Renewable energy in Germany

Targets

Since the passage of the Directive on Electricity Production from Renewable Energy Sources in 1997, Germany and the other states of the European Union were working towards a target of 12% renewable electricity by 2010. Germany passed this target early in 2007, when the renewable energy share in electricity consumption in Germany reached 14%. In September 2010, the German government announced ambitious energy targets: After the 2013 elections, the new CDU/CSU and SPD coalition government continued the energy transition, with only minor modifications of its targets in the coalition agreement. These targets include, for renewable energy:

The German Government reported, in 2011, renewable energy (mainly wind turbines and biomass plants) generated more than 123 TWh of electricity, providing nearly 20% of the 603 TWh of electricity supplied.

In 2012, all renewable energy accounted for 21.9% of electricity, with wind turbines and photovoltaic providing 11.9% of the total.

Chancellor Angela Merkel, along with a vast majority of her compatriots, believes, "As the first big industrialized nation, we can achieve such a transformation toward efficient and renewable energies, with all the opportunities that brings for exports, developing new technologies and jobs".

As of 2016, renewable sources account for 33.9% of the net electricity production. Compared to the same period of 2015, energy production from renewable energy sources remained on the same level, while it increased for gas by 15.1 TWh and decreased for the remaining fossil fuels by 16.6 TWh. The increase in energy production from gas can be traced back to low gas prices.

Primary energy consumption

As of 2015 Germany's primary energy consumption of 13 218 petajoules or 3 672 terawatt-hours refers to the total energy used by the nation. The final renewable energy consumption, split by the sectors, and with their relative share, are:

As of the end of 2015, renewable energy sources, such as biomass, biogas, biofuels, hydro, wind and solar, accounted for 12.4% of the country's primary energy consumption, a more than doubling compared to 2004, when renewables only contributed 4.5%.

Although the terms "energy" and "electricity" are often used interchangeably, they should not be confused with one another, as electricity is only one form of energy and does not account for the energy consumed by combustion engines and heat boilers, used in transportation by vehicles and for the heating of buildings.

Industry

Germany's renewable energy sector is among the most innovative and successful worldwide. Enercon, Nordex, REpower Systems, Siemens, and Fuhrländer are wind-power companies based in Germany. SolarWorld, Q-Cells, and Conergy are solar-power companies based in Germany. These companies dominate the world market. Every third solar panel and every second wind rotor in Germany are German, and German turbines and generators used in hydro energy generation are among the most popular worldwide.

Nearly 800,000 people work in the German environment technology sector; an estimated 214,000 people work with renewables in Germany, up from 157,000 in 2004, an increase of 36%.

Siemens chief executive Peter Löscher believes Germany’s target of generating 35% of its energy from renewables by 2020 is achievable – and, most probably, profitable for Europe’s largest engineering company. Its “environmental solutions” portfolio, which is firmly focused on renewables, is “already generating more than €27 billion a year, 35 per cent of Siemens’ total revenue, and the plan is to grow this to €40 billion by 2015”. Ending its involvement in nuclear industry will boost the credibility of Siemens as a purveyor of “green technology”.

Germany's main competitors in solar electricity are Japan, the US, and China. In the wind industry, it is Denmark, Spain, and the US.

Government policy

The renewable energy sector benefited when the Alliance '90/The Greens party joined the federal government between 1998 and 2005. Support for renewable energy continued under all following governments, regardless of composition, including the current CDU/CSU and SPD coalition government starting in 2013. The renewable energy sector was aided especially by the Renewable Energy Sources Act that promotes renewable energy mainly by stipulating feed-in tariffs and recently also market premiums that grid operators must pay for renewable energy fed into the power grid. People who produce renewable energy can sell their 'product' at fixed prices for a period of 20 or 15 years. This has created a surge in the production of renewable energy. In 2012, Siemens estimated the total cost of renewable energy would come to at least €1.4 trillion (US$1.8 trillion) by 2030.

For the 2011–2014 period, the federal government set aside 3.5 billion euros for scientific research in the country. Additionally, in 2001 a law was passed requiring the closing of all nuclear power plants within a period of 32 years. The shutdown time was extended to 2040 by a new government in 2010. After the Fukushima incident, the law was abrogated and the end of nuclear energy was set to 2022. After the 2013 federal elections, the new CDU/CSU and SPD coalition in important areas continued the Energiewende of the previous government, but also agreed on a major revision of the EEG.

The German energy policy is framed within the European Union, and the March 2007 European Council in Brussels approved a mandatory energy plan that requires a 20% reduction of carbon dioxide emissions before the year 2020 and the consumption of renewable energies to be 20% of total EU consumption (compared to 7% in 2006). The accord indirectly acknowledged the role of nuclear energy — which is not commonly regarded as renewable, but emissions-free — in the reduction of the emission of greenhouse gases, allowing each member state to decide whether or not to use nuclear-generated electricity.

Also, a compromise was reached to achieve a minimum quota of 10% biofuels in the total consumption of gasoline and diesel in transport in 2020.

Energy transition

Energiewende ("energy transition") designates a significant change in energy policy: The term encompasses a reorientation of policy from demand to supply and a shift from centralized to distributed generation (for example, producing heat and power in very small cogeneration units), which should replace overproduction and avoidable energy consumption with energy-saving measures and increased efficiency.

The key policy document outlining the Energiewende was published by the German government in September 2010, some six months before the Fukushima nuclear accident. Legislative support was passed in September 2010. Important aspects include:

In addition, there will be an associated research and development drive.

The policy has been embraced by the German federal government and has resulted in a huge expansion of renewables, particularly wind power. Germany's share of renewables has increased from around 5% in 1999 to 22.9% in 2012, reaching close to the OECD average of 18% usage of renewables. Producers have been guaranteed a fixed feed-in tariff for 20 years, guaranteeing a fixed income. Energy co-operatives have been created, and efforts were made to decentralize control and profits. The large energy companies have a disproportionately small share of the renewables market. Nuclear power plants were closed, and the existing nine plants will close earlier than planned, in 2022.

In May 2013, the International Energy Agency commended Germany for its commitment to developing a comprehensive energy transition strategy, ambitious renewable energy goals, and plans to increase efficient energy use and supported this approach. Nevertheless, the scale of Germany’s energy policy ambitions, coupled with the large size and energy intensity of its economy, and its central location in Europe’s energy system, mean further policy measures must be developed if the country’s ambitious energy transition is to maintain a workable balance between sustainability, affordability, and competitiveness.

Subsidies aimed at stimulating the growth of renewables have driven up consumer energy prices by 12.5% in 2013. To date, German consumers have absorbed the costs of the Energiewende, but the IEA says the debate over the social and economic impacts of the new approach has become more prominent as the share of renewable energy has continued to grow alongside rising electricity prices. The transition to a low-carbon energy sector requires public acceptance, and, therefore, retail electricity prices must remain at an affordable level. Presently, German electricity prices are among the highest in Europe, despite relatively low wholesale prices. At the same time, the IEA said the new energy policy is based on long-term investment decisions, and a strong policy consensus in Germany in favour of large-scale renewable energy commercialisation exists.

Ownership

In Germany, almost half of renewable power capacity was citizen-owned as of 2013, and about 20 million Germans lived in so-called 100% renewable energy regions.

Jobs

Estimated German jobs in renewable energy in 2012–2013 were about 370,000.

Statistics

Increases in installed renewable electric power capacity and generation in recent years is shown in the charts and table below:

Computer models

The Energiewende has be subject to a number of computer studies. Most concentrate on electricity generation and consumption as this sector is undergoing a rapid transition in terms of technologies and institutions.