Thursday, 17 January 2013

Merkel's senseless energy transition policy is hurting poor people, small businesses - and neighboring countries

Merkel's senseless energy transition policy is seriously hurting poor people and small businesses in Germany.

Germans are beginning to understand what chancellor Angela Merkel's energy transition policy means in practice. Last year electricity prices rose by a record 12 % - which means an additional cost of 125 euros for an average household - and the rise in the prices of electricity and gas is expected to continue. No wonder then that thousands of poor, mostly elderly people, are forced to live in unheated apartments, because they are unable to pay for the energy.
At the same time taxpayers last year paid in excess of 20 billion euros in subsidies to owners of inefficient wind turbines and other renewable energy producers.
In addition, taxpayers are also paying large sums as compensation for companies, which suffer because of fluctuations in the power grid caused by unreliable wind energy: 
Wind being an inconsistent source of energy, Germany's heavy reliance on it causes fluctuations in the power grid that, in turn, can force companies to shut down production for fear of a blackout.Such companies are financially compensated at the taxpayers' expense - up to 20,000 euros per megawatt per year when analysts say 2,000 euros would be a perfectly reasonable figure. The total cost of Germany's green-energy project thus rises by the millions.

The senseless energy transition policy is not only hurting taxpayers, and particularly poor and elderly people. It is also hurting Germany's small businesses, which unlike large companies are unable to avoid paying the "green" surcharges: 
Additionally, businesses can apply to be exempt from paying a surcharge that finances green-energy subsidies when it would inhibit their ability to compete globally. But it's not just multinationals that are granted such exempt status. Weekly Der Spiegel reports that among the more than 1,500 companies that are able to escape paying the tax this year are chocolate factories, poultry farms and slaughterhouses. It quotes energy expert Andreas Löschel as warning that if the policy isn't reversed, "only the stupid ones will not be freed from the surcharge." Even many midsize companies can prove some sort of international competition, so the tax burden falls disproportionately on small businesses.
And the negative effects of Merkel's Energiewende are hurting even Germany's neighbors:
Germany's green-energy push nevertheless remains fairly popular at home, but not abroad. Neighboring countries like the Czech Republic and Poland, which are tied to the same electricity grid as Germany, have been compelled to absorb the fluctuations that stem from its wind-energy production. These countries now intend to build security switches on their borders to prevent overloads and blackouts.
The conservative German newspaper Die Welt has little sympathy for its own government, arguing the Czechs and the Poles cannot be blamed for acting in what it calls "self-defense." Rather, Merkel's administration was "blinded" by its lofty ambitions, the paper editorialized last month, and used the grids of neighboring countries without even asking their permission, let alone paying for it.
Die Welt recognizes that the Czech Republic's and Poland's decision fragments the European energy market and "makes Germany the electric island in the European energy network."
Germany may meet its goal of boosting renewable energy production significantly to wane itself of coal, natural gas and nuclear, but that achievement will come at a price: literally for the German consumer, who will be paying a higher electricity rate than his European counterparts, but more importantly to the European single market which is now one bit less integrated.
Read the entire article here
Germans are hard working and law abiding people, which is why they so far have been prepared to pay for Merkel's energy madness, without complaining too much. But it is most likely that their patience will run thin in the not too distant future, forcing Merkel - or her successor - to make another Energiewende, reversing the entire policy. 

No comments: