CLEW: Which topics or events are going to shape German energy and climate policy in 2018?
Manuel Frondel: A redistribution of the costs stemming from renewables expansion is likely to top the new government’s energy policy agenda. We’ve seen a lot of ideas in 2017: how prices for energy consumers can be brought down, for example by lowering the electricity tax to a minimum or by funding industry rebates for the renewables surcharge with tax money instead of adding this sum to the customers’ power bills.
The sheer number of suggestions shows that a power cost reduction for customers is seen as urgently needed by many observers. But rather than simply redistributing costs, future renewables expansion should be made more cost-efficient. Auctions for specific technologies [such as solar PV or onshore/offshore wind power] were only a first step, while auctions that simultaneously include different technologies would be the next important stage.
Do you expect Germany to achieve its self-imposed goal of reducing its greenhouse gas emissions by 40 percent by 2020 compared to 1990 levels? What needs to happen to achieve the target or to at least come close to achieving it?
In all likelihood, Germany will miss its 2020 climate target. This would probably be the case even if the Green Party’s call for shutting down the 20 dirtiest coal plants by 2020 was heeded. But there’s a very simple way to meet the climate goal, which at current prices for emissions certificates would even be cost-efficient. The government should buy all the EU’s ETS certificates needed to meet the target by 2020 and delete them. Unlike a lignite [brown coal] exit, this would actually reduce emissions in Europe. A lignite exit scenario in Germany would simply shift emissions to other EU countries due to the ETS, while nothing would be achieved in terms of global climate protection.
What are the most pressing energy and climate policy issues that have to be tackled in 2018?
The most pressing questions are nitrogen oxide (NOx) levels in the transport sector and the corresponding driving bans in inner cities. Due to their negative economic effects, these latter should be avoided if possible. But I can imagine that driving bans could be averted through concerted efforts by policymakers and industry actors and by introducing a series of last-minute measures. However, this will certainly not be an easy task.