Record lows were reported in trading on 2014 energy deliveries as analysts predicted that 18% of German electricity demand could soon be met by solar panels unconnected to the country’s grid system, leading to over supply.
Germany desperately needs to upgrade its dilapidated grid system, which currently funnels renewable energy from north to south through third countries such as Poland, Slovakia and the Czech Republic.
Małgorzata Mika-Bryska, deputy energy director at Poland’s economics ministry, complained that German energy re-routing was causing “serious problems with our security of supply”.
More action from the Commission to spur German grid building was needed than "just one sentence in a [internal energy market] communication,” she said. “We need a rapid solution now because last year when we had a very heavy winter in our region, we were very close to blackouts.”
The scale of the German energy supply problem has led one member of Chancellor Angela Merkel’s government, Consumer Protection Minister Ilse Aigner, to call for the partial nationalisation of Germany’s electricity grid.
Aigner’s Christian Social Union – the Bavarian sister group of Merkel’s Christian Democratic Union – supported her call.
The sale of German power grids to companies such as E.On, RWE and Vattenfall is widely seen as a historic mistake, which now hinders moves to create a modern national grid, according to reports in Der Spiegel magazine.
Federal government plans will require the four grid operators to build 1,550 km of high-voltage lines - including several direct-current transmission lines – and connect dozens of wind farms to the terrestrial power grid by underwater cables.
However, with less than 250 km of lines actually built, the multibillion euro project has barely got off the ground.
“Fifteen years ago grids were supposed to be a project of priority and we haven’t seen much progress yet,” Michael Krepelka, chief market analyst for the Czech energy giant ČEZ told the Bruegel conference.
“If we achieve the 2020 goal [of a 20% renewables share in the energy mix], generation from renewables should double from today,” he said. “Yet we can already see the negative effects today and I can imagine what will happen in 2020 if we continue with the same dynamics.”
The European Commission is currently preparing a Green Paper, expected in April, to open a debate on the thorny question of whether the EU should set new climate targets for 2030, and if so, what they should cover. A follow-up communication is expected by the end of the year to map out policy options.
But while there is a consensus on the need for carbon dioxide emissions reductions goals, targets for renewables are bitterly opposed by countries such as Poland.
Mika-Bryska said renewable technology was “not mature enough” to base policy on and more stimulus was needed for fossil fuel energy in Poland. “We must give parallel actions to build parallel power generation system to help renewables to operate,” she said.
Old vs. new EU
Another panelist, Professor Péter Kaderjack, of the Corvinus University of Budapest, said that there was a “division between the old EU and new EU” on the EU’s decarbonisation plans.
“There is still quite an uncertainty whether aggressive decarbonisation could lead to carbon leakage or green growth,” he argued. “I think maybe our decision makers are not yet convinced that green growth is a reality and they’re afraid of increasing prices.”
However, Krepelka’s contention as the meeting concluded that because of EU renewables policy, “the US looks at Europe and they says: ‘these are crazy guys’” received a rebuttal from an unlikely source.
Speaking in Abu Dhabi on the same day, the US’s chief climate negotiator, Todd Stern, called for all nations to reassess what exactly their core developmental interests really were.
“The fact that moving to clean energy may have a cost in the short run cannot be taken as an excuse not to act,” he said.
The price of climate action would be paid off over time, especially when external costs such pollution and health impacts were factored in, Stern said.