The Limit for Cost of Renewable in Germany

German Environment minister Peter Altmaier has been discussing about the feed-in tariff surcharges on Twitter yesterday evening (German time). He closed with this tweet:

Ich habe jetzt ca 100 replies und noch immer keine Antwort auf die Frage, wo die Grenze für EEG-Umlage liegt.

There he complains that there have been around 100 replies to his tweets, but no one answers his question on how far the surcharges should be allowed to rise.

Here is a simple answer to that question.

In 2012, the costs of the feed-in tariff system were reported as EUR 16.6 billion.

The IMF estimates German GDP in 2012 as EUR 2,451.3 billion.

It follows that Germany spent only 0.68% of GDP on renewable energy last year.

That amount should be at least three times larger, so as to get to the minimum investment of 2% of GDP needed, considering the existential threat of global warming. EUR 50 billion would be a more responsible figure.

I recall that Germany has a special moral obligation to help dealing with climate change, since the country has enjoyed the fruits of the reckless use of fossil fuel from the 19th Century on.

Assuming that tripling the cost to EUR 50 billion (2 percent of GDP) would result in surcharges of 15 cents per kWh, my answer to Altmaier’s question would be:

Surcharges should be at least at 15 cents per kWh. Present levels of investment are inadequate.

The whole planet is at stake. Humanity may be wiped out by Venus syndrome. This is not the time to get concerned about costs. Speed should be the only concern.

Published by kflenz

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

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