Economics Minister Robert Habeck demands European industrial electricity price
Berlin “We need a European industrial electricity price,” said Economics and Climate Minister Robert Habeck on Monday at the Handelsblatt Energy Summit in Berlin. The energy price crisis cannot be solved without a transnational solution. “It has to happen that way, and I think it’s realistic,” emphasized the Green politician.
Without measures, he expects electricity and gas prices to be at the level of the electricity and gas price brakes. “But that would certainly be an order of magnitude for the industry that is not permanently competitive,” warned the Green politician.
He believes that subsidies are only possible up to the end of the 1920s. They are to be replaced by a different electricity market design and the more flexible use of electricity that has been generated up to now but has not yet been fed into the grid. Habeck described a proposal by the Spanish government, which provides for upper and lower price limits for renewable electricity, as “very interesting”.
Habeck announced tenders for the construction of new gas-fired power plants and details on the planning of the hydrogen network and also did not rule out the storage of carbon dioxide (carbon capture and storage, or CCS for short) in Germany for the future. After last year the focus was almost exclusively on security of supply, this year the focus should once again be on the energy transition.
Top jobs of the day
Find the best jobs now and
be notified by email.
The aim is for at least 80 percent of the electricity consumed in Germany to come from CO2-free sources by 2030. According to the Fraunhofer Institute for Solar Energy Research (ISE), it was 49 percent last year. The planned installed capacity of 115 gigawatts of wind onshore by the end of the decade would mean that more capacity would have to be installed by then than in the past 20 years.
Too few wind turbines in Germany
Almost 30,000 wind turbines are now turning on meadows, fields and in the North and Baltic Seas. After the expansion had hardly progressed in recent years, more wind turbines were installed again for the first time in 2022. According to the Wind Agency, 25 percent and thus almost 300 wind turbines more than in the previous year have been added. The figures are exclusively available to the Handelsblatt.
And yet that is clearly not enough, complains expert Jürgen Quentin from the Fachagentur Wind on Land: “In order for us to return to the climate protection path, more than twice as much wind energy capacity would have to be installed this year and next as in 2022,” he said Handelsblatt. Growth in permits is also far from sufficient. “The urgently needed increase in the number of permits did not materialize at the federal level,” says Quentin.
>> Read here: Significantly more wind turbines were built in Europe in 2022
In addition, Lower Saxony and North Rhine-Westphalia account for almost half of all newly approved wind turbines last year. Berlin, Bremen, Hamburg, Saarland and Bavaria bring up the rear. They either approved no wind turbines at all or, as in Bavaria, just eight of a total of more than 4,000.
Habeck is nevertheless confident: “80 percent renewables by 2030 can be achieved. That’s doable,” he emphasized on Monday in Berlin. Germany must now show that, as an industrialized country with all its demands for security of supply and prosperity, it can quickly decarbonize itself. “We will be judged on that,” said the minister.
Experts warn that the phase-out of nuclear power and coal could result in a power shortage given the slow pace of expansion of renewables. Instead of counting on increasing demand for more and more electric cars, heat pumps and electricity-powered applications, the Federal Government under Economics Minister did the math Peter Altmaier the power consumption forecasts have been good for years. Shortly before he left office, he corrected CDU-Politicians then still.
After the most recent amendment to the Renewable Energy Sources Act (EEG) under Altmaier’s successor Habeck, the current government is now even anticipating consumption of 750 terawatt hours in 2030. This is at the upper end of the range forecast by studies.
Fear of shortages disappears
For a few weeks now, discussions in the energy sector have been less concerned with the question of whether there are acute shortages in Germany. It is more about the question of whether and at what cost the energy crisis can be ended and how expensive the transition to renewable energies will be.
The challenges for the gas supply will still be “huge” in 2023, said Habeck, and warned against feeling safe. In 2022, however, the challenges were still “gigantic”.
Concerns about a “meltdown in German industry” were a “real scenario” and Putin’s plan. “We have looked into the abyss once this year and we are in the process of building a bridge over the abyss.”
The most important part of this bridge are the new terminals for the delivery of liquefied natural gas (LNG). Last weekend, Chancellor Olaf Scholz (SPD) opened the second landing site for LNG in Lubmin in northern Germany. The first terminal in Wilhelmshaven went into operation last year. Habeck announced that the third station in Brunsbüttel will follow in a few days. Through them, German companies can buy LNG from countries such as the USA or Qatar on the world market.
The pipelines from Russia were able to transport 55 billion cubic meters of gas per year. Now an infrastructure for 14 billion cubic meters has been newly created. In 2023, Germany increasingly purchased LNG from its neighboring countries. In the future, most of these deliveries will be processed via the company’s own terminals.
Habeck: The energy crisis could end in 2024
The Economics Minister is giving the all-clear for the current winter, and he also has hope for the winter of 2023/24: If things go well, “then we will finally be able to declare the energy crisis over in 2024”. It’s not certain yet.
In order to reduce gas consumption in the electricity sector, the federal government brought coal-fired power plants with almost six gigawatts back on line from reserve or did not shut down power plant units. Habeck spoke of a “climate policy sin”, which he wanted to keep short. “I definitely don’t want to stand here at the 2024 Handelsblatt conference and say: We have to extend the coal-fired power plants for another year or two,” said Habeck. Then one would have “completely failed” with a view to the structural crisis.
Due to coal-fired power generation, the delayed phase-out of nuclear power, efficiency measures, but above all due to the unusually warm winter, significantly less gas has been used in Europe in recent months than usual. This also brought down the extremely high gas prices in August. But they are not stable, said Habeck. The filling levels in the gas storage facilities are decisive for the price.
A permanent solution for this is only in sight when natural gas is replaced by hydrogen in the medium term. The minister promised that the first hydrogen differential contracts should be concluded this quarter. Hydrogen power plants are designed to be used infrequently, but must be able to maintain power for extended periods of time. In order for this to be worthwhile for the operators, the Ministry of Economics must pass new regulations. That too should happen soon.
CO2 storage in Germany
For the time being, blue hydrogen from Norway is to be burned there, during the production of which the resulting CO2 is separated and stored underground. In the future, it will primarily be green hydrogen that has been produced CO2-free with renewable energy.
>> Read also: Experts are in favor of CO2 storage in Germany
Habeck did not rule out storing CO2 in Germany. However, he does not see that blue hydrogen is being produced on a large scale in Germany. The Ministry of Economics is currently working on the legal basis for exporting CO2 from other industrial processes abroad. According to the minister, geological and economic questions determine where this ultimately happens.
Nevertheless, he continued to call on citizens to save energy. Now it must be a question of getting away from the additional coal power as quickly as possible.
More: Germany must build six wind turbines a day by the end of 2029
