Renewable Lowering Electricity Cost in Germany (Japanese Resource)

Tetsunari Iida just pointed on Twitter to this Tech-on article (in Japanese) about several lectures by German experts in Tokyo yesterday.

I think it is a great resource and am looking forward to use it as a reference when some ignorant Japanese comment doesn’t understand that renewable makes electricity cheaper in Germany.

I also learned some new facts myself and recommend to anyone able to read Japanese to take a look at this article.

These lectures were at the occasion of the 2nd Fraunhofer Tokyo Solar Day, held yesterday. I was not able to attend, since I had lectures of my own at my university.

The article introduces Cornelia Viertl of the German Environment Ministry as the first speaker. It then reports some facts from her presentation:

In September 2011 future contracts for electricity were traded at 57.5 euro a MWh. That price has gone down 19 percent to 48 euro in June 2012.

The feed-in tariffs for solar have already reached grid parity in 2012. They are now at 17.9 cents per kWh for systems under 30 kW and at 12.39 for systems under 1 MW, and will keep on falling. That means that there will be no increase of the surcharges for household users even if a lot more solar capacity is added.

I hesitate to agree unconditionally with the latter statement. While it is correct that the increase in surcharge will be much less than under much higher feed-in tariffs, it will obviously not be zero as long as the feed-in tariffs are higher than wholesale prices.

The second speaker was Prof. Eicke Weber, president of Fraunhofer Institute for Solar Energy Systems since 2003. He noted the following facts.

Since renewable energy (especially solar) nicely covers the midday peak, coal plants can run at the same level all day, saving costs in comparison to a situation where they need to increase their production for peak hours. So renewable energy is not only making electricity cheaper on the wholesale market, it also makes electricity generated by coal plants cheaper.

Germany employs now 400,000 people in the renewable energy industry, which is about half of the number of jobs in the car industry.

Generating costs for solar are now between 13 and 16 cents euro per kWh, which is about half of the costs for households buying electricity from the grid. In countries with better solar resources than Germany, these costs should be under 10 cents euro.

The speed of decreasing the cost of solar is much faster than for wind. That means that eventually solar will catch with up and surpass wind. Around 2030, solar, wind, and hydro will all be around 5 cents, beating fossil fuel and nuclear by a large margin.


Published by kflenz

Professor at Aoyama Gakuin University, Tokyo. Author of Lenz Blog (since 2003,

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: