Germany’s Energiewende shows energy transitions are damned difficult

Dr. Gunther Bachmann, a former director of the German Council for Sustainable Development.

Rating: High school and post-secondary

Summary: Markham interviews Dr. Gunther Bachmann, a former director of the German Council for Sustainable Development, about the challenges posed by his country’s energy transition plan, the Energiewende.

Related stories:

Commission proposes Germany coal use to be phased out by 2038

Policies critical to boosting renewables in energy mix

Germany 2020: Energy Policy Review, International Energy Agency

Germany – country energy profile by International Energy Agency

Energiewende, the German Energy Transition

Germany energy statistics at a glance

Source: International Energy Agency.

Markham Hislop: Welcome to another episode of Energi Talks, the podcast where we discuss global energy issues and trends with the experts from around the world, we’re going to be discussing the Energiewende, the German transition to clean energy. My guest is Dr. Gunter Bachman, a former director of the German Council for Sustainable Development, an advisory body that works closely with the business world to promote green standards and reports to the German Federal government. He is also the author of The Hour of Politics: An Essay About Sustainability, Utopias and Creative Spaces. Welcome to Energi Talks, Dr. Bachman.

Markham Hislop: Now I know a little bit about Energiewende and but not that much. And I bet my listeners know even less. So why don’t we start with an overview of Energiewende?

Dr. Gunter Bachman: The term Energiewende in German is an old one. It was first used by an NGO [non-government organization] in the late 1970s when we had an increase in nuclear power while we had this great battles on the metal grounds in front of a couple of those nuclear power plants to be cited at that moment. When German industry still dream to dream of a plutonium cycle those days, and Joel working with science-based data, they popularized the term and (inaudible), and what it meant at that time was a complete change in of the energy system, but it was not yet a term that would include climate change. The whole, you know, did we all afford, we now know that we have to do, when it comes to energy transformation, it was just plug out of nuclear energy over time.

In the eighties and the nineties we in Germany faced a fierce battle between the let’s say ecologically-enlighted action of society and those hard-nosed technological campaigners and enterprises that would go to the direct way to the nuclear and Brown and lignite coal power plants. In 2011, after the Fukushima accident, the Chancellery decided to call in a group of people that had only eight weeks to advise the federal government on how to proceed with a nuclear power plan. That was when the term and the Energiewende was popularized a second time and that time in a more political sense.

That is what we now understand as Energiewende – climate change mitigation policies, including the phase-out of nuclear power plant until 2022.

Total energy supply (TES) by source, Germany 1990-2019

Source: International Energy Agency.

Markham Hislop: Now Germany is generally considered to be a pioneer of this approach – the more aggressive climate policies and phasing-out of coal and lowering its greenhouse gas emissions. And I guess like most pioneers, most first movers it’s had its fair share of difficulties that it’s had to grapple with. I understand the idea of phasing out nuclear while you’re doing the transition has actually resulted in an increase in coal. That’s where critics often attack it because it’s supposed to lower emissions, but it’s led to more coal. And I think if I read correctly, even a bit of an increase in emissions. Have I got that correct?

Dr.Gunter Bachman: Well, we knew at the beginning that the phase-out of nuclear power must not compromise the climate goals. And as far as I know, it did not compromise the climate goals.  But we knew also that climate goals are hard to achieve. It’s really hard stuff.

Last year, the German government and society decided to phase out a huge chunk of the coal-fired power plants as well. That is really stressful on the system, but it’s good stress because it means innovation. It means huge investments into new technologies.

And that is where renewable energy comes in. We can only have this kind of transformation because we started 30 years ago. We started with Garret type engineers putting together solar power plants. And once you put these at that time, these panels on the energy system, you would have to pay like 60 Euro cents per kilowatt-hour in solar energy. We’re now down to almost nothing.

So that is the increase in innovation, the scaling up of technologies that we are now proud to use. We started earlier in full consciousness of the climate change transformation challenge.


Markham Hislop: I’ve had other experts tell me that were it not for Germany’s and the Energiewende starting 30 years ago, paying the extra costs, subsidizing the development of that technology, we might not have the state of development we have today in solar panels and wind turbines. And it was all that hard work that was done at the beginning in Germany that kind of primed the pump for the advances we see today. Is that accurate from your point of view?

Dr.Gunter Bachman: From my point of view, it is accurate. We as Germans would diplomatically not have pressed this point, but the German taxpayer and the energy bill-payer, we subsidized international scaling up of solar power plants and wind power plants as well.

Markham Hislop: Is there a recognition in Germany – because Germany is such an advanced society from a technology point of view – amongst German society at large that some of the innovation is really important to economic competitiveness, that sometimes, innovation has to be subsidized, and that the higher cost at the front end will have benefits for Germany over the longer term?

Dr.Gunter Bachman: Yeah, it definitely is. Take the figures of the amount of the federal budget. That goes into science, too.

Markham Hislop: Is there a recognition by Germans that investing in that kind of technology upfront and, you know, they have to pay a little more on taxes or maybe a lot more, maybe more on electricity prices, but subsidizing that innovation leads to a technological advantage for Germany and increases its economic competitiveness over the longterm?

Dr.Gunter Backham: There is not only a certain recognition, but I would say politicians are in full recognition of this fact. If you look into hydrogen technology, it’s exactly what they do. And we’re talking hundreds of millions of taxpayers’ euros that goes into this technology. If you look into battery cells, we call it an industrial policy in Germany, the industry, for the state to invest in this technology together.

It’s always the same. Even food system industries, people are used to investing in these new technologies with taxpayers’ money. And that comes with the general budget for the ministry for science and technology and innovation. Almost 3% of our national budget goes into science and innovation.

Markham Hislop: That’s a that’s a very large percentage. I know it’s nowhere near that in Canada. Let’s talk about some of the reforms that had to take place. For instance, I
understand there was a debate around electricity market reform and that’s of interest to me because I see the same thing happening now in North America. We see the American utilities that are grappling with this idea of how to integrate more renewables, wind, and solar, but also to increase the amount of electrical generation and distribution, because of climate policies. States and municipal governments are electrifying in order to reduce their emissions. Electricity market reforms are important.

Dr.Gunter Bachman: It looks like Germany grappled with that early on. We have this law that stems from the late nineties on the feed-in-tariff, you’ll get paid when you feed in renewable energy into the grid. And this law has to be readjusted from time to time, bringing this law up to date again, which we’re discussing this in Parliament right now.

With this law and with other regulations that are regulating the grid, for instance, we’re trying to make this transformation happen. And it’s a tricky thing because the increase in renewables is not the only benchmark. The integration of renewables into the system is another benchmark because we have to build transmission lines.

And the question is how to deal with those fossil fuel-powered power plants that that will be taken out of the system in two years, three years. As they remain in the the reserve and get paid for doing nothing you know, you have this basic energy flow and you need it from time to time because intermittent renewables and that kind of micro steering, the system is what the vendor is meant to do.

And that’s something it’s expensive in the first plans. But then what comes out of it is a new innovative infrastructure built on renewable energy.

Markham Hislop: Well, let’s talk about coal for a moment because coal over the last say five years that I’ve been hearing about Energiewende difficult it is to phase out coal is often pointed to, as a weakness in these kinds of climate policy approaches. And Germany certainly seems to be struggling with coal, but it also appears that of late in the last year or two, it’s kind of come to grips with that and figured out how it’s going to phase out coal. Have I got that accurate?

Dr.Gunter Bachman: Yeah. Last year we had a commission on how to deal with coal, how to phase-out coal. It was industry politicians, NGOs, whatever. So they decided to phase-out coal by 2038, which was debated for the environment. The NGOs said that’s too long and the capital market said that’s too long because they want to invest fresh money. And for industry that was quite right, but for the politicians that are governing those parts of the country where this industry sits, the mining industry, it was quite right, because the problem with the phasing out of coal is not coal.

The problem with phasing out coal is people who have jobs in regional areas that are kind of monopolized by the coal mining industries and for them to find alternatives, to rebuild these old structured areas, that is the challenge. So the challenge of phasing out coal is not coal it’s democracy. And you know, once those rust belt people vote in some right populist parties, that is the German challenge.

But I think now it’s settled. There is a lot of money going into these areas and these regions. And I mean, 2038 seems long, but the major chunk of coal would be taken out. But in the next couple of years and the rest would just stabilize the grid system. And for 2050 and for being climate neutral, 2038 is good enough.

Markham Hislop: I find that fascinating, Gunter, because you can see the Americans grappling with this and to a lesser extent in Alberta, which is our Texas of Canada. The issue arises, what do we do with the people and the communities that have grown up around coal mining? Particularly in the US, coal is collapsing and the coal companies are going bankrupt. And it seems like there’s very little support for those communities and they’re just going to fade away and they’ll have to adapt as best they can.

If I understand you correctly, the Germans have taken a different approach. You put in place just transition policies so that those folks will get retraining or have some other kind of industry to employ them. Is that accurate?

Dr.Gunter Bachman: And in addition, we did it before with the rural areas, where we have the old industrial steel and coal industries. That was completely redone in the last 30 years. So there is, from my personal perspective, the most important point is to take this challenge, not as a technological challenge, nor as a purely economic challenge, but as a cultural challenge. Make those people believe, let them be proud of what they achieved in the past. So they’d have to not have to apologize for having worked coal. They have to be proud to have been in the position to introduce some top-notch technologies for coal. And from then on, build the alternatives that would enjoy it in the German case, come with hydrogen, would come with all sorts of high-tech innovation.

Markham Hislop: From your point of view, how successful has that policy worked? Because we reported about the energy transition policies and experiences in various jurisdictions. So I’m quite familiar with what goes on in the US and Canada. And it seems like that is probably one of the most difficult problems to grapple with for policymakers. And frankly, it appears, they’re not doing a very good job in North America. Are there lessons that can be learned from Germany’s experience?

Because it seems like you’re doing a much better job.

Dr.Gunter Bachman: I will be very open here. We are not yet there. It’s an ongoing struggle and there are setbacks. There were regions where no industry will come in and invest. So this is problematic but on the bright side of it, we now have the European green deal. So Europe and we all together in Europe, 27 States, we together build, invest money into the transformation that is earmarked with climate change or climate mitigation money.

We never did this before. The [EU] commission was not allowed to interfere with national energy policies up to now, they are not allowed to do so. And there is collective money to be spent that will help the case in Slovakia, that will help the case in Poland, that will help the case in maybe even in Hungary – I’m not sure, but I will hope so.

So it’s not the German blueprint that we’re passing out. It’s just the way that collectively we provide money. And every nation, every region has to find its way into it, but there is no doubt that by 2050, some idea of climate and charity must be realized. I would not go so far as to sell the German experience as a resource for everyone. Because we are not there. We do have problems. We do have a problem in the regions. But on the other side, I would say as far as we got, we have a good chance to bring it to a good end.

Markham Hislop: My takeaway from your comments Gunter is that energy transitions are really difficult. This is structural change. We’re talking about economic structures, social structures, political structures, policy structures – those don’t change without a lot of hard work. And failure sometimes and difficulties for parts of the community. But it’s important in this case because this is a long-term structural change, to grapple with it early. Don’t put it off. Put in place policies like Germany, where you’re dealing with the social side of things, the just transition for the workers. Be prepared to do that hard work down in the trenches and to fix problems when they arise and understand that this is not just a simple flip the switch.

Is that a fair takeaway?

Dr.Gunter Bachman: Yeah. I would like to add, first of all, introduce some higher ambitious targets and goals. This data is what people need. They need to see the light. And the light is expressed by some targets, timetables and steps to 2030 and beyond.

That is important. And not only as an executive order, but to run it through the Parliament. That is another, I think, big takeaway. I say this because we did it in a different way before and it was not successful. We learned the hard way. Then invest in science and technology. That means invest in people, invest also in the arts, in the cultural framework.

The best money spent is on technology innovation and the arts, because young people at school, at University, if you can attract their attention by investing into universities and science, you get the bright minds on the issue. And then you need to have a translation between high stake transformation, innovation and technology, and what matters for the people at the best. You can do this. It’s not as politics. I mean, generally spoken about it with the arts, with movie pictures, what have you. And that is my takeaway to make transformation a cultural issue, and not only a technological or money issue.

Markham Hislop: I find that fascinating. And I’ll tell you why, Gunter. Within Canada. I am frequently debating and arguing for a change in the energy and climate narrative. So the way we think about and talk about energy, the stories we tell about energy. Very often within the energy sector and the policymakers, they push back and say, no, we need plans.

What I argue would be consistent with what you’re saying: you need to change the way people conceive of energy and what the future will look like. And when they buy into that and they change the narrative, then you need plans. Then you need plans to implement the new vision. I think we’ve kind of got backwards in Canada.

Would that be a fair comment? That it’s the vision, the thinking, the narrative, the talking that needs to come first? That it’s a better way to do it than to put innovation, science, and technology first?

Dr.Gunter Bachman: Yeah. You must be very careful not to be seen as the guy that should better go to the doctors, the shrinks. So whenever I talk about vision and I try to talk people into action towards this vision, I’m very careful being meaningful and being concrete. And so to say habit linked to what this means in real life of people. A plan, a vision, and then following up a plan is according to Churchill, the plan is useless except for having no plan at all.

Markham Hislop: And I think that having a vision into an electric future, a low-emission future, a low carbon future is much easier in 2020 than it would have been in 2010 in Germany. Because now you can point to say, you know, fall in, wind and solar costs are, are, are so low. Battery storage is becoming very inexpensive and the technologies improved. I mean, the technology changes the way changes your narrative. It changes your storytelling. It allows people to plug into what you’re saying, because you’re not that crazy guy that needs a psychologist or psychiatrist. You’re that guy who says, look, maybe they see electric vehicles driving around their neighborhood and on the, the car dealer lots, and they can now go, they can connect it to their experience, their daily experience, which was much more difficult a decade ago, I think.

Dr.Gunter Bachman: Yeah. I agree in principle, it’s the, yes we can mentality and narrative about on the other hand side, we should never forget that the problems, climate change, biodiversity loss, the oceans, the plastics the problems are still faster than the solutions. It’s still a runaway game. And the point here is that, well, all nations in the world agreed on the Paris agreement, all nations of the world agreed except one on the sustainable development goals, this is good framework. I mean, it’s the best framework in multilateral politics that we ever had, except maybe for the declaration of human rights, but t’s the same level. And you look into what is delivered so far. It’s, I mean, it’s not nothing, but it’s far too less and far too slow. So that is why I’m saying that food waste problems and equity now with COVID 19 recovery problems where this setback of a book, maybe for a couple of years of 10 years or so, we see illegal logging rising up.

Dr.Gunter Bachman: We see poaching rising because the tourism money is not in the countries that have these wonderful natural parks and they can’t pay the Rangers. And so poaching and illegal logging comes up again, these kinds of problems we still have. They are fierce. I mean, they are big problems. And what we now have in solutions, meaning technologies works for a country like Germany, but the big transformation is to make it work for Africa and for Latin America. I mean, you, in Canada, it’s the same with us in Germany. We can afford to pay these subsidies. Others cannot. So that is what I mean. And you mean climate change politics do only make sense if, if they work around the world and not only in our, I mean, Canada is a big country. Germany is a small country, but still on the larger scale, we are both small.

Markham Hislop: Before I let you go. One last question. I’m fond of quoting the German historian, Arnold Toynbee, jr. Who talks about the rise and fall of civilizations over, you know, millennia. And his argument is that leadership is the defining feature of whether the civilization rises again, when it’s confronted with challenge or whether it declines. Do we have the leadership globally, and in Germany to grapple with this issue and solve the problem and get us to where we need to go before we do irreparable damage, that cannot be repaired.

Dr.Gunter Bachman: How well? Once I say that problems are running away on solutions are too slow. Of course we do not. The answer to your question is we do not have the leadership. We need to have mr. Gutierrez UN secretary. In January said that we now are facing a decade of delivery because we are not delivering so far. And that’s a point in leadership. Well then I have to say that from my personal perspective and my personal experience that as he broke into council for sustainable development, it’s never leadership alone. It’s always the trust in the people, a good leader would trust his or her people. And then with trust comes expectation and motivation to deliver, and they put himself or herself on the line, and that is what is needed. We still in the world, we have quite good leaders when it comes to innovation, when it comes to governance and policymaking, and they come up with wonderful laws and pieces of legislation what they lack is the link and the trust to the people. And that is why the Energiewende in Germany is for a lot of people seen as a people’s product.

Dr.Gunter Bachman: And, and that is that, is it a message that could be sold to other countries as well, make it to people’s
project as the SEGs are people’s project.

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