Bloomberg News

Germany May Scrap Energy-Source Goal as Overhaul Stumbles

July 17, 2012

Chancellor Angela Merkel’s government said it may have to scrap some of its targets for shifting the source of its electricity supply, a move that would water down a commitment to bolster renewable energy in Europe’s biggest economy.

Economy Minister Philipp Roesler told today’s Bild newspaper that Germany may readjust targets linked to the plan to exit nuclear energy-generation by 2022 if jobs are threatened. The comments came a day after Environment Minister Peter Altmaier told Bild the coalition may fail to reach a goal to cut power consumption 10 percent by 2020. Merkel said July 14 that Germany probably won’t use carbon capture and storage facilities after passing the required bill in parliament.

“Instead of questioning targets or declaring the entire energy switch a failure, we now need the right decisions for more energy efficiency, grid expansion and smart market design,” Claudia Kemfert, the chief energy expert at the Berlin-based DIW economic institute, said today by e-mail.

The government is struggling to grasp the scale of the effort needed to shift Germany away from nuclear power 16 months after Merkel promised to phase out reactors in favor of renewable such as solar and wind following the meltdown in Japan. Merkel named Altmaier in May to steer the overhaul after sacking his predecessor, Norbert Roettgen, amid reports that he wasn’t listening to industry concerns about the transition.

Election Challenge

Overhauling the energy mix while making sure it remains secure, affordable and environmentally friendly “is not an easy path,” Merkel said yesterday in Berlin. She faces elections in the fall of 2013 as the power shift gathers pace.

Germany plans to close its remaining nine nuclear stations by 2022, build offshore wind farms that will cover an area six times the size of New York City and build or upgrade as much as 8,200 kilometers (5,100 miles) of power lines. The nuclear exit is coupled with goals to increase energy efficiency and raise the share of renewable-energy output in its power mix to at least 35 percent by the end of this decade.

Altmaier told reporters in Berlin today that he had raised the lack of progress in terms of reducing power consumption to spark a debate over what’s needed to reach that target.

To make the energy switch a success and benefit the German economy, “we have to know where we stand, what kind of problems have come up and where we need to do more or improve things,” Altmaier said. The costs linked to the energy switch should be as low as possible, he said.

To contact the reporter on this story: Stefan Nicola in Berlin at snicola2@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net


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