Archive for the 'European and German energy law' category

Print More Money For Renewable Energy

This is a follow-up to yesterday’s post “Print Money for Renewable Energy”, which discussed Adnan Al-Daini’s proposal to use “quantitative easing” as a source of finance for renewable energy.

I neglected to mention Al-Daini’s newer article on the question, which was published with the title “Climate Change: Governments Must Act To Reduce CO2 Emissions” at Huffington Post on May 6.

There he addresses two potential problems with this idea.

For one, people might object because this causes inflation. Al-Daini counters that the risk of inflation is minor compared to the risk of global warming. He says that inflation may not happen, since the GDP will be boosted as well as the money supply. And he says that without printing money, he expects that nothing will happen.

The other objection would be that this kind of government action is undesirable. Things should be left for the markets to figure out.

I partly agree with that objection. The Phaseout Profit Theory I am preaching all the time on this blog says that the global warming problem will be solved easily and quickly once the fossil fuel companies (and the climate activists) understand that reducing the supply of fossil fuel increases fossil fuel companies’ profits. High prices for fossil fuel would solve the problem.

But on the other hand, there is no such thing as a free market for energy. Most of it is decided by regulation. And subsidies. The idea that energy policy is decided mainly  by free markets is not based in reality.

Anyway, I don’t agree with these objections. And here are a couple of other thoughts to support the original proposal (print money to pay for renewable energy).

For one, Central Banks can print money. They can’t print Arctic ice, once it is gone.

Anyone understanding the scale of the damage expected from global warming should agree that we need to do whatever is possible. If this is one simple way to find a couple of trillion dollars a year for speeding up the transition to renewable energy, anyone objecting is making climate change worse. There is no need to make it worse. It will be a disaster anyway.

Another point: In the long run, transition to renewable energy faster will always be cheaper. Printing the money now and getting rid of fossil fuel a couple of decades earlier will save a fortune in fuel costs down the road. And it will of course reduce the damages from global warming.

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Print Money for Renewable Energy

Germany has been very successful with its feed-in tariff. It has deployed a lot of solar. And brought down prices for everybody in the process.

Now Adnan Al-Daini proposes a different way to finance renewable energy. In this article published at Huffington Post in February he calls for printing money and investing it in renewable energy. The number he mentions is GBP 375 billion, which is what the Bank of England has spent on “quantitative easing” (buying government bonds on the secondary market with newly printed money).

GBP 375 billion government spending for renewable energy would be a considerable sum. It would be more than half of last year’s United Kingdom budget, which had expenditure of GBP 682 billion.

I am all for it. As long as there are feed-in tariffs as well, there is nothing wrong with the government investing massively in renewable energy. That is especially true for military spending.

I recall that in the United States the Pentagon is a large investor in renewable energy. They spent around $680 billion in 2011 (the whole budget, not the spending on renewable, which is only projected to reach a measly $10 billion by 2030). The main purpose of that spending is to feed the large military contractor industry. The secondary purpose of that spending is to provide security.

Since global warming is the most serious threat to the security of any country, a large part of military budgets should be spent for renewable energy, on top of current (largely useless) spending for weapons. Sell some “renewable bonds” to get the money. And then have your central bank print money and buy those bonds.

Once the military contractors understand that they can get the Pentagon budget to a trillion dollars a year this way, I expect them to support this kind of idea in their lobbying efforts.

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Craig Morris Retires Fossil Nuke German Coal Myth

Craig Morris just posted at Energytransition.de with the nice headline “Germany builds minus six coal plants after nuclear phaseout”.

Based on this source by the German NGO “Deutsche Umwelthilfe” (PDF), he looks in detail at which coal power plants projects were started and finished exactly when. The result is that no coal power plants are currently built, and plans for six have been abandoned since the decision to phase out nuclear.

It would be nice if the Fossil Nukes attacking Germany would stop spreading their fantasies about all those new coal power plants Germany built after 2011. That however can only happen if they are interested in facts, even if they don’t match their propaganda needs.

Based on my experience, I would be surprised to see it. I recall Barry Brook tweeting this nonsense recently:

Germany will start up more coal-fired power stations than at any time in the past 20 years due to nuclear closure:

But the nice thing is that I don’t need to write about this any more. Just pointing to this post by Craig Morris will be enough whenever this particular anti-German propaganda talking point pops up in the future.

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VDE Trying To Delay Deployment of Plug&Play Solar in Germany

Apr 25 2013 Published by under European and German energy law

Franz Alt at the excellent Sonnenseite just published a release from VDE, a German private organisation active in the field of safety standards for electricity.

The VDE has published safety standards for small scale electricity generators, DIN VDE 0100-551. People so inclined can download these for the outrageous price of EUR 42.13 at the VDE publishing company’s website (link omitted on purpose).

I have not done so, and I am lacking in specialist knowledge on electricity safety anyway.

According to Alt, the VDE insists that plug&play solar panels are a very dangerous danger and should not be installed. They may cause fires, because the circuit breaker does not know of the additional electricity feed-in if you plug in your 200 W solar panel right into a wall outlet.

As a legal matter, what the VDE says is not directly binding law. The German law on product safety says in its Article 5 that technical standards like DIN ”may be considered” when deciding if a product needs to be taken off the market because of safety concerns.

Again, I am not an expert. But if an extra 200 W from one solar panel is enough to cause a fire anywhere, the circuit breaker in question was seriously lacking in safety margin in the first place.

I think the VDE needs to reconsider their position. And everybody else should ignore them and install plug&play anyway.

The last thing we need in Germany is restricting market access for new forms of solar photovoltaic.

In the long run, circuit breakers need to be redesigned. There needs to be a simple way to plug your balcony solar panel in and have the circuit breaker know about the additional electricity. While I think the VDE is overcautious right now, they are the experts. If they say there is a very dangerous danger of fire, many people may believe them and refrain from buying a plug&play solar panel.

That is an unfortunate state of affairs. The VDE should deploy a new technical standard that solves the remaining safety issues. Right now they are standing in the way of dealing with global warming.

Believe me, that risk is much more serious than that of a 200 W solar panel causing a fire somewhere.

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Google “Renewable Energy Tariff” White Paper

Google has released a White Paper titled “Expanding Renewable Energy Options For Companies Through Utility-Offered “Renewable Energy Tariffs”. Thanks to this blog post by North American Windpower and this tweet by Chris Young for the link.

Google has invested over $1 billion in renewable energy projects. They have two basic policy guidelines. From the White Paper:

• First, our efforts must result in “additional” renewable power generation. We’re not interested in reshuffling the output of existing projects, and where possible, we wan to undertake efforts near our data centers and operations.

• Second, we want our activities to be scalable and have the highest possible impact on the industry. When possible, our efforts should directly address problems that limit the growth of renewable energy.

As a consequence, their approach until now was either building and owning the capacity themselves, as with the 1.7 MW solar PV at Google headquarters, or buy the electricity directly from a renewable project owned by someone else, and selling excess capacity back into the grid.

Now they propose “renewable energy tariffs”.

That is not, as one might misunderstand, a feed-in tariff.

Instead, it is something the German utility Lichtblick has done for 15 years. They want an utility to deliver renewable energy (at a higher price than dirty energy). They want someone else to worry about all the problems associated with selling clean energy and concentrate on developing new search engines. That makes sense.

It made sense in Germany 15 years ago when Lichtblick was founded, an utility that sells only renewable electricity. It made sense in Germany 5 years ago when the German Parliament decided to buy their electricity from Lichtblick, going all renewable.

Of course there is a market for clean electricity. Some American utility should start serving it.

Google proposes to start this market by selling to large industrial customers. But there is really no reason why household customers should be excluded from buying clean energy. Lichtblick has over 600,000 customers now, and of course most of them are private citizens.

And while I am at it, Google might want to locate a couple of data centers in the Sahara and Gobi deserts. That would be rather compatible with their principle 2 mentioned above. Having this large source of electricity demand would help getting desert projects off the ground as long as the World Wide Grid is still not available.

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How To Keep Coal Power Plants Working in Germany

Apr 21 2013 Published by under European and German energy law

Platts reports in a blog post that renewable energy makes coal and gas power plants in Germany unprofitable.  They note that with more renewable in the mix wholesale prices go down, which cuts into the profitability of fossil fuel power plants.

This of course not news. It was clear a long time ago that solar is eating the fossil fuel and nuclear power plants’ lunch, and wind is eating their dinner.

The Platts blog author doesn’t seem to like that development. He writes about an “oversupply of renewable”.

In my book, there is no such thing as an oversupply of renewable. Even if renewable generation is higher than demand, there will be enough ways of using that extra zero price energy. Load some batteries. Make some hydrogen. Crunch some numbers to make bitcoins. Suck some CO2 out of the air. Whatever. But don’t tell me there is no way to use free electricity.

But I actually agree that it is a problem for coal and gas plants to be unprofitable, though that problem is more serious with gas.

That’s because these plants will still be needed for a couple of decades (if the inept CDU/FDP government stays in power) or a couple of years (if we get back to a government that knows what it’s doing with the energy transition). Note that having coal and gas power plants doesn’t necessarily mean burning fossil fuel. We will make gas from wind energy, and we can make coal from modern plants, instead of burning Tasneem’s mom.

If you don’t understand what “burning Tasneem’s mom” means, that’s a poetic way of saying “burning Jurassic plants”. Fossil fuel is nothing else but ancient biomass. Please read my mad genius science fiction novel “Tasneem” (FREE PDF file here) for more on that particular metaphor.

So how is it possible to keep coal and gas plants running with a profit?

The answer is easy. We need to get rid of the stupid and outdated “merit order” model of organizing the power market. And we need to replace it with a design I call “modified merit order”. I have introduced it in February with this (rather long) post.

To sum it up, in modified merit order, every power plant sets their price as the sum of fixed costs, marginal cost, and profit. Renewable energy gets priority even at higher prices, but these are limited to what we now have as feed-in tariff.

In such a model the prices of coal and gas plants will go up as their shares drop, since a lower capacity factor means more fixed cost per kWh. That’s a good thing, since it will keep alive those power plants for the occasional November night with no wind. It will also be nice to see that renewable beats fossil fuel on price, even without factoring in carbon costs and the costs from global meltdown. It will feel good to see solar and wind prices calculated in a way that make sure they beat the fossil fuel competition.

It is already clear that the present model (feed-in tariff plus merit order) does not work. It needs to be changed. And for the time being I don’t see much of a problem with my modified merit order proposal.

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Altmaier and Rösler Renewable Energy Brake Proposals Failed

Apr 20 2013 Published by under European and German energy law

FAZ reports that the proposals of German Environment Minister Altmaier and Economy Minister Rösler to change the German feed-in tariff system have failed definitely. Chancellor Merkel has decided to abandon efforts to get the opposition on board before the elections later this year.

I recall having discussed them in quite a lot of posts on this blog. Most of those proposals were without merit. And it was clear for anyone paying attention that most of these had no chance to make it through the Bundesrat, where the Green and SPD opposition has a majority.

The most outrageous of these proposals was to reduce feed-in tariffs retroactively. That would very likely have been unconstitutional as well as a dumb idea.

In contrast, having less reductions for industry was one proposal that was supported by SPD and Greens as well. Getting self-consumption of systems over 2 MW capacity in the feed-in tariff surcharge system was another proposal the opposition parties supported.

Anyway, that means there will be no big changes in German feed-in tariff law this year. What happens after the election depends upon what happens to the FDP. If the German voters succeed in booting them out of the Bundestag and a SPD and Green majority materializes, the German transition to 100% renewable will be done much faster and cheaper.

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Very Tiny Small Minimal Program for Batteries in Germany

Apr 20 2013 Published by under European and German energy law

Zachary Shahan at Cleantechnica already reported that Germany will start a subsidy program for batteries used with small solar power from May 1st on.

Now there has been an official news release from the German government on the matter. People will be able to get low cost financing from the Kreditanstalt für Wiederaufbau, the government-owned development bank. And they will get a subsidy of 30% of the battery costs. Solar PV systems up to 30 kW qualify for the program. This is for the rooftop market.

I recall that I have discussed this on March 3. As already explained, this program was supposed to start in January, and with twice the volume it now has (EUR50 million instead of the 25 million now available). And it was one promise the CDU/FDP government made in negotiations on a package reducing solar feed-in tariffs last year. That promise has been broken until now, and the program starting now is a very tiny small minimal effort.

EUR25 million is about 30 cents EUR per capita for Germany. This stuff is important to get the transition to 100% renewable done faster, saving the World from global meltdown and annoying the enemies of Germany rooting for our failure. The level of investment here is completely inadequate.

Germany already has time slots where demand is not enough to cover the supply of renewable energy. Storing some of the supply makes more sense to me than shutting down perfectly low carbon energy sources. Of course, the majority of storage will come from power to gas in the future. But that doesn’t mean batteries don’t have a place in the system as well. They sure do.

That said, having a very tiny small  minimal program in place is better than nothing. So I guess this is good news in a way.

But basically we need a change of government in the coming elections. With  the CDU/FDP government in charge right now, the transition to renewable will be much slower and much more expensive than with the SPD and the Greens.

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European Parliament Decision on ETS

The European Parliament decided on Tuesday against a proposal to increase prices for carbon permits under the European Emission Trade System.

German Economy Minister Rösler is happy about that decision, which proves conclusively that it is wrong. It also proves that the World will perish if the FDP gets over 5% of the vote in the upcoming elections in Germany. They need to be defeated decisively if humanity wants any hope of survival. </slight exaggeration> Thanks to this tweet by German Member of Parliament Hans-Josef Fell for the link.

The problem with the present state of the Emission Trading System is that it has been too successful. The EU has reduced emissions so quickly that the price of carbon permits has gone way down.

That’s of course a nice problem to have. The correct way to deal with it would be to set higher goals. If the present goals can be achieved with a very low carbon price, that shows clearly that they could be set to a much more ambitious level.

It’s the same like with feed-in tariffs. If Germany constantly marks over 7 GW of new solar capacity for a couple of years, politicians adjust feed-in tariffs downward. I really don’t understand why they don’t adjust climate targets with the same speed.

I am starting to get slightly bored with repeating myself, but I have actually solved this little global warming problem quite some time ago. Just reduce production of oil, coal, and gas. That will send prices way up. Much more than the couple of Euros per ton of CO2 the Emission Trade System brings. And at the same time it will send the profits of fossil fuel companies up, which is why they will support this proposal.

Just read the posts in the “Phaseout Profit Theory” category of this blog, or my global warming science fiction novel “Tasneem“. It is really very easy to understand and to actually do.

 

 

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I May Want To Stop Writing About Renewable Energy in Germany

Apr 18 2013 Published by under European and German energy law

Amory Lovins just said everything there is to say about the topic in this post, titled “Germany’s Renewables Revolution“.

I recommend reading it.

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