Pressure mounts on German government over energy shift
BERLIN, Jan 19 (Reuters) – Having signalled that Germany is getting out of nuclear, the government needs to map out further steps to make the switch work, energy executives said on Thursday.
“The energy shift is a political decision without a technical concept behind it,” said Stephan Reimelt, chief executive of GE Energy Germany. “I am very worried about time running out.”
Germany last summer launched legislation to speed up its exit from nuclear and to ‘green’ its energy industry.
Once all 17 nuclear plants are switched off by 2022, a key challenge lies in how to replace the lost supply of inexpensive round-the-clock electricity with renewable power, which is unpredictable in its nature.
Economy Minister Philipp Roesler, who joined energy executives at the Handelsblatt Energiewirtschaft annual conference in Berlin this week, said the energy shift was a task to be shared by government and industry.
“But when there’s a plan, it is not the job of the government to start building, it is the job of the free economy,” Roesler said.
Yet industry leaders say there needs to be more incentive to invest in flexible gas-fired power plants for supply when weather is unfavourable for wind or solar or for when industry and consumers need peaktime power, for example.
German shift from nuclear a Herculean task -execs
BERLIN, Jan 18 (Reuters) – Progress in Germany’s energy shift away from nuclear power is painfully slow, hampered by what energy sector executives say are inadequate incentives and a lack of strong investors, suggesting it will be Herculean task.
Germany, prompted by the March 11 earthquake and tsunami last year that caused a disaster at Japan’s Fukushima plant, decided to abandon nuclear power by 2022, leaving a large energy gap to fill.
Almost a year on, not much has happened to develop alternatives, executives of Germany’s energy industry complained at this year’s Handelsblatt Energiewirtschaft conference in Berlin, the agenda-setting meeting at the start of each year.
“Since the energy shift was announced, not much has happened,” said Michael Suess, a board member at German industry conglomerate Siemens who is in charge of the group’s energy sector.
“We finally need to gain traction now,” he said.
Switching off all 17 nuclear plants by 2022 will lead to a power gap of more 20,000 megawatts (MW) and the German government is focusing its plans on new gas plants, as they are friendlier to the environment than coal plants.
Utilities, are less keen. They say high natural gas costs, still mostly tied to oil with its inbuilt geopolitical price premiums, and low power prices make gas plants an unprofitable business.
EEX exchange bets on gas trading as growth driver
FRANKFURT, Jan 10 (Reuters) – The European Energy Exchange plans for further growth in its gas trading contracts in 2012 after expansion in 2011, its chief executive, Peter Reitz, told reporters in Frankfurt.
“We have not yet realised all opportunities in gas. The measures we have undertaken will serve to attract yet more liquidity to the EEX,” he said, without giving targets or precise numbers.
Figures for the 2011 trading results of the bourse, which also trades power, carbon and coal out of Leipzig and Paris, are expected around mid-January.
But a calculation of monthly gas trading results issued by the EEX for 2011 arrived at 58.6 terawatt hours (TWh) which would be a 25 percent increase over 46.9 TWh recorded in 2010.
Exchange-based gas trading in Germany, Europe’s second biggest gas market after Britain, was introduced five years ago and is still small relative to usage of over 900 TWh.
Reitz said that the concentration of Germany’s gas sector in two central zones, away from a jumble of countless delivery areas just a few years ago, had helped the EEX achieve higher volumes.
Also, it extended trading hours, added market makers, that set reliable prices, and 30 new trading members last year.
German solar boom strengthens critics of subsidies
FRANKFURT, Jan 9 (Reuters) – New solar installations reached a fresh record of 7.5 gigawatts (GW) in Germany in 2011, playing into the hands of advocates for steeper cuts in tariff subsidies to reduce growth of solar power and the resulting higher costs for consumers.
The figure slightly exceeds the 7.4 GW recorded in 2010, German network regulatory agency Bundesnetzagentur (BnetzA) said in a statement on Monday.
Boosted by lavish tariff incentives, Germany became the world’s largest solar market by installations and a major sales market of sector bellwethers such as U.S.-based First Solar , China’s Suntech, Norway’s Renewable Energy Corp and Germany’s SMA Solar.
But the country has been cutting those favourable tariffs in an effort to force the industry to lower its costs faster and head off steep rises in energy bills for companies and households, which are required by law to pay the feed-in tariffs.
Additions in December alone amounted to 3 GW, the agency said, citing preliminary figures and adding that the pace of installations could trigger a 15 percent cut in tariffs under the feed-in law for renewable energy from July 2012, if unabated.
Under previous regulation, it would take the installion of only 225 megawatts (MW) between January and April of this year to reach a level that would trigger a 15 percent cut in subsidies from mid-year, BnetzA President Matthias Kurth said.
“We see proponents of an annual installation cap gaining influence in the discussion, especially in the context of an overall weakening economy, making politicians more sensitive to cost burdens in the manufacturing industry sector,” Equinet analyst Stefan Freudenreich said.
German solar market reaches record, cuts loom-agency
FRANKFURT, Jan 9 (Reuters) – New solar installations reached a fresh record of 7.5 gigawatts (GW) in Germany in 2011, playing into the hands of advocates for steeper cuts in tariff subsidies to reduce growth of solar power and the resulting higher costs for consumers.
The figure slightly exceeds the 7.4 GW recorded in 2010, German network regulatory agency Bundesnetzagentur (BnetzA) said in a statement on Monday.
Boosted by lavish tariff incentives, Germany became the world’s largest solar market by installations and a major sales market of sector bellwethers such as U.S.-based First Solar , China’s Suntech, Norway’s Renewable Energy Corp and Germany’s SMA Solar.
But the country has been cutting those favourable tariffs in an effort to force the industry to lower its costs faster and head off steep rises in energy bills for companies and households, which are required by law to pay the feed-in tariffs.
Additions in December alone amounted to 3 GW, the agency said, citing preliminary figures and adding that the pace of installations could trigger a 15 percent cut in tariffs under the feed-in law for renewable energy from July 2012, if unabated.
Under previous regulation, it would take the installion of only 225 megawatts (MW) between January and April of this year to reach a level that would trigger a 15 percent cut in subsidies from mid-year, BnetzA President Matthias Kurth said.
“We see proponents of an annual installation cap gaining influence in the discussion, especially in the context of an overall weakening economy, making politicians more sensitive to cost burdens in the manufacturing industry sector,” Equinet analyst Stefan Freudenreich said.
German power grids say coping with shortfalls
FRANKFURT, Jan 5 (Reuters) – German power transmission grid operator TenneT and the national energy regulator said successful handling of a power shortfall on Dec. 8-9 showed that networks will be able to cope with overstretched conditions this winter.
They were responding to a media report on the incident that highlighted the potential difficulties in maintaining a stable power supply, a situation closely watched in Europe, since Germany shut 40 percent of its nuclear capacity last year.
This arose from a political U-turn after Japan’s Fukushima disaster, leading to the loss of a big slice of stable power feed, which grid firms must balance to safeguard crucial supply.
“A little over 1,000 megawatts (MW) of Austrian capacity was being called on during those two days to account for a regional shortfall, while the Gundremmingen C nuclear reactor happened to be offline,” said a spokeswoman for TenneT in Bavaria on Thursday.
“Power supply generally is not under threat,” she said.
Matthias Kurth, president of regulator Bundesnetzagentur, last August designated 1,009 MW of German and 1,075 MW of Austrian generation plant capacity as spare reserve should winter demand run high and renewable output flag.
TenneT added the reason the December incidents were not in the public eye at the time was that the activation of exactly such reserves had been anticipated and merely showed the system was working.
German court finds six guilty in CO2 fraud trial
FRANKFURT (Reuters) – A German court on Wednesday sentenced six men to jail terms of between three years and seven years and 10 months in a trial involving evasion of taxes on carbon permits.
Judge Martin Bach said the men, aged between 27 and 66, were guilty of having participated in a conspiracy to evade around 300 million euros ($393 million) in value-added tax (VAT) between August 2009 and April 2010.
In 2009 and 2010, the European Union’s spot carbon market was hit by so-called carousel trade in which buyers imported emissions permits in one EU country without paying value-added tax (VAT) and then sold them to each other, adding tax to the price and pocketing the difference.
“The convicted were fraudulently involved in tax-evading trades…they have brought the carbon market trading scheme into disrepute,” the judge said.
The EU Emissions Trading System, the bloc’s chief weapon against climate change, caps the emissions of factories and power plants, forcing them to buy carbon permits if needed while also allowing them to sell surpluses.
The way Germany’s flagship lender, Deutsche Bank, conducted emissions trading with some of those that have been convicted had left the door open for tax evasion, he added.
Deutsche Bank said Wednesday that independent legal experts had so far found no wrongdoing on the part of the bank’s employees. Bank staff have testified in the trial and some continue to be investigated, but none have been charged.
German wind, solar power to expand-regulator
BONN, Dec 7 (Reuters) – Germany is set to expand its onshore wind power capacity by 1.7 gigawatts (GW) a year up to 2032, its Federal Network Agency said on Wednesday after studying the impact of a planned rapid expansion of green power in Europe’s biggest economy.
It would arrive at 47.5 GW in 2022 and 64.5 GW in 2032, compared with 27.1 GW of capacity installed in 2010, the agency’s president Matthias Kurth said at a news briefing.
The authority, which supervises grids, said it looked realistic that fledgling offshore wind capacity could reach 13 GW in 2022 and 28 GW in 2032.
Solar power may reach 54 GW in 2022 and 65 GW in 2032, it said.
The figures are important to gauge subsidy levels for renewable power, which under German law must be shared by all consumers, the requirements for transmission grid expansion, and for future network stability, given that renewables are volatile as a power source.
“We are describing what we would need so that we can say that in 10 years’ time, we will have secure supply and networks,” Kurth said.
“We will need a realistic grid expansion plan based on our data, otherwise the ambitious energy strategy change cannot materialise,” he added.
Exclusive: German power export surplus plummets
FRANKFURT (Reuters) – Germany’s power export surplus in the first nine months of this year shrank by 85 percent over comparable 2010 to 1.6 terawatt hours (TWh), exclusive data from energy industry association BDEW showed on Tuesday.
Hildegard Mueller, managing director of BDEW said in an exclusive interview with Reuters the country has started relying more on imports from neighbors after switching off vast nuclear capacities in the wake of Japan’s Fukushima disaster.
“That’s definitely the reason,” she said. “We are no longer a stabilizer of the western Europen network to the degree that we used to be. We are more on the demand side.”
BDEW, a national lobby which represents 1,800 firms in power, gas and water supply, showed imports rose and exports declined, leaving the country a net exporter but at a much lower level than a year earlier.
Imports rose by 16.1 percent to 37.8 TWh in the nine months from January to September while exports declined by 8.7 percent to 39.4 TWh.
Power consumption in Europe’s leading economy declined by 0.6 percent to 388.4 TWh in the nine months compared with the year-earlier period , which BDEW attributed to moderate weather patterns and the start of a macroeconomic slowdown.
Gas usage in the nine months declined by 9.3 percent to 592 TWh compared with a year earlier, BDEW also said, pegging this mainly to lower heating requirements.
Energy outages to be disclosed under imminent EU law
BRUSSELS/FRANKFURT, Nov 18 (Reuters) – Energy companies will have to disclose the timing of gas field maintenance and nuclear shut-downs under new EU legislation about to be finalised and expected to start taking effect around the end of this year.
The law will not cover highly market-sensitive information on outages on oilfields, long a source of controversy among oil traders, although knowledge of when associated gas is shut down could provide a clue.
“Nuclear shutdowns and gas field maintenance would typically trigger a disclosure obligation,” said Lucas Bergkamp, a partner at Hunton & Williams in Brussels.
Another international law firm, Cleary Gottlieb, issued a note saying “inside information” would include anything linked to “the capacity and use of facilities for production, storage, consumption or transmission of electricity or natural gas and use of LNG facilities”.
That would include planned or unplanned disruptions.
“REMIT (Regulation on Energy Market Integrity and Transparency) is a first step in the extension of traditional prohibitions of insider trading and market manipulation to physical commodities market,” the note concluded.
Commission officials said they were working on the precise details of which data the energy firms would have to publish.

