In June, thanks to the Heinrich Böll Foundation, I had the chance to join a study tour to Denmark and Germany with staff from several US-based foundations that, like Barr, are working to accelerate our transition to a clean energy economy. In my last post, I wrote about Copenhagen, its bike culture, its commitment to wind power, and other ideas driving progress towards that city’s goal to be the world’s first “carbon neutral” capital by 2025.
After Copenhagen, our next stop was Germany, where we crisscrossed the country, meeting with politicians, farmers, community activists, small business owners, and many others to see how they were all engaged in the “Energiewende” – Germany’s energy transition.Between 2010 and 2011, committed to building on three decades of solid progress on renewable energy and unnerved by Fukushima, the German parliament enacted a series of polices to shift its power sector away from fossil fuels and nuclear to 80% renewables by 2050.
Two years later, they are well on their way. 25 percent of Germany’s electric power comes from solar, wind, and biomass. For comparison, in New England, 6.8% percent of our energy comes from renewable sources.Germany leads the world in installed solar capacity, even though it gets less sun than anywhere in the US, except maybe Alaska.
How is this possible? Here are a few things that stood out to me…
Left, Right, and Center – All German Politicians See a Green Future
After two days in the German countryside, we made our way to Berlin, and to the Reichstag – where the German parliament meets, and where, a few weeks later, President Obama stood and hinted at a major climate announcement soon to come from Washington. After German reunification, this imposing building only steps from the Brandenburg Gate was restored by Sir Norman Foster, an English architect. Foster set out to make the Reichstag into the greenest parliament building in the world.Now, a beautiful glass dome equipped with a solar-powered mirror, screen, and ventilation system allows both fresh air and daylight to stream into the parliament chambers. A combined heat and power plant (powered by rapeseed oil) provides energy to the Reichstag and several nearby buildings. Surplus heat is captured and stored a thousand feet below ground, until it is needed for heating during the winter.
In the Reichstag, we spoke with legislators and government officials from every side of the political spectrum – left, right, and center. What was striking to all of us in the group was their shared vision for a green Germany. They all bought into the economic and business case for the Energiewende as a way to maintain and grow Germany’s status as an economic powerhouse.
Policy- and People-Powered Renewable Power
In Berlin, we learned about the policy frameworks that set the energy transformation in motion. To see what this meant at the community level our hosts brought us to Husum, a town on the North Sea.As our train sped through the German countryside, I was awestruck by the scenery – large wind turbines and farm buildings covered with solar panels amidst the bright yellow fields of rapeseed, and grazing livestock.
In Husum, we met farmers who pooled resources with neighbors to erect wind turbines, install solar panels on their buildings and in their fields, and to build biomass generators.One farmer took us on a tour of his farm: “That’s the wheat field, the barley field, the rapeseed field,” he said. “And over here,” he added, beaming, “is my solar field.” Another farmer took us on a tour of the wind turbines he built with his neighbors, and of his barns that he’d converted to office space for 14 staff he hired to manage the business aspects of his energy micro- enterprises. We also visited a farmer who has built a biogas plant that generates electricity and heat from pig manure, corn, beets, and factory byproducts.
When you look at the data on ownership of power generation in Germany, it is clear that the farmers we visited with aren’t outliers. Germany’s Renewable Energy Agency
Half of all German renewable energy capacity is owned by individuals. 11% of these are farmers like those we met in Husum. Only 6.5% is owned by utility companies.
Energy projects like the ones we saw were rapidly developed when Germany introduced what is called a “feed in tariff.” This policy guaranteed a steady return over 20 years for investors in renewable energy.Based on this guaranteed revenue stream, a farmer could go to a bank and get a loan to finance the purchase and installation of a solar array on his barn or in his fields. The feed in tariff also gives priority to any renewable energy project that wants to connect into Germany’s energy grid, with no limits on the amount of energy. In these ways, feed in tariffs accelerate the development of the renewable energy industry and its entire supply chain, from manufacturers and suppliers to service providers. Meanwhile, regulators monitor and frequently adjust tariff rates for new contracts to give manufacturers the constant incentive to innovate and drive costs down.
Cooperatives are the common way for community members and farmers to invest in energy production.Currently, over 80,000 citizens hold shares in collectively run systems for the generation of electricity and heat. Since 2010, the number of cooperatives has tripled (to 700). Andreas Wieg of DGRV, the national cooperative association, calls this ownership structure a “NIMBY-buster,” because acceptance levels for renewable energy increase as cooperative owners reap the direct financial benefits as shareholders. They also see the secondary benefits, as a growing clean energy market generates well-paying jobs, which, in turn generate tax revenues for their communities. And they’ve become a destination for energy tourists like us. That farmer with the 14 staff was gracious enough to lead us to the top of one of his wind turbines, from where I took the photo below. What a view!
This cooperative model is also beginning to have its followers in big cities like Berlin. One of the people we met there was 25 year old Arwen Colell, who organized a cooperative called, BuergerEnergie Berlin (Citizen Energy Berlin). Under Colell’s leadership, BuergerEnergie Berlin is pooling investments from members to make a bid for control of the city’s electricity distribution system. In their view, the utility currently managing that system has failed to keep pace with Germany’s transition to renewable energy.Clearly, this group has lit a fire under residents and mobilized them around something that is normally taken for granted – an electricity distribution network.
Great Progress, but No Blueprint Yet for that Next 55%…
Germany’s progress is impressive. Yet, there is no clear roadmap or blueprint for how it will get from 25% to 80% renewables. Policymakers are well aware of the heavy lift required to make the shift.We met with Rainer Baake, a former State Secretary at the Environment Ministry and one of the architects of Energiewende, and now director of think tank, Agora Energiewende. He noted that progress in the coming years will depend on things like reforming the energy market design, investing in grid infrastructure upgrades, inventing new ways to more effectively store energy, and smart demand response mechanisms – which allow energy users to shift their consumption to times when supply is ample and prices are low.Interestingly, the one thing that we have in the Northeast of the U.S. that the Germans don’t (at least not yet) is a market mechanism to allow demand response (turning down electricity use to help manage grid needs; see ISO New England). But with the pace they are on, I wouldn’t be surprised if they are soon taking what we’ve been learning here, and putting it to work for them too.
In a new, related post on his “Cars, Cows, and Coals” blog, Ben Paulos, one of my fellow travelers in Denmark and Germany, discusses five big ideas that motivated Germany to move so aggressively towards their energy goals.
