February 28, 2014

#GREENFAIL: Germany’s Energiewende: A Path to Economic Self-Destruction.

More bad news for Germany’s green dreamers: Two reports published this week highlight some fundamental flaws underlying the Energiewende, Germany’s radical set of energy policies.

The first, by the Commission for Research and Innovation (EFI), states that the subsidies by which green power producers in Germany are paid guaranteed, above-market prices to put electricity on the grid aren’t a cost-effective instrument for climate protection. Nor are they producing a measurable effect on innovation. “For both these reasons, there is no justification for a continuation of the EEG [the Renewable Energy Law],” the report concludes.

Those are devastating blows against the Energiewende’s legislative cornerstone, which has been in force since 2000. The special path on energy cost taxpayers €22 billion last year alone—and that figure doesn’t include residual costs to the economy. . . .

The second report, by Information Handling Services (IHS), calculates that Germany lost €15 billion in exports last year from having to pay a premium for electricity compared with international competitors, and a total of €52 billion in the six-year period from 2008–13. As the Financial Times points out, smaller companies were disproportionately affected, because, “unlike heavy energy users such as BASF and ThyssenKrupp, small companies are not eligible for exemptions from the energy bill surcharges that cover the costs of the move to clean energy.”

When you do what the greens want, it’s a disaster.