V O I C E O F F U T U R E G E N E R A T I O N S

International Reactions to the German Transition and International Best Practices

International Reactions to the German Transition and International Best Practices

V O I C E O F F U T U R E G E N E R A T I O N S

AGENDAAGENDA

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V O I C E O F F U T U R E G E N E R A T I O N S

KEY ELEMENTS OF THE GERMAN ENERGY TRANSITIONKEY ELEMENTS OF THE GERMAN ENERGY TRANSITION

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V O I C E O F F U T U R E G E N E R A T I O N S

REACTIONS TO GERMANY‘S ENERGY TRANSITIONREACTIONS TO GERMANY‘S ENERGY TRANSITION

•This EnergiewendeEnergiewende is being watched very closely. If it works in Germany, it will be a template for other countries.

•"The German Energy ExperimentGerman Energy Experiment"

•Key questions Key questions raised:Can a heavily industrialized country power its economy with wind turbines and solar panels? Who should pay this in times of financial crisis?

•Only little attention for underlying factors little attention for underlying factors like decentralization/ empowerment aspects

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V O I C E O F F U T U R E G E N E R A T I O N S

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V O I C E O F F U T U R E G E N E R A T I O N S

GERMANY IS NOT ALONE WITH PHASING OUT NUCLEAR POWERGERMANY IS NOT ALONE WITH PHASING OUT NUCLEAR POWER

Europe– Ireland, Denmark, AustriaIreland, Denmark, Austria, and NorwayNorway had dismissed the nuclear option years ago– Sweden, Switzerland, the NetherlandsSweden, Switzerland, the Netherlands, and BelgiumBelgium are in the process of phasing

out nuclear power. – SpainSpain has banned the construction of new reactors.– FranceFrance's government (14th Sept 2012) begins a review one of the world's most

nuclear-dependent country's energy policy, strongly in support of its small and ailing renewables sector in an effort to boost local jobs and growth.

•Other remarkable country’s decisions– JapanJapan (14th Sept 2012): "We will use all possible political resources to realize the

goal of having no nuclear plants operating by the end of the 2030s," the report from the government's energy and environmental committee said.

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V O I C E O F F U T U R E G E N E R A T I O N S

RE SHARES: TOP FIVE COUNTRIES RE SHARES: TOP FIVE COUNTRIES

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Source: Global Status Report 2012

V O I C E O F F U T U R E G E N E R A T I O N S

AMBITIOUS TARGET SETTING – A KEY POLICYAMBITIOUS TARGET SETTING – A KEY POLICY

• Countries with a 100% RE target– Denmark: 100% RE by 2050 in power, heating, and transportation sector– Scotland: 100% RE in power sector by 2020– Upper Austria: 100% RE in power and heat sectors by 2030

• Cities with 100% RE target– Barcelona, Spain - Masdar City, UAE– Munich, Germany - Msheireb Downtown Doha, Qatar– San Francisco, USA (sustainable downtown regeneration project)

• Small Island States with 100% RE target– Islands of Tuvalu - Maledives– Cook Islands

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V O I C E O F F U T U R E G E N E R A T I O N S

UK - BEST PRACTICE FOR ENERGY TRANSITION?UK - BEST PRACTICE FOR ENERGY TRANSITION?

Change of Policy led to substantial increase of RE shareChange of Policy led to substantial increase of RE share

Before April 2010 :Quota obligations based on Tradable Green Certificates

After April 2010Feed-in tariffs

Source:The UK FiT: A User Survey

Miguel Mendonça, 2011

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FITS ENABLE PARTICIPATIONFITS ENABLE PARTICIPATION

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“It [FiTs] is evidently acting as a connecting policy – linking people, policy, energy and economy.“

Miguel Mendonca: The UK FiT: A User Survey, 2011Source: Co-operative renewable energy in the UK, Rebecca Willis and Jenny Willis 2012

V O I C E O F F U T U R E G E N E R A T I O N S

ONTARIO - BEST PRACTICE FOR ENERGY TRANSITION?ONTARIO - BEST PRACTICE FOR ENERGY TRANSITION?

robust regime for encouraging renewable electricity generation while maximizing the local economic benefits of this new power generation, because of the following elements:

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domestic content provision

community project price adders

Special program for small scale projects

50,000 jobs (by 2018) and dozens of new manufacturing plants

V O I C E O F F U T U R E G E N E R A T I O N S

AGENDAAGENDA

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V O I C E O F F U T U R E G E N E R A T I O N S

POLICY INSTRUMENTS - REGULATIONS AND INCENTIVES ?POLICY INSTRUMENTS - REGULATIONS AND INCENTIVES ?

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Type of instrument Formal Market Informal Organisational

Examples in the field of renewable energy

RegulationFeed-in tariffs (can also be seen as regulatory)

Advice Public enterprises

Self-regulation User chargesInformation provision

Public Private Partnerships (PPP)

Regional development plans

Congestion charge

Network between cities to share renewable energy strategies

Climate and energy agency

Environment impact assessment

Land use taxesAwareness raising campaign

Unit for climate change and energy in mayor’s office

Based on Howlett (2009)

V O I C E O F F U T U R E G E N E R A T I O N S

POLICIES ARE THE DRIVING FORCEPOLICIES ARE THE DRIVING FORCE

• 118 countries had renewable energy targets in place (by early 2012)

– more than half are developing countries

• Most common type of support policy: Renewable power generation policies: at least 109 countries (by early 2012)

• Feed-in-tariffs (FITs) and renewable portfolio standards (RPS) are the most commonly used policies

• At least 19 countries have specific renewable heating/cooling targets in place and at least 17 countries and states had obligations/mandates to promote renewable heat. (frontrunner Europe)

• Lack of long-term policy certainty and stability result in setbacks

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Source: Global Status Report 2012

V O I C E O F F U T U R E G E N E R A T I O N S

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Costs and pricing distortion from subsidies for fossil fuels; nuclear energy; externalities; high initial capital costs; high taxes on renewable energy equipment

Legal and regulatory No legal framework for independent power producers; planning restrictions (long lead times); lack of coordination amongst authorities; spatial planning, grid access (grid capacity, grid extension plans)

Market performance lack of access to credit; perceived technology uncertainty and risk; lack of technical or commercial skills and information

Usual obstacles to progress at the renewable energy sectorUsual obstacles to progress at the renewable energy sector

V O I C E O F F U T U R E G E N E R A T I O N S

Feed in tariffs in 1995

Source: IFOK/REN 21

V O I C E O F F U T U R E G E N E R A T I O N S

Source: IFOK/REN 21

Feed in tariffs in 2000

V O I C E O F F U T U R E G E N E R A T I O N S

Source: IFOK/REN 21

Feed in tariffs in 2010

V O I C E O F F U T U R E G E N E R A T I O N S

Implement regulatory frameworks consequently

Research and Development

(and its political support)

Abolishment of all subsidies for fossil fuel

(and nuclear)

Acceleration of administrative processes

and infrastructure measures

Strengthen renewable heating

sector

Binding target setting on regional,

national and international level

Notwendige Politische Maßnahmen für die EnergiewendeNotwendige Politische Maßnahmen für die EnergiewendeNeeded political measures for the energy transformationNeeded political measures for the energy transformation

V O I C E O F F U T U R E G E N E R A T I O N S

Thomas Edison 1920:

“We are like tenant farmers chopping down the fence around our house for fuel when we should be using Natures inexhaustible sources of energy — sun, wind and tide. ...

I'd put my money on the sun and solar energy. What a source of power! I hope we don't have to wait until oil and coal run out before we tackle

that”

V O I C E O F F U T U R E G E N E R A T I O N S

GLOBAL MARKET AND INDUSTRY OVERVIEWGLOBAL MARKET AND INDUSTRY OVERVIEW

• Global final energy consumption supplied by renewable energy in 2010: 16.7%

– 8.2%: modern renewable energy (counting hydropower, wind, solar, geothermal, biofuels and modern biomass)

– 8.5 % traditional biomass (primarily for cooking and heating in rural areas of developing countries)

• Continued growth in equipment manufacturing, sales, and installation across most technologies during 2011

• Globally there are more than 5 million jobs in renewable energy industries

Source: Global Status Report 2012

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INVESTMENT FLOWSINVESTMENT FLOWS

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Global new investment in renewable energy increased 17% in 2011, to a new record of USD 257 billion.

= more than six times the figure for 2004

= 94% more than the total in 2007

V O I C E O F F U T U R E G E N E R A T I O N S

GROWTH RATES BY TECHNOLOGYGROWTH RATES BY TECHNOLOGY

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Source: Global Status Report 2012

Solar PV attracted

nearly twice as much

investment as wind.

V O I C E O F F U T U R E G E N E R A T I O N S

100% RE Scenarios100% RE Scenarios

• Germany Federal Environment Agency: 100% RE in Germany by 2050

• Greenpeace: 100% RE in Germany by 2050

• McKinsey: 100% RE in Europe by 2050

• PWC: 100% RE in Europe and North America by 2050

• European Renewable Energy Council (EREC): 100% RE in Europe by 2050

• Jacobson/ Davis, Stanford University: 100% RE in the world by 2030

BUT: political and regulatory challenges

Pre-condition: Enabling Policy Framework

V O I C E O F F U T U R E G E N E R A T I O N S

The WFC builds its work on the expertise and networks of Councillors worldwide

The WFC builds its work on the expertise and networks of Councillors worldwide

The Council consists of fifty highly respected personalities represented in governments, civil society, business,

science, education, and the arts

V O I C E O F F U T U R E G E N E R A T I O N S

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Academic research, sufficiently understanding the challenges and their interdependency, identification and development of best policies to cope efficiently and quickly with the challenges

Awareness raising, making the legislation/politicians and the public aware of what needs to be done and how it could be done

Political Engagement/Advocacy, educating, consulting/engaging legislation/politicians what to implement and how

Political Empowerment/Enabling Legislation, developing tools to empower legislation/politicians to introduce the policies in question

Step 1

Step 2

Step 3

Step 4

The WFC working process to achieve our objectivesThe WFC working process to achieve our objectives

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WFC Principles and Values

Climate/ Energy

A world of climate stability

Future Justice

A world of justice

Sustainable Ecosystems

A world of stewardship

Sustainable Economies

A world of true wealth

Peace and Disarmament

A world at peace

1

2

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5

The five interacting programs of the WFCThe five interacting programs of the WFC

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Department Climate EnergyDepartment Climate Energy

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Decentralization – sharing benefits Decentralization – sharing benefits