Tuesday, October 20, 2009

Germany's renewable energy disaster


 
Germans have been encouraging renewable energy through feed in tariffs, a scheme which allows renewable energy producers to sell electricity back to the grid at  higher cost. Certainly this provides an incentive to produce electricity, but as should have been obvious to anybody, increased electricity costs burden the economy are are a jobs killer:

The allure of an environmentally benign, abundant, and cost-effective energy source has led an increasing number of industrialized countries to back public financing of renewable energies. Germany’s experience with renewable energy promotion is often cited as a model to be replicated elsewhere, being based on a combination of far-reaching energy and environmental laws that stretch back nearly two decades. This paper critically reviews the current centerpiece of this effort, the Renewable Energy Sources Act (EEG), focusing on its costs and the associated implications for job creation and climate protection. We argue that German renewable energy policy, and in particular the adopted feed-in tariff scheme, has failed to harness the market incentives needed to ensure a viable and cost-effective introduction of renewable energies into the country’s energy portfolio. To the contrary, the government’s support mechanisms have in many respects subverted these incentives, resulting in massive expenditures that show little long-term promise for stimulating the economy, protecting the environment, or increasing energy security. In the case of photovoltaics, Germany’s subsidization regime has reached a level that by far exceeds average wages, with per-worker subsidies as high as 175,000 € (US $ 240,000)
I note gross feed in tariffs are NSW  Liberal Party policy so I hope Barry is listening.

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