Climate change: energy prices in the skies and the use of fossil fuels in Germany continue to rise

It’s the “green” policy that is actually fake green

Climate change: energy prices in the skies and the use of fossil fuels in Germany continue to rise

Although more and more studies and practical observations support the negative economic and environmental consequences of nuclear disarmament, a significant proportion of Green Parties are unable to get rid of their former most important identity-forming element: anti-nuclear. The example of Germany is a good illustration of the social burden that an alliance between emotionally overheated antinuclear movements and the fossil fuel lobby that uses them can result in. Petra Halkó, senior analyst at the end of the century, Olivér Hortay, head of the business at the end of the century, and Péter Kovács, a university student and trainee at the end of the century, wrote a study on this.

A XXI. one of the most important questions of the twentieth century is how humanity will be able to solve the problem of overuse of nature while preserving the economic and social achievements it has achieved since the Industrial Revolution. Tackling climate change is a priority, and the decarbonisation of the energy sector, which is responsible for the largest share of global emissions, plays a significant role in preventing it. The three objectives of energy policy - security of supply, the environment and economic performance - are often referred to as a trilemma, which illustrates that measures do not generally lead to a positive shift in all three objectives and that it is up to decision-makers to "navigate" between objectives.
Preventing climate change therefore requires interventions that improve the environmental performance of the energy sector while minimizing security of supply and economic growth.

A significant part of the energy policy interventions in most countries is aimed at modifying the energy mix, ie the fuels and technologies that the sector supplies energy needs. From an economic point of view, the most effective regulatory instruments are technology-neutral, ie they penalize the pollutants emitted and, in addition, leave the various production technologies to compete freely with each other. In contrast, more and more measures are appearing in international practice to penalize or reward certain technologies, contrary to economic rationality. The most striking example of these bad practices is the persecution of witches against nuclear technology, which has reached the level of policy intervention in some countries.

Germany is the most extreme against nuclear energy, which will dismantle its nuclear capabilities by 2022, despite the fact that most major international climate and energy organizations (IPCC, IAE, etc.) warn that without nuclear energy only at huge cost and reduced security of supply climate protection goals can be achieved. The increasing penetration of wind and solar power plants is an important and good trend, but due to their weather-dependent, precarious production and specific high land requirements, they cannot yet replace nuclear technology.
So if we want to tackle climate change in a few decades, there is no alternative to nuclear energy.

Historical background
In Germany, from the early 1960s to the late 1980s, energy market developments were similar to those in other developed countries. Economic prosperity and electrification have led to a significant increase in energy demand, for which nuclear technology has been an efficient and inexpensive solution, making nuclear reactors built during this period an important pillar of the electricity grid. The oil crises of the 1970s and the Three Mile Island accident also embedded anti-nuclear movements in German society (the formation of the German Greens, the world's oldest and Germany's largest green party, literally a new social movement), which targeted the growth of their narratives. and the campaign against newly established power plants that symbolize technology. And although these movements organized a number of local demonstrations against the reactors under construction in the early 1980s, no real results could be achieved.

The first real change was brought about by the 1986 Chernobyl nuclear disaster, which caused the previously isolated, green subculture-specific antinuclear attitude to spread throughout German society. Nuclear power, previously supported by humans, has become a disaster and, following the last reactor to be built in 1989, no more investment could be made.
The Greens could not stop achieving their goal, as it would have questioned their raison d’être, so they turned their attention to the power plants already in operation. However, the shutdown of the operating reactors would have caused Germany economic damage that the Christian Democrats in power could no longer afford, so nuclear disarmament remained the flagship project of the anti-nuclear movements until the late 1990s.

The German Greens, who became a radical anti-nuclear party from the Green Movement, had a great opportunity in 1998. Social Democrat Gerhard Schröder could only seize power through a coalition, and the Greens promised to be good partners in many ways. On the one hand, Schröder, who has traditionally had good relations with companies, has been able to increase his popularity among left-wing voters by involving the anti-industrial Greens. On the other hand, the alliance lent a youth to Schröder, which in the campaign was well contrasted with the long-standing Christian Democrats. The calculation came in and winning the autumn elections, the Schröder-led Social Democratic-Green coalition could form a government. An agreement on energy policy was soon reached between the two parties. Nuclear decommissioning, important to the Greens, came to Schröder's work in preparation for a large-scale gas pipeline investment directly connecting Russia and Germany. In the years since coming to power, the coalition formally banned the construction of new nuclear power plants under a law passed by parliament in 2000 and planned a timetable for the decommissioning of existing plants, as well as a feasibility study for the Nord Stream gas pipeline and stakeholder approval. The start of decommissioning of nuclear power plants and the handover of the pipeline are also scheduled for 2011. Thus, a win-win situation emerged in the coalition: the Greens achieved their goal, creating a market for the influx of large amounts of natural gas, which legitimized Schröder’s important project. The story is further enhanced by the fact that the agreement to build the pipeline was signed a few days before the 2005 German elections, after which the losing Schröder moved from the chancellery directly to the chair of Nord Stream AG's owner and direct operator, Nord Stream AG.

Angela Merkel, a Christian Democrat who came to power in 2005, recognized that the decommissioning of nuclear power plants, which provided a quarter of German electricity generation, between 2011 and 2022 was economically irrational,
Thus, in 2009, it initiated an extension of the operating time for some reactors and changed the target date for decommissioning from 2022 to 2030. The change did not provoke strong public opposition, partly due to a temporary decline in anti-nuclear attitudes and partly due to fears of the consequences of the 2008 economic crisis. Eventually, however, Merkel's correction was swept away by the resurgence of negative public sentiment following the 2011 Fukushima nuclear accident: the nearly 250,000 people marching across the country across the country shortly decided to restore old decommissioning targets and shut down eight reactors immediately.

Consequences of nuclear disarmament
In Germany, 17 nuclear reactors were in operation in 2010, of which 8 were shut down in 2011, one each in 2015, 2017 and 2019, and the remaining 6 will be commissioned by 2022. The share of nuclear energy in German electricity generation has fallen from 25 percent in 2010 to well below 10 percent. Germany has replaced a significant part of the lost capacity with new, weather-dependent renewable investments. These technologies are less efficient, so even with declining energy consumption, more and more built-in capacity is needed to meet demand.

For the ever-increasing renewable capacity, Germany had to provide very significant investment and operating aid to producers.
In order to ensure that the change does not have dramatic consequences for the country's economic performance, it shifted the burden of subsidies to small consumers instead of large-scale industrial companies, so that the price of residential electricity in Germany is now significantly higher than the European average (more than three times Hungarian).
In addition, due to the higher operating costs of newly installed fossil power plants, wholesale electricity prices also increased slightly as a result of the switchover, which also had a negative impact on large consumers.

Another major challenge for nuclear decommissioning is the weather dependence of integrated renewables. Due to the limited storage of electricity and the low willingness of consumers to adapt to sunshine and wind, periods of overcapacity and high renewable capacity cannot be met in the German system. Germany addressed this problem in three ways: on the one hand, it increased its controllable fossil (coal and natural gas) power plant capacity; on the other hand, it increased its cross-border activity (partly through imports from France, a nuclear power, and the Czech Republic, which has a high fossil fuel share); thirdly, it has implemented large-scale network and market development projects at significant costs. New fossil power plants are not only a concern because of the greenhouse gas emissions that are responsible for climate change, but also because, especially in the case of coal-fired, they emit particulate matter, which demonstrably increases the risk of upper respiratory illness among local residents. The increase in cross-border activity during periods of low production, mainly due to French imports, not only provides a questionable source in the long run, also calls into question the meaning of the program.

Thus, based on the experience of recent years, nuclear disarmament has not led to a positive shift along any of the goals of the energy policy trilemma. The reform of the system has increased both residential and industrial energy prices, causing deepening economic problems for Germany (and indirectly for Europe). It is questionable how long this trend can be continued without major social conflicts, especially in the light of the economic difficulties caused by the coronavirus epidemic. From an environmental point of view, the only benefit is the reduction in nuclear waste, which, however, does not compensate for the increasing greenhouse gas and dust emissions from the fossil fuels put into operation. The latest study on the economic and environmental costs of German nuclear decommissioning was conducted by Professor Stephan Jarvis of the University of California, Berkeley, and co-authors, who estimate the measure will cost Germany more than $ 12 billion a year. Finally, the fact that people and companies have not yet had to face major security of supply problems in addition to fossil power plants is due to the fact that the variability of the German system can be offset by other European countries. However, as other European countries increase their weather-dependent renewables and reduce their controllable fossil capacities, so will their ability to balance.

Last week, the fight against certain technologies reached a new milestone in Germany: after a long debate, the Bundestag voted to shut down all coal-fired power plants by 2038. The package originally presented last year was strongly divided among MEPs. On the one hand, stopping coal burning is necessary to achieve climate goals and improve the health of the Germans. On the other hand, the industry, which has been artificially inflated as a result of nuclear decommissioning, currently employs nearly 30,000 people whose retraining should be solved. If Germany does not want to significantly increase its electricity imports, the conversion will require the construction of additional electricity generation capacity. And the new power plants will add new costs and, as regulated producers will continue to be needed in parallel with increasing renewable penetration, are expected to increase natural gas demand and thus Russian dependence. The credibility of the objective is undermined by the fact that the package will allow the new Datteln IV to enter this year. the commissioning of a coal-fired power plant unit, thus further increasing the share of fossil production in the German energy mix. In the future, Germany is expected to finance a significant part of the decommissioning costs from the newly created Brussels-based so-called Equitable Transition Fund, for which the European Commission will provide the necessary financial resources by redeploying cohesion funds from developing and less polluting countries, including Hungary.
With the maneuver, the German government would impose on developing countries the long-term, indirect costs of nuclear disarmament politically forced by the radical anti-nuclear lobby, which is seriously contrary to the core values ​​of the Union.

Lessons from the German atomstop
To date, almost every argument in favor of nuclear disarmament has been refuted. In people’s minds, perhaps the fear of nuclear disasters is still the strongest, as these tragedies threaten large numbers of people at one time and place. Statistics, on the other hand, show that nuclear production is the second safest technology after biofuels (0.005 dead for the former, 0.01 dead for the latter on average per terawatt hour), slightly ahead of solar, water and wind energy and significantly outpacing fossil technologies (e.g., coal combustion causes an average of 24.62 deaths per terawatt hour). The other argument often made that nuclear power plants hinder the decarbonisation needed to prevent climate change is also not true. Although the results of the research show significant variance, most researchers agree that the amount of greenhouse gas emissions over the entire life cycle of nuclear technology is on the order of magnitude of that of renewable producers (some say lower) and much lower than that of fossil technologies. The only issue that remains unresolved is nuclear waste management. The main problem here is that spent fuel needs to be stored for a long time. However, with today's technology, storage can be done at minimal cost, without health risks, so it does not justify strong social resentment.

The example of the German nuclear stop is a good example of how a left-wing anti-nuclear lobby, politically politely along the way and willing to bargain unprincipled for its purpose, can cause severe economic and environmental damage to an entire country in the long run and trap its adaptation to global warming. for greater challenges. Germany is in a very difficult situation because, although the arguments against nuclear technology have waned, the activities of radical movements have caused irreversible resentment in a significant part of the population, so it is no longer possible to back out of disarmament. At the same time, the country has to meet increasingly stringent climate protection requirements, which is incompatible with decommissioning fossil power plants. As a result of the problem, Germany is being forced to influence international action in a way that destroys not only its own credibility but also the unity of the European Union, and is also harmful to the environment. In the next EU budget cycle, the Equitable Transition Fund would divert resources from developing countries so that Germany, the second largest beneficiary, can cover the decommissioning costs of its coal-fired power plants. In addition, according to the EU's spring decision, investment funds labeled in principle with the so-called ESG label for sustainability do not have to consider natural gas as a fossil fuel source, so these funds can continue to finance coal-fired (and this year's North Stream 2) gas-fired power plants.

Surprisingly, the attitude towards nuclear energy still divides the Green Parties to this day. Some of them are still reluctant to acknowledge that anti-nuclear is both environmentally and economically irrational, because it would have to let go of its most important "cause", which would call into question the meaning of its existence. And those Green parties that are willing to correct and back down nuclear dismantling, they will have to find new things, because otherwise they will be lost in indifference, and since in the long run movements that are based on common sense can be successful, the latter strategy is likely to survive, and adapters will hopefully realize that it does not pay off in social or political terms.


Petra Halkó, economist, senior analyst of the End of the Century Foundation
Olivér Hortay, environmental economist, head of the Energy and Climate Policy Business Unit of Századvég Gazdaságkutató Zrt.
Péter Kovács, student of energy engineering, trainee in the energy and climate policy business of Századvég Gazdaságkutató Zrt.


Tags: Abroad  Environmental Protection