German Energy Transition Workshop-Anna Leidreiter from the World Future Council

VOICE OF FUTURE GENERATIONS

International Reactions to the
German Transition and
International Best Practices

AGENDA

How was the German energy transition
received internationally?

What other countries provide best practices
for an energy transition?

How does the international policy landscape
for RE look like?


26 September 2012 2

KEY ELEMENTS OF THE GERMAN ENERGY TRANSITION

Energy
Transition

1) Nuclear phase out
2) RE targets (RE energy: 60% by 2050)
3) Diversification of energy market
4) Decentralisation of energy production
5) Plant is where energy source is


26 September 2012 3

REACTIONS TO GERMANY‗S ENERGY TRANSITION

• This Energiewende is being watched very closely. If it works in Germany, it
will be a template for other countries.

• "The German Energy Experiment"

• Key questions raised:
Can a heavily industrialized country power its economy with wind
turbines and solar panels?
Who should pay this in times of financial crisis?

• Only little attention for underlying factors like decentralization/
empowerment aspects


26 September 2012 4



for RE look like?


26 September 2012 5

GERMANY IS NOT ALONE WITH PHASING OUT
NUCLEAR POWER

Europe
– Ireland, Denmark, Austria, and Norway had dismissed the nuclear option years ago
– Sweden, Switzerland, the Netherlands, and Belgium are in the process of phasing
out nuclear power.
– Spain has banned the construction of new reactors.
– France's government (14th Sept 2012) begins a review one of the world's most
nuclear-dependent country's energy policy, strongly in support of its small and
ailing renewables sector in an effort to boost local jobs and growth.

• Other remarkable country’s decisions
– Japan (14th Sept 2012): "We will use all possible political resources to realize the
goal of having no nuclear plants operating by the end of the 2030s," the report
from the government's energy and environmental committee said.


26 September 2012 6

RE SHARES: TOP FIVE COUNTRIES

Source: Global Status
Report 2012


26 September 2012 7

AMBITIOUS TARGET SETTING – A KEY POLICY

• Countries with a 100% RE target
– Denmark: 100% RE by 2050 in power, heating, and transportation sector
– Scotland: 100% RE in power sector by 2020
– Upper Austria: 100% RE in power and heat sectors by 2030

• Cities with 100% RE target
– Barcelona, Spain - Masdar City, UAE
– Munich, Germany - Msheireb Downtown Doha, Qatar
– San Francisco, USA (sustainable downtown regeneration project)

• Small Island States with 100% RE target
– Islands of Tuvalu - Maledives
– Cook Islands

26 September 2012 8

UK - BEST PRACTICE FOR ENERGY TRANSITION?

Change of Policy led to substantial increase of RE share

Before April 2010 :
Quota obligations based on
Tradable Green Certificates

After April 2010
Feed-in tariffs

Source:
The UK FiT: A User Survey
Miguel Mendonça, 2011


26 September 2012 9

FITS ENABLE PARTICIPATION

“It [FiTs] is evidently acting as a connecting
policy – linking people, policy, energy and
economy.“

Source: Co-operative renewable energy in the UK, Miguel Mendonca: The UK FiT: A User Survey, 2011
Rebecca Willis and Jenny Willis 2012


26 September 2012 10

ONTARIO - BEST PRACTICE FOR ENERGY
TRANSITION?

 robust regime for encouraging renewable electricity generation
while maximizing the local economic benefits of this new power
generation, because of the following elements:

domestic community project price Special program for
content provision adders small scale projects

50,000 jobs (by 2018) and dozens of new manufacturing plants



AGENDA



for RE look like?



POLICY INSTRUMENTS -
REGULATIONS AND INCENTIVES ?

Type of instrument Formal Market Informal Organisational

Feed-in tariffs (can
Regulation also be seen as Advice Public enterprises
regulatory)
Information Public Private
Self-regulation User charges
Examples in the provision Partnerships (PPP)

field of Regional
Network between
renewable cities to share Climate and
development Congestion charge
renewable energy energy agency
energy plans
strategies

Environment Unit for climate
Awareness raising
impact Land use taxes change and energy
campaign
assessment in mayor’s office

Based on Howlett (2009)



POLICIES ARE THE DRIVING FORCE

• 118 countries had renewable energy targets in place (by early 2012)
– more than half are developing countries

• Most common type of support policy: Renewable power generation
policies: at least 109 countries (by early 2012)

• Feed-in-tariffs (FITs) and renewable portfolio standards (RPS) are the
most commonly used policies

• At least 19 countries have specific renewable heating/cooling targets in
place and at least 17 countries and states had obligations/mandates to
promote renewable heat. (frontrunner Europe)

• Lack of long-term policy certainty and stability result in setbacks
Source: Global Status Report 2012


Usual obstacles to progress at the renewable energy sector

Costs and pricing
distortion from subsidies for fossil fuels; nuclear energy;
externalities; high initial capital costs; high taxes on
renewable energy equipment

Legal and regulatory
No legal framework for independent power producers;
planning restrictions (long lead times); lack of
coordination amongst authorities; spatial planning, grid
access (grid capacity, grid extension plans)

Market performance
lack of access to credit; perceived technology uncertainty
and risk; lack of technical or commercial skills and
information

15

Feed in tariffs in 1995

Source: IFOK/REN 21



Source: IFOK/REN 21


Notwendige Politische Maßnahmen für die Energiewende
Needed political measures for the energy transformation

Strengthen
Implement regulatory
renewable heating
frameworks
sector
consequently

Research and Binding target setting
Development on regional,
(and its political support) national and
international level

Abolishment of all Acceleration of
subsidies for fossil fuel administrative processes
(and nuclear) and infrastructure
measures


Thomas Edison 1920:

―We are like tenant farmers
chopping down the fence
around our house for fuel
when we should be using
Natures inexhaustible sources
of energy — sun, wind and
tide. ...

I'd put my money on the sun
and solar energy. What a
source of power! I hope we
don't have to wait until oil and
coal run out before we tackle
that‖


GLOBAL MARKET AND INDUSTRY OVERVIEW

• Global final energy consumption supplied by renewable
energy in 2010: 16.7%
– 8.2%: modern renewable energy (counting hydropower,
wind, solar, geothermal, biofuels and modern biomass)
– 8.5 % traditional biomass (primarily for cooking and
heating in rural areas of developing countries)

• Continued growth in equipment manufacturing, sales, and
installation across most technologies during 2011

• Globally there are more than 5 million jobs in renewable
energy industries

Source: Global Status Report 2012


INVESTMENT FLOWS

Global new investment in
renewable energy increased 17%
in 2011, to a new record of USD
257 billion.

= more than six times the figure for
2004

= 94% more than the total in 2007



GROWTH RATES BY TECHNOLOGY

Source: Global Status
Report 2012



100% RE Scenarios

• Germany Federal Environment Agency: 100% RE in Germany by 2050

• Greenpeace: 100% RE in Germany by 2050

• McKinsey: 100% RE in Europe by 2050

• PWC: 100% RE in Europe and North America by 2050

• European Renewable Energy Council (EREC): 100% RE in Europe by 2050

• Jacobson/ Davis, Stanford University: 100% RE in the world by 2030

BUT: political and regulatory challenges

Pre-condition: Enabling Policy Framework

The WFC builds its work on the expertise and networks of Councillors
worldwide

The Council consists of fifty highly
respected personalities represented in
governments, civil society, business,
science, education, and the arts

The WFC working process to achieve our
objectives

Academic research, sufficiently understanding the challenges and
their interdependency, identification and development of best
Step 1 policies to cope efficiently and quickly with the challenges

Awareness raising, making the legislation/politicians and the
Step 2 public aware of what needs to be done and how it could be done

Political Engagement/Advocacy, educating, consulting/engaging
Step 3 legislation/politicians what to implement and how

Political Empowerment/Enabling Legislation, developing tools to
Step 4 empower legislation/politicians to introduce the policies in
question


26

The five interacting programs of the WFC

1
Peace and Climate/
Disarmament Energy
A world at
A world of
peace climate
5
stability

WFC 2
Principles
Future and Values
Justice Sustainable
A world of Ecosystems
justice A world of
stewardship
Sustainable
4 Economies
A world of true 3
wealth


27

Department Climate Energy



Decentralization – sharing benefits


German Energy Transition Workshop-Anna Leidreiter from the World Future Council

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