Tuesday, August 13, 2013

German renewable energy—it only gets harder

Being a leader is a LOT harder than it looks.  Which is one of the reasons I love to watch the Germans try to figure out a way to power their very sophisticated society with renewable energy.  Someone has to figure out how to do it and they are especially qualified to break new ground.  Besides, their problems don't cost me anything and their learning curve benefits anyone curious.

But their woes include the EU bureaucracy, bad ideas that cost money to find out that they won't work, and crazy problems like unexploded WW II ordinance in areas where wind farms are going.  Of course, the BIG problem is neoliberalism which demands that all this difficult work must be done on the cheap.  And even though Germany has sidestepped much of the big economic mess that has swept Europe, neoliberalism is very destructive and so fledgling industry like renewables is susceptible to damage because it is weaker than much of the rest of the economy.

Unfair Competition? EU Takes on German Green Energy Law

DPA 15 JUL 2013

German renewable energy is being subsidized through a charge on energy bills -- but many companies are exempted from the charge.

The European Commission plans to launch a probe this Wednesday into Germany's renewable energy law. Brussels says it breaches EU competition law because it exempts many companies from charges levied to fund green subsidies.

The European Commission plans to open proceedings on Wednesday against Germany's renewable energy law on the grounds that it breaches EU competition regulations.

Under the law, German electricity users pay a charge that goes towards funding renewable energy generation. Competition Commissioner Joaquin Almunia believes that exemptions granted to some energy-intensive German companies from those charges run counter to EU law.

The Commission plans to launch proceedings aimed not only at banning such exemptions in the future, but also requiring companies to repay the charges they were exempted from in the past.

Energy Commissioner Günther Oettinger even called the entire renewable energy law into question in remarks to a conference hosted by German energy company E.on last week.

Too Many Exemptions?

Oettinger said many provisions in the law appeared to be in breach of EU single market rules and competition law. For example, he said, it wasn't acceptable that Germay subsidizes its own wind power but makes no subsidies available to operators from Denmark and Norway that deliver windpower to Germany.

Some 4,500 companies have so far applied to be exempted from the renewable energy charge. The German Economy Ministry, responding to a written question from the opposition Greens, confirmed that even golf clubs have largely been freed from paying the charge.

On Sunday, Chancellor Angela Merkel said Brussels had raised questions about the law and she reiterated her intention to amend it if she wins a third term in the September 22 election. The law was introduced over a decade ago, before Merkel came into office.

The charges have financed large incentives to renewable energy providers, triggering a boom in green power production. But they have also driven up the cost of electricity for users who have to pay the charge. "We urgently need an amendment to the renewable energy law," Merkel told ARD television. more
It seems as if the Germans have really given up on carbon capture.  This is probably some sort of proof that it really is practically impossible to do.

Carbon capture technology loses out in Germany

DW.DE 07.08.2013
Author Gero Rueter / yz,so

Fossil-fueled power plants are the biggest greenhouse gas emitters worldwide. Modern gas capturing methods could make them more climate-friendly. But there's a risk to it, and Germany has decided to scrap it altogether.

Fossil-fueled power plants emit huge amounts of carbon dioxide (CO2) into the air. It is, however, possible to capture harmful gases at the plant and deposit them in the ground by using "Carbon Capture and Storage" (CCS) technology. This could result in better, more climate-friendly coal-fired power plants.

But it's a highly controversial technology. Development is especially slow in Europe, according to the EU Commission. In Germany, the introduction of CCS failed due to residents and politics opposing the technology. As a result, plans to construct massive underground storage reservoirs were abandoned.

More realistic CCS scenarios needed

The EU and the International Energy Agency, however, are still convinced CCS can help limit global warming to a maximum of two degrees Celsius (35.6 degrees Fahrenheit), and are continuing with CCS projects in Europe.

A recent International Energy Agency report predicts that by 2035, "almost 30 percent of new fossil-fueled power plants will be fitted with CCS."

Professor Manfred Fischedick, from the Wuppertal Institute for Climate, Environment and Energy, argues that it would be smarter to wait for research results.

"There is a difference between wishful thinking and reality," Fischedick told DW. "For the moment, I cannot imagine that CCS technology will be widely used by 2020 or 2025, not in Europe and not worldwide. I therefore recommend to take a more realistic approach."

That view is echoed by the German Institute for Economic Research (DIW Berlin): "The past five years have shown CCS to be a failure," said Christian von Hirschhausen, DIW's research director for industrial economics. "The EU scenarios are from four or five years ago, and are based on the assumption that carbon capture exists in a technically safe and economically sound environment. Both has proven to be incorrect."

Fischedick and the energy company RWE predict that power plants using CCS will accumulate additional costs of over 60 to 80 percent per kilowatt hour. In other words, power from a German coal power plant which uses CCS would cost around 13 euro cents ($ .17) per kilowatt hour. By comparison, the current price for wind and solar power costs under 10 euro cents. And according to experts the price could drop below seven euro cents by 2025.

Renewables are the future

The EU should review and update the figures it uses for its climate policy, said Claudia Kemfert, a climate expert at DIW. It should, for instance, consider falling production costs of renewable energy sources. "Renewable energy is the only option for sustainable, low-emission energy in Europe," she told DW.

Fischedick also says policymakers need to focus on renewable energy. At the same time, he also emphasizes that CCS research should not be neglected entirely.

"We might experience a time where it becomes necessary to integrate CCS technology into existing power plants for environmental reasons," Fischedick said. more
The following story is a demonstration of why the merely difficult becomes damn near impossible when conducted under a neoliberal economic regime.

Turbine Trouble: Ill Wind Blows for German Offshore Industry

By Michael Fröhlingsdorf

Only recently, the offshore wind industry was seen as an opportunity to regenerate Germany's coast. But amid changing political attitudes and spiraling costs, several companies are struggling to survive. Is the wind boom over before it even really began?

The new power plant 15 kilometers (9 miles) off the North Sea island of Borkum is a masterpiece of German engineering. In only 14 months, experts anchored dozens of giant rotors to the sea floor. The 150-meter (492-foot) wind turbines at the Riffgat offshore wind farm work perfectly.

Providing clean electricity to 120,000 households, Riffgat was expected to become a milestone of the federal government's shift away from nuclear power and toward green energy.
But the dedication of the first commercial German wind farm in the North Sea on August 10 is set to be a low-key affair. Chancellor Angela Merkel cancelled her scheduled appearance. And Environment Minister Peter Altmaier and European Union Energy Commission Günther Oettinger, both members of Merkel's center-right Christian Democratic Union (CDU), have hesitated to accept the invitation from EWE, an energy company based in the northern German city of Oldenburg.

The reason is that Riffgat has a cosmetic defect: the wind farm is still missing part of its power line to the mainland. For the time being, instead of producing energy, Riffgat is actually consuming it. To prevent the rotors from corroding in the salty air, they have to be supplied with electricity produced with diesel generators.

Grid operator Tennet is responsible for the missing power line. The delay is costing EWE millions of euros, costs that will eventually be passed on to electricity customers. Instead of being a showcase project, Riffgat has become a symbol of the government's failed offshore wind policy.

The Germans invested in offshore wind farms because the wind blows constantly at sea and no land area is needed. But they were also keen to avoid spoiling the view from the North Sea resort islands, which is why Germany's wind farms, unlike those in England and Denmark, are not near the coast.

But the solutions developed by engineers proved expensive. The public became increasingly skeptical as it saw its electricity bills going up, and politicians began discussing a cap on electricity prices.

The shift in the direction of political winds immediately affected the turbine builders. Several companies that were recruiting on a large scale only a few months ago are now laying people off. One company, Siag Nordseewerke, has filed for bankruptcy, and others could soon follow. The offshore boom has hardly begun, and yet it already seems to be over.

Half a dozen wind farms are still being built in the North Sea, but there are no follow-up contracts. "The market has collapsed," says Ronny Meyer, the managing director of Windenergie Agentur (WAB), based in the northern port city of Bremerhaven. Riffgat developer EWE also doesn't want to invest in additional offshore turbines.

From Boom to Bust

Until last year, the construction of wind farms was seen as an opportunity to regenerate Germany's coast. Cities like Bremerhaven, Cuxhaven and Emden, ailing for years in the wake of declines in the shipbuilding and fishing industries, were booming. An estimated €1 billion ($1.3 billion) was invested in port facilities and factory buildings, and some 10,000 jobs were supposedly created. In Cuxhaven alone, the state of Lower Saxony invested €125 million ($165 million) in the harbor. Each square meter of the wharf can now support 90 tons, so that the turbine foundations can be loaded onto construction ships.

Today, only seagulls are landing at the new harbor facility. The grounds of Cuxhaven Steel Construction (CSC) cover an area of 70 soccer fields, and in the middle is a large building, 270 meters long and 52 meters high. Until this spring, this is where foundations for the Bard Offshore 1 wind farm, now being built about 100 kilometers off the coast, were being welded together. CSC hasn't had any work since then, and almost all of its 450 employees were laid off.

The parent company, Bard, hasn't had much luck attracting investors. Once the foundations were built, the company turned to rotor production. Of Bard's initial 1,000 employees, only those who will operate the wind farm will remain. A company spokesman couldn't say how many employees that would be.

Close to the CSC premises, Austrian construction company Strabag had intended to build concrete foundations with 500 employees. A few weeks ago, Strabag quietly closed its office in Cuxhaven. The 15 wind farms in the North Sea in which the company had planned to invest will not be built, at least for now.

CSC's other neighbor, a company called Ambau, is still making steel towers for the wind turbine generators. But, says Ambau head Kai Simon, "we only have work in Cuxhaven until the end of the year. I don't know what'll happen after that." The company was actually planning an expansion, but the building permit is now sitting in a drawer.

The same grim scenario is unfolding all along the coast. China's Hantong Group had planned to build a plant in Wilhelmshaven, but now the Chinese have temporarily stepped away from production in Germany.

There are several reasons for the industry's problems. Grid operator Tennet, which readily admits that it is underfinanced, has also failed to connect wind farms to the power grid on schedule in other locations. But the industry is mostly critical of the lack of investment security. Economics Minister Philipp Rösler, a member of the pro-business Free Democratic Party (FDP), and Environment Minister Altmaier announced plans for a cap on electricity prices in February. This could reduce the guaranteed feed-in tariffs for green energy in order to keep costs low for consumers.

This alarmed the industry. Operators of offshore wind farms depend on sufficiently high electricity prices to refinance their investments. "Although the cap on electricity prices was never approved, it made investors very anxious," says wind energy expert Meyer.

A Wasted Learning Curve

Many along the coast are pinning their hopes on the upcoming national election in September. "We need planning certainty," Lower Saxony's Environment Minister Stefan Wenzel, a member of the Green Party, said during a visit to Cuxhaven. Jürgen von Ahnen at the Economic Development Agency of Cuxhaven claims that the industry has merely "bottomed out," and that things will go uphill again after the election, no matter who is in power.

There is little reason for such optimism. The government has increased the incentives for electricity from offshore wind turbines several times to help the industry get off its feet. Now the wind farm operators will receive 19 cents for each kilowatt-hour fed into the grid for the first eight years after construction. This is more than twice as much as is paid for electricity from terrestrial wind turbines.

Growing numbers of critics say that the offshore wind turbines are too expensive. The criticism comes from Germany's southern states and is politically motivated to some extent, because the south doesn't want to leave the generation of wind energy to coastal areas. This explains why the government in the southwestern state of Baden-Württemberg has no qualms about building turbines in the Black Forest, while neighboring Rhineland-Palatinate is even proposing the construction of wind farms on ridges in the scenic Hunsrück and Eifel regions. more

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