Germany’s energy transformation: Energiewende | The Economist
The rest of the world watches with wonder, annoyance—and anticipatory Schadenfreude. Rather than stabilising Europe’s electricity, Germany plagues neighbours by dumping unpredictable surges of wind and solar power. To many the Energiewende is a lunatic gamble with the country’s manufacturing prowess...An even bigger worry is supply interruptions, which can disrupt factories even if they last for fractions of a second. VIK says they have risen 30% in the past three years. The odds of outright power cuts have jumped...
Renewables can depress wholesale prices, eg, when the sun creates a midday jolt. This discourages investors in the flexible, gas-powered generation needed to provide backup for windless, cloudy days. “The market dynamics are completely destroyed,” says Peter Terium, boss of RWE, one of the big four. There is talk of paying generators to offer capacity, not supply power. But such payments would add another subsidy distortion to the market.
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It is hard to think of a messier and more wasteful way of shifting from fossil and nuclear fuel to renewable energy than the one Germany has blundered into. The price will be high, the risks are large and some effects will be the opposite of what was intended. Greenhouse-gas emissions are likely to be higher than they would have been for quite a while to come. But that does not mean the entire enterprise will fail. Politicians cannot reinvent the Energiewende on the run, but they can stay a step ahead of the risks and push back against the costs—and they are beginning to do so. In the end Germany itself is likely to be transformed.
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