The energy turnaround in Germany and the need for academic research

Transcription

1 University of Augsburg Prof. Dr. Hans Ulrich Buhl The energy turnaround in Germany and the need for academic research Erasmus Energy Forum 2014 Science Day, June 20 th 2014 Research Center Finance & Information Management Project Group Business & Information Systems Engineering of the Fraunhofer FIT Department of Information Systems Engineering & Financial Management Elite Graduate Program Finance & Information Management

2 International press on the energy turnaround A global challenge addressed the German way Two years of leading battle on climate change end in two days of hard haggling [...] the triple 20 deal of reducing greenhouse gas emissions by 20% by 2020 [...], cutting energy consumption by 20% [ ], and of ensuring that 20% of the EU s energy mix comes from renewable sources deal on an EU-level Binding rules for every member state Different implementation of rules in the EU member states Germany Debates Subsidies for Solar Industry Renewable Energy An ambitious cross-study scheme has given rise to a new industry Merkel Signals Faster Exit From Nuclear Power German way clearly technology-driven Lowering greenhouse gas emissions through rapid diffusion of distributed generation technologies (solar, wind) Goals: Putting Germany s energy industry at the top to enhance export technologies Increasing the speed of phasing-out nuclear power plants 2 Prof. Dr. Buhl The energy turnaround in Germany and the need for academic research FIM Research Center

3 Climate goals examined (I/III) Nation of engineers outperforms renewables climate goal easily Quasi-planned 1) German energy economy In % 80.0 Fast Nuclear phase-out Germany 2020 Goal Adjustment of EEG* (increase of funding rates) Cutbacks of subsidies for Photovoltaics Substitution of base-load power plants by volatile renewable energy sources Compensation for feed-in from renewables Introduction EEG * Adjustment of goal: 30% renewables by 2030 Compared to 1994: resource productivity should double Subsidizing renewables observed targets for 2020 and 2050 Goal already met in ) In 1990 barely any renewables apart from hydro power EEG accelerates growth of renewables from 2000 on Remarks: * Renewable Energies Act in Germany (Erneuerbare-Energien-Gesetz) Source: 1) The Economist 2) BMU Prof. Dr. Buhl The energy turnaround in Germany and the need for academic research FIM Research Center

4 Climate goals examined (II/III) but this leads to strange results! 1 Emissions 2 Grid stability 3 Economic aftermath Emissions from lignite 1) ( ) Grid interventions 2)* ( ) Negative energy prices 3) ( ) in million t CO2 in number of interventions in hours p.a Emissions from lignite grew! by 9% since 2010 Number of grid interventions grew by factor 10 within only! 4 years Hours per year with negative energy prices increased from! 2010 to 2013 by 50 Demand flexibility is key to handle an energy system which is designed by mad men! Remarks: * Example of MITNETZ Strom, one of the biggest grid operators in eastern Germany Source: 1) Umweltbundesamt ) MITNETZ Strom 3) Agora Energiewende Prof. Dr. Buhl The energy turnaround in Germany and the need for academic research FIM Research Center

5 Climate goals examined (III/III) The forgotten challenge: Meeting the energy consumption goal is unlikely lack of awareness and assessment skills Energy saving investments effective in several ways Direct effect on reducing emissions Reducing resource dependency (e.g., Russia) Lower capacity requirements (e.g., transmission lines) Primary energy consumption per capita nearly constant over years 1) -0.7% p.a. -0.2% p.a. -2.8% p.a. The government failed completely to reach the objective of reducing energy consumption. Scale of energy saving investments is low due to awareness and valuation issues Bärbel Höhn, Alliance90/The Greens Party In GJ/p.c. 190 realized realized required Effects less visible to public and media Lack of knowledge and tools for valuing investments observed target 2020 Energy saving s economic implications should drive academia to not only develop technologies but to build integrated methods, to develop theory to justify investments for adding transparency, and to create precedents Source: 1) BMU Prof. Dr. Buhl The energy turnaround in Germany and the need for academic research FIM Research Center

6 Sample solution artifact Extensions of established methods help to make the potential of investments in energy savings more visible! Investments in private or commercial-used buildings can reduce emissions and energy consumption by 35% - 80%. This corresponds to 14% - 32% of the overall primary energy demand in Germany 1). Traditional methods do not sufficiently reflect implications of energy saving measures McKinsey 2007; World Business Council for sustainable development Limitations of traditional valuation methods for energy saving refurbishments leverage the expected resale value of the building significantly reduce the energy costs reduce the volatility of the overall cash outflows for energy consumption Extension An increase in energy efficiency acts as an insurance against energy cost volatility (both on a private and aggregate level) Ecolocical saving potential Economical and ecological profitable investments without insurance effect Willingness to pay and energy savings Source: 1) VDI 2010 Economical and ecological profitable investments with insurance effect Insurance effect 6 Prof. Dr. Buhl The energy turnaround in Germany and the need for academic research FIM Research Center

7 Conclusion Energy turnaround: Need & responsibility of academic research Energy turnaround is a climate policy with strange incentives Good climate policy is rational Need Germany s technology-centered policy risks to fail EU climate goals Strange incentives waste resources in this quest Academia should enhance good policy-making Demands efficient use of resources for the reduction of greenhouse gas emissions i.e. maximizing the reduction of greenhouse gas emissions per unit of deployed resource Incentivizes to invest in new mechanisms that avoid emissions Supporting rational decision-making (e.g., with regard to demand flexibility) is a key responsiblity of academic research Effective (applied) research shall create societal value Richard Watson, June 7 th 2014, Augsburg, Germany Responsibility Reducing greenhouse gas emissions and decreasing energy consumption have tremendous societal value Applied academic research shall help transferring knowledge to practice & politics 7 Prof. Dr. Buhl The energy turnaround in Germany and the need for academic research FIM Research Center

8 Contact University of Augsburg Research Center Finance & Informatione Management Universitätsstraße 12, Augsburg Phone: Web:

9 Excursus: Sample measures to increase demand flexibility First approaches towards an integrated view of both technical and market aspects exist - but further research is required 1 Synergies of generation, consumption and (thermal) storage Financing communal heating/power stations (CHP) Using their thermal storage for virtual power plants Local energy cooperatives 2 3 Incentives through market-oriented regulations Tariff design Since 2009 subsidies for CHP 1) 656 energy cooperatives in 2013 in Germany 2) Aligning solar panels according to market prices Real-time pricing Multiple service classes Since 2012 plant operators can sell electricity at the EEX 4)** Variable tariffs rare, also because of low smart meter coverage 3)* Remarks: * smart meters in private households in 2012 **European Energy Exchange (EEX) Source: 1) BAFA ) DGRV ) dena ) Gawel/Purkus Still a lot of topics in this context need to be covered by academia 9 Prof. Dr. Buhl The energy turnaround in Germany and the need for academic research FIM Research Center