CLIMATE ACTION PLAN 2050

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1 CLIMATE ACTION PLAN 2050 PRINCIPLES AND GOALS OF GERMAN GOVERNMENT S CLIMATE POLICY By Dr. Ursula Fuentes Hu2ilter On leave from former posi:on as Head of Unit, Federal Ministry for the Environment, Nature Conserva:on, Building and Nuclear Safety

2 Overview Ø Starting point: Ø Climate and Energy policy in D and EU, Energiewende Ø Coalition Agreement 2013 Ø Process: Scenario Analysis, Stakeholder Dialogue Ø Outcome: Agreed Climate Action Plan 2050 Ø Outlook

3 Source: BMUB - Climate Action in Figures 2016 Climate Action since 1990 Source: BMUB Climate Action in Figures 2016 *still in development

4 Comparison of absolute emissions of 15 countries (excluding LULUCF) Greenhouse gas emissions - international comparison Source: BMUB Climate Action in Figures 2016, based on data 2013: UNFCCC (2015); UBA (as of march 2016); data 2012: EDGAR (2014)

5 5 Per-capita CO 2 emissions 2014 Source: BMUB Climate Action in Figures 2016, based on EDGAR (2015) and World Bank (2015)

6 EU climate and energy framework GHG emissions reduction (as compared to 1990 (*2005) level) Share of renewable energy Improvements in energy efficiency % To be defined To be defined % (at least) 27 % (at least) 27% (at least) ETS: 43 %* Review in % Non-ETS: 30 %* % 20 % 20 % ETS: 21 %* Non-ETS: 10 %* INDC submitted in March 2015 scope for raising ambition

BMUB Climate Action in Figures 2016 7 EU Climate Roadmap and emission reduction goals Million tonnes of CO 2 equivalents (excl.

7 BMUB Climate Action in Figures EU Climate Roadmap and emission reduction goals Million tonnes of CO 2 equivalents (excl. LULUCF) Source: BMUB Climate Action in Figures 2016, based on EEA (2015) and BMUB (2014) Depicted are the EU s greenhouse gas emissions and the emission reduction goals of the Climate Roadmap 2050

8 Source: BMWI Energiewende targets Climate Renewable Energies Energy Efficiency % greenhouse gas reduction (vs. 1990) % gross electricity consumption % gross final energy consumption % primary energy consumption (vs. 2008) final energy productivity (vs. 2008) building renovation % transport energy consumption (vs. 2008) Achieved % 31.6 % 13.8 % (2014) % 1.7 % p.a. ~1 % p.a. 1.9 % to % p.a. ( ) doubling of renovation rate: 1% à 2% p.a. The energy transition follows a transparent, long-term strategy with specific targets to to Source: Federal Government 2010, BMU/BMWi 2014, BMWi 2015, AGEE-Stat 2014, AGEB 2015, BMWi 2016 Speaker

9 Source: BMUB German nuclear phase-out timeline Nuclear phase out dates back to 2002 Nuclear Energy Act Shut down of 7 nuclear power plants since 2011 S:ll expor:ng electricity in 2014 net exports more than 34 TWh Remaining 10 nuclear power plants will be phased out by GW Nuclear Energy Act Fukushima June 2015 Dec 2019 Dec 2022 Dec 2017 Dec % 57% Source: BMWi

10 Renewables have become power source No. 1 Historic German gross electricity produc:on Electricity mix in 2015 Renewables Source: Ecofys 2016, AGEB 2015, Agora Energiewende 2016 *preliminary data 10

Coalition Agreement: in the light of Paris" Coalition Agreement Dec 2013 "In the light of the European targets and the outcomes of the 2015 Climate Change Conference in Paris, in Germany we want to

11 Coalition Agreement: in the light of Paris" Coalition Agreement Dec 2013 "In the light of the European targets and the outcomes of the 2015 Climate Change Conference in Paris, in Germany we want to define an emissions reduction pathway with a final target of 80 to 95 percent lower greenhouse gas emissions compared to 1990 by We will underpin this target with concrete measures, drawn up through a broad dialogue (Climate Action Plan)."

12 The Light of Paris... Source: M. Meinshausen

13 Paris Agreement emission path vs 2 o C path Source: Fig. 4 Schleussner, C.-F. et al., Science and policy characteristics of the Paris Agreement temperature goal. Nature Climate Change, 6, pp Available at:

14 DEVELOPMENT OF GHG EMISSIONS

15 Climate Ac+on Programme 2020 Target At least 40% reduc0on in GHG emissions by 2020 (vs. 1990) Gap With current policies: 33-34% GHG reduc0on by 2020 (uncertainty of +/- 1%) CAP Climate Ac0on Programme 2020 adopted in Dec 2014 in Cabinet over 100 addi0onal measures Source: BMUB

16 Path to the Climate action plan 2050 Dialogue Process & Scenario analysis BMUB draft Interministerial coordination Cabinet decision on Climate Action Plan 2050 Dialogue Stakeholders and Citizens: June 2015 to March 2016 March 2016 to September 2016 September 2016 to November November 2016

17 Scenario Analysis 1, Mio. tco 2 Equ LS 2011-A *) LS 2011-THG95 *) THGND KSZ-AMS KSZ-KS80 KSZ-KS90 KSZ-KS95 ERP-Ref *) ERP-Ziel *) Historic development Reduction target (base year 1990) % - 95%

18 Source: Climate Protection Scenarios nd final report. Studiy conducted on behalf of BMUB Climate Scenarios I 80% by CS 80-20% Waste management % Agriculture GHG emissions in Mt CO2e % % % % % % 0-100% Reduction compared to 1990 Transport Households Tertiary Industry (incl. process emissions & product use) Energy industry (incl. fugitive emissions) EMS (2012)

19 Source: Climate Protection Scenarios nd final report. Studiy conducted on behalf of BMUB Climate Scenarios II 95% by CS 95-20% Waste management % Agriculture GHG emissions in Mt CO2e % % % % % % 0-100% Reduction compared to 1990 Transport Households Tertiary Industry (incl. process emissions & product use) Energy industry (incl. fugitive emissions) EMS (2012)

Macroeconomic assessment Ambitious climate strategy as a combination of efficiency policy, electricity from renewables and product innovation is a noregret strategy which would pay off in

20 Macroeconomic assessment Ambitious climate strategy as a combination of efficiency policy, electricity from renewables and product innovation is a noregret strategy which would pay off in the long-term. The resulting employment gains would mainly be in the construction, transport and energy sectors. Macroeconomic effects in climate action scenario (56% GHG reduction by 2030):

21 Dialogue Process

22 Climate Action Plan 2050 Structure (I) Preamble and introduction Climate action as a strategy for modernising the economy International context (global and EU) Path towards greenhouse gas neutrality in Germany Fortschreibung, Monitoring

23 Climate Action Plan 2050 Structure (II) Overarching goals for all areas of action: At least 55 percent GHG reduction by 2030 against to 95 percent GHG to 2050 against 1990 guiding principles and transformational pathways 2050 milestones 2030 (strategic) measures Learning process: review, update, monitoring

24 Guiding principles 2050 Extensive greenhouse gas neutrality by mid-century Almost fully decarbonised energy generation Mostly Climate-neutral building stock Transport system virtually independent of fossil fuels Industry: high-efficiency strategy to reduce energy and resource consumption Agriculture: under current conditions, not possible to avoid emissions completely by 2050, but significant further reductions after 2030 too

25 Milestones 2030 sectoral targets Sectors 1990 (absolute, in mil t CO 2 equiv.) actual emissions 2014 (absolute, in mil t CO 2 equiv.) actual emissions Reduction comp to 1990 Energy sector Buildings (heating) Transport ? Industry Agriculture 88 72? Other Total at least 55 %

26 Milestones 2030 sectoral targets Area of action 1990 (absolute, in mil t CO 2 equiv.) actual emissions 2014 (absolute, in mil t CO 2 equiv.) actual emissions 2030 (absolute, in mil t CO 2 equiv.) target 2030 (reduction s compared to base year 1990) Energy sector % Buildings (heating) % Transport % Industry % Agriculture % Other % Total %

27 Strategic Measures (selection) Energy sector: Commission for growth, structural change and regional development; mix of instruments targeting economic development, structrual change and climate action by end of 2018 Buildings: Road map towards almost climate neutral building stock, gradual further development of energy standards for new buildings and refurbishment of existing stock; focusing support for heating systems on renewable energies

28 Strategic measures (II) Transport: Climate action strategy for road transport addressing emissions from passenger vehicles, light and heavy commercial vehicles; GHG-free energy supply, infrastructure and interlinking of sectors Industry: Research and development programme aimed at reducing GHG emissions from industrial processes, directed towards the goal of greenhouse gas neutrality

29 Strategic measures (III) Agriculture: Consistent enforcement of fertilizer legislation, in cooperation with the Länder; aiming to reach target value of 70 kg N per hectare between 2028 and 2032 Land use and forestry: Preservation and improvement of carbon sinks in forests, expansion of forest cover; greater focus on the funding area "forests" contained in the Joint Task for the Improvement of Agricultural Structures and Coastal Protection

30 Strategic Measures (IV) Overarching measures: Reviewing potential for gradually further developing tax system as a way of helping achieve 2050 climate targets Strengthening economic incentives for consumers to steer them towards sustainable production and consumption patterns Reviewing climate-damaging impacts of various taxes

Learning process Where we are Science platform National Climate Action Alliance

proposed measures and sectoral goals Describing measures; adjusting sectoral

transformative paths Updating the Climate Action Plan 2050 Implementing: Action

Action Programmes Interdepartmental coordination; coordination with the

and strategic measures Implementation Cabinet s decision Science platform

31 Learning process Where we are Science platform National Climate Action Alliance Interdepartmental coordination Cabinet s decision Ex-ante impact assessments of proposed measures and sectoral goals Describing measures; adjusting sectoral goals if necessary Increasing ambition, adjusting intermediate goals and transformative paths Updating the Climate Action Plan 2050 Implementing: Action programme Collection and classification of proposals for measures Climate Action Programmes Interdepartmental coordination; coordination with the National Parliament ( Bundestag ) Monitoring and adjusting visions, milestones, and strategic measures Implementation Cabinet s decision Science platform informs Societal process of discourse National Climate Action Alliance Monitoring: Climate Action Report

32 THANK YOU FOR YOUR ATTENTION

33 BACKUP

BMUB Climate Action in Figures 2016 34 Breakdown of EU climate target 2020 Source: BMUB Climate Action in Figures

34 BMUB Climate Action in Figures Breakdown of EU climate target 2020 Source: BMUB Climate Action in Figures 2016 The EU climate package of 2008 includes the division of the EU climate target for 2020 between all 28 Member States

35 Climate Scenarios

36 Emissionspfade der Szenarien

37 Korridore 2030 in Szenarien 37

38 Change of electricity consumption in CS 80, Change in net elec. consumption in TWh CS 80 Electric vehicles (new elec. consumption) replace fossil-fuel-powered vehicles Heat pumps (new consumption) replace fossil-fuel-based heat generation Elect. savings and efficiency improvements in conventional elec. consumption Conventional elec. consumption CCS Electric mobility Heat pumps / power-to-heat 80% 60% 40% 20% 0% -20% -40% Change compared to 2008 Power-to-gas / -liquid Losses of supply, own consumption of power plants, stored electricity, other energy industry Gross electricity consumption EMS (2012) Gross elec. consumption CS 80

39 Change of electricity consumption in CS 95, Change in net elec. consumption in TWh Additional elec. consumption from 2030 due to CCS CS Conventional elec. consumption CCS From 2040: power-generated fuels for transport 80% 60% 40% 20% 0% -20% -40% Change compared to 2008 Electric mobility Heat pumps / power-to-heat Power-to-gas / -liquid Losses of supply, own consumption of power plants, stored electricity, other energy industry Gross electricity consumption EMS (2012) Gross elec. consumption CS 95

Coal policy: Electricity production from lignite halved by 2030 CS 80 EU ETS: 2050: 130 /EUA Expansion of renewable energy:

40 Gross elec. production and elec. exchange balance in TWh Electricity production and electricity imports in CS 80, Coal policy: Electricity production from lignite halved by 2030 CS 80 EU ETS: 2050: 130 /EUA Expansion of renewable energy: 2050: 83% Imports: 2050: 61 TWh Other PV Wind Biomass Natural gas Hard coal Lignite Nuclear energy Imports/exports GHG CS 80 GHG EMS (2012) GHG emissions in Mt CO 2 e

marginal electricity production from coal fired power plants in 2030 CS 95 Expansion of renewable energy: 2050: 83% EU ETS: 2050: 200 /EUA Low

41 Gross elec. production and elec. exchange balance in TWh Electricity production and electricity imports in CS 95, Coal policy: Only marginal electricity production from coal fired power plants in 2030 CS 95 Expansion of renewable energy: 2050: 83% EU ETS: 2050: 200 /EUA Low imports: 2050: 7 TWh Other PV Wind Biomass Natural gas Hard coal Lignite Nuclear energy Imports/exports GHG CS 95 GHG EMS (2012) 2050: significant reconversion to electricity GHG emissions in Mt CO 2 e

Source: BMWI Key elements of the Energiewende

and system integration Renewable Energy Key

Ordinance Energy research and development Key

Energy Heat Act Increasing energy productivity

policy Steady growth Environmentally friendly energy

42 Source: BMWI Key elements of the Energiewende Supporting fields of action Energy Efficiency Market and system integration Renewable Energy Key legislation: Energy Saving Ordinance Heating Cost Ordinance Energy research and development Key legislation: Renewable Energy Sources Act Renewable Energy Heat Act Increasing energy productivity Cost-efficient savings European energy and climate policy Steady growth Environmentally friendly energy supply Energy efficiency and renewables secure a sustainable energy transition. 42

43 Source: BMWI Key elements of the Renewable Energy Sources Act (EEG) Amendment 2017 Renewable support levels for most technologies are now determined individually by the market through auc:ons. Guiding principles Introduction of auctions for most technologies Diversity of actors Costefficient Quantity control - Clear delimitation of new installed capacity - Technologies covered - Onshore wind (2,800 MW) - Offshore wind ( MW) - PV (600 MW; > 750 KW)) - Biomass ( MW) Source: Ecofys

Source: BMWI Referent 44 Onshore wind U+lity- scale solar PV Morocco USD 30/MWh Germany USD 47-100/MWh Germany USD 75 130/ MWh United States USD 47/MWh United States USD 65-70/MWh Canada USD

South Africa USD 51/MWh South Africa USD 65/MWh Egypt USD 41-50/MWh This map is without prejudice to the status or sovereignty over any territory, to the delimitation of international frontiers

44 Source: BMWI Referent 44 Onshore wind U+lity- scale solar PV Morocco USD 30/MWh Germany USD /MWh Germany USD / MWh United States USD 47/MWh United States USD 65-70/MWh Canada USD 66/MWh Turkey USD 73/MWh China USD 80 91/MWh India USD /MWh Brazil USD 81/MWh Brazil USD 49/MWh Jordan USD 61-77/MWh United Arab Emirates USD 29/MWh Chile USD 29-68/MWh Uruguay USD 90/MWh South Africa USD 51/MWh South Africa USD 65/MWh Egypt USD 41-50/MWh This map is without prejudice to the status or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area Best results occur where price compe00on, long- term contracts and good resources are combined Australia USD 69/MWh Source: IEA MRTMR 2015

45 Source: BMWI Flexible power market no baseload economics in the future 27-Mar-17 Referent 45

46 Source: BMWI Referent 46 Number of hours with negative prices, average negative price and lowest price Generators adapt to flexibility

47 Source: BMWI Key elements of the electricity market act 2016 More flexibility Ensure system security Lower carbon emissions Strengthened market mechanisms Fair competition between flexibility options Capacity reserve Grid reserve Security stand-by Monitoring of security of suppy Free price formation Strengthen incentives to uphold balancing group commitments Wider access to balancing capacity markets: more competition between power stations, consumers and storage facilities Power stations of approx. 4 GW ready to step in exceptional situations where demand cannot be met in any other way Prolonged beyond 2017 to guarantee secure grid operation and relieve congestion Winter grid reserve Old lignite-fired power stations will be placed on security stand-by and decommissioned after four years Monitoring of security of supply will no longer focus solely on national output, but also on European internal electricity market

48 Source: BMWI Speaker 48 Share of renewables has grown in all sectors, but fastest in electricity Share of RES in Germany in % * 2020 target electricity heating and cooling transport Source: Ecofys based on AGEE-Stat 2016, BMWi 2016, Agora 2017

49 Source: BMWI Sector Coupling /electrification of enduse sectors Renewable energy Transport Sector Consumption of fossil fuels decreases by more efficient use, sector coupling and the use of renewables Fossil energy Electricity Sector Coupling (e.g. E-Mobility) Electricity traditional electricity consumption (e.g. household devices, industrial processes) decreases by improved electricity efficiency Electricity Sector Coupling (e.g. heat pumps) Heat Consumption of fossil fuels decreases by improved efficiency, sector coupling and use of renewables Renewable energy Fossil energy Own graph, based on IWES et al. (2015) time 27-Mar-17 Referent 49

50 Options to increase flexibility in all areas Share of RE 20% 35% 50% 65% 80% Target year Network Grid expansion Supply Storage Flexibility (conventional and renewables) Pumped storage Batteries Power-to-gas Demand Load management Demand response Sector coupling Heating Transport Power-to-x Markets Short-term products on spot and balancing markets Flexibility options are key to making the market renewables-ready. Source: Ecofys

CLIMATE ACTION PLAN 2050

CLIMATE ACTION PLAN 2050 PRINCIPLES AND GOALS OF THE GERMAN GOVERNMENT S CLIMATE POLICY by Division KI I 1: Strategic Aspects of Climate Policy, Climate Action Plan Federal Ministry for the Environment,