Germany Plugs into Renewable Energy

Twenty years ago, when Germany first resolved to reduce its carbon emissions, it set the lofty goal of having 1,000 homes fitted with solar panels.

Today, with an estimated 500,000 installations and a capacity equivalent to six nuclear power plants, solar panels are as common as sausage and beer – scarcely a street in the country doesn’t have at least one home generating its own electricity. Indeed, it has become so easy for homeowners to become solar power producers that the government has lost track of exactly how many solar photovoltaic installations are in operation.

“It’s plug and play,” says Jeffrey Michel, an electrical engineer and energy researcher, who has studied Germany’s transformation into a world leader for renewable energy. He says Germany now accounts for about half the world’s solar production and is proving that going green can be cost effective and generate positive economic spinoffs, too.

Solar is only one element of Germany’s thriving, $13-billion alternative energy industry, which also prominently features wind and biomass energy. The sector’s already lofty employment of over 230,000 people is expected to more than double by 2020, when renewable energy is forecast to supply at least 27 per cent of the country’s total electricity supply.

In Germany’s so-called Solar Valley, a factory that produces 16 per cent of solar cells worldwide is turning around the formerly depressed economy. “People are coming back to the area to work,” says Michel, who expects green jobs will help Germany bounce back quickly from the recession.

“It all depends on the fact that people are making money on it, that the price is coming down, and the cost of coal generation is going up,” he says, noting the savings from renewables compared with the expense of cleaning up pollution from coal-fired plants. “Within five to seven years, solar is going to be cheaper per kilowatt hour at the wall socket.”

It wasn’t always this way. For years, hydropower provided a relative constant five per cent of the country’s electricity. Germany’s commitment to renewables was primarily driven by two factors: public mistrust of nuclear power – which produced more than a quarter of the country’s power – and the landscape degradation and massive carbon emissions from coal-fired power, which produced more than half its electricity.

When Germany enacted its so-called “feed-in law” in 2000, the country’s renewables sector surged ahead. The Renewable Energy Sources Act provides a national set of standards, requiring grid operators to buy power from renewable energy generation on a priority basis at fixed rates. “It’s one single rule for everybody. That’s why we are where we are today,” says Michel. Since the act was implemented, the share of electricity provided by renewables has tripled to 15 per cent and is expected to increase to 27 and 45 per cent by 2020 and 2030 respectively.

The act has also resulted in steep cuts in Germany’s carbon dioxide (CO2) emissions. In the first six years under the act, CO2 emissions fell by 45 million tonnes and are expected to be reduced by 52 million tonnes by 2010 and 89 million tonnes by 2020. Together with electricity not covered by the Renewable Energy Sources Act, renewable energies will account for CO2 reductions of 72 million tones by 2010 and 111 million tonnes by 2020.