1. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert The German Model - Transition to a New Energy Mix Manchester, UK 24 October 2012

2. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Political Milestones in 2011 Jan. Febr.MarchApr.MayJuneJulyAug.Sept.Oct.Nov.Dec. Nuclear desaster at fukushima 11 March Moratorium (8 nuclear power plants were taken from grid) 15 March Establishment of the Ethics Commission: reassesment of risks of nuclear power 22 March Decision to phase out nuclear power and modify the energy concept 30 May Cabinet decision on accelerating the transformation of the energy system 6 June New laws of energy policy adopted 30 June Specification of the monitoring process for the energy transformation 20 October 2011 2011: Year of the German „Energiewende“ (energy transition) The transition is politically decided and must now be implemented

3. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Areas of Action of the Federal Government‘s Energy Concept (I)  Renewable energies as a cornerstone of future energy supply (80% renewables by 2050)  Energy efficiency as the key factor (renovation of old buildings and efficiency minimum standards for new buildings)  Efficient grid infrastructure for electricity and integration of renewables (need of new extra high voltage power lines, implementation of smart grids)  Coal and gas as bridging technologies (modernisation of coal and gas power plants)

4. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Areas of Action of the Federal Government‘s Energy Concept (II)  Mobility (support of low polluting vehicles, aim: 1 mio. electric cars by 2020 and 6 mio. by 2030, coupling of electromobility and renewables, use as electricity storage in the long run)  Energy research towards innovation and new technologies (funding of research on renewable energies: 447 mio. € in 2010/11, funding in new storage technologies: 200 mio. €)  Acceptance and transparency (intensive dialog with the population, early information)  Monitoring (monitoring of the process to determine whether additional steps are necessary)

5. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Targets by 2020 and 2050 Goal20202050 Share of Renewable Energies 35%80% Climate-damaging greenhouse gas emissions 40%95% Primary energy consumption 10%25% Electricity consumption 10%25% (compared to 2008) Energy productivity Increase of 2.1% p.a. Heat demand in buildings 80%

6. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Towards a Renewable Energy Mix

7. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Catching-up-Process Since 2000 Germany: Not a forerunner of renewable energies in the past (mainly fossil based energy mix) This changed with the year 2000: first desicion to phase out nuclear energy and adoption of the Renewable Energy Sources Act (EEG) by red-green government Beginning of a fast catching up- process toward renewable energies Source: Economist Today: 25%

8. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert EEG – Most Important Instrument of Energy Transition  Main Ideas: Promotion of Renewable Energies, Economic Chances, Job Creation  Elements of Regulation: - Priority of renewable energies  grid operators are obliged to purchase electricity from renewable energy installations as a priority - Guaranteed feed-in payments  for a period of up to 20 years per plant (investment security), degressive steps to reduce costs - EEG cost apportionment  costs of EEG are allocated to the electricity consumers  Exeptions for energy intensive industries: - Energy intensive industries (more than 10 GW of electricity per year) have to pay a lesser amount (0,05 ct/kWh instead of 3,59 ct/kWh)  enhancement of competitiveness at international level (financial relief of 2 billion €)

9. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Development of RES Source: BMU (2011)

10. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Electricity Mix toward Renewable Energies

11. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert The DGB Perspective

12. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert The DGB-Perspective  The German Trade Unions greatly welcome the withdrawal from nuclear power energy  We share the aim to transform the energy system towards renewable energies  But: - the transition process must be socially just and may not lead to a drifting apart of „winners“ and „loosers“ and - the transformation process must not undermine the industrial base (all parts of the value added chain must stay in the country)

13. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Job Creation of REs Source: BMU (2011) Estimation: More than 600.000 Jobs by 2030

14. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Quality of Work  The quantity and quality of jobs is important  Green jobs are not necessarily good jobs - tariff commitments as well as pay, social and working standards need to be improved in some sectors of renewable energies (e.g. solar industry)  Unions policy to improve working conditions - increase the union organisation degree in the green sectors - implement co-determination structures and work councils - Subsidies to promote the green economy should be connected to national laws and standards of the International Labour Organisation (ILO)

15. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Current Political Debates

16. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Renewable Energies – Further Development  Current Situation - Renewable Energies (wind/solar) are developing fast - Germany is well on track to hit ist 2020 goal of 35% (50% RE expected by 2020) - plans for windparks of the Federal states exceed the plan of government by 60%,  Government - The high dynamics of RE expansion must be reduced - Major reform of EEG (CDU), abolition of EEG (FDP) - A new „electricity market design“ is necessary  DGB - EEG is an important instrument to increase the share of renewables - Reform is needed, but no permanent ad hoc changes of EEG - „Moratorium“ of 2-3 years

17. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Energy Prices – Socially Just?  Current Situation - Rising of EEG apportionment: from 3,59 ct kWh to 5,27 ct kWh - Debate on the distribution of costs of RE expansion (small companies and private consumers have to bear the costs of rising apportionment)  Government - Exeptions for energy intensive industries are to be retained, but the „targeting“ of exceptions should be reviewed - Free energy advice to increase energy efficiency  DGB - Energy intensive industry and private consumers should not be placed in opposition to each other - The state must bear part of the costs (abolition of VAT on EEG apportionment) - Financial support for low income households (increase of Hartz IV standard rates, financial support for purchasing energy efficient household appliances)

18. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Grids – Bottleneck of the Energy Transition  Current Situation - DENA-II-Study: between 1800 and 3600 km of new transmission grids - But: expansion is too slow (just 214 km constructed so far) - Long planning and authorization procedures, investors are reluctant, unclear liability rules  Government (NABEG – Law for Speeding up Network Expansion) - Shortening the planning and autorization procedures from 10 to 4 years - Pooling of responsibilities on national level - Broad and early consultation of citizens  DGB - NABEG welcomed, but focus on transmission networks. Distribution networks are not taken into account - As decentralised power input by REs grows, investments in distribution networks become more important (27 bn €) - New models of finance: long-term loans instead of short-term strategies, financial participation of citizens (e.g in grid building, citicens wind farms)

19. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Energy Efficiency- an underused potential  Buildings - Government has announced to double the renovation rate of buildings from 1% to 2% - But: the budget for the „CO 2 - Building-Modernisation-Programme“was reduced, from 2.5 bn € in 2009 to 1.5 bn € in 2012 - Increase annual budget to 5 bn €  Mobility - Not only electromobility, but also more efforts to prevent and shift traffic (relocation fright traffic onto the rails) - Electromobility as complement to carbon-based vehicles (electricity generation for electromobility on basis of RE) - Rethinking of mobility behaviour (car sharing etc.)  Industry - Promotion of combined heat and power - Increase of the energy efficiency fund (500 mio. €) to promote energy efficient technologies (pumps, motors etc.) - Introduction of energy management systems, integrate resource efficiency ratios in balance sheets - Traning and involvement of employees and work councils

20. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Conclusions

21. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Conclusions – What do we need?  Massive investment in infrastructure (grid, storage technologies) to integrate the renewable energies into the supply system.  Reliable framework to improve investment security for investors (no abolition of EEG).  Integrated approach for the future energy system, that draws together the different elements of the energy transformation process (master plan) and careful monitoring of progress.  Institutional changes: Bundling of competencies instead of permanent disputes of competencies between two ministries.  Strengthening the participation of all actors (national platform of “Energiewende”).  Qualification and training of employees and works councils.

22. Abteilung „Industrie-, Dienstleistungs- und Strukturpolitik“Dr. Inge Lippert Thank you for your attention!