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Blown off-course? Despite rapid expansion across Europe, German offshore wind capacity growth is slowing

19 February, 2019 - 15:00

Even as larger turbines come online and are producing more energy less expensively, wind energy groups warn that political conditions are hampering growth throughout Germany, with both on and offshore generation capacities suffering. L. Michael Buchsbaum explains

Middelgrunden offshore wind farm (40 MW) in the Øresund, 3.5 km outside Copenhagen, Denmark (Photo by Slaunger, CC BY-SA 3.0)

“Blown Off-Course” is part one of a series on current wind energy challenges and opportunities. Upcoming blog posts will address the on-going tension between off- and on-shore wind development, challenges to onshore wind expansion, as well as the vital role community wind energy continues to play in Germany’s Energiewende.

Warning signs are beginning to appear for the German offshore wind industry.

With 276 MW of fully installed turbines far out at sea not yet feeding power to the electrical grid, a stubborn lack of grid expansion progress, and only a narrow investment pathway, investors specializing in offshore energy development are starting to look away from Germany.  Even as larger turbines come online and are producing more energy less expensively, groups warn that political conditions are hampering the growth of Germany’s critical wind energy sector, with the vital expansion of both on and offshore generation at stake.

2018 saw growth for offshore wind

According to new figures from the trade group WindEurope, total European offshore wind capacity grew by 2.6 GW in 2018. This includes about 400 new grid-connected turbines spread across 18 projects. Most of this new capacity (85%) was deployed in the United Kingdom and Germany, followed by Belgium and Denmark. Though investments in new offshore wind amounted to €10.3bn, a 37% increase over 2017, industry leaders UK and Germany connected slightly less capacity than previously.

Photo: Deutsche WindGuard

By the end of 2018, the UK had the largest amount of offshore wind capacity in Europe (44% of all installations measured in MW), followed by Germany (34%), Denmark (7%), Belgium (6.4%) and the Netherlands (6%).

WindEurope also reported that the average size of individual offshore wind turbines continued to increase to 6.8 MW in 2018, up 15% from the previous year. However, the UK installed the world’s biggest offshore turbines – 8.8 MW – and opened the world’s largest offshore wind farm – Walney 3 extension, at 657 MW. Germany also opened their largest wind farm to date, as the Borkum Riffgrund II (465 MW) was fully connected to the grid. As for project owners, Ørsted connected the largest amount of wind capacity in 2018, followed by E.ON, Global Infrastructure Partners, Equinor and Macquarie Capital.

In total, Europe now has 105 offshore wind farms comprised of over 4,540 turbines operating across 11 countries with a total capacity of over 18.5 GW. A further six offshore wind farms are currently under construction in Europe, including the giant Hornsea One in the UK; with a planned 174 turbines, it will be the largest offshore wind farm to date. Construction started in 2018, and in February the first installed turbines were ready to supply energy to the grid.

“The technology keeps developing. The turbines keep getting bigger. And the costs keep falling,” said WindEurope CEO Giles Dickson. “It’s now no more expensive to build offshore wind than it is to build coal or gas plants. And it’s a good deal cheaper than new nuclear. More and more governments are recognising the merits of offshore wind.” Poland, which has previously blocked renewable energy at every turn, plans to build 10GW of offshore wind by 2040. Unfortunately, says Dickson, “Germany’s 2030 targets are modest and France has no plans to invest.”

German offshore industry calls for more ambitious targets

According to the figures published by the German WindGuard, over a thousand offshore turbines with a total output of 6,382 MW were feeding into the grid last year. While another 276 MW of fully installed turbines remain unconnected, offshore farms with a combined capacity of 966 MW are also under construction while another 112 MW of potential capacity still await a final investment decision.

Going forward, Germany’s legally possible expansion of 7.7 GW by 2020 is expected to be achieved as planned. However WindGuard and other industry groups argue that it is critical to raise expansion targets to at least 20 GW by 2030, particularly given the planned coal exit, which calls for the last coal-fired plants in Germany to close no later than 2038.

Photo: Deutsche WindGuard

To break the deadlock, at a news conference in late January, several groups including the German wind energy association (BWE) and the Association of German offshore wind farm operators (BWO), called for a special offshore wind capacity tender for no less than 1,500 MW in the first quarter of 2019. Moreover, they stressed that the industry needs a reliable framework and a clear political signal.

To achieve the goals of Germany’s coalition government to reach 65% renewable power by 2030, the offshore wind industry needs to expand to at least 20 GW by 2030 and at least 30 GW by 2035. However, “how offshore wind will contribute is not yet clear,” warned the groups.

“2019 must be the year of progress in energy policy. Offshore wind energy is of central importance for the achievement of climate protection targets and secures value creation in Germany as an industrial player,” said the BWO in the joint press release. “Insisting on the status quo costs jobs and threatens the international competitiveness of Germany. The current migration of qualified workers to foreign markets is a warning signal that must be taken seriously.” Germany’s accumulated offshore wind energy experience “is an essential advantage in the growing international competition that must be maintained. There must be no further delay.”

In a win for offshore wind, high-voltage power lines go forward

But there is good news for offshore wind industry: the German government will go ahead with power lines meant to move power from the windy north to the rest of Germany. In early February, Germany’s Federal Network Agency (BNetzA) finally decided on the route for the first part of a high-voltage power line.

Such high-voltage power lines are seen as an indispensable part of the Energiewende, and the best way to balance the fluctuations of wind energy from the north and solar energy from the south. Operators and the German federal government want to build another 4,650 kilometres of new transmission lines by 2025, including four north-south direct-current, high-voltage connections.

How that will happen is another open question – the plans have faced resistance from both citizen groups and advocates of distributed and community energy. But unless Germany develops, enacts and sticks to a pathway forward, how the nation will achieve the majority of its clean energy goals remains elusive. And while politicians continue to debate, impatient investors are already looking elsewhere.

Categories: Blogs

Corruption undermines public transit in Honduras

18 February, 2019 - 14:00

Public transportation offers the potential to reduce emissions and improve quality of life – but only if it’s finished. In Honduras, the corruption of the “Trans450” project ended with boarded up bus stations and frustrated citizens, writes Rebecca Bertram.

A barricaded bus stop in Tegucigalpa, Honduras (Photo by Rebecca Bertram)

I moved to Tegucigalpa, the capital of Honduras, at the beginning of this year. It is my first time in this Central American country that does not enjoy the most favorable international image, not least because of the recent news of many Hondurans fleeing the country to the United States. This is a country with significant problems: the country has one of the highest murder rates in the world, and there are high un- und underemployment rates. This leaves much space for improvement in itself.

But in this blog, I would like to focus on how an infrastructure project, meant to improve people’s everyday lives, was turned into a corruption scandal and, as a result, has put people off the idea of investing in a cleaner, climate-friendly and more efficient transport system.

The first day I got here, I was struck by something that resembled a bus stop. It was not a usual bus stop, because its entrance was barricaded. As I got to know more of Tegucigalpa during the days that followed, I saw more of its kind – all barricaded – with separate lanes for buses, but no buses to be seen anywhere. Instead, public taxis and small so-called “public” buses (public only in the sense that they would carry more than one party at a time but otherwise privately owned by a transport mafia) move the 200,000 people dependent on public transit for their commute around the city every day.

Such “public” buses represent a very inefficient and insecure mode of public transportation. They do not follow any set schedule, and there are reports of regular assaults of passengers. This is precisely why former Mayor Ricardo Alvarez initiated the new bus infrastructure Trans450 project in Tegucigalpa in 2010. The Trans450 was set to receive a grant of 50 million US$ by the Inter-American Development Bank (IADB) and a 20 million US$ grant by the Central American Bank for Economic Integration (CABEI) and to be finalized by the year 2017.

Mayor Ricardo Alvarez had made the Trans450 one of his most important infrastructure projects during his mayoral terms between 2006 and 2014. He had secured the loans for the project and pushed it forward, even though both the country’s National Assembly and the Finance Secretary had voted against the project due to its high costs and high public debt.

“At this point, it became very clear that this was going to turn into a corrupt project,” Ismael Zepeda from the Social Forum on External Debt and Development of Honduras (FOSDEH) told me. Subsequently, funds were either spent on building the infrastructure for the Trans450 or largely disappeared without any trace of the busses. Before Ricardo Alvarez’ mayoral term came to an end in 2014, he staged an inauguration of the project, ironically only with toy busses.

Today, the project remains unfinished. The next mayor of Tegucigalpa, Nasry Asfuera, never regarded the Trans450 as his project, and as there were no more funds available, left it largely neglected. Some of the Trans450 lanes actually interfered with his own infrastructure plans to build new bridges and were subsequently destroyed. In addition, the Trans450 has met considerable opposition by the powerful transport mafia in the city who of course do not want to see any competition to their ‘private’ buses and taxis.

This has left the Trans450 largely unpopular amongst Tegucigalpans. To them, the project does not only represent a clear case of corruption and a waste of public money but also a worsening of the transit system as some important pedestrian walkways had to give way for the project. They are now increasingly reclaiming the extra bus lanes to cope with the immense traffic in this city.

The sad thing with this story is that the image of a cleaner, more efficient and secure transport option for Tegucigalpa has been destroyed through this messy and corrupt process. There are rumors that the municipality will take up the project again later this year, but I believe it when I see it.

Over the next year, I will be writing more blogs on energy and climate related issues in the Latin American region. I thank the Heinrich Böll Foundation for this opportunity to share some of my thoughts with you via this medium.

Categories: Blogs

Germany is transforming its coal fields into renewable energy sites

15 February, 2019 - 15:00

Old coal fields have to be cleaned up in order to be used again. Germany is using its old coal mines for renewable energy sources. L. Michael Buchsbaum talks to developers to see how it works.

Wind farms could provide new renewable energy sources on the site of former coal mining areas (Public Domain)

Coal mining has left the Earth pockmarked with countless abandoned shafts, open pits and tens of thousands of hectares of disturbed lands from old surface mines.

Though many countries passed reclamation rules requiring mining companies to restore land back to its state after the extraction ends, mining companies have generally been slow to do so. The vast majority of post-mining lands are nowhere near as healthy or bio-diverse as they were prior to industrial activities.

But more and more, regulators and energy companies are realizing that developing these degraded areas into renewable energy sites enables them to transform them into clean revenue-generating assets.

As part of the European Commission’s support mechanism for transitioning away from coal, their Joint Research Centre published a study which looks at the best practices and opportunities throughout Europe, as well as suggestions of financial support (EU coal regions: opportunities and challenges ahead).

The report and developers agree that after a mine closes, converting the site to a renewable energy generation facility can provide new job opportunities and economic value, as well as contribute to a more secure energy supply.

Such projects can greatly benefit from the pre-existent infrastructure and land availability. The EC report finds that several coal producing regions in Spain, Greece and Bulgaria are particularly well situated for solar power generation while many current coal regions in Hungary, the Czech Republic and Poland have high wind availability.

Renewable redevelopment in Germany

Throughout Germany the report cites several redevelopment examples. One great success is the Klettwitz wind farm in southeastern Germany, built on former surface mining lands. When it opened in 2000, it was the largest wind operation in Europe; today it includes five separate sections. And following recent upgrades and re-powerings, it has a combined generation capacity of 145.5 megawatts.

Initially the biggest technical challenge of the pioneering project was the construction of turbines on unstable foil above the former pit. Now for almost 20 years, renewable energy has been generated “where previously climate-damaging coal was mined. A brilliant example of the green energy transition,” said Ralf Heinen, CEO of the developer, Ventotec.

Nearby, developer ABO Wind Energy is approaching completion of a wind park on the site of the Lausitz Energie Bergbau (LEAG) owned Jänschwalde open cast mine. The second such project for ABO, it’s the company’s largest to date and they see “enormous potential” for similar brown-to-green undertakings in the future, said company spokesman, Dr. Daniel Duben.

Prior to redevelopment, the site had been a more or less abandoned pit, filled in and awaiting recultivation for future farming. Mining activities at depths greater than 95 meters had left soil layers looser than those found in normal terrain, creating technically demanding construction conditions, ABO reported.

“Though normally foundations for 200-meter high wind systems are only three to four meters in depth, that does not suffice at Jänschwalde,” said Duben. Instead the company used water to flush gravel deeper and then compressed the loose soil. They followed this up by hammering 32 concrete piles, each between 15 and 21 meters long, into the ground to keep the foundations stable. Because of this, the project is more expensive. “Normally it takes less than a year for the wind mills to generate enough energy and income to pay for their installation. It will take a bit longer for the former post mine site because of the size of their concrete anchors,” continued Duben.

Nevertheless, ABO is now targeting similar sites. They view them as classic win-wins since one of the struggles for wind developers is locating sites where they won’t affect local wildlife, bird or human populations. Already impacted and cleared of trees and villages, former mine sites are “ideal” for such redevelopment. Though a handful of other companies are also moving in this direction, most avoid such redevelopment strategies because of the additional complications. But ABO is “keen on developing projects on these sites” because they “strongly believe in the necessity of energy transformation,” said Duben.

However, despite the need to create viable post-mining economies, at present there are no subsidies or technical assistances offered from the state or federal government. In fact “there are more technical and legal barriers to overcome in Germany to build wind farms on former mines than at other locations,” continued Duben.

Back in coal heavy North Rhine-Westphalia, fossil fuel dependent RWE AG has also redeveloped a sliver of their former mine sites into wind farms, in particular erecting the 67-megawatt Königshovener Höhe wind farm on a reclaimed site of their Garzweiler opencast mine.

But frustratingly in NRW, only about 12% of gross electricity generation is currently generated from green energies–about half of which is wind, despite the region’s enormous potential. This is in stark contrast to other areas of northern Germany or the country as a whole which is now averaging close to 40% renewable energy.

“Renewable development shifts the policy of the conservative CDU / FDP state government, which after taking over in 2017, is keen to slow down the expansion of wind energy,” said Dirk Jansen, head of the Friends of the Earth Germany (BUND).

Indeed, though the Hambach and Garzweiler pits are virtually surrounded by wind turbines, the gigantic residual holes of the RWE mines are supposed to be flooded after the end of operations, negating any wind energy potential.

Though other possibilities exist, both the state and RWE have been resistant to other alternatives. Worse still, the struggling “Coal Commission has also presented little in the way of concrete alternatives,” lamented Jansen. But perhaps presented with the success of other sites, RWE will adopt a different course. After all, there’s shareholder value at stake.

 

Categories: Blogs

Big money skews South Africa’s fossil fuelled economy

13 February, 2019 - 15:00

South Africa’s electricity sector has emerged from a turbulent decade that has been tamished by corruption and mismanagement. Vested political interests within the electricity industry here could still be locking the continent’s biggest carbon emitter on its current course as one of the dirtiest and most energy-intensive economies in the world, writes Leonie Joubert.

South Africa’s energy policy is dominated by new coal and nuclear energy deals (Public Domain)

Evidence of corruption and vested political interests within the South African electricity sector have been surfacing on almost every transparency platform in the past few years: the public protector’s State of Capture inquiry in 2016, and various legal commissions that domino-ed out of that investigation; legal submissions in various court processes, including one challenging the state’s nuclear procurement processes; and much of the associated media coverage.

These dirty dealings have surfaced in the government’s attempt to assign Russia to build a fleet of six nuclear power stations here, even though the Treasury showed that the cost would cripple the economy. It came through in the commissioning of various new coal-fired power plants. It skewed the numbers used in the modelling process for the country’s energy blueprint, the Integrated Resource Plan, which until recently favoured coal and nuclear because it didn’t accurately reflect the sudden drop in the price of renewable energy relative to new-build coal. It is evident in the deliberate obstruction of the country’s utility-scale renewable energy programme. And it has emerged in recent investigations into the state’s coal purchasing contracts with emerging mining companies.

During his visit to the World Economic Forum in Davos last month, president Cyril Ramaphosa tried to reassure international investors that these were precisely the kinds of dirty dealings that he would root out while in office.

But a local energy researcher argues that newly established coal interests, who are beneficiaries of ANC-insider patronage, have special leverage to influence government. And they’re using the fear of coal-related jobs losses to derail the country’s transition to a lower carbon economy.

Vested political interests in coal

South Africa gets between 85 percent and 90 percent of its electricity from coal.

It is also one of most energy intensive economies in the world. SA needs more energy to produce a unit of GDP than most countries, engineer and energy researcher Hilton Trollip said during a radio interview this week.

Trollip, who works with the University of Cape Town’s Energy Research Centre (ERC), referred to ongoing revelations of the newly established coal interests within the ANC under the rule of corruption-tainted former president Jacob Zuma.

‘Eskom spends more than R50 billion a year on coal,’ says “IT” Trollip. ‘This amount has doubled in the past ten years, even though the volume of coal it’s buying has stayed the same.’

From 2007 to 2015, Eskom shifted 30% of its coal supply from long-term coal-buying contracts, to short-term contracts with emerging mining companies. While some of these contracts are ‘above board’, Trollip points to the public protector’s State of Capture report which links some of these contracts with government insiders who are ‘connected to a faction in the ANC’ that benefited from this ongoing relationship with the coal industry.

Dirty dealings in the nuclear plan

As reported on in this column and elsewhere, by the end of 2017 the administration under then-president Jacob Zuma was on the verge of committing to a programme that would have locked the country into a deal with Russian to build up to six nuclear power stations here. Legal action stalled the procurement process just long enough for the ANC to recall the corruption-tainted Zuma, who had fired several finance ministers in his effort to force the deal through without following due process.

Zuma was replaced by his deputy Cyril Ramaphosa, who had the sense to listen to his Treasury’s warning that the cost of this deal would cripple the economy. Since then, Ramaphosa has called off the deal, but various court processes and state investigations, including the public protector’s State of Capture report, showed the vested interests within the Zuma administration which were pushing the deal for their own financial gain.

Tripping up the renewable programme

At the same time, the country’s utility scale renewable energy (RE) project, run between 2011 and 2015 and hailed as one of the most successful RE procurement processes in the world, came to a halt when the state utility, Eskom, refused to finalise the last round of contracts with private-sector investors, in spite of the energy minister instructing it to do so. This, too, was linked with pro-coal and pro-nuclear interests within the ruling party.

Once Ramaphosa was sworn in as president, suddenly the final stalled projects were signed off and allowed to reach completion. This, say pundits, is further evidence of the vested interests within the Zuma administration which were obstructing efforts to replace coal in the energy mix.

President Cyril Ramaphosa tried to reassure international investors at Davos that the new administration would root out the kind of corruption that has skewed the country’s energy policy away from what researchers at the ERC and the Council for Scientific and Industrial Research (CSIR) have calculated to be the most affordable and low-carbon transition plan for the economy: a steady decommissioning of old coal plants, while bringing on line utility-scale wind and solar, supported by gas, and also an increased shift to distributed energy resources such as roof-top solar panels, energy efficiency and batteries.

What’s still missing from the state’s energy transition plan, though, is a clear policy about how to support workers within the coal industry who will lose their livelihoods as the country phases out coal. Trollip argues that some interests, who rely on maintaining the coal economy for their patronage benefits with the ANC, are using the labour question as a way to continue to lobby against a transition to a cleaner energy sector.

Categories: Blogs

The German Coal Commission fails to honor the Paris Agreement

11 February, 2019 - 15:00

The German Coal Commission has recommended that all coal be phased out by 2038. But this trajectory won’t be quick enough to meet the goals of the 2015 Paris Agreement, says L. Michael Buchsbaum.

Lignite mining area Gazweiler in North Rhine-Westphalia, Germany (Public Domain)

Days after the Coal Commission announced their recommendations, the climate activist members of the group held their own press conference to criticize the 20-year exit plan, claiming that although well-intentioned, its slow pace will nevertheless violate Germany’s international climate targets.

A quarter of Germany’s installed coal power capacity will be shut down between 2019 and 2022; the path for the years 2023 to 2029 is much less clear.

(Chart: CarbonBrief)

“Neither the planned final exit date of 2038 nor the vague path until 2030 are sufficient for an adequate contribution to climate protection from the energy sector,” read a declaration by the commission members Martin Kaiser (Greenpeace), Kai Niebert (umbrella NGO DNR), Hubert Weiger (Friends of the Earth Germany, BUND) and Antje Grothus (Climate Alliance Germany/Buir for Buir).

Indeed in their dissenting vote, the four commission members rejected the otherwise agreed-upon timetable. Lamenting that the commission had missed an “opportunity to combine ambitious climate protection with future-proof regional and economic development,” they nevertheless voiced their support for the compromise in general because it broke “Germany’s climate policy stalemate of the past years” and because it creates a phase-out through 2022 while at least recommending the preservation of the still-embattled Hambach Forest.

In addition, the group argued that it is still urgently necessary to specify the exit path from 2023 to 2029. Rejecting both the “non-concrete path from 2023 and the late exit date” of 2038, they fear the lack of concrete planning will “prevent a cumulative CO2 reduction of the energy sector compatible with the Paris Climate Agreement.” On the contrary, “cumulative CO2 emissions in the atmosphere [will be] far too high for Germany to contribute to limiting global warming to a maximum of 2 degrees, let alone 1.5 degrees…In the interest of climate protection, an exit would be necessary by 2030.”

Not progress, but business as usual

Their fears are backed up by an analysis from think tank Carbon Brief which suggested that coal capacity would barely fall faster under the Commission’s plan than under a business-as-usual (BAU) pathway. The lignite and hard-coal-fired power stations slated for shutdown in the near term are already expected to retire.

In their analysis, they state that without cutting deeper into planned power plant emissions, Germany will “breach a Paris Agreement-compatible pathway by more than a billion tonnes of CO2.”

Of course, one of the main challenges is that coal currently supplies nearly two-fifths of German electricity, and has long been the backbone of its generation capacity.With the largest fleet of coal-fired power stations in Europe, Germany also has the fourth-largest fleet in the world, after China, the US and India.

(Chart: CarbonBrief)

The proposed phaseout timeline could actually break EU law: it breaches the deadline for EU coal power to be phased out, as shown in the International Energy Agency (IEA) “below 2C” pathway. Indeed, even an accelerated 2035 coal phaseout would only be roughly in line with the IEA’s 2C pathway, but not its “below 2C” scenario.

In total, the commission’s recommended timeline could prevent a cumulative 1.8bn tonnes of CO2 (GtCO2) from entering the atmosphere compared to business as usual, but could still breach the “below 2C” pathway by some 1.3Gt CO2. The 2015 Paris Agreement significantly raised the bar with its target of limiting warming to “well-below 2C” above pre-industrial temperatures and, ideally, only 1.5C. The EU has pledged to raise its 2030 targets and indicated it could commit to a net-zero goal in the longer term.

Critically, according to Carbon Brief, it is only after 2030 that the coal commission’s proposal starts to significantly bend the curve away from business as usual. In other words, it is recommending that forced early coal plant closures mainly take place after 2030, some 12 years into the future. The designated pathway before then really isn’t that ambitious.

The way forward

This looming planning failure seems even more worrying given that in early February Germany finally officially acknowledged that it is also not making the envisioned progress on climate change that had been formerly planned. Though by 2020 Germany is expected to emit around 32% less greenhouse gases than in 1990, the government had previously pledged a reduction of at least 40%. While experts have known for years that Germany would not be able to fulfill these goals (originally set in 2007), the 40% reduction was meant to inspire other EU countries to set more ambitious targets.  Instead, Germany’s failure may now inspire other nations to also fail to hold to established emissions pledges. Indeed when combined with the underwhelming ambitions of the coal commission’s emissions recommendations, this admission should signal that Germany’s long-term strategies are simply not working as promised.

(Chart: CarbonBrief)

In announcing the new report, German Federal Environment Minister Svenja Schulze (SPD) called for more courage and commitment to climate policy. She reiterated that she would therefore come up with a law that makes compliance with the 2030 climate goals more binding, something also suggested by the Coal Commission’s environmentalist wing, but ultimately watered down in the final report. As it stands now, by 2030, Germany’s greenhouse gas emissions are planned to be reduced by 55 per cent compared to 1990 levels.

Germany’s Chancellor Angela Merkel also backed the Coal Commission’s findings, stating that “by 2038, we want to have exited coal,” adding that “unfortunately we still have too much brown coal.”

However, rather ominously, the chancellor then said that by exiting coal, Germany “will have to use more gas.” The dissenting green commission members and much of the environmental community instead hopes that the planned structural reforms and renewable energy expansion will once again “change the discussion within a few years.” But with fossil gas proving to be as potentially harmful as coal, is Merkel’s climate change solution simply to take Germany from the frying pan into the fire?

Categories: Blogs

Dead lakes, dry holes: RWE’s post-mining plans threatened by climate change

8 February, 2019 - 15:00

RWE is digging the biggest hole in Europe for dirty lignite – and they don’t have a working plan to deal with the consequences, says L. Michael Buchsbaum.

RWE’s plans for land cleanup after mining are shockingly irresponsible (Photo by Ende Gelände, CC BY-SA 2.0)

Last year’s record reduced water flowing through Germany’s Rhine River should be setting off alarm bells for myriad reasons. Ever-worsening climate change is reducing precipitation in its Swiss headwaters, suggesting that this year’s “low water event” will not be uncommon going forward.

This water scarcity will also have a major impact on the future of the three giant open pit lignite mines in the Rhineland coalfields west of Cologne. The pits are owned by RWE, which must now realize how preposterous its long-term recultivation plans are when faced with climate change-induced droughts.

Impacts of lignite mining

Put together, the Hambach, Garzweiler and Inden mines produce around 100 million tons of filthy lignite annually, which is fed into three nearby RWE owned power plant complexes. These plants are some of the most toxic emitters in Europe, the source of some 75 million tons of annual CO2 emissions.

While opposition to coal mining and burning has increased, international media has mainly focused on the continuing clashes around the embattled Hambach Forest or the looming destruction of several villages dotted around the growing surface mines. Most people don’t know that RWE’s plans for land cleanup after mining are shockingly irresponsible.

Producing over 40 million tons of lignite per year, the Hambach is the largest mine in Germany. Uncovering all that lignite requires miners to displace another 220 to 250 million square meters of “overburden” or soil, most of which is dumped nearby. Over 85 square kilometers in size and with mining operations in the pit over 500 meters (1,640 feet) below the surface, the Hambach is both the deepest and largest hole in Europe.

The German Great Lakes

But what’s to be done with the giant Hambach hole once mining is complete? RWE plans to turn it into a vast lake over 4200 hectares in size and up to 400 meters deep.

To fill it, the company will require a volume of over 3.6 billion cubic meters of water to be diverted from rivers over a period of at least 40 years, most likely through 2100.

However, the future artificial lake may be further enlarged if officials permit RWE to also flood the nearby Inden open pit mine as well as the older Bergheim pit. Either way, the planned “Lake Hambach” would become the deepest and, after Lake Constance, the second largest lake in Germany.

It won’t be the only mammoth new water body in the area.

Several kilometers away sits the currently expanding Garzweiler mine. When production there ends, also in the 2040s, RWE is planning to create Garzweiler Lake stretching across a 2,300 hectare surface area with waters over 200 meters deep. For this, the company plans to fill it up with another 60 million cubic meters of water per year, also over a 40-year period (roughly 2.4 billion cubic meters).

Beyond then, even after the lake reaches a planned water level of 65 meters above sea level, it will still need to be topped up annually with another 25 million cubic meters more of Rhine water in order to offset outgoing flow losses from years of RWE’s drilling into the Earth and disturbing the natural ground water table in the area.

RWE has no idea what they’re doing

Since the 1980s, RWE has “recultivated” much of the area by planting millions of trees, many of which populate the otherwise desert-like slopes of the largest artificial hill in Germany, the Sophienhöhe, sitting adjacent to and comprised of soil and dirt that was once inside the Hambach mine. However, polluted water run-off from this and other spoil heaps located directly beside the envisioned lakes will likely acidify them, fouling the diverted Rhine water and rendering the new lakes lifeless for decades to come as well as unsafe for most recreational activities. Though RWE and other companies proudly show off similar (albeit much smaller) artificial lakes–the largest only being only around 100 hectares–as positive post-mining land uses, experts admit that much of the “lake” water is unhealthy and humans should limit their recreational activities.

In addition, it’s not even clear if RWE will be able to get the water to fill the holes: diversions of this size have never been attempted before. And given that the Rhine River is now regularly flowing lower than usual, it’s also unsure where this water will even come from. It sounds almost like a cruel joke: the water needed to fill in these enormous pits is getting scarcer, due to climate change exacerbated by the reckless burning of lignite.

Finally, by flooding the mines, any potential for “standard” renewable energy to be built within these vast spaces will be eliminated unless expensive floating wind or solar farms are constructed. But even if RWE simply back-fills them with the removed earth, that’s not enough to allow renewable energy redevelopment. Once excavated and replaced, the uncompacted soil “swells” the land, rendering future wind-farming challenging as turbines cannot be safely anchored. That requires more expensive additional steps—as we will discuss in another post.

As ludicrous as these schemes are, beyond filling the pits with Rhine water, there doesn’t seem to be a Plan B. Nevertheless, RWE and the state government of North Rhine-Westphalia insists that the mines should continue to be expanded for decades to come, seemingly unconcerned with what to do with the gaping holes once all that coal is removed.

Categories: Blogs

The Green New Deal Lives in the U.S.

7 February, 2019 - 15:00

There’s real momentum on the Democrats’ left to launch the green blueprint into America’s mainstream. It’s not a completely crazy idea, says Paul Hockenos.

The GND could create millions of jobs that would facilitate a just, rapid transition to 100% renewable energy (Public Domain)

Part one of three: read part one here.

It surprised no one more than the European authors of the original Green New Deal (GND) (see Part I) when U.S. presidential candidate Bernie Sanders and then his campaign manager, now U.S. congresswoman Alexandria Ocasio-Cortez, started pushing a sweeping, one-trillion-dollar Green New Deal investment plan over a ten-year period. The GND, they and environmental NGOs claimed, could create millions of good-paying jobs that would facilitate a just, rapid transition to 100% renewable energy – and in the timeline we need to avert the worst of climate change. And then, last year, in a matter of months, 45 U.S. congressmen and women, as well as hundreds of civil-society groups, signed onto the blueprint for environmental modernization.

“Suddenly ‘bang!’ it reappeared out of nowhere,” says Colin Hines, a British environmental activist and member of the Green New Deal Group, a small London-based NGO that helped draft the original GND in 2008 and has since campaigned for it, largely though without a lot of resonance. (“At the moment, it’s very hard to get any time at all to talk about anything other than Brexit,” Hines told me.)

Now, though, it’s on the front burner again – in the U.S. In December, at an event with Sanders, Ocasio-Cortez elaborated on the GND and said: “This is going to be the New Deal, the Great Society, the moon shot, the civil-rights movement of our generation.” “The Green New Deal is one of the most interesting—and strategic—left-wing policy interventions from the Democratic Party in years,“ gushed The Atlantic magazine late last year.

The Americans’ eleven-page “Plan for a Green New Deal” is currently at the center of a campaign led by the Sunrise Movement, an activist group composed of young people concerned about the environment; the Democrat signatories in Congress; and groups like Bill McKibbens’s dynamic, climate-protection organization 350.org. The GND is, in its own words, a plan “to develop a detailed national, industrial, economic mobilization plan for the transition of the U.S. economy to become greenhouse gas emissions neutral and to significantly draw down greenhouse gases from the atmosphere and oceans and to promote economic and environmental justice and equality.“

The plan includes lots of the points and language of the British, UN, and EU Greens’ versions of a decade ago (AOC’s people met with the Hines’s UK GND group in early 2018), but it is no facsimile of those takes nor is it a finished product. Rather it’s a work in progress that dozens of grassroots groups and citizens will hammer into shape over the course of the year. The Plan for a Green New Deal currently entails:

  • dramatically expanding existing renewable power sources and deploying new production capacity with the goal of meeting 100% of national power demand through renewable sources;
  • building a national, energy-efficient, smart grid;
  • upgrading every residential and industrial building for state-of-the-art energy efficiency, comfort and safety;
  • eliminating greenhouse gas emissions from the manufacturing, agricultural and other industries, including by investing in local-scale agriculture in communities across the country;
  • eliminating greenhouse gas emissions from, repairing and improving transportation and other infrastructure, and upgrading water infrastructure to ensure universal access to clean water;
  • funding massive investment in the drawdown of greenhouse gases;
  • making “green” technology, industry, expertise, products and services a major export of the U.S., with the aim of becoming the undisputed international leader in helping other countries transition to completely greenhouse gas neutral economies and bringing about a global Green New Deal.

A wish list? The minimum necessary, say its authors, to keep temperatures rising beyond 2.7 degrees Fahrenheit before 2100, the goal of the 2015 UN Paris treaty.

The Europeans with some experience under their belt said the U.S. plan looks good: “It covers all three main pillars,” says German Green Sven Giegold, one of the original manifesto’s authors. He argues that it does three things by addressing social concerns, namely job creation and government intervention for low-income people; environmental transformation, in the creation of a low-carbon economy; and the financial world as an enabler for business and industry to prosper. “Everyone has to win, to see something in it for them so that the program can gain acceptance across party and income lines,” says Giegold.

The GND’s first foray into the mainstream of the Democratic Party actually failed. In November 2018 and then on Jan. 17 this year more than 100 young people joined sit-ins at the offices of House leader Nancy Pelosi and Senator Chuck Schumer on Capitol Hill. The group delivered thousands of petition signatures demanding that the Democrats support a Green New Deal. This did not happen but Nancy Pelosi promised to create a special new committee to examine climate change called Select Committee on the Climate Crisis. The Sunrise Movement said that it saw the setback as unfortunate but at least a first step.

”We will make it clear to all politicians that if they want the votes of young people, they need to back the Green New Deal,” said Sunrise organizers. On February 5, hubs and homes across the country will host livestream watch parties to tune into a Sunrise livestream detailing the 2019 GND vision. Anyone can host a party to grow the movement and go forward with the 2019 GND strategy.

Of course, the GND has to catch on beyond college students and life-long liberals to make reality out of it. The idea – to get it on the Democratic platform in 2020 for the national campaigns – is a goal worth pursuing, a real chance. With a Democratic congress and Democratic president, yeah cross your fingers …. suddenly, bang, it becomes possible.

Categories: Blogs

The end of Buen Vivir? Ecuador plans oil extraction in Yasuní National Park

6 February, 2019 - 15:00

Yasuní National Park in the Ecuadorean Amazon, one of the most biodiverse regions in the world, was a beacon of hope for conservationism and environmental governance. But it seems that the government is now planning to allow oil drilling in the Amazon, says Maximiliano Proaño.

Did the sustainable approach of the ecuadorian “buen vivir” fail to save the national biodiversity? (Public Domain)

Current president of Ecuador, Lenin Moreno, is doing a similar bait-and-switch move. Although he promised to protect the Amazon, a draft Presidential Decree was leaked in November 2018 that revealed government plans to allow oil drilling in the buffer zone of a protected area established for the Tagaeri-Taromenane which until now has been off limits to drilling.

Yasuní: leaving oil in the ground

Yasuní was once an example for global conservation. The Yasuní-ITT (Ishpingo-Tambococha-Tiputini) Initiative consisted of leaving the oil underground in a part of Yasuní National Park.

In 2007, former president Rafael Correa offered to leave the oil in the ground in return for $3.6bn compensation from the global community. This money was to be invested in renewable energy, protection of biodiversity, and conservation of 44 protected areas. With this project, which was linked to the National Plan for Living Well (Buen Vivir), Ecuador was moving toward a post-petroleum-based society and the pursuit of better living standards. However, in 2013 the plan was scrapped by Correa´s government on the grounds that the international community had not paid enough to compensate Ecuador.

Activists fight to preserve the park

A number of environmental groups emerged in response to the threat to Yasuní. One of them, Yasunidos invoked the right to a popular consultation. To do this, they had to collect signatures corresponding to 5% of the electorate. If the group was able to do so, this would have put the question of whether to leave oil beneath Yasuní National Park permanently in the ground before all Ecuadorian voters.

On April 12, 2014, the deadline for the collection ended. According to the members of Yasunidos, 780,000 signatures were delivered. Weeks later, the National Electoral Council – an institutional figure in charge of data verification – validated only 360,000, which were not enough to bring the cause to public consultation. Therefore, President Correa announced in August 2014 that the drilling would go forward.

But this was on the basis of a lie: in November 2018, a National Election Council investigation revealed that the Ecuadorian government fraudulently rejected hundreds of thousands of signatures gathered during the 2014 referendum. In other words, the decision to start drilling is based on a subvention of democracy.

The second phase of the controversial Ishpingo-Tambococha-Tiputini (ITT) project, started in 2016, has triggered fierce criticism from conservationists and civil society organizations.

At Tambococha-2, Petroamazonas planned to build four platforms and drill almost 100 wells. The company insists it will do so unobtrusively by concentrating drilling in a small area, burying pipes and putting in place precautions against spills. But environmental groups say it is impossible to guarantee zero impact on such a biologically sensitive area. New roads and workers are likely to accelerate deforestation, and it’s a threat for two isolated nomadic tribes of the area.

A muddled way forward

For a while, it seemed that the Amazon would stay safe: President Moreno promised the United Nations he would do more to protect the environment, and a successful 2018 referendum would have expanded the protected areas for nomadic tribes and reduce the amount of the Amazon accessible for drilling.

In addition, Ecuador’s Hydrocarbon Minister Carlos Pérez unexpectedly announced in November 2018 that an oil auction planned for the end of 2018 would be reduced from the original sixteen blocks to two.

However, it seems that the Amazon will yet again come under attack. The leaked draft of the Presidential Decree would allow oil drilling in a formerly protected zone. And, Pérez claimed that the two blocks which will be auctioned (86 and 87) do not have any indigenous people. But the two blocks, located along the Peruvian border, overlap with the titled territory of the Sapara, Shiwiar, and Kichwa nations, and Tagaeri-Taromenane sightings have been reported there.

The draft decree would expand the protected area where there is less evidence of isolated peoples and allow drilling in the buffer zone. According to U.N. Special Rapporteur on the Rights of Indigenous Peoples Victoria Tauli-Corpuz, “The decision to proceed with oil extraction in Yasuní’s buffer zone could produce a grave and unpredictable impacts on peoples living in voluntary isolation and initial contact in the region.”

Amazon communities and Yasunidos have declared that the exploitation of oil block 87-south-east, would destroy what we have left of the Yasuni national park completing the “ring of death” and provoke the genocide of the isolated villages Tagaeri Taromenane.

Paradoxically, this conflict comes a decade after the Ecuadorian 2008 Constitution, which was seen as a new paradigm of indigenous rights and rights for nature. It was meant to protect sensitive ecosystems from “activities that could lead to species extinction, the destruction of ecosystems, or the permanent alteration of natural cycles.”  Perhaps Mr Pérez and Mr Moreno should have another look at Ecuador’s founding document.

 

Categories: Blogs

How can the Western Balkans and Ukraine transition to clean energy?

4 February, 2019 - 15:00

The success of the energy transition in the Western Balkans and Ukraine is a question of political will in those countries. But the EU can help set up the conditions for a successful modernization, writes Robert Sperfeld.

Supporting energy efficiency should remain a top priority of EU’s technical and financial support mechanisms (Public Domain)

Insights from a discussion in the European Parliament on 22 November 2018

Unbearable pollution from coal

In Tuzla, Bosnia-Herzegovina, a forty-year-old thermal power plant is missing filters for desulphurization and other pollution control instruments. Ashes containing heavy metals are disposed openly and contaminate air, soil and water. The burden for health of the local population is huge, causing tens of millions in additional expenditure in the health system.

This painful example makes it clear that many years of various action plans and transposition of EU legislation on energy and environment did not make a difference on the ground. To be sure that rules are enforced, societies need to establish rule of law and functioning state institutions. Development depends on governance and democratic control of authorities and their independence from commercial interests of corporations. The efforts to win the green transition have to be related to this broader context.

A lack of political will

At the same time, however, the political will of leading decision makers is often lacking. According to Mirjana Jovanović of the NGO Belgrade Open School, coal remains a central pillar in the long-term vision for the Serbian energy supply; the Serbian government even convened in an open pit lignite mine as a PR stunt to support coal industry.

Significant subsidies for fossil industries are in place. In such a situation a Green energy transition cannot just be imposed from outside, as Aleksandar Macura of the Serbian think tank RES Foundation underlined. European policy instruments and institutions like the European Energy Community and its Secretariat in Vienna could not replace national development strategies. Transition efforts need public and political support in the respective countries, so education and information campaigns on climate change and economic opportunities of decarbonization need to remain a priority.

Looking to Germany, Poland or Greece it becomes clear that this is not an issue of Western Balkan or Eastern European countries alone. It requires also holistic approaches taking into account social consequences for regions and towns most affected by such changes in the structure of the economy.

What is the point of the European Energy Community?

It is worthwhile to recall the context in which the European Energy Community was set up back in 2005. After the terribly bloody disintegration of former Yugoslavia, its mission to facilitate energy security and social stability was very much seen as a tool to re-build mutual trust, solidarity and peace in the region.

Listening to the rhetoric of current nationalist political elites in the Western Balkans one might conclude that a lot remains to be done in this respect. The good news is that the transition towards a sustainable energy system has so much to offer for this purpose.

First, energy reforms are about human rights and livelihood. Introducing clean energy enable local communities to engage in energy supply on their own. In addition, investments into efficiency help fight widespread energy poverty. The energy transition can contribute to improving quality of life, social stability and economic perspectives for the region, reducing the welfare gap between the EU and its neighbours.

Second, regional cooperation in the electricity sector would bring economic benefits for the involved countries of around 270 million Euros annually, says Janez Kopač, head of the Energy Community Secretariat in Vienna. National markets alone are too small to balance demand peaks and fluctuations in generation from renewables and to maintain reserve capacities in a cost efficient way. Market integration within the region and with EU countries will create benefits and pave the way for further integration.

What can the EU do to support the transition?

The Energy Community Treaty is actually an extremely important tool and mechanism for partnership with the Balkans and Ukraine. Without the Energy Community and the work of its Secretariat most member countries’ energy sectors would be weaker and certainly no less carbon intensive.

As Iryna Holovko from the Ukrainian NGO Ecoaction confirmed in her presentation on progress of energy sector reforms, in case of Ukraine the Energy Community treaty in line with the EU association agreement were the most important drivers of energy sector reforms. Technical and legal support from the Secretariat is highly competent.

However, the role of the Energy Community is limited. On the one hand, it has little influence on the internal factors in the member countries with regard to rule of law issues and public support. On the other hand, it depends on the EU to set the right conditions for its work and on the commitment of the EU and its member countries to give the energy transition agenda the necessary political weight in the relations with the respective partner countries.

In contrast, the European Commission and the member states have a broader range of instruments to engage with governments and societies to foster good governance and to support activities conducive to the transition agenda on the level of communities, businesses, education, and civil society.

But also within the framework of the Energy Community Treaty, the European Commission as the key party to the Treaty needs to act more proactively. The Treaty requires new tools to ensure implementation of rules and compliance with the related acquis. Instruments of other branches of the Commission such as the Directorate General for Neighbourhood and Enlargement Negotiations (DG NEAR) should be more closely linked to progress in the implementation of the Energy Community agenda.

Furthermore, the European Commission should do more to close the legal gap between the EU countries and the Energy Community. Without making more parts of the acquis mandatory also for the Energy Community countries there are no effective incentives to phase out dirty and carbon intensive generation capacities.

The Commission should push for a full-scale inclusion of the Clean Energy for All Europeans Package into the Energy Community Treaty. As a first step, the Coal Regions in Transition Platform and its funding instruments can be opened for the partner countries in order to promote discussion about a just transition. This would send strong messages to those governments and investors that plan new fossil capacities.

Supporting energy efficiency should remain a top priority of EU’s technical and financial support mechanisms. Potential is huge: efficiency strengthens competitiveness, reduces fuel costs and negative externalities from generation.

While the EU offers significant support to interconnectivity of grids and markets, it must be careful that the infrastructure does not serve the export interests of particular fossil or nuclear companies thus impeding the transition towards more sustainable energies. This is the case for example with the planned transmission line from the Ukrainian Nuclear Power Plant Khmelnytskyi to Poland.

In order to strengthen local development and to create higher acceptance for renewables, the EU should encourage citizen energy projects. In addition, the EU can pressure countries to establish more reliable framework conditions and set up financial instruments to encourage investments in renewable energy.

A rapid expansion of renewables is needed to replace old, polluting coal power plants with their devastating effects on health and environment. The EU holds the key to presenting viable alternatives quickly and helping the Balkans and Ukraine on their transition path.

Robert Sperfeld is Senior Program Officer for Eastern and Southeastern Europe at the Heinrich Böll Foundation in Berlin.

Categories: Blogs

Multilateral banks pile onto Mexico solar

1 February, 2019 - 15:00

The Mexican solar business continues to attract international investors – in December 2018 they spent $87 million dollars. Charles W. Thurston takes a look.

The latest in a rapid string of solar projects being announced in Mexico is the 80 megawatt Chihuahua project (Public Domain)

Mexico’s phenomenal solar expansion over the last three years makes it one of the fastest growing solar nations on the planet. Much of this growth has been financed by a host of multilateral development banks, including several from the United States. Four of these banks have just committed to an 80 megawatt project in Chihuahua state being developed by Spain’s X-Elio.

The Mexico solar program also is setting world records for low cost bids: the government’s September 2017 third bidding round registered an average price of $20.57 per megawatt-hour, a new low record at the time. The third round will bring an estimated 1.3 gigawatts (GW) of solar capacity to the country with an investment of over $1 billion. The three auctions together will add almost 5 GW of solar capacity, with a cumulative investment of $5 billion for about 40 solar plants.

Typically, the multilaterals are early investors in a developing country’s infrastructure, and aim to help establish a market, so that private banks will follow them in. In Mexico, the solar financing wave is being fueled in large part by Mexico’s renewable energy goals, which are for 35% by 2024 and 50% by 2050, with a specific carve-out for solar at 23%.

The latest in a rapid string of solar projects being announced in Mexico is the 80 megawatt Chihuahua project unveiled last week by Spain’s X-Elio, with financing from IDB Invest — the private sector arm of the Inter-American Development Bank, the Canadian Climate Fund for the Private Sector of the Americas, the Chinese Fund for the co-financing of the Americas, the Official Credit Institute and the MUFG Bank.

X-Elio CEO Jorge Barredo said “Mexico is one of the key points in our development and international expansion strategy and our idea is to continue growing in this market, whose energy goals have made it an attractive region for clean energy.” X-Elio already operates a 74 MW solar farm in the Guanajuato area.

Earlier this month, the European Investment Bank (EIB) committed $87 million in financing for three solar power plants in Mexico, including the combined 828 MW Villanueva I and Villanueva III projects, and the 260-megawatt Don José project in Guanajuato. The Villanueva project is said to be the largest solar park in South America.

Along with the EIB, investors in the X-Elio project included IDB Invest, the Inter-American Development Bank, and Mexican development bank Bancomext. Private banks also investing include MUFG Bank, BBVA Bancomer, CaixaBank, and Natixis.

A frequent Mexico solar financier is the North American Development Bank (NADB), based in San Antonio, which was formed as a result of NAFTA. Last year, the NADB approved the 317.5 MW Puerto Libertad Solar Park for the municipality of Pitiquito, in Sonora State. The bank is considering a $75 million loan for the $400 million project, slated to come online in June.

NADB also lends for US solar projects. One in the pipeline is a set of solar plants, the 6 MW Ecoplexus Calipatria and the 6 MW Ecoplexus Centinela (6.0 MWAC) solar plants, for the Imperial Irrigation District, in Imperial County, California. The bank could lend up over $17 million for the development.

Based on the solar resource assessments developed by Mexico’s energy agency SENER, Sonora state has a high potential for solar energy development, with solar irradiation resources estimated at 2,600 GWh/year. Solar irradiation in the state is 45% higher than the national average, mainly in the northern area of the state, a neighbor to Arizona and New Mexico.

NADB is currently financing the development of the 43.2 MW Santa Rita Solar Project in Villa Ahumada, Chihuahua state. The bank is also financing the 43.4 MW Los Juan Pablos Solar Project in Caborca, Sonora. Three earlier solar projects also have been financed in Mexico.

The potential for cross-border energy industry trade between Mexico and the United States is massive. Apart from the flow of energy itself, the equipment and services for the development of solar in Mexico is significant, according to the Center for American Progress, “an independent nonpartisan policy institute.”

“By using existing North American trade and production systems, where goods cross the border multiple times during the production process, the United States has an opportunity to enhance its manufacturing of solar photovoltaics (PV) in the United States and install them along the Northern deserts of Mexico to engage in cross-border solar energy generation and transmission,” said CAP in a study last year. “Such development of price-reduction and deployment strategies would not only benefit U.S. solar PV manufacturing, it would also boost exports and U.S. clean energy production,” the group adds.

Charles W. Thurston specializes in renewable energy, from finance to technological processes. Among key areas of focus are bifacial panels and solar tracking. He has been active in the industry for over 25 years, living and working in locations ranging from Brazil to Papua New Guinea.

This article has been republished from CleanTechnica.

Categories: Blogs

Germany’s Coal Commission proposes a nebulous 20-year coal-exit pathway

30 January, 2019 - 15:00

At the end of January, the Commission on Growth, Structural Change and Employment, aka, the Coal Commission, finally released its 336-page report. Filled with economic observations and recommendations, it sets an end date of 2038 for Germany to close its last coal-fired power plant. L. Michael Buchsbaum reveals the most important facts of the report.

Protesters plead for a faster coal exit (Photo by mw238, CC BY 2.0)

Agreed to by a 31-member team comprised of environmentalists, union leaders, state ministers and representatives of power companies like RWE, though weak on concrete determinations like which plants and mines should be shut and when, the report instead provides a range of goals and deadlines for how many gigawatts of generating capacity should be curtailed. But regarding the still occupied Hambach Forest, site of on-going protests and a symbol of the public’s desire for an immediate coal shutdown, the report only says preserving it “would be desirable.”

Under the terms of the plan, by 2022 today’s total coal-fired output would be reduced from over 42 gigawatts to 30 gigawatts, split evenly between domestically-mined brown coal and imported hard coal. The planned 5 GW lignite reduction means local production, most likely in the Rhineland area west of Cologne, will be curtailed. However, if you subtract the facilities that were already planned for shutdown, only seven additional gigawatts of coal capacity have been added, according to economic newspaper Handlesblatt. The coal commission proposed that an independent panel assess the announced measures in 2023, 2026 and 2029 to see whether they were delivering in the intended results with regard to jobs, security of supply and prices.

Data based on the report of Germany’s coal exit commission

Nevertheless each committee member voted to adopt the report, except for Greenpeace’s Martin Kaiser, who criticized the coal burning end-date of 2038 as “unacceptable.” However he seemed to sum up the prevailing mood by stating that “At least Germany is moving again after years in a climate policy coma. With the help of the pressure of tens of thousands of protesters, Greenpeace and other environmental groups were able to push through important partial successes: Germany finally has a road map for how to make the country coal-free. There will be no further coal plants.”

However, even as the report’s recommendations are debated, Commissioner Antje Grothus, called on environmental activists to stay in the embattled Hambach Forest. “You just can not trust RWE here,” said Grothus on Monday to radio station WDR5. “And you have to make sure that it is protected.”

While envisioning an end to coal mining and burning in Germany, the plan notes this will come in part by converting some coal-fired power plants to burning imported fossil gas instead. Additionally, since the last nuclear reactor will also be shut down in 2022, the efforts to increase the share of green energy must be considerably increased. To avoid surcharges on the price of electricity, private households and the overall economy should also be shielded from rising energy prices and the commission considered a subsidy of at least €2 billion per year will be necessary to reduce network costs. The commission said energy customers should not face a surcharge for the phasing out of coal.

To help ease the pain of structural transition in coal regions, the Commission proposed at least 40 billion euros ($45.7 billion) in aid to North Rhine-Westphalia, Brandenburg, Saxony and Saxony-Anhalt. The commission recommended the federal government provide €1.3 billion per year over 20 years. In addition, they should provide all German states with €700 million per year over a 20-year period, and decommissioned areas should be prioritized for the further expansion of renewable energy capacity.

The report said ways to determine further compensation for power producers could include capacity tenders or simply keeping plants on standby, similar to existing reserve payments for operators that have totaled as much as 150 million euros ($171 million) per gigawatt per year in the recent past.

Compensation should also apply to plants in operation and those that have not yet entered service or were still being built, including Uniper’s Datteln 4. However, the older the plants, the lower the compensation, the Coal Commission added. Eckhardt Ruemmler, chief operating officer of Uniper, which operates 3.8 GW of coal-fired capacity in Germany, said the report suggested the Datteln 4, a 1.05 GW coal plant that has so far cost 1.2 billion euros, would never enter service.

RWE, Germany’s biggest power producer, lignite miner and the largest operator of coal-fired plants at 13.3 GW of capacity, said an end date of 2038 was too soon, urging lawmakers to consider extending this during a planned review in 2032. “We are obliged to protect the interests of our employees as well as our shareholders,” RWE Chief Executive Rolf Martin Schmitz said in a statement. Either way, German coal producers and burners will not walk away empty handed.

Calling the agreement “a good compromise for climate protection,” federal environment minister, Svenja Schulze (SPD) also lauded its economic suggestions for the affected mining regions, saying in total, the plan shows how Germany could guarantee supply security. “The commission has done a very, very good job, she told Deutschlandfunk.

However, even though the contents of the plan have now been published, they are not binding. Indeed many have suggested that the real negotiations are only now about to begin. Claudia Kemfert, energy economist at DIW, while praising the compromise warned that “it is particularly important that politicians follow the report’s recommendations. The time for excuses is over, the coal exit has to be put in action fast and the Energiewende must be advanced.”

In a first step, the relevant federal ministers will now thoroughly review the report. Federal Economy and Energy minister, Peter Altmaier (CDU), said it will “take a few days” before conclusively commenting on the proposals, he told public broadcaster ZDF. “We will discuss this with the state premiers, but also with the four commission heads over the coming days, and then present a plan with the necessary laws,” he said. Then it falls to the German parliament to decide upon each individual concrete step.

Whatever final plan is eventually adopted, Green party leader Annalena Baerbock, reminded, that “we’ll need more than what the compromise says if we want to meet [our 2030] climate targets.”

Categories: Blogs

Coal has no real future in Southeast Europe

29 January, 2019 - 14:00

Governments may be looking the other way, but rising carbon prices and stricter EU regulations are sounding the death knell for the region’s lignite fired power plants, Martin Vladimirov explains.

In the near future, power plants will no longer be able to compete with renewable energies (Public Domain)

Rapidly increasing carbon prices and stricter EU regulations on air-polluters will make already outdated lignite-fired power plants in the region bankrupt and politically unacceptable over the next decade.

More importantly, green energy alternatives are already economically feasible, and could become a force not only for energy transition but for the transformation of whole economic regions that now depend on coal.

In the current legislative and market environment, fossil-based electricity production may still be the cheapest option, especially in the Western Balkans.

Most power plants in Southeast Europe are old [some of the “youngest” were built in 1988, before Yugoslavia broke up], so the original investment in the plants has long been recovered, enabling them to operate at prices that recoup their marginal costs.

However, policy-makers should be aware that the projected hike in carbon prices will require ever bigger state subsidies for power plants, which is not sustainable in the long run. Without these subsidies, fossil-based generation will make no economic sense.

Most lignite power plants in the region will also have to face the EU’s new Best Available Techniques environmental standards, BAT, which will require enormous investment in modernization that would have to come either from the budget or from private investment.

As a result, roughly half of the region’s existing coal and lignite generation will have to be replaced or phased out by 2030. All of the above would raise household power prices, or, alternatively, the budget cost of maintaining them artificially low.

But the response of governments has been either to do nothing or even to double-down on coal.

The discussion of how to deal with the coal legacy is one of the main energy policy dilemmas in the region’s EU member-states, like Bulgaria and Romania, which are developing integrated national energy and climate plans, NECPs, required by the Energy Union’s Governance Regulation, to reduce CO2 emissions by 2030.

Other Western Balkan countries, as contracting parties to the Energy Community, are mulling similar plans, although the EU’s influence on the debate there is weaker.

In 2016, China’s Dongfang Electric Corporation completed the first privately built coal-fired power plant in the Western Balkans, the 300-MW Stanari plant in Bosnia and Herzegovina.

A year later, Kosovo signed a billion-euro deal with US-based ContourGlobal to build a new 500-MW lignite-fired power plant, initially backed also by the World Bank.

A total of 12 coal-fired power plant projects have either been started or are in the planning stage in the Western Balkan region.

Bulgarian and Romanian energy policy-makers have also been reluctant to give up on coal, for obvious political reasons. More than 60,000 workers are directly or indirectly engaged in coal mining, coal-fired power generation or auxiliary services in the two countries. Phasing out coal could mean an economic catastrophe for the affected regions and possibly trigger violent street protests.

The cost of not doing anything, however, is even worse. Bulgaria’s Maritsa Istok 2 lignite power plant, the largest thermal power plant in Southeast Europe, could generate losses of more than 150 million euros for the 2018 financial yeardue to the more than three-fold increase in the price of CO2 emissions.

Previously one of the cheapest power generators in the region, Maritsa Istok 2 now finds it hard to sell its electricity on the free market. As the EU plans to continue reducing the CO2 quotas allocated to member states, the carbon price is expected to keep rising in the medium term.

The 2017 South East Europe Electricity Roadmap, SEERMAP, a modelling study of three scenarios for the de-carbonisation of the electricity system by 2050, conducted in nine countries in Southeast Europe, showed that by 2040, the total installed coal capacity in the region will drop to around 2.3 GW down from more than 24 GW today, on the back of rising carbon prices.

The assumption based on the European Commission’s 2016 reference scenario is that it would reach 88 euros per tonne by 2015.

The corresponding rise in average wholesale power prices in the region will meanwhile make renewable energy sources more competitive.

This means that although RES-based power plants would need some support in the beginning, most renewable investment in the mediumterm would be realized by private investment.

The RES support relative to the electricity cost [wholesale price plus RES support] is only 2.6 per cent at its highest level in the decarbonisation scenario, indicating that if renewable energy deployment is well planned, and if forward-looking policies are in place, the impact of renewable subsidies on households and businesses can be kept very low.

The alternative to delaying de-carbonisation of the power system is possible but would end up being costlier.

As burning coal becomes more expensive, the utilization rate of power plants will drop below 15 per cent, leading to enormous stranded capacities. These will likely require public intervention, whereby costs are borne by society, with electricity consumers paying an estimated more than 2 euros per MWh on average to keep coal plants in reserve.

Stranded costs are much higher in Bosnia, Greece and Kosovo. Most of these costs can be avoided, however, by taking early action to decarbonize the electricity sector and by avoiding investment in additional fossil fuel plants.

The result would mean not only a fall in the energy poverty levels, one of the biggest politically sensitive issues in the region. It would also mean less air pollution, which has been choking the region for decades. More than 43,000 premature deaths in the region each year are attributed to bad air quality, according to the European Environment Agency.

What can be done?

Komatsu bulldozer pushing coal in power plant Ljubljana (Photo by Petar Milošević, CC BY-SA 4.0)

Market forces, not external regulations, will therefore likely drive out most of the coal-fired power generation in the region.

To mitigate the associated socio-economic pain, governments should take bold steps to gradually transform the economies of coal dependent areas.

The targeted use of financing instruments, including the new Modernization Fund, the EU Cohesion and IPA funds, could facilitate projects for new renewable-based power generation on the sites of the closing coal plants or for the education and reskilling of coal workers.

It is also time to bust the myth that renewables are the costliest energy source. In fact, renewable technologies are getting cheaper and in some countries are already competitive with traditional fossil fuel-based electricity generation. However, as capital costs in the region are still excessively high, public-private cooperation would be needed to implement financial de-risking instruments.

To unlock the renewable energy potential, policy-makers should work on a long-term robust, reliable renewable energy support framework that reduces the administrative and tax burden for new RES investments, creates market-based financial incentives and empowers household consumers also to become electricity producers.

Ultimately, this will require a significant improvement of energy governance to remove the vested interests that have captured policy – and that have contributed to the generation of enormous public-sector waste.

Martin Vladimirov is an analyst at the Economic Program of the European policy research think tank, the Center for the Study of Democracy.

This article has been republished from Balkan Insights and was produced as part of the South East Europe Energy Transition Dialogue project financed by the European Climate Initiative (EUKI).

The information and views set out in this article are those of the author(s) and do not necessarily reflect the official opinion of the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety.

The opinions expressed in the Comment section are those of the authors only and do not necessarily reflect the views of BIRN.

Categories: Blogs

The green new deal is back

28 January, 2019 - 15:00

There’s fresh international interest in the flagship green-growth project. What is the Green New Deal and where did it come from? Paul Hockenos takes a look.

The “Green New Deal” was proposed in 2009 by the European Greens in the context of the European Parliament elections. (Public Domain)

About a decade ago, the European Greens’ visionary Green New Deal (GND) program – a full-scale environmental overhaul of our economies driven by public investment – had been put on a high shelf in a backroom somewhere in Brussels. The brainchild of several circles of environmentalists and then picked up by the European Greens in the late aughts was, perhaps, ahead of its time (critics, on the contrary, sniped that it was really nothing more than a naïve wish list.) The idea was to finance green infrastructure projects with state investment, which would put people to work and act as a stimulus is the crisis-racked recession economy. The GND brought together economic growth and environmental protection – an attractive win-win strategy, it was thought.

But it didn’t get a lot of traction in Europe at the time. In the 2009 European Parliament vote, the EU Greens bumped up their percentage of seats marginally: from 5.7% to 7.5%, ultimately a disappointment.

“The problem was the term ‘New Deal,’ which in the U.S. is known from the era of the Great Depression [the state investment and public works program launched by Franklin Roosevelt in the mid-1930s] and has positive connotations,” says Sven Giegold, a German Green in the European Parliament and co-author of the European Greens’ 2008 Green New Deal program. “While in English ‘New Deal’ means something, it doesn’t in French or German, and people didn’t really get it,” he says. “In France we just shortened it to ‘Green Deal’.  And then after the 2009 EP vote we more or less dropped this tag,” says Giegold.

As the severity of the financial crisis receded, Giegold says, there was also less talk of and need for stimulus, he notes, which was central to the GND program of the aughts. But Giegold argues that the content, basically ecological modernization guided and in part financed through fiscal spending, has been at the core of every Green campaign platform since then as it is now in the current program for the upcoming May European Parliament election. (Interestingly, in contrast to the EU Greens, the UNEP stuck with it, enshrining their version of it in the Global Green New Deal in 2009 and keeping the term and the program in currency.)

Today though, the manifesto has been taken down from the shelf and dusted off – by left-wing U.S. Democrats (see Part II next week). As candidate in 2018, the democratic socialist Alexandria Ocasio-Cortez, now a U.S. congresswoman, ran her campaign plugging for a Green New Deal. And she’s not alone. Bernie Sanders’s 2016 campaign, on which Ocasio-Cortez worked, touted a version of the Green New Deal. Today, presidential hopefuls Elizabeth Warren and Cory Booker, as well as another 30 congresspeople – all Democrats, have endorsed the plan. Moreover, the former Greek finance minister Yanis Varoufakis, and his left-wing European movement DiEM25 have taken some version of it on board. The London-based Green New Deal Group, founded in 2008 and never disbanded, is pushing it from the UK.

Before we take another look at what the GND is, let’s get something about its origins straight. It was not, as Wikipedia and other sources claim, the idea of US columnist Thomas Friedman, although he did pen two commentaries using the term in early 2007. He called for a GND, citing the way that Roosevelt‘s New Deal snapped the U.S. economy out of the depression. Friedmann argued further: “If we are to turn the tide on climate change and end our oil addiction, we need more of everything: solar, wind, hydro, ethanol, biodiesel, clean coal and nuclear power — and conservation. It takes a Green New Deal because to nurture all of these technologies to a point that they really scale would be a huge industrial project. To spark a GND today requires getting two things right: government regulations and prices.”

The European Parliament’s Greens, led by the Germans and the UK’s Caroline Lucas, turned the catch phrase, which was already in use at the UN Environment Program (UNEP),  into a policy paper with real content.

The EU Greens contracted the prestigious German environmental think tank, Wuppertal Institute, to study the possibility of bringing together green politics and market economics under one hat and with one label. The idea was to cut green gas emissions through government spending in eco-friendly industries and infrastructure that could stimulate economic recovery during the financial crisis, which had hit in 2007. The nub of this, the institute recommended, would be: “state investment in activities which produce goods and services to measure, prevent, limit, minimise or correct environmental damage to water, air and soil, as well as problems related to waste, noise and eco-systems. This includes innovation in cleaner technologies and products and services that reduce environmental risk and minimise pollution and resource use.”

The results of the Wuppertal study were incorporated into the European Greens’ “Green New Deal for Europe” manifesto with which they ran on in the 2009 European Parliament elections.

Here are some snippets from the program, which obviously haven’t lost their relevance:

  • “Shifting to a greener economy and combating climate change will boost employment and make us more self-sufficient, reducing our damaging reliance on energy imports.“
  • “Neoliberal ideology in Europe has established a system where the interests of the few come before the general well-being of its citizens. They have put the profits of polluting industries ahead of the environment and public health.”
  • “The impact of a resource crunch and dangerous climate change would dwarf that of any financial and economic crisis. Thankfully, most of the solutions are already at hand. The current economic slowdown is an opportunity to transform our system, so that we can avoid the extremes of the resource and climate crises, and secure a good quality of life.”
  • “Combating climate change is a win-win process. A combination of ambitious and binding targets, of incentives and of public investments into green technologies and services will help create millions of green jobs in Europe and tens of millions worldwide.”
  • “Nuclear energy cannot be part of the solution to climate change. Expensive investments in this dead-end technology will not be able to contribute to the urgently-needed emissions reductions and will divert much-needed funds from the promotion of sustainable energy production.”
  • “The resource crunch we face runs far beyond energy resources. A more sustainable approach to our agricultural and marine resources is vital for our wellbeing, the health of our ecosystems and their wealth of biodiversity.”
  • “A Green New Deal calls for massive investment in education, science and research in green, future-oriented technologies to put Europe at the forefront of a global economic revolution.“
  • ”A truly prosperous, innovative, stable and sustainable economy requires a fairer society guaranteeing fair working conditions, equal opportunities and a decent standard of living for all. Europe must defend social values and justice while adapting to the needs of changing times.”

Giegold says that in 2008 there was tension between the UN and the European version of the plan. The EU Greens had social concerns at the forefront – the financial crisis acute at the time – realizing that there was the possibility that environmental modernization could adversely impact the less well-off, and thus hurt the GND’s chances. The UN, he says, deemphasized social impact because it thought the leftist slant decreased the chances of their GND package gaining broader acceptance.

Since then, he says, the EU Greens and most of the European Green parties advocate state-financed investment in climate protection, as the GND posited, but more as a transformative process rather than an economic stimulus. Indeed, the green-stimulus route was NOT taken by the Europeans but it was advanced in Korea, China, and, to a lesser degree, in Obama-era America.

The next installment will focus on the Green New deal in the US. Stay tuned

 

Categories: Blogs

In 2019, expect even less coal in the US

25 January, 2019 - 15:00

There will be no new coal plants built in the US, and existing ones are coming under pressure from renewables. Energy utilities are switching to wind power instead: Xcel Energy has promised to use 100 percent carbon-free electricity by 2050. L. Michael Buchsbaum goes in-depth.

“Then the coal company came with the world’s largest shovel/And they tortured the timber and stripped all the land/They dug for their coal ‘till the land was forsaken/And then they wrote it all down as the progress of man…”

Singing about his family’s ancestral home in Western Kentucky, John Prine’s 1971 country-folk song “Paradise,” about the ravages of strip mining, became an anthem for the growing environmental movement.

Now some 50 years later, the last 971 MW unit of what was once the largest coal-fired power plant in the world may finally be shuttered by the Tennessee Valley Authority (TVA), book-ending an era. Simply uncompetitive against renewables and cheap fossil gas, that unit and almost every other coal-fired one nationwide, may be nearing the end of the line.

Coal use in the US still falling

From its 2007 peak, America’s coal consumption has fallen over 44%. Now at only 691 million short tons (MMst), it’s at the lowest level since 1979. Since 2010, at least 630 coal-fired plants across 43 states — nearly 40 percent of the U.S. coal fleet, have either closed or announced they soon will, according to data by the American Coalition for Clean Coal Electricity. The trade group doesn’t have any interest in greenwashing, either: it reprsents some of what were the largest coal burners and miners in the world, like the Southern Co. and miner Peabody Energy Corp.

By the end of 2017, over 500-units with a combined capacity of 55 GW were shuttered. This year, another 14 GW were expected to be taken off-line too, based on data reported to EIA by plant owners and operators, the second-highest year for coal retirements after the 14 GW switched off in 2015. And the bleeding is set to continue as another 4 GW of capacity is set to retire through 2019 as the U.S. Energy Information Administration predicts coal’s share of the domestic electricity market to further decline to 26 percent.

With so much wind, solar and cheap fossil gas flooding the system, electrical producers are looking for the exits regardless of all of Donald Trump’s promises and pandering to coal country voters. Despite essentially rolling back environmental protections to Nixon-era pre-EPA levels, big coal burners like PacifiCorp, the quasi-federally owned TVA and others are accelerating shutdowns.

Renewables, not coal, provide cheap energy

Perhaps the biggest news yet is that the Minnesota-based Xcel Energy, serves 3.6 million customers across eight states –on top of shutting down its coal fleet—will become 100% carbon neutral before mid-century.

Now virtually no analysts expect new coal plant openings, said Toby Shea, vice president at Moody’s Investors Service. Even “existing coal plants are being challenged by low-cost natural gas and renewables,” even with the easing of environmental regulations.

With so much cheap wind and renewables coming on line, billionaire Warren Buffet’s Berkshire Hathaway-owned utility giant, PacifiCorp has concluded that most of its 10 coal fired plants, with a nearly 6,000 MW combined capacity, are no longer economically competitive.

Selling power to almost two million customers across six western states (California, Idaho, Oregon, Utah, Washington, and Wyoming), and generating some 40 million tons of CO2 annually, PacifiCorp’s recently made public an internal unit-by-unit review that found 13 of 22 units could be replaced with cheaper alternatives. Additionally, the review found that they could save consumers money by retiring 16 of its 22 coal units early, pegging 2022 as a hypothetical retirement date. The study is reflective of “the continued cost pressure on coal generation driven by market forces and regulatory requirements,” said PacifiCorp spokesman Bob Gravely in an email.

The debate over PacifiCorp’s coal plants comes as the utility gears up for a major increase in its renewable portfolio. The company’s plans call for building enough wind generation to power 400,000 homes by 2020. Two more important takeaways from the PacifiCorp news is that, despite how close most of their units are to Wyoming’s Powder River Basin, the largest and lowest coalfield in the U.S, they still are not competitive. Secondly, Berkshire Hathaway also owns outright the BNSF Railroad, the largest in the U.S., and the nation’s biggest coal hauler (and second largest user of diesel fuel in the world, after the U.S. Navy), which originates and delivers a good portion of the PacifiCorp’s coal burn. Essentially a vertical monopoly, if those units aren’t able to make money at that point, what about every other coal plant across the country?

Just a few days after the midterm elections, in sunny Colorado, another utility giant, Xcel Energy announced its new clean energy vision that will see it deliver 100 percent carbon-free electricity to customers by 2050. As part of this goal, the company also announced plans to reduce carbon emissions some 80 percent by 2030, compared to 2005 levels.

Since 2000, Xcel has been a leader in the clean energy transition, reducing its carbon emissions 35 percent since 2005, as part of its previous goal to cut carbon 60 percent by 2030. However, even though the company believes that its 2030 goal can be achieved affordably with renewable energy and other technologies currently available, achieving the long-term vision of zero-carbon electricity requires technologies that are not cost effective or commercially available today. Because of that, the company is working closely with laboratories and other think tanks to get the rest of the way there.

However, like California’s recent SB 100 law, Xcel explicitly did not promise 100 percent renewable electricity. It promised 100 percent carbon-free electricity, allowing it to rely on advanced nuclear and fossil fuel power plants with carbon capture and sequestration.

“Xcel Energy’s ground breaking climate commitment is an act of true leadership…and will help speed the day when the United States eliminates all such pollution from its power sector,” said Fred Krupp, president of Environmental Defense Fund. Though the first major US utility to pledge to go completely carbon-free, given the ever-cheaper economics of renewables plus storage, it won’t be the last.

Categories: Blogs

Germany hammers out its coal exit plan

22 January, 2019 - 11:00

Chancellor Angela Merkel’s so-called coal commission, officially the Commission on Growth, Structural Change and Employment, ended last year in deadlock as to how to end Germany’s long dependence on the dirtiest of all fossil fuels, lignite coal. L. Michael Buchsbaum reports.

Germany’s phase-out of coal is imminent, but yet there is no plan drawn up for the future of former coal workers (Public Domain)

The commission, made up of representatives from industry, trade unions, science and environmental groups, is tasked with developing a plan for Europe’s largest economy to transition away the brown coal industry which employs over 60,000 and supplies almost 30% of Germany’s overall electricity.

While not officially in the title of the Commission, they are also tasked with creating a so-called “Just Transition” for the affected regions and workers. Given the economic devastation throughout the former East Germany following the fall of Berlin Wall, the pain stemming from the area’s “Un-Just Transition” continues to linger, especially in Lusatia. Home to almost 11,000 miners and power workers who will be directly affected by the coal exit, the politicians representing them also face regional elections later this year.

But after a private meeting between Merkel, the leaders of the Commission and the four prime ministers of the affected coal regions, the promise of significant long-term substantial financial support seems to have broken the deadlock. Now with only a few weeks to come up with a decision by its already extended deadline, the commission is expected to meet again on January 25th. And in order to ensure it’s plan is hammered out, it’ll continue its talks at the Chancellery on January 31st and complete its work by the beginning of February.

No matter the outcome, Merkel and the Commission face a tricky balancing act: how to stop the mining and burning of lignite without whipping up more voter anxiety over job losses or further delaying a decision and risk fueling ever-widening clashes with environmentalists around the Hambach Forest. The sustained on-going protests have been growing in size, last year reaching at times over 50,000 demonstrators. The police presence there has also mushroomed, swelling to over 7,000 officers to keep protestors at bay. The largest force ever assembled in North Rheine-Westphalia, the strain and expenses for all sides is starting to wear thin as public support for the Energiewende continues to rise steadily.

Now with Merkel clearly in the twilight of her long reign as Chancellor, what’s also at stake is both Germany’s reputation as a climate leader and her legacy as a climate champion. As the largest economy in Europe and its largest coal burner, she is also quite aware that the whole world is watching how Germany navigates this challenge.

Announced aid plan lacks details, comes with a high price

Following the private summit, Saxony-Anhalt’s Prime Minister Reiner Haseloff (CDU) announced that new long-term support assurances made by federal finance minister Olaf Scholz for the affected regions had potentially won him over. According to AFP, the prime ministers of the federal states of Brandenburg, Saxony-Anhalt, Saxony and North Rhine-Westphalia received pledges that the government will give way more than the so-far budgeted 1.5 billion euros by 2021. More in line with 1.0 to 1.5 billion euros per annum over a period of 15 to 20 years, according to a letter obtained by Bloomberg, the Prime Ministers are demanding “aid worth €60bn ($69bn) on top of current public grants to cushion the coal exit.” This will be used to foster structural change, including new research institutions, new jobs, new industries and the expansion of train connections.

North-Rhine Westphalia, Germany’s biggest state in terms of population, and one of it’s strongest economies, also will be seeking “more than €10bn” to finance the recreation of its economy once coal plants owned by Uniper SE, RWE AG and STEAG are shuttered, the state’s Economy Minister Andreas Pinkwart said on January 11 in Dusseldorf. RWE alone employs about 8,000 in the state’s mining and lignite industries.

“The regions affected by the planned coal exit, such as Lusatia, can count on long-term financial assistance from the federal government, said Saxony-Anhalt’s Prime Minister Reiner Haseloff.

“If we want ambitious climate protection, it will cost money, that’s a truth, it’s on the table,” said Brandenburg’s Prime Minister Dietmar Woidke (SPD). But the money “must be used in such a way that structures are created that are sustainable, which then help to re-develop the region and contribute to its tax revenue”.

Rumored coal phase out being divided into short and long-term parts

One major question remaining is how much power plant capacity should be shut down immediately, by 2022, and by 2030. While representatives of the environmental groups on the Commission are demanding the decommissioning of more than ten gigawatts of power, or about ten to fifteen large power plants, how, when and where to do so is undetermined.

The general thinking is that the power plant and mine closures will be heaviest and more immediate in the west and move slowly in the east.

The reasoning is that with upcoming elections in Saxony and Brandenburg’s regional parliaments combined with the overall more fragile economy in these former East German states, Commissioners may slow the planned speed of the coal exit there. They fear a swifter exit will only help the far right AfD party already on the rise, take voters away from both the CDU and SPD, partially because they stand against the movement towards clean energy. Haseloff (CDU) strongly warned against the consequence of structural change that is not financially cushioned. “This concerns the stability of our society, to the confidence in the ability to act of the state,” he said. “I do not want yellow vests like in France.”

However, Greenpeace Managing Director Martin Kaiser, a member of the coal commission, said that while it’s “important that the federal government supports the countries in modernizing our energy supply…the exit from lignite will only be accepted socially if it is implemented quickly. That is feasible within the next twelve years.”

Whatever the outcome of the Coal Commissions report, their suggestions do not carry any legal weight. It’s quite likely this fight will go on for months as it remains a political football for all parties.

 

Categories: Blogs

Lithium in Bolivia: beyond extractivism

22 January, 2019 - 10:00

Although Bolivia has some of the largest lithium reserves in the world, the country so far has not focused on extraction. Now that lithium is in high demand for electromobility and renewable technologies, Bolivia’s geopolitical role may change. Maximiliano Proaño takes a look.

At Lake Salar de Uyuni in Bolivia lithium can be extracted from the brine of the salt crust and from inside the brine (Photo by Ricampelo, CC BY 3.0)

Lithium is going to be in high demand in the next years from companies that produce batteries to power electric cars, laptops and other high-tech devices: some projections expect demand to increase as much as 650% by 2027.

Latin America will be crucial for this transition. Argentina, Chile and Bolivia are part of South America’s so-called “lithium triangle” which holds 54% of the world’s lithium resources. Chile has about 8.4 million tons of lithium reserves and processed 14,100 tons of the white metal in 2017, the second largest worldwide production after Australia. While an estimated 9 million tons of lithium sits untapped in the Argentina, it produced 5,500 million tons of the light metal in 2017. According to Reuters, lithium carbonate production in Argentina will triple by 2019.

In contrast, while Bolivia has one of the world’s largest reservoirs of this light metal, it has not so far developed large-scale production. In 2017, a pilot plant located in Uyuni produced close to 250 tons of lithium carbonate, less than 2% of Chilean production.

The country has a traumatic past of being exploited by foreign investors and not gaining from it,
Mineral extraction has long been part of the Bolivian economy. The experience of mining exploitation is still an open wound: in the 17th when Spanish settlers forced natives and African slaves to extract the enormous reserves of silver in the city of Potosí.

Afterwards, early in 20th century, tin metal reserves were discovered. Tin was called the devil´s metal because the bad labour conditions: tin miners affected by silicosis often died before reaching 30 years of age. Then in the 1970s the gas era began, which contributed to political instability factor until Evo Morales reached power in 2006. Morales renationalized gas companies, and signed contracts with private companies where public company property always has at least 51% and raised taxes until 70%.

The geopolitics of lithium

Lithium has become a strategic resource for the global energy transition. Perhaps due to the history listed above, Bolivia has taken its time to react to the demand for lithium, but the Morales government understands that its reserves will play a geopolitical role.

In December 2018, Bolivia announced a $1.3 billion deal with German company ACI for extraction and the manufacturing and marketing of batteries. The joint venture aims to produce up to 40,000 tons of lithium hydroxide per year from 2022 over a period of 70 years. The agreement includes a 51% share of revenue for Bolivia, and build a manufacturing plant in the country.

With the joint venture, Bolivian state company YLB is teaming up with Germany’s privately-owned ACI Systems to develop its massive Uyuni salt flat and build a lithium hydroxide plant as well as a factory for electric vehicle batteries in Bolivia. The conditions seem to suit Bolivia’s desire to develop a more complex model than just a raw material extraction.

“Morales is trying to work with the global south, to show they’re sticking together,” said Dr Anna Revette, a sociologist and author of a study on lithium extraction and cultural politics in Bolivia. And indeed in July 2018, Bolivia signed a preferential trade agreement with India for use of its resources. In 2017, it exported its first shipment of lithium carbonate to China.

However, Juan Carlos Montenegro, general manager of state-owned Yacimientos de Litio Bolivianos (YLB) affirms “Bolivia will be a relevant actor in the global lithium market within four or five years”. Yacimientos de Litio Bolivianos (YLB) plans raise its production to 150,000 tons within five years. This would make Bolivia one of the top-producing nations and the source of about 20 per cent of the world’s lithium by 2022, according to Bloomberg NEF projections.

Some onlookers are skeptical. After all, there were previous agreements between Bolivia and Japan, Bolivia and South Korea, and Bolivia and France that never materialized. “I’d be surprised if this went forward, but it’s not impossible” said author Dr Anna Revette.

In my opinion, Latin American countries with an extractivism history dating back to colonial times have to explore new ways to manage their own natural resources. In this sense, Bolivian efforts to put together an entire production chain linked to lithium extraction could be a good example for the future of the region.

 

 

Categories: Blogs

Road Transport: the “problem child” of European decarbonization

21 January, 2019 - 15:00

One-fifth of EU emissions are from road transportation, and they’re rising. The EU is trying to help matters by pushing electric vehicles and batteries – but while this would help with decarbonization, it comes with its own risks, as Radostina Primova explains.

Electric Vehicles Only: The EU aims to increase the use of electric vehicles (Photo by Mary and Angus Hogg, CC BY-SA 2.0)

Road transport has always been the problem child of European decarbonization in the transport sector. Cars, motorcycles, heavy and light duty trucks, buses and other means of road transportation are by far the largest emitters of greenhouse gases in the transport sector and no trend towards decreasing levels of pollution is foreseeable.

In fact, GHG emissions have constantly risen since 1990 with only a little interruption between 2007 and 2013, which is due to low levels of productivity in Europe, rather than actual change.

Source: EEA (CC BY 2.5 DK)

According to national reporting data from 2015, road transport accounted for 72.9 percent of all GHG emission in transport, and to about one fifth of the total CO2 emissions of the EU. With the heat and transport sectors lagging behind and renewables targets set rather low for the transport sector across the EU, the transition is not happening fast enough and not going beyond the power sector.

Challenges for clean road transportation in the EU

One huge challenge is the high oil addiction of the EU transport sector that depends 94 percent on oil to satisfy its energy needs, of which 90 percent is imported. This has huge implications for the energy security of Europa and its external dependance on undemocratic regimes.

The automobile sector in Europe has also undergone a serious public crisis since the Volkswagen car emissions scandal of 2015 that shook the credibility of the European automotive industry and has given the occasion to tighten the transport regulation. In this way, it blew some wind in the sails of the sector’s decarbonisation.

Since September 2017, a new CO2 emissions test procedure has been put into place. The former New European Driving Cycle (NEDC) had been strongly criticized for ineffective emission testing procedures. The scandal revealed regular differences between the laboratory tests and the real life emissions on European roads. Today, cars sold in the EU are tested for “Real Driving Emissions” (RDE) and face an improved laboratory test following the Worldwide Harmonised Light Vehicle Test Procedure (WLTP).

The second big challenge is the slow pace of integration of renewables into the transport sector, since little progress has been made so far due to the huge infrastructure gap. Furthermore, the market uptake of low and zero emission electric vehicles and electric railway transport depends on the right mix of carbon tax policies and proper price incentives for less emission-intensive types of transport, which have been so far insufficient to achieve the EU 2030 transport target.

EU pushes cleaner road transport

To accelerate the decarbonisation of the road transport, the European Commission has put forth the Clean Mobility package, which included a number of measures to reinforce low-emission mobility. More precisely, the Commission proposed to enlarge the infrastructure for alternative fuels, to extend the role of coach and bus services in public transportation, to incentivize the procurement of clean vehicles by the public sector and set new emission standards for different types of vehicles.

A proposal for an EU regulation setting binding targets for CO2 emissions for passenger cars and light-commercial vehicles for 2025 and 2030 has been an essential element of the package, since they make up for more than half of the total GHG emission among all means of transportation.

The European Commission, the European Council and the European Parliament reached a compromise on the post-2020 regulation on 17 December 2018, according to which the average emissions of new light commercial vehicles and passenger cars for 2025 will have to be 15 percent lower than the 2021 reference target (95g CO2/km for passenger cars, 147g CO2/km for light commercial vehicles). For the year 2030, a 37.5% target was agreed upon for passenger cars and a 31% target for light commercial vehicles.

The targets are lower than the proposals of the European Parliament, and still insufficient in terms of their contribution to reaching the overall 2030 emissions reduction target of 30% for the non-ETS sectors. This would require either further measures to reduce GHG emissions in the transport sector, or other non-ETS sectors need to fill in the gap. In addition, the CO2 standards for heavy-duty vehicles, which are still under negotiations, will also determine if we are getting closer to bridging this gap or still deviating from the 2030 and 2050 decarbonisation targets.

Another powerful incentive in the post-2020 regulation is the target for achieving a 35% market share of sales of zero- and low-emission vehicles – ZLEVs – (electric cars or vehicles which emit less than 50g CO2/km) by 2030, and 20% by 2025. The mobility package also foresees the development a real-world CO2 emissions test using a portable device. From 2025 carmakers shall report the lifecycle of CO2 emissions of new cars on the market by using a common methodology.

Balancing batteries and sustainable trade

To incentivize the growth of electric vehicles and boost investments in battery chain value, the EU set up the European Battery Alliance to establish a value chain for the development and production of intelligent batteries in the EU and scale up battery cell manufacturing.

But ensuring sustainability over the whole value chain is crucial if we are serious about decarbonizing the transport sector. This includes also the import of raw materials abroad that should not harm environmental integrity, human rights and social principles in third countries where raw materials are procured from.

EU trade policy will become an important instrument in achieving the EU sustainable mobility targets and exacerbate competition with other leading industries such as China, Brazil and the US on access to raw materials. Therefore, it is essential that all future EU trade agreements and external investments are monitored in terms of their coherence with the sustainable development goals and comply with the high environmental, social, and human rights standards that are part of EU internal legislation.

Direct CO2 emissions from the transport sector under different reduction scenarios for the period 2030 to 2050. Results are estimated using the ICCT Roadmap Model. Source ICCT (2019): CO2 emission standards for passenger cars and light-commercial vehicles in the European Union, Figure 5, p.8

Developing an EU internal market for secondary raw materials in tandem with the right incentives for smart charging and flexible storage, as well as bans on diesel and gasoline cars in cities could be also part of the solution. Not least from a strategic point of view, the EU must avoid replacing the fuel dependency with a battery dependency.

Categories: Blogs

Germany’s politicos close eyes to Energiewende’s popularity

16 January, 2019 - 14:00

Despite polls showing that Germans want more climate protection, Germany’s political parties, with one exception, shun the topic. Paul Hockenos argues that the standstill can’t go on if Germany expects to hit its climate targets.

82% of Germans think that climate change is a big or very big problem (Public Domain)

Germany’s Energiewende, or transition to clean energy, hasn’t gone according to plan – one reason being that there wasn’t a plan to begin with, just a few (indeed very important) laws and, critically, local businesspeople and communities that were chomping at the bit to produce energy themselves.

And over the past 20 years there’s been plenty of obstacles, not least high energy prices and, until recently, the strong-willed opposition of German industry. Moreover, the gigantic project has cost, just in the past five years alone in terms of government investment and costs to consumers, an estimated €160 billion ($184 billion).

Nevertheless, a decade of diverse polls show that Germans have broadly and consistently supported the transition to renewable energies (and simultaneously the phase-out of nuclear- and coal-generated power) usually with 80 to 90% of respondents favoring the transition, about half of those wanting more – and faster.

The newest polls, however, clearly show that ever more Germans are frustrated that the country’s battle to curb climate change isn’t adequate – and they’re holding the politicians to blame.

A new report that the Potsdam research institute IASS will release this month shows that Germany’s foremost concern is that climate protection is happening much too sluggishly, in particular the expansion of renewable energies. (Other sources of unhappiness are its disproportional impact on poorer households and high costs to consumers.)  According to a poll conducted by German public television, about three-quarters of Germans say the government is falling short in its efforts to put the brake on global warming.

In fact, Germans are so adamant that climate change be better addressed that, according to a yet another survey, this one conducted for the conservative daily Die Welt, that  85%  say they’re doing more personally to aid the cause, including measures such as saving energy at home, eating less meat, and driving less. Furthermore, 73% of Germans want to end coal generation in Germany in the next eleven years (the government refuses to fix a date). And 84% say that the climate is more important than coal production.

This burst of willful concern can most probably be traced to Germany’s record hot 2018 summer and the IPCC report warning of the disastrous impact of climate change if temperatures on earth rise even to “just” 1.5 degrees Celsius. Nearly 70% of Germans, for example, attribute this summer’s record heat wave to global warming; 82% think that climate change is a big or very big problem for Germany. And nearly 70%, in this poll, lay the blame at the foot of the government.

The frustration comes from the fact that the country remains Europe’s largest producer and burner of coal, which covers a third of its power supply. Moreover, emissions in the transportation sector have only shot up, by 20% since 1995 and rising with no end in sight, say experts. On the EU level, Germany even waters down legislation intended to reign in transportation emissions – a consequence of pressure from the country’s powerful automobile lobby.

The government that Germans squarely blame for the plodding pace is Chancellor Angela Merkel’s centrist coalition comprised of Christian Democrats (CDU/CSU) and Social Democrats (SPD). Their pique is most intensely directly at the SPD: only 5% think the party has decent policies to drive the Energiewende forward. Even among its members, only one in five approve of the party’s energy policies.

It is thus not much of a leap in reason to hold the climate and energy policies of the leading parties responsible for their precipitous falls in favor: in the past years’ elections and in current polls that show both parties with record-low popularity. In recent regional elections, the results showed an enormous migration of voters from the Christian democrats and SPD to the Greens, the one party that unabashedly prioritizes climate protection. The 20% support that the Greens now boast in national surveys is, among other reasons, attributable to their sensible climate policies.

What accounts for this strange state of affairs in such a poll-driven era of politics? Why don’t the centrist parties (and this goes for the liberal Free Democrats too) jump on the bandwagon, get with the program?

The answer is dispiriting: they seem to consider climate and renewable energy marginal topics that are occupied by the Greens. Apparently, they feel that addressing these topics as urgent priorities would only drain voters from their ranks and feed the Greens.

But another factor is that the government parties no longer have leading environmental experts at their fronts, the way the CDU/CSU once did with Norbert Röttgen and Josef Göppel, and the SPD with the late Hermann Scheer.

Among other reasons, the government parties’ stance is extremely hurtful and misguided as it saps the debate about climate protection of diversity of opinion on the vast array of issues that arise in shifting an industrial country’s energy supply and adapting to the effects of climate change.

Germany’s political parties might learn something from the very recent 180-degree course reversal of German industry. Polls showed Germans just as critical of Germany’s private sector as the government on energy and climate questions. Last year, Germany industry obviously saw the writing on the wall – and now wholly embraces the Energiewende and also argues for its acceleration.

Industry’s lobby groups advocate an Energiewende from which they will profit. Judging by the votes and the surveys, political parties could profit from doing the same.

Categories: Blogs

A cycling boom can break class barriers and save our car capital

14 January, 2019 - 13:55

Recently, the New Delhi Municipal Council (NDMC) installed 25 stands with 300 bicycles on a one-month trial and at least 5,000 people registered on its SmartBikes app. Shivani Singh looks at the progress on New Delhi’s roads.

With the spread of the bicycle culture, New Delhi could promote sustainability within transport (Public Domain)

In a city notoriously known as the car capital of India, cycling for leisure is not popular. So the sights of riders trying to navigate the roads of Lutyens’ Delhi on bright blue bikes came as a pleasant surprise.

Recently, the New Delhi Municipal Council (NDMC) installed 25 stands with 300 bicycles on a one-month trial and at least 5,000 people registered on its SmartBikes app. Enthused by the response, the Council has decided to add 500 bikes by the next year, create cycling tracks on service lanes and assign space on major arterial roads for bikers.

Cycling has multiple benefits. It is pollution-free and great for fitness. Cycle-sharing schemes such as NDMC’s allow riders to make short trips without having to own a bicycle. In Delhi, this can plug the last-mile connectivity gaps in the Metro transit. For a tourist, it is the best way to explore the city.

Delhi has, in the past, launched a number of less sophisticated versions of bikesharing and rentals, mostly around its Metro stations. On some routes, such as the Delhi University’s North Campus, which has clean cycling paths, the response from college students has been encouraging. On others, the forlorn cycle stands now resemble scrap yards.

If Delhi’s upwardly mobile takes to NDMC’s new and improved scheme, cyclists may finally gain some bargaining power in the Capital. Till now, biking has not been a healthy or green choice but an economic compulsion for the majority of Delhi’s cyclists, who could barely influence policies on road space-sharing and infrastructure.

With 10 million cars and two-wheelers, Delhi has broken all vehicle-ownership records.

This giant fleet often overshadows the obvious reality that private vehicle users are still a minority. Only 19% of Delhi’s working population use private vehicles between home and work. The rest either take public transport, cycle or simply walk. According to the 2011 census, 30% of Delhi residents own bicycles and 12% of its workforce cycle to work.

Yet, our public funds are invested heavily in increasing road space to decongest the vehicular traffic, which invariably catches up. Building and maintaining cycle tracks are the cheapest and most democratic road investment.

In the late 1990s, the Colombian city of Bogota realised that much of its investment was in promoting vehicular infrastructure while only 20% of the citizens owned cars.

So, it began restructuring the city by removing cars from sidewalks, creating 330 km of new bicycle lanes. In new neighbourhoods, pedestrian and cycle paths were built before roads were laid, wrote Danish urbanist Jan Gehl in “Cities for People”.

London and New York City are also returning to the pedal power. NYC has 1,900 km of bicycle lanes, of which around 190 km are protected by creating space between the pavements and parked cars to shield cyclists from fast-moving traffic. Only last week, London launched a cycling plan that aims to double cycling journeys over the next six years.

Copenhagen, a leader among cycling cities, made the first move out of sheer necessity. During the oil crisis in the 1970s, the Danish city told its people to get their bicycles out, wrote Gehl. Today, it even offers ‘Green Wave’, a traffic system designed to ensure that cyclists get no red light to and from work.

In Delhi, on much of its 100km-long cycle track — which runs along some arterial roads — cyclists are edged out by two-wheelers, auto-rickshaws and small cars. Pavements are anyway disconnected pathways with no kerbed ramps or blended crossings, a must for safe cycling. Last year, of the 1,584 road fatalities in Delhi, 67 were of cyclists. Till December 15 this year, 50 of them were killed.

Madho Singh, an office attendant, cycles 40 km daily from Karawal Nagar to Connaught Place and back.

His only safety net is the one provided by his fellow cyclists.

“We watch out for each other and try to ride in a group so we are visible to the rushing traffic,” he says. On days he misses the group, he cycles alone, most precariously.

The Public Works Department says all new road projects in Delhi are now fitted with cycle lanes. Even some of the older stretches, they maintain, will soon be retrofitted with similar paths. But it will require more — perhaps a mindset shift in planning — to make Delhi cycle-friendly. For example, while creating infrastructure and thinking lane discipline, Delhi should stop stripping its roads of tree cover. A no-brainer in a choking city, it will also make cycling less exhausting.

Shivani Singh leads the Delhi Metro team for Hindustan Times. A journalist for two decades, she writes about cities and urban concerns. She has reported extensively on issues of governance, administrative and social reforms, and education.

This article has been republished from Hindustan Times.

Categories: Blogs

‘Yellow vests’ killed EU bid to phase out regulated electricity prices

9 January, 2019 - 14:00

A European Commission proposal to phase-out regulated prices of electricity looked set to win approval from EU member states until the ‘yellow vest’ movement swept across France and nipped it in the bud. Frédéric Simon takes a deeper look behind the  scenes.

The ‘yellow vest’ protests started in mid-November to complain against the French carbon tax (Public Domain)

Did Emmanuel Macron personally pick up his telephone? Versions diverge, but the ‘yellow vests’ undoubtedly killed all hopes of passing the reform, according to several French sources in Brussels.

“Telephone calls were passed from the Elysée,” affirmed one source in the European Parliament, who explained the gist of the message coming from the French president’s office: in the midst of the protests, any attempt to deregulate electricity prices at EU level is a non-starter.

The ‘yellow vest’ protests started in mid-November to complain against the French carbon tax, which added about 10 euro cents to the litre of petrol and diesel. It then morphed into a wider anti-government movement, which saw riots erupting in Paris and other cities across the country.

For Paris, that was the last nail in the coffin. “Politically, the yellow vests episode gave weight to the French position calling for member states to keep the possibility of proposing regulated electricity tariffs,” said a French energy industry source in Brussels.

Regulated energy prices are politically sensitive in France. People there widely perceive them as a necessary shield against abusive practices from energy companies. Brussels, on the other hand, argues they hold back attempts to create a European energy market and discourage investments into cleaner forms of electricity, like wind and solar.

The European Commission’s initial proposal was to phase out regulated electricity prices over a five-year period for all consumers.

Under pressure from Paris and Sofia, the two loudest opponents of the reform, subsequent drafts referred to a phase-out over a seven- or ten-year period for all households.

A possible extension was also considered for specific segments of the population like vulnerable consumers and households in energy poverty, triggering a debate in Brussels about the lack of a common definition of energy poverty across Europe.

Regulated tariffs maintained, even for the wealthy

But all references to a phase-out, time limitations or restrictions to certain population groups were deleted during a final round of talks on Tuesday (19 December), which sealed an EU-level agreement on the reform of Europe’s electricity market.

The scope of regulated energy tariffs was even broadened at the last moment to include micro-enterprises in addition to households. The last-minute addition came at the request of Paris to ensure French farmers can also benefit from regulated tariffs, according to a source in the European Parliament.

Martina Werner, a German lawmaker, described the EU agreement as “a big victory” for the Socialists and Democrats (S&D) group in the European Parliament, which came out in support of regulated energy tariffs. “We managed to ensure regulated prices so that member states can guarantee affordable energy prices,” she said in a statement.

In fact, the deal probably went too far for the socialists because it preserves regulated tariffs for all customers, including the wealthiest households. “I would have preferred these [regulated tariffs] to target the more vulnerable and energy-poor households,” Werner admitted, saying “these are the customers who really need it.”

Regulated energy prices have indeed come under fire when they are applied to all customers with no distinction of income.

“This results in a policy that not only fails to target vulnerable and energy poor consumers, but also ends up giving the greatest potential benefit to richer households, as these households are the ones consuming the largest amounts of energy under regulated prices,” said Klaus-Dieter Borchard, a senior official at the European Commission.

But amid all the noise of the ‘yellow vests’, any argument in favour of reining in regulated tariffs had become inaudible.

“In light of the recent events, notably the ‘yellow vests’ movement in France, it is politically justified to carry on with regulated prices at this stage,” says Florent Marcellesi, a Spanish lawmaker for the Green group in the European Parliament.

“However we should be honest: regulated prices have nothing to do with the protection of the energy poor. We need stronger structural measures to fight energy poverty, notably a large-scale building renovation programme that would allow the most vulnerable part of the population to be kept warm at affordable cost,” Marcellesi told EURACTIV.

Despite those shortcomings, consumer groups continue to see regulated tariffs as a protective shield for vulnerable households.

“Member states should keep the option of regulated prices open,” said Monique Goyens, director general of BEUC, the European consumer organisation. “The argument to get rid of them is not convincing enough as long as energy markets are not truly competitive,” she wrote just before the agreement was passed.

Lessons for the ‘just transition’

Still, green campaigners believe there are valuable lessons to be learnt from the French protests.

Although it’s tempting to conclude that the ‘yellow vest’ movement is part of a bottom-up backlash against climate action, it rather demonstrates the need for “a fair, just, and managed transition” to sustainable energy, argued Sanjeev Kumar, the founder of Change Partnership, a think tank focused on solving the politics of climate change.

“The yellow vest movement has shown that the energy transition must be socially fair, it cannot penalise the poorest,” agreed Clémence Hutin, climate justice campaigner at Friends of the Earth Europe.

“This is why the role of regulated prices must be clarified: they must be designed to protect low-income families who are facing rising energy costs, not subsidise dirty energy,” she told EURACTIV.

Frédéric Simon is deputy editor of EURACTIV and writes about energy related topics.


This article has been republished from EURACTIV
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