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  • September 20th, 2013

Germany’s Effort at Clean Energy Proves Complex

It is an audacious undertaking with wide and deep support in Germany: shut down the nation’s nuclear power plants, wean the country from coal and promote a wholesale shift to renewable energy sources.

Irina Lucke spent most of last year on the low sandyislandofBorkumin theNorth Seasupervising the assembly of the 30 soaring turbines that form the wind farm, which probably will not generate electricity until next year.

But the plan, backed by Chancellor Angela Merkel and opposition parties alike, is running into problems in execution that are forcing Germans to come face to face with the costs and complexities of sticking to their principles.

German families are being hit by rapidly increasing electricity rates, to the point where growing numbers of them can no longer afford to pay the bill. Businesses are more and more worried that their energy costs will put them at a disadvantage to competitors in nations with lower energy costs, and some energy-intensive industries have begun to shun the country because they fear steeper costs ahead.

Newly constructed offshore wind farms churn unconnected to an energy grid still in need of expansion. And despite all the costs, carbon emissions actually rose last year as reserve coal-burning plants were fired up to close gaps in energy supplies.

A new phrase, “energy poverty,” has entered the lexicon.

“Often, I don’t go into my living room in order to save electricity,” said Olaf Taeuber, 55, who manages a fleet of vehicles for a social services provider inBerlin. “You feel the pain in your pocketbook.”

Mr. Taeuber relies on just a single five-watt bulb that gives off what he calls a “cozy” glow to light his kitchen when he comes home at night. If in real need, he switches on a neon tube, which uses all of 25 watts.

Even so, with his bill growing rapidly, he found himself seeking help last week to fend off a threat fromBerlin’s main power company to cut off his electricity. He is one of a growing number of Germans confronting the realities of trying to carry out Ms. Merkel’s most ambitious domestic project and one of the most sweeping energy transformation efforts undertaken by an industrialized country.

Because the program has the support of German political parties across the spectrum, there has been no highly visible backlash during the current election campaign. But continuing to put the program in place and maintaining public support for it will be among Ms. Merkel’s biggest challenges should she win a third term as chancellor in Sunday’s election.

Ms. Merkel, of the traditionally conservative and pro-business Christian Democrats, came up with her plan in 2011, in the emotional aftermath of theFukushimanuclear disaster inJapan. It envisions shutting down all ofGermany’s nuclear plants by 2022 and shifting almost entirely to wind and solar power by 2050.

The chancellor’s about-face not only seized the energy initiative from her center-left opponents, it also amounted to a gamble that could prove to be her most lasting domestic legacy — or a debacle whose consequences will be felt for generations.

The cost of the plan is expected to be about $735 billion, according to government estimates, and may eventually surpass even that of the euro zone bailouts that have received far more attention during Ms. Merkel’s tenure. Yet as the transition’s unknowns have grown, so have costs for the state, major companies and consumers.

Mr. Taeuber showed up last Friday, one of three “walk-ins” that day at one of two agencies in Berlin offering aid to people struggling to pay their energy bills. He arrived just as employees from the power company Vattenfall were on the way to his apartment.

Sven Gärtner, an agency employee, called Vattenfall with the promise of a payment plan, sparing Mr. Taeuber from being disconnected. “The boys were already in the basement, but they agreed to pull them back,” Mr. Gärtner said triumphantly.

Since January, Mr. Gärtner said, his group has intervened in more than 350 cases to prevent Vattenfall from leaving one family or another in the dark. In the first six months of this year, about 1,800 sought help, 200 more than in all of 2012.

With consumers having to pay about $270 each in surcharges this year to subsidize new operators of renewable power, the hardest hit are low-wage earners, retirees and people on welfare, Mr. Gärtner said. Government subsidies for the plan amounted to $22.7 billion in 2012 and could reach $40.5 billion by 2020, according to John Musk, a power analyst at RBC Capital Markets.

“The energy transformation makes sense, but its implementation has been sloppy and uncoordinated,” Mr. Gärtner said. “People can’t be expected to keep cutting more and more in other areas. They are not receiving enough for the basic costs to cover their energy needs.”

Part of the reason consumer prices have risen so sharply is that, for now, the government has shielded about 700 companies from increased energy costs, to protect their competitive position in the global economy.

Industrial users still pay substantially more for electricity here than do their counterparts inBritainorFrance, and almost three times as much as those in theUnited States, according to a study by the German industrial giant Siemens. The Cologne Institute for Economic Research said there had been a marked decline in the willingness of industrial companies to invest inGermanysince 2000.

Already there are winners and losers. A third of electronics and automotive companies have increased profits with the plan, and 11 percent of those in the chemical and metal industries have had losses, the German Economic Institute reported.

“We are now coming to a critical stage, and all the politicians are aware of this,” said Udo Niehage, Siemens’s point person for the transition. “The costs are becoming high, maybe too high, and you have to look at the consequences for the competitiveness of our industry inGermany.”

Rivaling the costs are the logistical challenges of eventually shifting 80 percent of energy consumption to renewable sources, something that has never been tried on such a grand scale.

One of the first obstacles encountered involves the vagaries of electrical power generation that is dependent on sources as inconsistent and unpredictable as the wind and the sun.

And no one has invented a means of storing that energy for very long, which means overwhelming gluts on some days and crippling shortages on others that require firing up old oil- and coal-burning power plants. That, in turn, undercuts the goal of reducing fossil-fuel emissions that have been linked to climate change.

Last year, wind, solar and other nonfossil-fuel sources provided 22 percent of the power forGermany, but the country increased its carbon emissions over 2011 as oil- and coal-burning power plants had to close gaps in the evolving system, according to the German electricity association BDEW.

“It is great that we have achieved such a high percentage of renewable energy,” said Michael Hüther, director of the Cologne Institute for Economic Research. “But there are negative repercussions that we are now beginning to feel and must be addressed by the next government.”

Large offshore wind farms that have been built inGermany’s less populated north generate energy that must then be transported to industries and sites in the south.

“We worked 24-hour days and weekends,” said Irina Lucke, who spent most of last year on the low sandyislandofBorkumin theNorth Sea, supervising the assembly of 30 soaring turbines for the largest offshore wind farm. It is owned mostly by the utility EWE and was due to open last month.

Those turbines will probably not generate electricity until next year. Workers must still sweep the seafloor for abandoned World War II ordnance before a cable can be run to shore. “It’s really frustrating,” Ms. Lucke said. The delay threatens to add $27 million to the $608 million cost of the wind park.

Even without the energy the offshore turbines could produce,Germany’s power grid has been strained by new wind and solar projects on land, compelling the government to invest up to $27 billion over the next decade to build roughly 1,700 miles of high-capacity power lines and to upgrade lines.

The largely rural northern state of Schleswig-Holstein produces as much as 12,000 megawatts of power with new wind turbines and solar panels, but it can consume only about a sixth of that.

“Schleswig-Holstein is a microcosm for all ofGermany,” said Markus Lieberknecht of the grid operator Tennet. “Where energy was previously brought into the state and distributed to small communities, these communities are now producing the power, and we need to find a way to transmit it to the larger urban areas. Everything has been stood on its head.”

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