Another hole to fill in the German state budget… The figures came out this weekend: nearly 9 billion euros are missing to finance the development of renewable energies, such as wind or solar power!
To encourage the energy transition, since 2000 the German state has guaranteed a higher price to suppliers of electricity produced from renewable energy sources.
In the past, this compensation was financed by a consumption tax. But the government decided to cover the costs. Except that since then, the price of electricity has fallen sharply on the stock market. And the budget forecasts were significantly exceeded – almost double the amount initially planned!
Electrical infrastructure to be reviewed for renewables
This example from Germany shows the complexity of the energy transition for the countries of the European Union… which have set themselves a goal of climate neutrality by 2050.
So that the entire continent can benefit from electricity produced from renewable sources, we must also set up a European electricity network capable of transporting this electricity. According to Kadri Simson, European Commissioner in charge of Energy since 2019, Europe is already halfway there:
“Europe’s electricity infrastructure is already very well developed. We plan to electrify different sectors, which means that our energy consumption will double. And of course, this means that we also need to strengthen our electricity network. We need to modernize it to allow the installation of more renewable energies.”
Geographic complementarities
European countries have different strengths when it comes to green electricity production. To put it simply: in the north and by the sea, there is wind and wind turbines. And in the south, it’s the sun and solar energy. A complementarity that is not only geographical, according to Harald Bradke, director of the competence center for energy technologies and systems at the Fraunhofer Institute in Karlsruhe.
“Photovoltaics and wind complement each other well because wind produces electricity mainly in winter and photovoltaics mainly in summer. And we also have storage capacities in Scandinavia and in the Alpine countries of Austria , Italy and Switzerland When the demand for electricity is higher than what we can produce, we can use this electricity.
In mountainous regions, pumped storage power plants can regulate electricity needs: if there is too much, it can be used to pump water into a dam and if there is not enough, the Discharged water turns the turbines which function like huge batteries.
According to Harald Bradke, the more European countries are interconnected, the more efficient the supply of green electricity will be.
“The advantages are that electricity is cheaper because it is purchased directly where it is produced at low cost. There is no need to turn on expensive reserve plants that only run for a few hundred hours per year to produce electricity Instead, we can achieve a balance by transporting electricity across Europe and getting it where it is particularly cheap. And everyone benefits.
The problem of high voltage cables
So that everyone benefits, the network of high voltage lines should be expanded. And that’s where things get tricky. You can see this just by looking at the map of Germany. The north of the country produces a lot of electricity thanks to wind power, but it is the south, where the large industrial centers are located, which needs it the most. However, in Germany, the construction of north-south electricity networks is progressing only slowly…
“It’s a big problem. We are about seven years behind on the network expansion and we should have had 6,000 kilometers more by now.”
It’s not just a money problem. Many local residents are opposed to the construction of electricity pylons: for example, they fear health problems or that their land will lose value. Burying cables is not a solution either: it is expensive and harms agriculture, explains Harald Bradke…
“These underground cables are much more expensive than overhead cables. And they are not very good for farmers. High voltage currents have losses and dry out the soil. Where the cables are located, one and a half meters deep and over a length of 20 to 25 meters, a farmer can hardly plant anything and must be compensated accordingly.”
What funding for the new network?
The German example shows the scale of the challenge represented by an interconnection between several EU countries. However, the European Commissioner for Energy, Kadri Simson, believes that there are solutions.
“Cross-border interconnections require a greater share of public money. Because otherwise, disputes concerning the beneficiary – the one who produces renewables or the one who consumes them – risk lasting too long. So for cross-border infrastructure, the money public is a means of resolving conflicts.”
The rules for the construction of trans-European networks (TEN-E) have been adapted to facilitate access to European funding, with the aim of accelerating the development of renewables. The Estonian Commissioner is also committed to strengthening the “Connecting Europe Facility” fund set up by the EU.
“For this decade we need 800 billion euros. But keep in mind that in 2022 alone, European consumers have paid 600 billion euros to buy fossil fuels from third countries. So this may seem like a massive need for investment, but at the same time, fossil fuels aren’t free either.”
Part of the costs could well be borne by private investors, believes energy expert Harald Bradke. He gives the example of the construction of a power line between Germany and Great Britain, which must be financed exclusively by private funds.
“Large insurance companies and pension funds are looking for safe financial investments. The return should not be too high: 4 to 6% is enough. But it must be safe and long-term.”
Harald Bradke points out, however, that money is not everything when it comes to network expansion. According to him, it is important to assess real needs to avoid ending up with ruins of high voltage lines that no one would need anymore…
The current financial framework, which determines the EU budget, is still valid until 2027. The rest will be in the hands of the European Parliament which has just been elected… and the next European Commission which is underway negotiations.
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On July 1, “cannabis clubs” open in Germany… or not
Seen from Germany, second part… We stay in Europe and even in Germany. After decades of repression, the country has decided to make a 180-degree turn in its policy against narcotics: since April 1, possessing and consuming cannabis is now legal for people over 18 years old.
Although the legal framework is extremely strict, particularly regarding quantities and consumption in public spaces, Germany has become the most progressive country in Europe when it comes to cannabis.
Monday, July 1, a new step will be taken: “cannabis clubs” will be able to officially open their doors. Completely legal places for the production and sale of cannabis.
But faced with administrative difficulties and still very strong stigma, cannabis clubs still seem to be a very distant dream for consumers. From Berlin, the report by our correspondent Julien Mechaussie
