Utilities increase nuclear provisions / A 'power market pentagon'
Spiegel Online/AFP/Süddeutsche Zeitung
“Utilities increase nuclear provisions”
The utilities have increased their provisions for the nuclear exit in the last year, according to a report by press agency AFP on Spiegel Online. At the end of the year provisions added up to 40.1 billion euros, compared to 38.7 billion euros at the end of 2014, according to data from the economics ministry.
According to a report in the Süddeutsche Zeitung, Vattenfall increased its provisions by 16 percent. Increases at the other nuclear operators were smaller, ranging from RWE’s 0.8 percent to EnBW’s 3.2 percent, writes Michael Bauchmüller.
Read the Spiegel Online report in German here.
Read the article in Süddeutsche Zeitung in German here.
“Price of freedom”
Utilities are keen to close the chapter of nuclear energy because it has become a huge burden, writes Michael Bauchmüller in a commentary in the Süddeutsche Zeitung. The government commission on the financing the nuclear exit might decide this week that they will have to pay a few billion euros into a fund to get rid of nuclear liabilities, which would give them new freedom. “It will be the task of the commission to sell this new freedom for as much money as possible to the utilities,” writes Bauchmüller. It would be a disservice to society if they get it too cheaply.
In a separate article (see above) Bauchmüller says it is unclear whether the commission will have its last and decisive meeting on Wednesday, as planned. “The search for a date for a very last meeting has started already.”
Germany’s buildings to be climate neutral by 2050
A large share of Germany’s buildings are in bad shape in terms of energy efficiency, environment Minister Barbara Hendricks said at the Berliner Energietage, an energy and efficiency sector meeting in Berlin. Unfortunately insulation and exchange of heating systems in these buildings has decreased due to the low prices for oil and gas, the minister said. “The energy transition in the heating sector will take a prominent place in the Climate Action Plan 2050,” Hendricks announced. Her ministry is currently preparing this energy transition plan which is due to be passed by cabinet in summer 2016. It makes sense to support new gas-fired heating systems at this point in time, Hendricks said. But in the future German buildings, which are supposed to become climate neutral by 2050, would have to be heated and cooled with renewable energies.
Read a CLEW dossier about efficiency and the energy transition here.
Federal Network Agency
Network Agency awards contracts in fourth PV auction
21 bidders out of 108 have won the fourth tender to build a total of 128 megawatts (MW) of solar PV installations in Germany. The fourth round of pilot PV tenders followed the “pay-as-bid” procedure. It resulted in an average price of 7.41 cents/kilowatt-hour, the Federal Network Agency said in a first estimate. “That the price has decreased further shows that there is high competition in the market,” said agency president Jochen Homann. The bidders proposed building 540 MW of solar PV capacity but the tender was limited to around 125 MW.
Read the press release in German here.
“Car of the Future: Quickly exiting fossil propulsion”
Banning cars with combustion engines by 2025 in Germany is not realistic, writes Christoph Schwarzer in Zeit Online. “Among other things, we would need gigantic production capacities for batteries far exceeding Tesla’s gigafactory in Nevada,” according to Schwarzer. He adds it is unclear whether disruptive technological changes can be decided by politics at all. “Therefore, doubts about a planned or ordained change of car propulsion are warranted. But these refer to the timing, not to the content. Because one thing is obvious: The German car industry will be part of the Energiewende.”
The Green Party’s parliamentary group economic spokesperson, Dieter Janecek, said last week new petrol and diesel cars should be outlawed in 2025.
Read the article in German here.
Find the CLEW dossier on the Energiewende in transportation here.
“The Power Market Pentagon”
Think tank Agora Energiewende* has identified a “power market pentagon” that makes up a pragmatic market design for Europe’s power system: Energy-only market, emissions trading, smart retirement measures, stable revenues for renewables and measures to safeguard system adequacy. As the future European power system will be based on wind power and solar PV, flexibility on the supply and demand side will be required. To ensure continuous investment into these technologies, a more flexible energy-only market and a stable carbon price will not be enough – additional instruments will be needed, the authors find.
Read the analysis in English here.
“New study on citizens’ financial participation in projects of the Energiewende”
Existing models for citizens’ financial participation in the Energiewende are insufficient for the future, according to a new study by University of Leipzig. The study calls for the development of new instruments to finance larger projects with citizens’ participation, especially in the area of grid extensions.
Read a press release on the study in German here.
Find the CLEW dossier on citizens' participation in the Energiewende here.
Efficiency initiative for medium-sized enterprises focuses on mobility management
Partners in the government’s “Medium-sized Businesses Initiative Energiewende and Climate Protection” want to put stronger emphasis on mobility management, according to the economics ministry. Companies are meant to pay more attention to efficient and environmentally friendly alternatives for their car fleets.
Find the press release in German here.
“Out with coal”
Vattenfall will sell its German brown coal operations to Czech energy company EPH, but it is unlikely that EPH is paying a high price for the operations, the Tagesspiegel reports. Citing internal company sources, the paper said negotiations centered around setting aside reserves for clean-up strip-mining operations, as well as hedging contracts, in which Vattenfall had secured contracts for electricity sales that guarantee a higher price for power than the current market price, the paper said. Exchange prices are currently around 20 euros/MWh while 30 euros/MWh are needed to make a profit, the Tagesspiegel said. The newspaper said EPH was able to snap up the operations at a cheap price because of the uncertain future of coal, but that the company is betting that coal-fired power will be needed longer than expected.
“For our steel industry, it's down to the nitty-gritty”
Frank Schultz, head of German operations for the world’s largest steel company, ArcelorMittal, told the Wirtschaftswoche that the steel industry will face new cost burdens if the current EU emissions trading proposal is put in place. The proposal would mean “that German steel producers would have 40-45 percent too few emissions certificates by 2030. By the end of the next trading period in 2030, German steel would be 30 euros per tonne more expensive,” Schultz said, citing a study by the Ecofys Institute. That would cost steelmakers around a billion euros, he said. Schultz noted that the steel industry has already cut its CO2 emissions by 19 percent since 1990, and has very little room for manoeuvre in that area. China emits much more CO2 and is selling its products much more cheaply in the EU, he said. “If European steel production continues to sink, through competition distorting and cost-boosting charges from emissions trading rights, then it will just be substituted by environment-damaging imports,” he said.
Read the article in German here.
*Like the Clean Energy Wire, Agora Energiewende is a project funded by Stiftung Mercator and the European Climate Foundation.