Sunday, 14 March 2010

Renewable Energy - A Warning from Germany

Dr Richard North has picked up on an important report from the Rheinisch-Westfälisches Institut für Wirtschaftsforschung, entitled: "Economic impacts from the promotion of renewable energies: The German experience" - (don't worry, it's in English).
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)

Dr North's own commentary on this report usefully brings in some UK examples:
Yet, this is the scheme (feed-in tariffs) that is to come into force in the UK on 1 April. Predictably, organisations such as the National Trust are leaping on the bandwagon, having already fitted PV to their Dunster Castle in Somerset. They are adding insult to injury by attracting funding from Barclays, the "Big Lottery Fund Bio-Energy Capital Grants Scheme" and the Rural Development Programme. Equally predictably, they do not tell us how much this is going to cost other electricity consumers, concentrating instead on the illusory "carbon" savings.

He ends with:
Forgive me for harping on, but this is so staggeringly stupid – in a land beset with stupidity – that it is difficult to take on board. One can only surmise that they really cannot be that stupid, and it is all a joke. After all, the scheme is set to start on 1 April.

We forgive you Richard. At least you're taking notice and trying to warn us.

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