“Energiewende” – The German Energy Transition Ten German lessons for Canadian energy policy

I. Action on Climate Change

II. Leadership in Renewable Technologies and the Green Economy

III. No need for coal

IV. Nuclear phase-out

V. Conservation and efficiency

VI. Buildings (Cogeneration, Heating and ‘Passive-House’)

VII. Grid Upgrade, Flexible Power

VIII. Co-op, democratic focus; community buy-in

IX. Emissions trading and environmental taxation

X. Energy security

Instructor: David Athersych

Class: ESET 680

Date: March 27th, 2015

Student: Michael Clarke

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1.0 – Table of Contents

1.0 – Table of Contents ........................................................................................................................................................... 2

2.0 – Introduction to this Report ............................................................................................................................................ 3

3.0 – Background Information on the ‘Energiewende’ ........................................................................................................... 3

4.0 – Ten German Lessons for Canadian Energy Policy .......................................................................................................... 4

I. Action on Climate Change .......................................................................................................................................... 4

II. Leadership in Solar, Wind and the Green Economy ................................................................................................... 6

III. No need for coal ....................................................................................................................................................... 11

IV. Nuclear phase-out .................................................................................................................................................... 12

V. Conservation and efficiency ...................................................................................................................................... 13

VI. Buildings (Cogeneration, Heating and ‘Passive-House’) .......................................................................................... 14

VII. Grid Upgrade, Flexible Power .................................................................................................................................. 16

VIII. Co-op, democratic focus; community buy-in ........................................................................................................... 18

IX. Putting a Price on Carbon ......................................................................................................................................... 19

X. Energy security .......................................................................................................................................................... 20

5.0 – Summary ...................................................................................................................................................................... 21

6.0 – References and Biography ........................................................................................................................................... 22

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2.0 – Introduction to this Report

For the last decade, Germany has been the undisputed world leader in the advancement of wide-scale, renewable

energy adoption. This process has been called the ‘German Energy Transition’, or ‘Energiewende’.

This report will aim to explain what Energiewende is, how it works, why it has been successful, and what challenges lay

ahead. The report will examine the specific effects that the Energiewende has had upon the German economy,

environment and society. Also explored will be the way forward for Canada, following the German example. Finally, the

report will summarize all topics covered thus far, and suggest that Canadian energy policy be further modelled upon the

German Energiewende model.

This report is broken up into ten different sections outlining ten different categories where Canadian energy policy may

take its cue from Germany:

3.0 – Background Information on the ‘Energiewende’

What is the ‘Energiewende’?

The ‘Energiewende’ or ‘German Energy Transition’, is the ongoing process by which Germany is shifting from gas, coal,

oil and nuclear power generation to renewable sources like wind, solar and biomass. The main goals of the

‘Energiwende’ are to decarbonize energy supply and reduce demand by means of conservation and greater efficiency.

Why do this?

There were several pertinent factors that led to the switch to renewable energy and conservation:

Fighting climate change

Reducing energy imports; improving energy security

Stimulating technological innovation and the green economy

Eliminating the risks of nuclear power

Strengthening local economics and providing social justice

These topics are further described beginning on the next page.

I. Action on Climate Change II. Leadership in Renewable Technologies and the Green Economy III. No need for coal IV. Nuclear phase-out V. Conservation and efficiency VI. Buildings (Cogeneration, Heating and ‘Passive-House’) VII. Grid Upgrade, Flexible Power VIII. Co-op, democratic focus; community buy-in IX. Emissions trading and environmental taxation X. Energy security

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4.0 – Ten German Lessons for Canadian Energy Policy

I. Action on Climate Change

“In 2011, a survey found that 66 percent of Germans believe that climate change is a “very serious” problem.”

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 8)

At the beginning of the Industrial Revolution, the atmosphere had 280 parts per million (ppm) of carbon dioxide. Now,

CO² concentrations are approaching 400 ppm. If the necessary steps are not taken expeditiously, a worldwide

temperature rise of 2°C (a critical milestone) may occur as soon as 2030. Carbon-addicted humanity seems not only to

be heading straight for a brick wall of climate upheaval, but in some cases, blissfully accelerating towards it.

Germany bears the burden of being one of the country’s most responsible for increased planet-wide carbon emissions.

For many decades, Germany has been a leading industrialized nation whose industry and electricity is heavily reliant on

coal. Through its economic growth, Germany has inadvertently sped up the mechanisms of climate change. This will

have the greatest impact on those less developed countries who are least prepared to cope with climate change.

Germany has recognized and is meeting this responsibility through 1) a commitment to international climate funding;

and 2) the energy transition, or “Energiewende”.

“Germany is the second largest donor of financing for climate protecting worldwide. German Climate Funds

promote action to mitigate climate change by enabling efficiency measurements, funding renewables, electric

mobility, etc.”

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 53)

Long-term, comprehensive energy and climate targets set by the German government in 2010

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 17)

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“Relative to 1990, Germany reduced its carbon emissions by 25.5 percent at the end of 2012, thereby

overshooting its target for the Kyoto Protocol of 21 percent for the end of 2012. But Germany aims to go further,

with targets of a 40 percent reduction by 2020 and an 80 to 95 percent reduction by 2050.”

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 9)

While an 80-95 percent reduction in carbon emissions by 2050 may seem ambitious, Germany has so far proven capable

of meeting ambitious goals. Despite a 22% reduction in GHG emissions, Germany has been able to increase its GDP by

28% from 1991 to 2012. This proves the economic validity of their energy transition process, and should serve as a

model for Canada, as well as other countries.

GDP vs GHG in Germany, 1991-2012

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 8)

“(A 2011)… survey found that 79 percent of Germans believe that energy efficiency and combating climate

change are good for economic growth and can create jobs.”

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 8)

Germany has surpassed their Kyoto emissions reduction target of 21% (by 2012) by achieving a 25.5% reduction (by the end of 2012), as compared to 1990 emission levels.

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II. Leadership in Solar, Wind and the Green Economy “In 2009, another survey taken among 378 businesspeople, researchers, and politicians in Germany (…) found

that more than four fifths believed that the pioneering role that Germany has played in reducing greenhouse gas

emissions would lead to technological leadership.”

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 8)

Germany vs Rest of the World (2012); Solar and Wind capacity

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 23)

Share of renewables in Germany’s electricity generation (2013)

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 28)

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Germany has been a world leader in the deployment of PV deployment, despite relatively modest solar resources. When

compared to Canada, it can be seen that Germany has quite meager solar insolation, and yet, they have achieved

tremendous progress harnessing this limited potential.

Canada vs Germany Solar Resource Potential (Dec 2010)

http://www.cansia.ca/sites/default/files/pdf/solar_vision_2025.pdf

Despite their solar resource disadvantage, Germany has significantly developed its solar capacity. In 2013, it lead the

world with an installed capacity of 33 GW’s of PV, 27% of the world’s total solar capacity. This compares to Canadian

capacity of 1.2MW, which totaled less than 1% of world capacity.

Solar Capacity by Country; 2013

http://en.wikipedia.org/wiki/Solar_power_by_country (modified)

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The comparison remains true for wind development as well. Despite having vastly lower wind resources than Canada

(less than 5% of Canadian potential), Germany has mightily outpaced Canada, and have deployed fourfold the wind

capacity that Canada has.

Canada vs Germany Wind Resource Potential

http://www.pnas.org/content/106/27/10933.full.pdf (modified)

Canadian vs German wind capacity (2014)

http://www.pembina.org/reports/feed-in-tariffs-factsheet.pdf (modified)

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Wind Capacity by Country; Dec 2014

http://en.wikipedia.org/wiki/Wind_power_by_country

The Germans have developed their solar and wind capacity through a Feed-In-Tarriff system, which was emulated in

Ontario. In fact, the Ontario Green Energy Act (2009) was based on the German Renewable Energy Act. The German law

specified that renewables had priority of purchase on the grid, and that renewables must receive sufficient

compensation to provide adequate return. The high level of investment security and the lack of significant red tape

made the German Act so successful. For example, the standard German contract for a Feed-In Tarriff is two pages,

where the equivalent U.S. Power Purchase Agreement (PPA) is 70 pages. If the Ontario MicroFit program were to

streamline itself as much as the German FIT program, there would likely be increased interest and adoption rates.

In Germany, wind power has become the most inexpensive source of new renewables generation. PV is now

competitive with conventional energy generation. Feed-in Tariffs do no lead to unnecessarily high prices. Germany has

the cheapest solar power in the world because of the investment certainty and market maturity. German politicians

have been rushing to reduce the solar feed-in tariffs to keep up with falling prices. Solar tariffs have fallen from around

50 cents to less than 10 cents (for big arrays), and less than 14 cents from the smallest rooftop arrays. The rate will

continue to drop until 52 GW’s of PV have been installed in Germany, at which time FIT for PV will be phased out.

Forecast of Power Generation Cost in Germany (up to 2030)

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 9)

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One common criticism that has levied against the German energy transition has been the increase in energy cost for the

consumer. This increase has been attributed to high subsidies for wind and solar. While a popular and logical argument,

it doesn’t tell the whole story. If we consider the local added value of renewable capacity, the environmental damage

prevented by their deployed, and other factors, we can see that German is effectively saving 7 billion euros a year

through renewables. Renewables become the most economically attractive option when commonly disregarded

externalities are brought into the cost-benefit equation.

Renewables save Germany more than 7 billion euros per year (2011)

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 10)

Employment in Germany in renewable and conventional energy sectors (2005-2011)

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 11)

“These figures represent “gross job creation”, meaning the absolute number of jobs that have been added. A thorough study of the German market estimates a net job creation of around 80,000, rising to 100,000-150,000 in the period from 2020 to 2030. One reason why renewables have such a tremendous positive impact on net job creation is that renewable power directly offsets power from nuclear plants, and very few people work in the sector.”

“The Energy Transition

(Energiewende) boosts

green innovations, creates

jobs, and helps Germany

position itself as exporter

of green technologies”

‘Energy Transition’ –

Heinrich Boll Stiftung, Nov

28, 2012. (Page 10)

The German energy

transition offers evidence

that renewables create

more jobs than

conventional energy does.

Nearly 400,000 Germans

work in renewable energy.

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III. No need for coal

Lignite, or hard coal, is widely mined and burned in Germany, but it’s three times more carbon intensive than natural

gas. Coal can’t ramp very well with demand, so it’s not as effective for peaking as natural gas. The German conventional

energy sector was 40% coal in 2000, and expects to be 10% by 2050. The long term plan for coal in Germany is a

reduction to zero.

Installed conventional electricity generation capacity in Germany (2000-2050)

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 20)

Carbon Capture and Storage (CCS) has been rejected as an effective long term solution in Germany. It has been deemed

too expensive and unsafe, and best not pursued. Carbon capture reduces the efficiency of the coal power plant, it

increases fuel costs and storage has high inherit risk. A number of recent coal projects have been cancelled for reasons

of local protest, difficulty in procuring water rights and decreased profitability in light of the boom in renewables.

German communities have voiced their opposition to CCS: people don’t want repositories of stored pollutants near

where they live. The German states have the political authority to veto any plan to build a carbon capture storage

repository on their land. This ensures that is highly unlikely such a repository will ever be built in Germany, negated the

possibility of widespread CCS implementation.

“We have to be realistic. We cannot store carbon dioxide underground against the will of the population. And I

do not see any political acceptance in a single German state for CCS technology with hard coal and brown coal

power plants.”

German Energy Minister Peter Altmaier, July 2012

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IV. Nuclear phase-out

While Canada, and specifically Ontario, have embraced nuclear power, the Germans have historically not. In fact,

German protest to nuclear power goes back as far as the 1970’s, and it’s phasing out had always been part of the

Energiewende. The timetable was drastically moved forward after Fukushima. The disaster lit a spark of protest against

nuclear power in Germany that burned all the way to the parliament. Public pressure forced a resolution to shut down,

and set concrete decommissioning dates for nine out of the country’s 17 nuclear reactors.

Declining German Nuclear Capacity (2000-2022)

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 39)

Germany sees three main unresolved disadvantages to nuclear power:

The Risks (Proliferation, Meltdowns)

The Costs (‘Unbankability ’ – No banks finance nuclear plants; only governments do)

The Waste (Radiation for waste storage; passing on the burden to next generations)

Additional concerns arise with the limited worldwide uranium supply. At current rates of consumption, uranium for

conventional light-water reactors will only be available at affordable prices for the next 30 years. At that time, nuclear

power as conventionally generated will likely not be the low cost option it has historically proven to be.

The worldwide future of current generation nuclear is dim: more plants are scheduled to be taken off-line over the next

ten years than are expected to be put online. Even if we were to triple the number of operational nuclear plants by 2050

(35 per year), global carbon emissions would only effectively be reduced by 10%. That outcome is too little, too slow, too

expensive, with too much inherit risk

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 12)

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V. Conservation and efficiency Amory Lovins, acclaimed environmental scientist, has called the concept of conservation “a change in behavior based on

the attitude ‘Do Less to Use Less’. A Megawatt of power saved through conservation is a megawatt not needed to be

generated. He has nicknamed this ‘avoided energy’ as the ‘Nega-watt’. As important adding renewable capacity is to the

German energy transition, equally important is the simultaneous reduction in consumption.

Reduced energy consumption; increased renewable capacity (German energy plan, 2005-2050)

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 18)

One major pillar of this reduced consumption is called the ‘Energy-related Products Directive (ErP), formally the

‘Ecodesign Directive’. This piece of Brussels based regulation sets minimum efficiency standards, and considers the

lifecycle environmental impact of such energy-consuming devices as:

Consumer electronics

Refrigerators

Electric Motors

Windows

Showerheads, and more.

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 51)

One of the most impactful results of the ErP Directive was the regulation of standby and off-mode power losses. The

Directive requires that power loss from devices in standby mode must be no more than one watt. This threshold will be

further decreased to 0.5 watts in the near future.

The ErP directive has been the main regulatory instruments for cutting off from the market those products with the

worse environment performance. This has resulted in banning the sale of incandescent light bulbs for domestic lighting.

“By 2020, phasing out incandescent light bulbs will result in energy savings (…) equivalent to (…) six old coal

power plants. The (…) regulation for electric motors will even lead to a reduction (…) equivalent to 20 coal

power plants.”

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 51)

By 2020, the directive is expected to reduce power consumption within

the EU by 12% (compared to no Directive).

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VI. Buildings (Cogeneration, Heating and ‘Passive-House’) Cogeneration is when part of the waste heat from a power generator is recovered, increasing overall efficiency of fuel

consumption. Cogeneration is much more efficient than separate power and heat generation. Additionally, heat is much

easier to store than electricity is, which can provide a ramping ability to offset peak heating demand. Germany wants to

get 25% of its power supply from cogeneration units by 2020. The ‘Cogeneration Act’ was therefore introduced in 2002

to incentivize cogeneration units relative to system size, irrespective of the feedstock. Owners receive upfront incentives

for the purchase of the cogeneration units, plus ongoing bonus payments for electric power produced by the unit.

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 48)

Comparing cogeneration to conventional ‘coal-electricity with oil-heating’

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 47)

In 2009, German passed the Renewable Energy Heating Act. This piece of legislation aimed to increase the share of

renewable heat to 14% by 2020. Owners of new buildings are now obligated to get a certain share of their heat from

renewable energy. The owner chooses how best to meet these obligations. Options could include renewables, more

insulation, and heat from district heating networks or cogeneration units. The program was temporarily cut during the

last economic crisis, however it is now back in place.

A sister program to the Act supporting existing buildings is called the Market Incentive Program (MAP). The program

offers financial support for owners to purchase energy related retrofits. Such retrofits can include:

Small and large solar heat collectors (incentives based on collector surface area)

Bio-mass-fired furnaces with automatic feed systems (wood pellets)

Highly efficient firewood gasifiers (upfront incentive)

Efficient heat pumps (upfront incentive)

Visualization services for such systems

Similar programs to MAP offer incentives for geothermal, district heating, even the potential for solar power batteries.

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 48)

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Buildings consume 40% of all generated German energy, mostly due to heating. Oil and gas dominate the heating sector

with a combined share of three-quarters of the market. It is a big slice of the pie to reduce, but doing so would have a

tremendous impact, so it is a crucial area of focus for the German energy transition. This focus on reducing building

heating loads began as early as 1990 with the development of highly efficient ‘Passive Houses’.

German building energy demand standards

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 51)

Passive houses allow the complete negation of heating systems, even in Germany’s cold climate. Heat from the kitchen

and warm bodies are enough to warm the house, even during winter. Heating expenses are cut by an estimated 90%

compared to a conventional new building.

The houses utilize a combination of low-tech and high-tech building methods. Homes are built facing the South in

Germany, and their southern facades have large glazed surfaces to allow solar heat gain. In the summer, overhanging

balconies stop the sun’s rays from entering. Deciduous trees are also planted on the southern side of the build to

provide shade in summer, but sun in winter when they defoliate. High-tech building methods include triple-glazed

windows, which allow light and heat to enter, but prevent heat from exiting the building. Passive houses also have

ventilation systems with heat recovery (HRV’s), to capture was heat and prevent mold build up

Passive houses are an excellent example of how Germany’s energy transition will produce much higher standards of

living even as energy consumption is reduced and made more sustainable. They have become the standard for new

building construction in some German cities (like Frankfurt).

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 52)

“The EU will require that all houses constructed starting 2020 be “nearly zero-energy homes,” essentially making

German passive house the standard within Europe.”

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 18)

‘Passive House’

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VII. Grid Upgrade, Flexible Power

Germany has gone from 3% renewable power in the 90’s to more than 25% in 2015 without any major changes to its

electricity grid. However, to achieve the ‘85% renewables by 2050’ target, major changes to the grid will be required.

Conventional vs Renewable electricity generation (2000-2050)

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 20)

Grid operators are presented with several problem when renewables become a large percentage of the grid. Firstly is

the problem with the inherent intermittency of renewable generation. The wind does not always blow, nor the sun

always shine, when and where the power is needed. Effective grid storage would be required for a renewable

dominated grid, and a number of storage solutions are possible, feasible and even proven economical:

Pumped hydro-power storage

Flywheel energy storage technology

Compressed air storage in caverns or old mine shafts

Secondly, a substantial increase in distributed renewable generation presents the problem of multi-directional power

flow, not simply one way from producer to consumer. To account for this, a smarter grid is required. Special controls and

sensors will be needed to monitor the temperature and power of high voltage lines. Transformers and other devices

may be susceptible to failure in a grid dominated by renewable sources.

Finally, the ongoing argument remains whose responsibility it is to invest in the shared resource that is the electricity

grid. With distributed generation comes the requirement for increased infrastructure for renewable power to reach

consumers in cities, and the question of “who pays?” is a hot button issue. For instance, ‘double standard’ controversy

has arisen when Utilities have shown willingness to make grid upgrades for large, offshore, corporate backed wind

farms, but not for smaller, onshore, community funded projects.

One unique proposal would see Germany exporting large amounts of power for storage to Norway and Switzerland,

which have tremendous hydro-storage potential. This would require large investment to increase transmission capacity,

but the returns may be worth it. Ontario could conceivable do the same: Exporting surplus renewable energy to Quebec

for hydro storage, to be run through generators during times of high demand, high prices and low renewable output.

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 53)

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The new renewable landscape poses problems too for Germany’s four biggest power companies. They earn their

revenue through providing peak power at a large markup, with less expensive baseline power. If renewables are able to

take a huge bite out of peak demand, as solar is now doing, then the power companies will find their revenue

substantially curtailed. They will need to adapt and reconfigure their capacity to match the new reality.

Baseload power is incompatible with renewables, and will soon be a thing of the past. What will be required is flexible,

fast ramping, quickly dispatchable power generation. The graph below shows the predicted German power demand

profile for 2020. Solar provides 0% of the demand - then 90% - then 0% again over a single day. Conventional plants

ramp from 10GW to 50GW within twelve hours. Wind is highly variable. This is the energy landscape of the future.

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 53)

‘Flexible Power’ – German power demand over a week in 2012 vs 2020

[] - ‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 23)

Current ‘baseload’ plants will not be sufficiently nimble to match this new power demand landscape, resembling 24/7

peak load following. Highly ramp-able turbines fueled by natural gas will be the short term solution, replaced with

sustainable biogas and renewably generated hydrogen. The long-term solution see a complete redesign of the power

market, perhaps with the introduction of a ‘strategic power reserve’: Plants held offline/idle, in good working order,

ready to quickly ramp up when needed. The solution was proposed in July 2012 by the German Environmental Agency

(UBA). Power companies would be paid for a certain amount of generating capacity maintained in service, not for the

power generated from these plants. The rest of the power market would remain undisturbed. Such is the sort of system

that will be required to meet the demands of a predominately renewable energy grid.

[] - ‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 53)

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VIII. Co-op, democratic focus; community buy-in

“Local ownership of renewables provides great economic payback to investing communities. Energy efficiency

and renewables together give the poor a way around higher prices for fossil fuels.”

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 14)

Community ownership of renewable energy projects is widespread in Germany. The German word for community

ownership group, or cooperative, is “Genossenschaften”. As power producers, the electricity they sell back to the grid

has priority over corporations. The German feed-in tariff system, upon which our Canadian MicroFIT program was

based, is conducive to community ownership of large projects. Through co-ops, ownership of the country’s power supply

shifts from large power companies to the citizenry. Co-ops are a democratizing force within Germany.

“Energy cooperatives democratize energy supply in Germany and allow everyone to benefit from the energy

transition even if they do not own their own home.”

- Head of Germany’s Solar Industry Association (BSW-Solar)

It is estimated that “energy cooperatives” have leveraged € 800 million in investments for more than 80,000 private

citizens in Germany. You needn’t own your own home to invest: shares in co-op PV projects can be as low as € 100, with

the average minimum being around € 500.

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 36)

“We cannot say who owns a particular wind farm in Germany because ownership is splintered across scores, and

sometimes hundreds, of local citizens and businesses.”

DEWI, organization that collates statistics on German wind power.

German ownership of renewables (2012)

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 34)

There have even been instances, notably in Hamburg, where citizen co-ops have successfully purchased their local utility

grid. Imagine a group of Canadian citizens purchasing a part of Hydro-One, or Kingston Utilities!

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IX. Putting a Price on Carbon

http://www.euractiv.com/sections/energy/after-oil-price-crash-its-time-carbon-tax-311377

The European Union has put a price on carbon, which is something Canada is still debating doing. The European

initiative, called the ‘Emissions Trading System’ (ETS), caps greenhouse gas emissions for the long term. The only method

by which carbon producers can overshoot their emissions cap is through the purchase of ‘carbon offset’ certificates.

These credits give emissions allowances to companies in different sectors. This policy is the main instrument in the EU to

lower greenhouse gas emissions.

The ETS has had a rocky history, and was completely revised in 2009/2010. It has been criticized for a lack of ambition,

too many loopholes, concessions to electricity and industry lobbies, unambitious targets and a lack of adjustment to

economic downturns. Some notable criticisms and design flaws have included:

The giving out of generous volumes of free certificates to major emitters early on in the pilot phase. The major

emitters then turned around and sold those offsets to others for a profit. To correct this, certificates are no

longer be offered for free, but auctioned off.

Too many certificates are still in circulation, diluting the intended effect of the system. The EU aims to correct

this by postponing the issuing of new certificates.

The allowance for European companies to reduce their carbon emissions not at home, but in developing

countries. The criticism centers on the issue of outsourcing the responsibility for emissions reduction abroad,

which postpones inevitable structural changes at home. The current system allows for as much as 50%

outsourced offsets.

The ‘price of carbon’ is too low to stimulate the required mass switch over to low carbon fuels.

Emissions trading has sometimes been viewed in conflict with the Feed-In Tariff program. If the goal is lowering

greenhouse gas emissions, then the ETS, through market forces, would presumably deliver the optimal solution. Why

then, the need to artificially incentivize certain renewables to make them more economically viable? The perceived

conflict arises from not recognizing the identical goals of renewables and carbon credits: Renewables offset gas and coal

in Germany, reducing greenhouse gases; Carbon credits financially punish large emitters, also encouraging the reduction

in greenhouse gases. The practical results of both projects are identical: the reduction in greenhouse gases. They exist

synergistically, differing only in means and method.

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 53)

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X. Energy security

In 2012, Germany spent 87 billion euros on energy imports. It imports more than 70% of its energy, including uranium.

Germany is by far the biggest importer of gas from Russia. With the recent troubles in the Crimea and the Ukraine, and

the sanctions levied on Russian, it might be conceivable that Russia halt the exportation of gas to Germany.

German energy imports, 2012

‘Energy Transition’ – Heinrich Boll Stiftung, Nov 28, 2012. (Page 14)

As worldwide demand for energy continues to rise, it will outstrip supply in a fossil fuel based world. The more energy a

country can get from within its own borders, the more protected they are from outside influence or political coercion.

Improving energy efficiency, conservation measures and renewable energy generation can all contribute to reduced

imports and enhanced energy security. By reducing energy imports, Germany is less vulnerable to the rising prices for

fossil fuels and to political influence from abroad.

Domestic production of renewable gas would make supply more certain and less politicized. Reducing the consumer-

supplier political dynamic would contribute to harmony between nations. What need would there be for wars over

resources if one’s own renewable energy economy was vital? Just consider the affect the Saudi’s have had on the oil

sands developments. Canada, by investing heavily into fossil fuel projects, has made herself vulnerable to outside

influence, and from the fluctuations of the oil price. This was the way of the past. The future of energy security, and the

long-term survival of the human species, is centered on clean, economically viable, renewable energy sources. Germany

has lead the charge, and now Canada must follow them through the breach on that noble project; the grand enterprise

of the twenty-first century.

http://blog.lufft.com/en/heading-for-the-future-with-renewable-energy/

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5.0 – Summary

Germany has taken the lead into the renewable energy future with their ‘Energiewende’, or Energy Transition, and

Canada now has the opportunity to follow.

Recognizing the grave threat climate change poses, Germany has instituted drastic measures to reduce her carbon

emissions. In 2050, Germany plans to reduce carbon emissions by 80% compared to 1990 levels, and have 80% of its

energy derives from renewable sources. They plan to do this through a monumental increase in PV and wind capacity, all

while reducing coal and phasing out nuclear power. Increased building efficiency, conservation measures and

cogeneration will also make a significant contribution to this transition. Novel storage methods will be developed,

perfected and made financially lucrative. A continued focus on community ownership and involved ensures the energy

transition is a democratic movement. Increased renewable capacity at home reduces the need for energy importation,

increasing security and lessening tensions over resources.

Germany aims to prove by 2050 the economic and practical viability of a modern, industrial economy deriving most of its

energy from renewable sources. This author shall do his utmost, in whatever capacity he finds himself, to aid in the

success of that transition, whether here in Canada, in Germany, or wherever in the world he finds himself between 2015

and 2050. It is a worthwhile enterprise to dedicate one’s life to.

http://www.futuretimeline.net/21stcentury/images/energy-islands-large.jpg

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6.0 – References and Biography

Title Page Pictures: http://www.unternehmerakzente.de/wp-content/uploads/2012/02/Energiewende_700_300_artikel.jpg

http://www.zeit.de/2011/20/Energiewende-Interview-Merkel

ENERGIEWENDE MAIN SITE - http://energytransition.de/

NRCAN Report -

https://www.nrcan.gc.ca/sites/www.nrcan.gc.ca/files/www/pdf/publications/emmc/renewable_energy_e.pdf

Greater Toronto Area – Renewable Energy Overview - http://www.greatertoronto.org/wp-

content/uploads/2014/04/GTA-Renewable-Energy-Overview-for-Italian-businesses.pdf

Failure of Canada to meet its obligations - http://www.pembina.org/media-release/pembina-reacts-to-us-china-climate-

announcement

Cansia Roadmap 2020 - http://cansia.ca/sites/default/files/cansia_roadmap_2020_final.pdf

Cansia Roadmap 2020 (present) - http://cansia.ca/sites/default/files/20140620_kpmg_roadmap_presentation_final.pdf

Low cost solar in 7 days, not 180 - http://cleantechnica.com/2015/03/05/low-cost-solar-7-days-not-180-days/

Canada future of Wind - http://canwea.ca/wind-energy/national/

CanWea WindVision - http://canwea.ca/pdf/windvision/Windvision_summary_e.pdf

CanWea WindVision (Background)- http://canwea.ca/pdf/windvision/Windvision_backgrounder_e.pdf

Best Practices for Community involvement in Wind energy - http://canwea.ca/pdf/canwea-communityengagement-

report-e-final-web.pdf

Renewable energy coops - http://www.brantfordexpositor.ca/2014/12/18/renewable-energy-co-ops-springing-up-

everywhere

Renewable energy coops (2) - http://www.cooperativedifference.coop/assets/files/National/RE_Co-

op_Review_RegulatoryScan_Jan2012.pdf

Pembina (Solid Energy Policy Resource) =

http://www.pembina.org/re

http://www.pembina.org/re/work/municipalities

http://www.pembina.org/re/work/first-nations

http://www.pembina.org/re/work/developing-countries

http://www.pembina.org/re/work/provincial-policy

Ontario’s LTEP - http://powerauthority.on.ca/sites/default/files/planning/LTEP_2013_English_WEB.pdf

Facts about Photovoltaics in Germany - http://www.ise.fraunhofer.de/en/publications/veroeffentlichungen-pdf-dateien-

en/studien-und-konzeptpapiere/recent-facts-about-photovoltaics-in-germany.pdf

Two energy lessons from Germany - http://blogs.scientificamerican.com/plugged-in/2014/10/07/energiewende-two-

energy-lessons-for-the-united-states-from-germany/

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Energy Transition - http://en.wikipedia.org/wiki/Energy_transition_in_Germany#cite_note-18

Separating Fact from fiction in Germany -

http://blog.rmi.org/separating_fact_from_fiction_in_accounts_of_germanys_renewables_revolution

Singapore energy efficiency example - http://blog.rmi.org/blog_2015_03_05_energy-

efficiency_insights_from_singapores_marina_bay_sands

Reinventing Fire - http://www.rmi.org/ReinventingFire

Gamechangers(1) -

http://blog.rmi.org/blog_2014_09_30_three_energy_gamechangers_for_china_and_the_world_part_1

Gamechangers(2) -

http://blog.rmi.org/blog_2014_10_01_three_energy_gamechangers_for_china_and_the_world_part_2

Amory Lovins -

http://blog.rmi.org/blog_2014_12_16_joining_forces_to_combat_climate_change_and_reignite_the_global_economy

Germany leads the way - http://www.worldwatch.org/node/5430

Renewable energy lessons from Germany - http://www.renewableenergyworld.com/rea/blog/post/2014/10/7-

renewable-energy-lessons-from-germany

Germany National Renewable Energy Plan -

http://en.wikipedia.org/wiki/Germany_National_Renewable_Energy_Action_Plan

Expensive gamble of Germany renewables - http://www.wsj.com/articles/germanys-expensive-gamble-on-renewable-

energy-1409106602

Economist con article - http://www.economist.com/node/21559667

The Drake Landing Solar Community in Okotoks, Alberta – http://www.dlsc.ca/reports/DLSC_SHC_2012_final.pdf

More stuff - http://reneweconomy.com.au/2015/graphs-of-the-day-the-success-of-germanys-energy-transition-15022

http://en.wikipedia.org/wiki/Renewable_energy_in_Germany

http://www.gtai.de/GTAI/Content/EN/Invest/_SharedDocs/Downloads/GTAI/Articles/The-renewable-energy-

industry-in-germany.pdf

http://motherboard.vice.com/read/one-third-of-germany-is-powered-by-renewable-energy