’s 2030 power mix would reduce electricity costs and emissions and allow the country to reach its climate target in the energy sector, according to think tank Agora Energiewende*. The think tank says that while reducing coal capacity would initially cause the wholesale power price to rise by 0.4 cent per kilowatt hour (kWh), a parallel increase in the share of wind and solar power would reduce the price by 0.8 ct/kWh, resulting in a net reduction of electricity costs. “Energy-intensive industries would benefit the most from this combination. They could take advantage of a lower power price without having to fund the expansion of renewables” if they continue to be exempt from Germany’s renewables surcharge, said Agora Energiewende’s Frank Peter. Higher costs for other customers would be offset by lower wholesale prices, Agora’s analysis found. To ensure supply security, Germany would have to invest in building flexible new gas power plants, increase European power market integration and improve demand-side management, it added.

Find the study and a press release in German here.

See the factsheet Germany’s greenhouse gas emissions and climate targets for more information.

*Like the Clean Energy Wire, Agora Energiewende is funded by Stiftung Mercator and the European Climate Foundation.

Aligning lending standards of development banks with the Paris Agreement’s emissions reduction targets would help achieve a quicker and more sustainable modernisation of the recipient countries’ economies, according to a working paper by NGO Germanwatch. “It is critical that when trying to close the infrastructure investment gap, investments are aligned with the Paris Agreement today to avoid high-carbon lock-in and the risk of stranded assets in future,” the paper says.

Read the working paper in English here.

See the CLEW article German financial sector expects EU standards to boost green finance for more information.

Germany’s energy policy has not lived up to its climate and renewables expansion targets and has failed to adequately integrate citizens in planning procedures, Simone Peter of the German Renewable Energy Federation (BEE) and Stefan Kapferer of the German Association of Energy and Water Industries (BDEW) said during a debate on public radio station Deutschlandfunk Kultur. “The Energiewende [energy transition] has a big benefit, but this has to be explained to people,” Peter, a former Green politician, said, adding that the government has chosen to rather give in to industry interests and failed to provide a clear roadmap for its energy transition strategy. Energy industry lobby group head Kapferer said there had to be clarity on the expansion of renewable energy sources and grid development as well as in the promotion of combined heat-and-power systems and storage technology. “The transition to renewables will always be accompanied by interventionist policies,” Kapferer said, adding that the conflict over the Hambach Forest showed that “decision makers let themselves be used by opponents of the project.”

Find the radio programme in German here.

See the CLEW article Wind industry calls for special auctions amid expansion slowdown and the interview with researcher Quaschning about a German solar power policy for more information.