Germany’s Energy Policy Flip-Flop

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BY JACK DINI – Germany’s experiment with subsidizing inefficient solar technology has failed. “One of the world’s biggest green-energy public-policy experiments is coming to a bitter end in Germany, with important lessons for policymakers elsewhere,” reports Bjorn Lomborg. (1)

Germany once prided itself on being the ‘photovoltaic world champion’, doling out generous subsidies—totaling more than $130 billion to citizens to invest in solar energy. But now the German government is vowing to cut the subsidies sooner than planned, and to phase out support over the next five years.


Solar power is at least four times more costly than energy produced by fossil fuels. It also has the distinct disadvantage of not working at night, when much electricity is consumed. Also, on short, overcast winter days, the 1.1 million solar-power systems can generate no electricity at all. The country is then forced to import considerable amounts of electricity from nuclear power plants in France and the Czech Republic. (1)

Defenders of Germany’s solar subsidies claim that they have helped to create ‘green jobs.’ But each green job created by  green energy policies cost an average $175,000, while some are as high as $240,000.(2) And many ‘green jobs’ are being exported to China, meaning that Europeans subsidize Chinese jobs, with no CO2 reductions.

Despite the massive investment, solar power accounts for only about 0.3% of Germany’s total energy. This is one of the key reasons why Germans now pay the second-highest price for electricity in the developed world, exceeded only by Denmark. Germans pay three times more than their American counterparts. (1)

How well will this investment counter global warming? Bjorn Lomborg calculates that Germany’s $130 billion solar panel subsidies will have postponed temperature increases by 23 hours over the next 20 years. In other words, Germans have paid $130 billion for a climate-change policy that has no impact on global warming. They have subsidized Chinese jobs and other European countries’ reliance on dirty energy sources and have needlessly burdened their economy. (1)

The fundamental claim used to legitimize ‘renewables’ is the replacement of coal-fired plants. But in fact, despite all the billions in investment, not a single coal plant has been shut down because these fossil fuel facilities are indispensable as a back-up even when there is a strong feed-in of ‘green’ power. If wind and solar power die down due to certain weather patterns, then coal plants must be restarted as quickly as possible to serve as substitutes. Moreover, they have to be restarted within 30 minutes, meaning they cannot be switched on if they find themselves in a cold status. A cold start takes hours. Short term regulation of grid disturbances becomes impossible. Therefore, the plants must be kept warm at all times by constantly running them in the idling mode. This requires plenty of coal. Therefore, wind and solar power cannot replace the equivalent of coal use one-on-one, but rather just of a part of it. (3) So, Germany hasn’t given up on coal. Paul Driessen reports that they plan to build 27 coal-fired electrical generating plants by 2020. (4)

Then there’s the feed-in act. Germany’s power and gas has become so expensive thanks to its Renewable Feed-In Act that it is now an unaffordable commodity for many among the poor. Under this act, power companies are forced to buy up the expensive renewable energy from producers and pay them exorbitant tariffs. This has further helped drive Germany’s electricity prices up. So much so, that many can no longer pay for electricity. Because of unpaid electricity bills, an estimated 600,000 households in Germany had their power cut off in 2010. Price increases of about 15% for electricity and gas over the past 12 years have made energy an unaffordable commodity for many households. (5)

Last spring, Chancellor Angel Merkel set Germany on course to eliminate nuclear power in favor of renewable energy sources.  Shutting off seven of its nuclear power plants will lead to an additional eight million tons of carbon dioxide in just three months;  this from a country that was on the forefront of leading the world in being ‘green’.(6)

Today, several industries are suffering as electricity prices rapidly increase. Many companies are closing factories or moving abroad. Berlin’s energy policy affects all classic industrial sectors, from steel and aluminum to paper and cement manufacturers, as well as the chemical industry. The metal industry, long an important sector in Germany,  is already migrating to countries with cheaper electricity. (7)


  1. Bjorn Lomborg, “Germany’s sunshine daydream,”, February 16, 2012
  2. “The status of renewable electricity mandates in the states,” Institute of Energy Research
  3. Geunter Keil, “Germany’s energy supply transformation has already failed,” European Institute for Climate and Energy, January 2012
  4. Paul Driessen, “Leader of None,”, September 8, 2009
  5. P. Gosselin, “600,000 households in Germany without power-increasing energy poverty is alarming,”, February 23, 2012
  6. “Analysts: German nuclear shutdown set to send emissions soaring,”, March 17, 2011
  7. Benny Peiser, “Germany to shovel climate fund dollars into coal plants,”, July 13, 2011





  1. Tough loss for Germany. I'm not sure how well they will come to terms with this. We should learn from their mistakes and do a better job

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