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Keeping track of the progress of the energy transition
As shown by the latest report on the progress of the energy transition, many steps on the way to a successful energy transition have already been taken. The challenges that remain to be mastered in order to make this major climate policy project a success, have been identified, and ways to address them described. The report contains almost 300 pages of information and figures on the current state of the energy transition and provides an outlook for the years up until 2030. It is part of an extensive process to monitor the progress of the energy transition. The report was conducted by the Federal Government, with the Federal Ministry for Economic Affairs and Energy serving as the lead ministry, and was adopted by the Federal Cabinet on 6 June. A commission made up of four renowned and independent experts proof-reads the report and provides a scientific opinion of the results of the monitoring activities achieved.
Energy transition makes headway
The report shows that the energy transition is coming along. Germany is well on track in its use of renewable energy. The share of renewables in gross electricity consumption reached 37.8 per cent in 2018, which means that the target that had been set for 2020 was reached two years earlier than planned. In addition to this, the costs of expanding wind and photovoltaic installations continue to fall. So the energy sector is making a key contribution to reducing greenhouse gas emissions. According to estimated figures, the use of renewable energy in the electricity sector helped Germany cut its greenhouse gas emissions by around 140 million tonnes of CO2 equivalents in 2018. This is almost equal to the total amount emitted in the transport sector (162 million tonnes in 2018). And the good news does not end there: Germany’s electricity supply continues to be secure, even as the share of renewables in electricity generation grows. The country is able to cover its demand for energy at all times and ranks among the best countries worldwide in terms of the reliability and quality of its energy supply.
The macroeconomic costs for electricity – in terms of GDP – once again went down in 2017, reaching the lowest level since 2010. Electricity prices for private customers remained almost the same between 2017 and 2018, whilst remaining at a relatively high level compared with other European countries. When it comes to electricity prices for companies that are particularly energy-intensive, Germany ranks somewhere in the middle of all European countries. This is because Germany has adopted legislation to help these companies cope. However, customers in the industrial sector who are not covered by these rules had to pay around 4.9 per cent more for electricity in 2017, and according to the information provided by the report, these costs continued to climb in 2018.
The energy transition – an engine for innovation
The report clearly shows that the energy transition is triggering investment and innovation in the German economy and industry. It benefits companies which are selling new, innovative energy technologies. In 2017 alone, German companies exported equipment and components required for using renewables technology worth more than eight billion euros. Federal Minister for Economic Affairs and Energy Peter Altmaier commented on the report by saying that business models will only be successful in the future if they take energy and climate concerns into account. "At the same time, this is also a great opportunity for us to create new opportunities for business and industry in Germany," he said.
Federal Government takes action to further reduce carbon emissions
Even though greenhouse gas emissions have recently been decreasing, falling by a mere 0.5 per cent in 2017 and a whopping 4.5 per cent in 2018, Germany is likely to fall short of its target to reduce GHG emissions by 4 per cent by 2020 compared with 1990 levels. Not all sectors are seeing the same development, though. In the energy sector, for example, carbon emissions have continued to fall, decreasing by 14 million tonnes between 2017 and 2018 alone according to initial estimates. Once the recommendations developed by the Commission on Coal with regard to Germany’s planned phase-out of coal-fired power have been put into practice, however, there is a good chance that the energy sector will meet its targets for 2030. The Federal Government has set up a cabinet committee on climate protection (the "climate cabinet"), which seeks to ensure compliance with the climate targets for 2030 which it is required to meet by law.
Away from emission reductions, energy efficiency is also improving. In 2018, primary energy consumption is estimated to have fallen by 4.6 per cent, lowering Germany’s energy consumption to a level last seen in 1972. However, further considerable efforts are required to meet the national and European targets on energy efficiency. This is why the Federal Government plans to adopt a cross-sectoral strategy on energy efficiency.
German and European energy strategies on the way
The Energy Concept adopted by the Federal Government sets out clear and ambitious targets for the medium and long term. These targets can be regularly and closely scrutinised under the "Energy of the Future" monitoring progress that was launched in 2011 and by the commission of energy experts. The EU’s "Clean Energy for all Europeans" legislative package provides the basis for bringing about the energy transition at European level. It also contains clear targets for 2030 and the post-2030 period. The idea behind the extensive monitoring process is to have an instrument that allows adjustments to be made to the process as it goes along. By providing for a continuous reporting mechanism and publishing important data on the energy transition, the complex process is to be made easier to understand and more transparent. At regular intervals, the more in-depth progress report on the energy transition is published instead of the annual monitoring report. The first progress report was published in December 2014.