Germany set to miss key energy transition targets – McKinsey

Germany is set to miss several key energy transition targets for the year 2020, and the country's high power supply security is at risk unless new generation capacity and grid infrastructure are built in time for the coal and nuclear exit, consultancy McKinsey says in its bi-annual Energiewende Index. Greenhouse gas emissions are not falling fast enough, largely due to an increase in road traffic, and despite a continued decoupling from economic growth, Germany's primary energy use decreases too slowly, says McKinsey. To avoid power supply shortages in the future, Germany should continue to expand renewables, but also build additional gas power plants, as the last nuclear power station will close by 2023, by which time the first phase of the planned coal exit will likely be implemented, says the consultancy. On the positive side: the renewables share in power consumption has already surpassed the 2020 target of 35 percent (37.8% in 2018), employment in the renewables industry is stable, while jobs in power-intensive industries have risen significantly over the past years, and power prices for industrial consumers have decreased since 2014.

After years of booming renewables, Germany's planned transition to a low-carbon, nuclear-free economy – the famed Energiewende – has slowed in recent years. Emissions remain too high to reach climate targets, renewables expansion has slowed, and initiating changes in sectors such as transport has proven to be extremely difficult. Chancellor Angela Merkel has therefore set up the so-called climate cabinet – a group of ministers with responsibilities in key climate policy fields – to decide necessary legislation to reach 2030 climate targets – as promised in the 2018 grand coalition government treaty.