Key Questions

Energy policy remains the subject of intense debate, but not the question of whether to pursue the energy transition, rather only the question of how.

In Germany, the issue of energy supply has long been a controversial political issue. In particular, nuclear energy was the subject of intense controversy for decades. But since the German parliament’s June 2011 decision to embark on the Energiewende, there exists in Germany a cross-party consensus on the transition, which is shared by the majority of German citizens. The phase-out of nuclear energy by 2022 and specific targets for renewable energy development in the electricity sector are now fixed by law. The energy strategy of the federal government also stipulates other goals, especially in the area of energy efficiency and energy savings.
This generational project aims to secure a sustainable energy supply for the future, without the risk of further nuclear catastrophes or uncontrollable climate change. Naturally, energy policy remains the subject of intense debate, but not the question of whether to pursue the energy transition, rather only the question of how. This debate is worthwhile. It helps determine the best way to achieve the Energiewende, with the aim distilling the best interest of the entire society from the conflicting interests of individuals – for this generation and its heirs.

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Core results

  1. 1

    Synthetic fuels will play an important role in decarbonising the chemicals sector, the industrial sector, and parts of the transport sector.

    Synthetic fuel production technologies can be used to manufacture chemical precursors, produce high-temperature process heat, as well as to power air, sea and possibly road transport. Because synthetic fuels are more expensive than the direct use of electricity, their eventual importance in other sectors is still uncertain.

  2. 2

    To be economically efficient, power-to-gas and power-to-liquid facilities require inexpensive renewable electricity and high full load hours. Excess renewable power will not be enough to cover the power demands of synthetic fuel production.

    Instead, renewable power plants must be built explicity for the purpose of producing synthetic fuels, either in Germany (i.e. as offshore wind) or in North Africa and the Middle East (i.e. as onshore wind and/or PV). The development of synthetic fuel plants in oil- and gas-exporting countries would provide those nations with a post-fossil business model.

  3. 3

    In the beginning, synthetic methane and oil will cost between 20 and 30 cents per kilowatt hour in Europe. Costs can fall to 10 cents per kilowatt hour by 2050 if global Power-to-Gas (PtG) and Power-­to-Liquid (PtL) capacity reaches around 100 gigawatts.

    The aimed-for cost reductions require considerable, early and continuous investments in electrolysers and CO2 absorbers. Without political intervention or high CO2 pricing, however, this is unlikely, because the cost of producing synthetic fuels will remain greater than the cost of extracting conventional fossil fuels.

  4. 4

    We need a political consensus on the future of oil and gas that commits to the phase-out of fossil fuels, prioritises efficient replacement technologies, introduces sustainability regulations, and creates incentives for synthetic fuel production.

    Electricity-based fuels are not an alternative to fossil fuels but they can supplement technologies with lower conversion losses, such as electric vehicles and heat pumps. Application-specific adoption targets and binding sustainability regulations can help to ensure that PtG and PtL fuels benefit the climate while also providing a reliable foundation for long-term planning.

  1. 1

    From 2019, a “Lusatia Structural Change Fund” should be established within Germany’s federal budget.

    The aim of the fund would be to strengthen the region’s economic attractiveness and its desirability as a place to live. It should help to: preserve the region’s industrial character, strengthen innovation among its businesses, support its academic institutions, equip it with an up-to-date transport network and digital infrastructure, and foster a lively civil society that retains local residents while also attracting new ones.

  2. 2

    The Lusatia Fund should be endowed with 100 million euros per year for 15 years, to be divided equally between four key pillars: business development, academia, infrastructure, and civil society.

    In each of these areas, it should be possible to use the available funds in a flexible manner (i.e. to shift funding between areas), and funds that are not withdrawn should not expire (i.e. funding should be transferable to subsequent years).

  3. 3

    Regional stakeholders from the spheres of business, academia, politics, and civil society should play a key role in awarding of funds.

    The federal government should only play a monitoring and coordinating role, as part of a steering committee; decisions on funding priorities should be made by stakeholders from the region.

  4. 4

    The funds assigned to the civil society pillar should be administered by a new “Lusatia Future Foundation.”

    Raising the attractiveness of a region means more than just promoting its economy, academic institutions and infrastructure. Ultimately, the vibrancy of a place depends on art, culture, lived traditions and the quality of civil society. These factors require ongoing support, which can be guaranteed in the short term through the Structural Change Fund and in the long term through developing a foundation with a strong endowment.

From study : A Future for Lusatia
  1. 1

    Face à la croissance des énergies renouvelables, la France et l’Allemagne sont confrontées à des enjeux communs sur la restructuration de leurs parcs de production conventionnelle.

    Avec un objectif d’électricité renouvelable de 40 % en France et de 50 % en Allemagne d’ici 2030, les deux pays augmenteront considérablement leur production d'énergie éolienne et solaire. Le parc de production conventionnelle devra donc être restructuré afin d’éviter des coûts échoués.

  2. 2

    En France, le développement visé des énergies renouvelables et le réinvestissement dans le parc nucléaire ­au-delà de 50 GW comporterait un risque important de coûts échoués dans le secteur électrique.

    Un parc nucléaire supérieur à 40 GW augmenterait les exportations d'électricité et repousserait, au-delà de 2030, l'atteinte de l'objectif de réduction de la part du nucléaire à 50 % de la production électrique. La rentabilité d'un parc nucléaire supérieur à 50 GW ne serait pas assurée en 2030, malgré l’hypothèse d’une augmentation de 60 % des capacités d'exports françaises, un doublement des interconnexions en Europe et un prix du CO₂ à 30 euros par tonne de CO₂.

  3. 3

    En Allemagne, l’atteinte des objectifs climatiques nécessite une division par deux de la production des centrales à charbon et un rehaussement de l’objectif national d’électricité renouvelable à au moins 60 % de la consommation d’électricité en 2030.

    Dans ce cas, la balance des échanges électriques de l’Allemagne avec ses voisins est équilibrée. L'augmentation prévue de la part des énergies renouvelables à 65 % de la consommation brute d'électricité en 2030 contribuera à éviter que l'Allemagne ne dépende d'importations non-désirées dans un contexte de sortie du charbon.

  4. 4
  1. 1

    Face à la croissance des énergies renouvelables, la France et l’Allemagne sont confrontées à des enjeux communs sur la restructuration de leurs parcs de production conventionnelle.

    Avec un objectif d’électricité renouvelable de 40 % en France et de 50 % en Allemagne d’ici 2030, les deux pays augmenteront considérablement leur production d'énergie éolienne et solaire. Le parc de production conventionnelle devra donc être restructuré afin d’éviter des coûts échoués.

  2. 2

    En France, le développement visé des énergies renouvelables et le réinvestissement dans le parc nucléaire au-delà de 50 GW comporterait un risque important de coûts échoués dans le secteur électrique.

    Un parc nucléaire supérieur à 40 GW augmenterait les exportations d'électricité et repousserait, au-delà de 2030, l'atteinte de l'objectif de réduction de la part du nucléaire à 50 % de la production électrique. La rentabilité d'un parc nucléaire supérieur à 50 GW ne serait pas assurée en 2030, malgré l’hypothèse d’une augmentation de 60 % des capacités d'exports françaises, un doublement des interconnexions en Europe et un prix du CO₂ à 30 euros par tonne de CO₂.

  3. 3

    En Allemagne, l’atteinte des objectifs climatiques nécessite une division par deux de la production des centrales à charbon et un rehaussement de l’objectif national d’électricité renouvelable à au moins 60 % de la consommation d’électricité en 2030.

    Dans ce cas, la balance des échanges électriques de l’Allemagne avec ses voisins est équilibrée. L'augmentation prévue de la part des énergies renouvelables à 65 % de la consommation brute d'électricité en 2030 contribuera à éviter que l'Allemagne ne dépende d'importations non-désirées dans un contexte de sortie du charbon.

  4. 4
  1. 1

    With the growth of renewable energy, France and Germany are facing common challenges regarding the restructuring of their conventional power plant fleet.

    With a renewable electricity target of 40% in France and 65% in Germany by 2030, the two countries will significantly increase their production of wind and solar energy. Their conventional power plant fleet will have to be resized accordingly to avoid stranded costs.

  2. 2

    In France, the targeted development of renewable energy alongside the reinvestment in the nuclear fleet greater than 50 GW would pose a significant risk of stranded costs in the electricity sector

    A nuclear fleet exceeding 40 GW in 2030 would increase the national electricity export surplus and additionally postpone the achievement of the objective of reducing the share of nuclear power to 50% beyond 2030. The profitability of a nuclear fleet greater than 50 GW would not be assured in 2030, even when assuming a 60% increase in French export capacity, a doubling of interconnectors capacity in Europe and a CO2 price of 30 euros per ton of CO2.

  3. 3

    In Germany, achieving climate targets requires a halving of coal-fired power generation and an increase in the national renewable electricity target to at least 60% of electricity consumption in 2030.

    In this case, Germany’s electricity trade balance with its neighbours is balanced. The new planned target of 65% renewable energy in electricity consumption by 2030 will ensure that Germany will not depend on undesired electricity imports while phasing-out coal.

  4. 4
  1. 1

    A power system with a 95 percent share of renewables has the same or even lower costs than a fossil-based system under most assumptions for future fuel and CO₂ prices.

    A coal-based system would only be significantly less expensive if extremely low CO₂ prices are expected in 2050 (20 euros/t). Similarly, a natural gas-based system would only be significantly less expensive if gas prices are low and CO₂ prices are not high (i.e. below 100 euros/t).

  2. 2

    A renewables-based system insulates the economy against volatile commodity prices, as the costs of fossil-based systems heavily depend on fuel and CO₂ price trends.

    Variable costs (largely for fuel and CO₂) account for 30 to 67 percent of the total costs of the fossil-based systems. By contrast, variable costs represent just 5 percent of costs in the renewables-based systems.

  3. 3

    A power system with a 95 percent share of renewables reduces CO₂ emissions by 96 percent their 1990 levels at CO₂ abatement costs of about 50 euros/t.

    A renewables based energy transition can thus be considered efficient climate policy, as CO₂ damage costs are estimated a lot higher (80 euros/t over the short-term, and at 145 to 260 euros/t over the long term).

  1. 1

    The heating sector needs to phase out oil: A cost-efficient, climate friendly energy mix for building heating would most likely consist of 40 per cent natural gas, 25 per cent heat pumps, and 20 per cent district heating – with little to no oil.

    In this scenario, the importance of natural gas remains roughly the same as today, while oil heating is almost entirely replaced by heat pumps. District heating is another key factor. By 2030, district heating will primarily draw on heat from CHP plants, but it will increasingly rely on solar thermal energy, deep geothermal energy, industrial waste heat, and large-scale heat pumps as well.

  2. 2

    Efficiency is decisive: To meet 2030 targets, energy use for building heating must decline by 25 per cent relative to 2015 levels.

    Energy efficiency is a pillar of decarbonisation because it makes climate protection affordable. Improving energy use efficiency in buildings requires a green retrofit rate of 2 per cent and a high retrofit depth. But current trends in building modernisation fall far short of these targets.

  3. 3

    The heat pump gap: Based on current trends, some 2 million heat pumps will be installed by 2030 – but 5 to 6 million are needed.

    To close this gap, heat pumps must be installed early on not only in new buildings but also in existing buildings, for example as bivalent systems with fossil fuel-fired boilers for peak demand. If heat pumps can be flexibly managed and existing storage heaters replaced with efficient heating units by 2030, the 5 to 6 million heat pumps will affect only a slight rise on peak demand that thermal power plants must cover.

  4. 4

    Renewable electricity for heat pumps: By 2030, renewable energy must comprise at least 60 per cent of gross power consumption.

    To reach the 2030 climate protection target, additional electricity consumption in the heating and traffic sector must be covered by CO2-free energy sources. But the new renewable energy capacities stipulated in EEG 2017 will not suffice to do so.

From study : Heat Transition 2030
  1. 1

    The European power system will be based on wind power, solar PV and flexibility.

    The existing climate targets for 2030 imply a renewables share of some 50 percent in the electricity mix, with wind and PV contributing some 30 percent. The reason is simple: they are by far the cheapest zero-carbon power technologies. Thus, continuous investments in these technologies are required for a cost-efficient transition; so are continuous efforts to make the power system more flexible at the supply and demand side.

  2. 2

    Making the Energy-Only Market more flexible and repairing the EU Emissions Trading Scheme are prerequisites for a successful power market design.

    A more flexible energy-only market and a stable carbon price will however not be enough to manage the required transition to a power system with high shares of wind and solar PV. Additional instruments are needed.

  3. 3

    A pragmatic market design approach consists of five elements: Energy-only market, emissions trading, smart retirement measures, stable revenues for renewables, and measures to safeguard system adequacy.

    Together, they form the Power Market Pentagon; all of them are required for a functioning market design. Their interplay ensures that despite legacy investments in high-carbon an inflexible technologies, fundamental uncertainties about market dynamics, and CO2 prices well below the social cost of carbon, the transition to a reliable, decarbonised power system occurs cost-efficiently.

  4. 4

    The Power Market Pentagon is a holistic approach to the power system transformation. When designing the different elements, policy makers need to consider repercussions with the other dimensions of the power system.

    For example, introducing capacity remunerations without actively retiring high-carbon, inflexible power plants will restrain meeting CO2 reduction targets. Or, reforming the ETS could trigger a fuel switch from coal to gas, but cannot replace the need for revenue stabilisation for renewables.

From study : The Power Market Pentagon
  1. 1

    The Foundation

    Principle 1: Convening a ‘Round Table for a National Consensus on Coal’

    Principle 2: Incremental, legally binding phase-out of coal power by 2040

  2. 2

    The Coal Phase-Out in Germany’s Power Plant Fleet

    Principle 3: No new construction of coal-fired power plants

    Principle 4: Determine a cost-efficient decommissioning plan for existing coal power plants based on remaining plant lifespans, including flexibility options in lignite mining regions

    Principle 5: No additional national climate policy regulations for coal-fired power plants beyond the phase-out plan

  3. 3

    The Coal Phase-Out in Lignite Mining Regions

    Principle 6: No additional lignite mines and no further relocation processes of affected communities

    Principle 7: The follow-up costs of lignite mining should be financed with a special levy on lignite

    Principle 8: Creation of ‘Structural Change Fund’ to ensure a sound financial basis for structural change in affected regions

  4. 4

    Economic and Social Aspects of the Coal Phase-Out

    Principle 9: Ensuring security of supply over the entire transformation period

    Principle 10: Strengthening EU Emissions Trading and the prompt retirement of CO? certificates set free by the coal phase-out

    Principle 11: Ensuring the economic competitiveness of energy-intensive companies and the Germany economy as a whole during the transformation process

  1. 1

    Three components are typically discussed under the term “integration costs” of wind and solar energy: grid costs, balancing costs and the cost effects on conventional power plants (so-called “utilization effect”).

    The calculation of these costs varies tremendously depending on the specific power system and methodologies applied. Moreover, opinions diverge concerning how to attribute certain costs and benefits, not only to wind and solar energy but to the system as a whole.

  2. 2

    Integration costs for grids and balancing are well defined and rather low.

    Certain costs for building electricity grids and balancing can be clearly classified without much discussion as costs that arise from the addition of new renewable energy. In the literature, these costs are often estimated at +5 to +13 EUR/MWh, even with high shares of renewables.

  3. 3

    Experts disagree on whether the “utilization effect” can (and should) be considered as integration costs, as it is difficult to quantify and new plants always modify the utilization rate of existing plants.

    When new solar and wind plants are added to a power system, they reduce the utilization of the existing power plants, and thus their revenues. Thus, in most cases, the cost for “backup” power increases. Calculations of these effects range between -6 and +13 EUR/MWh in the case of Germany at a penetration of 50 percent wind and PV, depending especially on the CO? cost.

  4. 4

    Comparing the total system costs of different scenarios would be a more appropriate approach.

    A total system cost approach can assess the cost of different wind and solar scenarios while avoiding the controversial attribution of system effects to specific technologies.

  1. 1

    The German Energiewende is here to stay. Started in the 1990s, it is a long-term energy and climate strategy reaching as far forward as 2050.

    It enjoys broad public support and is driven by four main political objectives: combatting climate change, avoiding nuclear risks, improving energy security, and guaranteeing competitiveness and growth.

  2. 2

    Wind energy and solar PV are the backbone of the German Energiewende and flexibility is the new paradigm of the power sector.

    Wind and solar energy are now cost-competitive with conventional energy sources for new investments. These technologies, however, impact power systems, making increased system flexibility crucial. Fossil power plants currently deliver the needed flexibility; increasingly other options (demand side management, storage,… ) will become more important.

  3. 3

    The Energiewende requires a structural change in the German energy sector, bringing new challenges and opportunities.

    Given the transformative nature of the Energiewende, investment, growth, and employment are shifting towards new low-carbon sectors. Renewable energy and energy efficiency are providing several hundred thousand jobs, while jobs in the nuclear and coal sectors are declining. A broad consensus on the phasing out of coal is needed to accompany this restructuring process.

  4. 4

    The transformation of the power systems toward renewable energy is not only taking place in Germany but worldwide.

    In 2014, for the third year running, worldwide investment in new renewable capacity exceeded investment in fossil-fuel power. Many other countries in Europe and beyond have set ambitious renewable energy targets. The challenges faced by Germany are therefore a preview of what is likely to occur in several other countries in the medium to long-term.

From study : Understanding the Energiewende
  1. 1

    Wind and solar PV drive power system development.

    As part of Europe’s renewable energy expansion plans, the PLEF countries will strive to draw 32 to 34 percent of their electricity from wind and solar by 2030. The weather dependency of these technologies impacts power systems, making increased system flexibility crucial.

  2. 2

    Regional European power system integration mitigates flexibility needs from increasing shares of wind and solar.

    Different weather patterns across Europe will decorrelate single power generation peaks, yielding geographical smoothing effects. Wind and solar output is generally much less volatile at an aggregated level and extremely high and low values disappear. For example, in France the maximum hourly ramp resulting from wind fluctuation in 2030 is 21 percent of installed wind capacity, while the Europe-wide maximum is only at 10 percent of installed capacity.

  3. 3

    Cross-border exchange minimises surplus renewables generation.

    When no trading options exist, hours with high domestic wind and solar generation require that generation from renewables be stored or curtailed in part. With market integration, decorrelated production peaks across countries enable exports to regions where the load is not covered. By contrast, a hypothetical national autarchy case has storage or curtailment requirements that are ten times as high.

  4. 4

    Conventional power plants need to be flexible partners of wind and solar output.

    A more flexible power system is required for the transition to a low-carbon system. Challenging situations are manifold, comprising the ability to react over shorter and longer periods. To handle these challenges, the structure of the conventional power plant park and the way power plants operate will need to change. Renewables, conventional generation, grids, the demand side and storage technologies must all become more responsive to provide flexibility.

  1. 1

    Increased integration between the Nordic countries and Germany will become ever more important as the share of renewables increases. The more renewables enter the system, the higher the value of additional transmission capacity between Nordic countries and Germany will become.

    In particular, additional generation from renewables in the Nordics – reflected in the Nordic electricity balance - will increase the value of transmission capacity. There is a lot of potential for trade, due to hourly differences in wholesale electricity prices throughout the year.

  2. 2

    A closer integration of the Nordic and the German power systems will reduce CO2 emissions due to better utilisation of renewable electricity.

    This is caused by reduced curtailment of renewables, improved integration of additional renewable production sites and increased competitiveness of biomass-fuelled power plants.22

  3. 3

    Higher integration will lead to the convergence of wholesale electricity prices between the Nordic countries and Germany. But even with more integration, the Nordic countries will see lower wholesale electricity prices if they deploy large shares of renewables themselves.

    In general, additional integration will lead to slightly higher wholesale electricity prices in the Nordics and to slightly lower prices in Germany. But this will be counteracted by the decreasing price effect that higher wind shares in the Nordics have on the wholesale power market.3

  4. 4

    Distributional effects from increased integration are significantly higher across stakeholder groups within countries than between countries.

    This strongly impacts the incentives of market players such as electricity producers or consumers (e.g., energy-intensive industries) for or against increased integration. Distributiona leffects need to be taken into account for creating public acceptance for new lines and for the cross-border allocation of network investments.

  1. 1

    Increased integration between the Nordic countries and Germany will become ever more important as the share of renewables increases. The more renewables enter the system, the higher the value of additional transmission capacity between Nordic countries and Germany will become.

    In particular, additional generation from renewables in the Nordics – reflected in the Nordic electricity balance - will increase the value of transmission capacity. There is a lot of potential for trade, due to hourly differences in wholesale electricity prices throughout the year.

  2. 2

    A closer integration of the Nordic and the German power systems will reduce CO2 emissions due to better utilisation of renewable electricity.

    This is caused by reduced curtailment of renewables, improved integration of additional renewable production sites and increased competitiveness of biomass-fuelled power plants.

  3. 3

    Higher integration will lead to the convergence of wholesale electricity prices between the Nordic countries and Germany. But even with more integration, the Nordic countries will see lower wholesale electricity prices if they deploy large shares of renewables themselves.

    In general, additional integration will lead to slightly higher wholesale electricity prices in the Nordics and to slightly lower prices in Germany. But this will be counteracted by the decreasing price effect that higher wind shares in the Nordics have on the wholesale power market.

  4. 4

    Distributional effects from increased integration are significantly higher across stakeholder groups within countries than between countries.

    This strongly impacts the incentives of market players such as electricity producers or consumers (e.g., energy-intensive industries) for or against increased integration. Distributiona leffects need to be taken into account for creating public acceptance for new lines and for the cross-border allocation of network investments.

  1. 1

    The expansion of renewable energy does not have to wait for electricity storage.

    In the next 10 to 20 years the flexibility required in the power system can be provided for by other, more cost-effective technologies such as flexible power plants, demand side management. New storage is required only at very high shares of renewable energies.

  2. 2

    The market for new storage technologies will grow dynamically.

    New markets for battery storage and power to gas technologies are expected to emerge, especially in the transport and chemical sector. Storage developed in these sectors can enable further flexibility for the electricity system as an additional service. Research and development as well as market incentive programs should maximize the system-supporting contribution of new storage technologies.

  3. 3

    Storage must receive equal access to markets for flexibility.

    Storage can already today deliver several ancillary services at competitive costs. Flexibility markets – such as the ancillary services or future capacity markets – should therefore be designed such that they are technology-neutral.

  4. 4

    Storage should become a tool in the toolbox of distribution system operators.

    In specific cases, storage that is used to support a grid can help to avoid grid expansion in the low-voltage distribution grid. The regulatory framework should enable such cost-efficient decisions.

  1. 1

    Improving energy efficiency would significantly lower the costs of the German electricity system.

    Each saved kilowatt-hour of electricity reduces fuel and CO2 emissions, as well as investment costs forfossil and renewable power plants and power grid expansion. If electricity consumption can be lowered by10 to 35 percent by 2035 compared to the Reference scenario outlined in the study, the costs for electricitygeneration will reduced by 10 to 20 billion euros2012.

  2. 2

    Improvements in the energy efficiency of the electricity sector can be achieved economically.

    One saved kilowatt-hour of electricity would lead to reduced electrical system costs of between 11 to 15euro cents2012 by 2035, depending on the underlying assumptions. Many efficiency measures wouldgenerate lower costs than these savings, and would therefore be beneficial from an overall economicperspective.

  3. 3

    Reductions in future power consumption mean a lower need to expand the power grid.

    A significant increase in energy efficiency can significantly reduce the long-term need to expand thetransmission grid: between 1,750 and 5,000 km in additional transmission lines will be needed by 2050,down from 8,500 km under the “business as usual” scenario.

  4. 4

    Reducing power consumption would reduce both CO2 emissions and import costs for fuel.

    Reducing power consumption by 15 percent compared to the Reference scenario would lower CO2 emissionsby 40 million tonnes and would reduce spending on coal and natural gas imports by 2 billion euros2012 in2020.

  1. 1

    Germany is currently facing an Energiewende paradox: Despite an increasing share of renewable energy sources, its greenhouse gas emissions are rising.

    The reason for this paradox is not to be found in thedecision to phase out nuclear power – the decrease of nuclear generation is fully offset by an increasedgeneration from renewables. Rather, the paradox is caused by a fuel switch from gas to coal.

  2. 2

    Due to current market conditions, German coal-fired power plants are pushing gas plants out of the market – both within Germany and in neighbouring countries.

    Since 2010, coal and CO2 prices have decreased, whilegas prices have increased. Accordingly, Germany’s coal-fired power plants (both new and old) are able to produceat lower costs than gas-fired power plants in Germany and in the neighbouring electricity markets thatare coupled with the German market. This has yielded record export levels and rising emissions in Germany.

  3. 3

    If Germany is to reach its Energiewende targets, the share of coal in the German power sector has to decrease drastically – from 45 percent today to 19 percent in 2030.

    Sharp decreases in generation fromlignite and hard coal of 62 and 80 percent, respectively, are expected in the next 15 years while theshare of gas in electricity generation will have to increase from 11 to 22 percent. This goes in line with thegovernments’ renewables and climate targets for 2030.

  4. 4

    Germany needs a coherent strategy to transform its coal sector.

    Such a strategy – call it a coal consensus –would bring power producers, labour unions, the government and environmental groups together in findingways to manage the transformation.

  1. 1

    Policy makers have a large scope of action in designing policies for the regional distribution of onshore wind and photovoltaics.

    Regional distribution of this renewable energy has little impact on the total cost of power supply.

  2. 2

    Finding the right balance is important in expanding offshore wind power.

    To promote technology development and reduce the cost of electricity for consumers, expansion should be continued, but on a lower level than current plans foresee.

  3. 3

    Grid expansion is an important prerequisite for the Energiewende.

    Solely in terms of cost, a few years of delays for the additional transmission lines foreseen in the German Grid Development Planning act would not be critical. Further expansion of renewables does not have to wait for these new transmission lines.

  4. 4

    A strong focus on battery storage systems combined with photovoltaic is currently not desirable.

    Only if cost of such systems drop by 80 % in the next 20 years would a renewable expansion path focusing on photovoltaics + storage be an economically viable option.

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