Wednesday, 6 June 2012

Merkel´s energy transition: Energy prices now so high that low-income Germans not able to pay

"The primary reason for these costs can be seen on rooftops throughout Germany" 

The sad truth about German chancellor Angela Merkel´s failed energy transition policy is becoming more and more evident. Subsidised wind and solar power production has led to higher energy prices that low-income and unemployed Germans are not able to pay anymore. And further increases are in the pipeline ...

More than a year has passed since the Fukushima nuclear reactor disaster in Japan prompted Germany's lower house of parliament, the Bundestag, to vote to gradually phase out the country's nuclear power plants, replacing them wherever possible with renewable energy sources. Yet it is only now that a serious discussion is beginning over the costs of the nuclear phase-out.
Chancellor Angela Merkel made the transition to renewable energy a top priority after dismissing her environment minister, Norbert Röttgen, last month, but essential questions remain unanswered. Who will pay for this supposed "joint effort," in Merkel's words? What's the upper limit on costs? And when will voters' positive view of the nuclear phase-out give way to frustration over rising costs?
Rising energy costs are especially embarrassing for German leaders because, until very recently, they claimed to have everything under control. Merkel more or less offered a price guarantee in a speech on the energy turnaround she gave in front of the Bundestag last year.
"We must continue to provide both businesses and individual citizens with affordable energy," Merkel said at the time. "The costs to consumers as a result of the EEG must not exceed their current level."
That's a promise the chancellor won't be able to keep. This fall, the Federal Network Agency is expected to announce rates that are 30 to 50 percent higher than current levels, putting consumers' contribution to renewable energy subsidies between 4.7 and 5.3 euro cents per kilowatt hour of energy, plus sales tax, up from the current level of 3.59 cents. Bareiss, the CDU's energy specialist, has even talked of "potentially more than six cents" per kilowatt hour, which would be an increase of nearly 70 percent.
The primary reason for these costs can be seen on rooftops throughout Germany. Energy consumers will pay €100 billion over the next 20 years to subsidize photovoltaics installed before the end of 2011. The first several months of this year added at least €5 billion to that amount.
Meanwhile, many low-income and unemployed Germans have reached the limits of what they're able to pay, as the example of Aminta Seck in Berlin shows. As a single mother, Seck receives €860 a month in government assistance. By law, €40 of that amount is intended primarily to cover energy costs.
In reality, though, the money isn't enough. Despite moving out of her old apartment and into a smaller one, Seck consistently comes up a few euros short each month, an amount she then has to pay as a lump sum at the end of the year. "I manage to come up with the money for the energy bill in the summer," she says, "but in the winter, when it's dark, it's just not possible."
Once the electricity has been shut off, it's difficult for consumers to climb out from under their debts, since in addition to settling their overdue bills, they have to pay a fee of up to €80 to have the power turned back on.

"My clients end up waiting at least a week, and in extreme cases even up to two months," says social worker Renate Stark, who works in Prenzlauer Berg at Caritas, a social services organization, and counsels people who have fallen behind on their energy bills.
Stark says she's already seen the effects of the transition to renewable energy sources. "In the past, at most one client per month came to me because of problems paying energy bills," she says. "Now it's at least 30."
This makes it all the more astonishing how casually politicians -- from all parties -- have disregarded the societal consequences of their project. While the government and opposition quarreled for months over a few euros' difference in Hartz IV payments, they essentially formed a grand coalition when it came to subsidizing solar panels.

Read the entire article here

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