German climate and energy policy : Frequently Asked Questions
What are the major renewable energy sources in Germany today? What about the status of nuclear energy in Germany? And what kind of energy mix is Germany striving to achieve in the future? You'll find the answers to these and many more questions in our 'FAQ' section below.
What are the sources of energy in Germany and the U.S. and what percent of electric power generation do they represent?
In Germany, the energy source percentages for 2008 electric power generation are as follows:
Coal 43.5%
Nuclear 23.3%
Hydroelectric 4.2%
Wind 6.3%
Solar 0.6%
Biomass 3.6%
(All renewables combined about 15%)
Natural Gas 13%
Petroleum 1.6%
(Source: www.ag-energiebilanzen.de, 2008)
In the U.S., the energy source percentages for 2006 electric power generation are as follows:
Petroleum 1.6%
Natural Gas 20%
Coal 48.9%
Nuclear 19.3%
Hydroelectric Conventional 7.1%
Other Renewables 2.4%
Others 0.7%
(Source: International Energy Agency for 2006)
What percent of Germany’s annual energy demand does the country have to import? And is it true that Germany imports nuclear power from abroad due to a lack of other energy sources?
Because Germany has only relatively few energy resources, much of its energy supply must be covered by imported energy. This applies in particular to crude oil, nearly 100 percent of which comes from foreign sources, as well as natural gas, 80 percent of which has to be imported.
Hard coal must also increasingly be imported in larger quantities. Lignite and renewable energies are, on the other hand, produced almost exclusively domestically.
(Source: Federal Ministry of Economics Website)
Germany is totally dependent on uranium imports for nuclear energy.
(Source: Federal Ministry for the Environment Website)
Germany produces surplus power and can even export it. In 2008, Germany had a power export surplus of 22.5 billion kWh, which was even higher than in the previous year (approx. 19 billion kWh).
(Source: www.ag-energiebilanzen.de, 2008)
What is status of nuclear energy in Germany?
In Germany, there are 17 nuclear plants in operation. Following the general election in October 2009, the new governing coalition has agreed in the coalition treaty to consider nuclear energy as a "bridging technology" until it can be replaced by renewable energies in a reliable manner. To that end, they are ready to extend the life cycle of the existing German nuclear power plants taking into account the rigorous German and international safety standards. The ban on building new nuclear power plants persists.
What are the major renewable energy sources in Germany today?
The major renewable energy sources for power generation are wind and hydrogen energy, followed by biomass and photovoltaics and a small percentage of geothermal energy.In 2008, renewable energies accounted for 15 percent of power consumption.
(Source: www.erneuerbare-energien.de June 2009)
Is it true that Germany is a world leader in wind energy production? How many megawatts does it produce?
Germany currently ranks second behind the U.S. in wind energy production. In late 2008, Germany had 20,301 wind power stations with a capacity of 23,903 megawatts. Wind energy thus accounts for 7 percent of power consumption in Germany. The first German offshore wind farm alone, which recently went online in the North Sea, will provide 50,000 households with energy.
(Source: Survey of the Germany Wind Energy Institute (DEWI) on commission by the German Wind Energy Association and the German Machinery and Plant Manufacturers Association - Status as of Dec. 31, 2008)
How does Germany rank among solar energy producers? How many megawatts does it produce?
In 2008, 29 percent more power, or approx. 4.0 TWh, was produced from photovoltaics than in the previous year. With more than 210,000 solar thermals for household water and space heating, twice as many plants were installed than in 2007. In late 2008, 118,4 million square feet of collector panels were installed in Germany.
(Source: Federal Ministry for the Environment brochure Renewable Energies in Figures, status as of June 2009.)
What role does energy production from biomass play in Germany?
Bioenergy accounts for close to 5 percent of Germany’s primary energy demand.
Biomass is used for heat and power generation and as a biofuel.Biomass accounted for 93 percent of the heat supplied from renewable energies in 2007. What is known as “energy timber” is overwhelmingly used as a fuel. Energy timber is wood that is to be used exclusively for energy production through combustion, in other words, only low-grade wood varieties from forests, wood from fast-growing species plantations, wood remnants from the wood-processing industry, and scrap wood.
In April 2009, the Federal cabinet adopted the National Biomass Action Plan (Energy). The Federal government thus supports the EU Commission, which called on the member states in its EU Biomass Action Plan published in 2005 to establish national action plans for the use of biomass as energy.
(Source: www.erneuerbare-energien.de)
What is the German position on biofuels produced from crops such as corn?
Electricity from biomass and biofuels must be produced in a sustainable manner. In future, only sustainably produced plant oils may be used for power generation from renewable energies. This is provided for under the Sustainability Ordinance for the Renewable Energies Act (Biomass Electricity Sustainability Ordinance), which entered into force on August 24, 2009. Under the Sustainability Ordinance, liquid biomass that is commoditized according to the EEC (e.g. rapeseed, palm and soybean oil) must be produced in such a way that its use for power generation emits at least 35 percent less greenhouse gases than fossil fuels. Furthermore, the plants must not be cultivated on land with a high nature value, such as rain forests or wetlands. Expansion of bioenergy use must not occur at the cost of nature conversation. Also, other food priority countries, especially developing countries, must not be allowed to suffer from the increases. Similar legislation on biofuels is being passed.
(Source: www.erneuerbare-energien.de)
What kind of energy mix is Germany striving to achieve in the future (midterm)?
The Federal government is aiming for a decentralized, broad-based energy mix – for modern power plant parks whose technologies can respond flexibly. If the sun does not shine, the park will burn biomass; if power from wind energy is not needed, it will be used to produce hydrogen power. In 20 to 25 years, offshore wind turbines are expected to cover 15 percent of German power consumption.
On January 1, 2009, the Renewable Energies Heat Act entered into force. It contains a requirement that renewable energies must be used to provide heat in new buildings. The percentage of renewable energies that must be used to supply heat is to rise to 14 percent by 2020.
(Source: www.erneuerbare-energien.de)
Where do Germany and the U.S. rank among the top carbon-emitting countries?
There are numerous rankings, which take into account different factors. The U.S. is second in terms of absolute carbon emissions (behind China) and carbon emissions per capita (behind Australia). Germany is sixth in both rankings.
(Source : www.bloomberg.com 15.9.09)
How many jobs are renewable energies creating in Germany?
Renewable energies provided nearly 280,000 people with jobs in 2008. Compared with five years ago, that represents an increase of approx. 75 percent. Compared with last year, employment rose by about 12 percent.
(Source: Federal Ministry for the Environment brochure Renewable Energies in Figures, status as of June 2009)
Which of the larger German renewable energy companies have invested in the U.S. and vice versa?
There are numerous larger German renewable energy companies that have invested in the U.S. The following companies are some examples:
SolarTrust of America (German company: MAN Ferrostaal)
In August 2009, German solar thermal company Solar Millennium AG and plant builder Man Ferrostaal AG created a new company called Solar Trust of America LLC. The company aims to gain 20 percent of the U.S. market for solar thermal energy. According to Solar Trust of America LLC:
“Several power plants are being built in the Southwest of the U.S. Each of the plants will entail investments worth more than $1 billion. Each plant is expected to directly employ more than 800 skilled workers during the initial construction phase and create approximately 100 permanent jobs for operations, maintenance, and management employees. And, each plant is expected to indirectly create thousands of additional jobs, as Solar Trust of America procures materials, goods, and services for each facility in the U.S.”.
In 2007, the German company SolarWorld AG began expanding a factory in Hillsboro, Oregon, for the production of integrated solar grade silicon wafers and solar cells. This will be the largest solar factory on the American continent. The investment at the Hillsboro factory will create 1,000 new jobs by 2011. Two hundred and fifty people have already been hired since the start of production.
There are numerous larger U.S. companies that have also invested in Germany. First Solar, Inc. and Juwi Holding AG an excellent example:
First Solar, Inc. and Juwi Holding AG have secured financing for a 53 megawatt (MW) DC photovoltaic (PV) power plant near the German city of Cottbus. More than 80 percent of the required project capital is financed through non-recourse debt from a consortium of banks. First Solar and Juwi intend to sell the majority of the project after its completion. Construction of the project began in January 2009, and the first 15 MW have been completed. The remaining 38 MW are scheduled to be completed by the end of 2009. Upon completion, the PV power plant will consist of approximately 700,000 modules and is projected to be the largest in Germany – producing enough power to provide for the annual electricity needs of more than 14,000 homes – and the second largest worldwide.
Is it true that Germany is the world’s larger producer of wind turbines/solar cells?
Germany is one of the world’s largest producers of wind turbines after Denmark and China. The export rate of German manufacturers and suppliers of wind power stations was more than 70 percent in early 2007 according to the German Wind Energy Association. Worldwide market share of German wind companies is about one third.
(Source: www.oem-ag.at)
Germany is the world’s second largest producer of photovoltaic systems. With a production capacity of approx. 370 MW annually, German manufacturers supply about 34 percent of the global market for photovoltaic systems (2007 figures).
(Source: www.solaranlagen-portal.de)
What role does the renewable energy industry play in comparison to Germany’s other economic sectors?
NATIONALLY:
The German renewable energy industry is one of the most important growth industries in Germany. It covers 15.1 percent of German electricity consumption, 7.3 percent of heat consumption and 5.9 percent of fuel consumption.
Renewable energy's contribution to total energy consumption in Germany was around 9.6 percent in 2008.
In 2008, renewable energies cut approx. 115 million tons of carbon emissions.
INTERNATIONALLY:
The German renewable energy industry also continues to be a leader internationally. In 2007, plants and technology worth approximately € 8.5 billion (approx. 11.8 billion dollars) were exported.
The German wind energy industry accounts for aproximately 30 percent of the global market.
Germany is a world leader in terms of its capacity of wind power plants and photovoltaic systems.
The renewable energies sector saw a sharp rise in revenues in the period from 2000 to 2008. Revenues grew sixfold from € 6.9 billion (approx. 9.3 billion dollars) to € 40.7 billion (approx. 55 billion dollars). The sector is also a reliable jobs engine. According to the Working Group on Renewable Energies Statistics (AGEE-Stat), plant manufacturers, suppliers, and planners employ roughly 280,000 people. In 2008 alone, the number of jobs climbed by 30,000 – that’s about 80 new jobs per day. Since 1998, the number of employed in the renewable energies sector quadrupled (+332 percent). By comparison, economic sectors such as the auto industry have seen only weak growth over the past 10 years (+5 percent) or reduced their workforce, such as the textile industry (-37 percent) or the lignite and hard coal industries (-35 percent and -58 percent, respectively).
(Source: www.unendlich-viel-energie.de)
Is Germany meeting the Kyoto climate goals?
At the 3rd climate conference in Kyoto in 1997, the participating states adopted the Kyoto Protocol. In the Protocol, the industrial countries commit to reduce their joint emissions of the six major greenhouse gases [among others, carbon dioxide (CO2), methane (CH4), chlorofluorocarbons (CFCs)] by 5.2 percent relative to 1990 levels from 2008 to 2012. At the same time, individual countries accepted different emission limitation commitments (e. g. USA : -7 percent, later withdrew from the protocol; Japan: -6 percent; Russia: +/-0 percent). Internally, the EU redistributed its joint Kyoto commitment of -8 percent, so that, for example, Germany had to achieve -21 percent. Germany met the Kyoto requirements four years ahead of the deadline. In 2008, Germany reduced its greenhouse gas emissions by 22.4 percent relative to 1990 levels.
At the EU Summit in March 2007, the heads of state and government decided to reduce carbon emissions by 20 percent relative to 1990 emission levels by 2020. Thereupon, Germany decided to achieve a 40 percent reduction by 2020.
(Source: www.bmu.de)
What are Germany’s short, medium, and long-term climate goals?
The Federal government aims to increase the share of renewable energies by 2020 as follows:
- to 18 percent of total final energy consumption
- to at least 30 percent of total power generation
- to 14 percent of total heating supply
- to 10 percent in the total transportation sector (binding EU target for all member states)
In 2050, renewable energies are expected to account for at least half of total German energy demand.
(Source: www.erneuerbare-energien.de)
What are Germany’s goals for Copenhagen?
A whole host of measures to be taken by industrial and developing countries are necessary. These include the following:
1. A target for industrial and developing countries as a whole to reduce global greenhouse gas emissions by at least 50 percent by 2050.
2. A binding minimum target for the industrial nations as a whole to reduce their greenhouse gas emissions between 25 and 40 percent by 2020, which the intergovernmental climate council, the IPCC, views as necessary.
3. National action plans for the developing countries with effective measures to reduce greenhouse gas emissions by 2020.
4. Financial support for developing countries both in reducing emissions and in adapting to climate change.
5. A decision-making mechanism for the use of these funds in which both industrial and developing nations jointly participate.
(Source: www.bmu.de September 2009)
What, in Germany’s view, are the advantages of cap and trade (emissions trading) versus a tax?
Emissions trading has created a carbon market which effectively promotes investments in climate protection at home and abroad and which, at the same time, is profitable. Harmful carbon dioxide, which is released into the environment by power plants and other industrial facilities, will be further reduced in a cost-effective manner through emissions trading. The principle is as follows: The operators of these facilities receive allowances. These entitle the holder to emit a fixed amount of CO2. If the facilities release more emissions, the operator must purchase more allowances. Vice versa, if the operator releases fewer emissions, he may sell the excess allowances and thus make a profit.
The idea behind this instrument is quite simple: Instead of committing all operators to the same rigid emission limits, the companies are allowed economic flexibility. What matters when it comes to climate protection is that carbon emissions as a whole are reduced – wherever this happens on an individual basis is secondary. Emissions trading thus makes it possible to reduce harmful CO2 wherever this can happen at the lowest cost. Since 2008, companies have had to purchase some of their allowances; as of 2010, they will be auctioned partly. The number of allowances is annually reduced.
(Source: Federal Ministry for the Environment website: www.bmu.de)
How does the German emissions trading system work?
At the UN Climate Conference in Kyoto in 1997, the European Union promised to reduce its emissions by 8 percent relative to 1990 levels by 2008 to 2012.
At the start of 2005, Germany and the EU introduced a new instrument for climate protection: carbon emissions trading for specific sectors (private households and the transportation sector, for example, have been excluded).
The emissions trading system offers an economic basis for reducing the emissions of harmful carbon gases. To this end, the trading market determines the value of one ton of CO2. Specific reduction targets are assigned to the economic sectors and each affected facility, and emission allowances are made available in this amount. The total amount of emissions must be continually reduced. The emission allowances are tradable and thus act as a kind of credit. If the company achieves the targets through its own cost-effective carbon reduction efforts, it can sell the allowances it does not need on the market. Alternatively, it can purchase allowances on the market if its emissions reduction efforts turn out to be too expensive. If the company does not meet its minimum commitment, it must pay a sanction, which comes to 100 euros (approx. 135 dollars) per ton of CO2 in the current trading period. The reduction target which the company did not attain is added to the target for the following year.
In the test phase from 2005 to 2008, allowances worth 499 million tons of CO2 were distributed free of charge in Germany.
In the second phase from 2008 to 2012, the allowable amount of carbon emissions was reduced to 452 million tons. Forty million fewer allowances per year will be handed out to power-producing facilities. Starting in 2010, the allowances will auctioned. Currently, 1,665 facilities in Germany and a total of 10,000 facilities in the EU are participating in the emissions trading scheme. Certain energy-intensive industrial facilities such as steelworks, cement factories, paper factories, and brick works are issued a fixed amount of carbon emission allowances on the basis of their average production from 2002 to 2005.
In the third phase starting in 2013, emissions trading will be more heavily centralized at the EU level. Air transport will then also be included in the scheme. The same standard emission values will be given for all EU member states. All the allowances will then be auctioned in electricity production.
How does ‘carbon capture and storage’ (CCS) work? What level of emissions does Germany hope to avoid through this system?
Carbon capture and storage is the process whereby carbon is sequestered in the power plant and then stored in geological structures.
At the EU level, Directive 2009/31 regulates the geological storage of carbon dioxide and the selection, approval process, and operation of carbon storage facilities. The binding use of such technology in new power plants and the retrofitting of existing ones were discussed but not included in the directive.
The possible storage capacity for carbon dioxide in Germany is estimated at approx. 22 Gt (gigatons), but these figures have not yet been definitively confirmed.
Are there already CCS facilities operating in Germany?
So far, CCS technology has been investigated at test facilities. German pilot plants are among worldwide technology leaders in CCS (e.g. Schwarze Pumpe, Niederaussem). 12 research institutes and 13 companies are researching the technology on commission by the Federal government.
What does the Renewable Energies Act provide for? How do feed-in tariffs work? How high are the government feed-in tariffs for private operators of renewable energy facilities?
The Renewable Energies Act entered into force in April 2000 and was amended in August 2004. The Act ensures that power generation from renewable energies is financially feasible. First, power supply companies commit to feed electricity into the power grid from wind turbines and solar power systems. In the past, some power suppliers had refused to do so. Second, they have to pay a fixed rate, or tariff, to the producers of this green electricity. The feed-in tariffs vary depending on the type of energy and location. The power suppliers then pass on this additional cost to consumers - on average, a 3-person household pays about €1.50 (approx. 2 dollars) a month extra for electricity.
Are electricity prices in Germany higher than elsewhere?
Electricity prices vary based on numerous factors, just as in the United States.
How high are the annual government subsidies for renewable energies?
Renewable energies are getting by without any subsidies in Germany. They do not use any tax money. However, they are promoted through the Renewable Energies Act, as stated above.
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