In the face of much scepticism, Germany’s Energiewende — or energy transformation away from oil and uranium — has continued to the point where it is reshaping not only the supply business but the whole of the energy market. The utilities have had to redefine their role. Renewables now supply almost 30 per cent of the electricity market, and much more when the sun shines and the wind blows. Two weeks ago, for example, the Greens, the SPD and the Left party gathered for a meeting that was attended by Sigmar Gabriel, the leader of the SPD, who is Angela Merkel’s deputy chancellor and prospective leader of such a “red-red-green” bloc. Perhaps more likely is that the Greens will join the CDU. Anyone who believes that such a “black-green” combination is impossible should visit Baden-Württemberg, where Winfried Kretschmann became state premier after the Greens won more than 30 per cent of the vote in regional elections. Mr Kretschmann is a strong supporter of Ms Merkel’s policy of welcoming refugees, the issue most likely to determine next year’s polls. If this scenario comes about, the issues at stake would inevitably include energy, the cause at the heart of the Green movement. This could mean an more rapid shift to adopt renewable energy. The SPD with its strong links to the coal industry is likely to try to preserve it, at least for now. But a centre-right coalition could sacrifice coal as well as setting new limits on the use of natural gas. The direction of change is clear. At every stage since the 1970s, when the anti-nuclear movement saw the first stirrings of what would become the Energiewende, its ambitions have been dismissed as impossible to deliver. At every stage that has proved wrong. The Energiewende has altered the energy mix in Germany and broken the old business model of the power-generating utilities. But there is much more to come.
FT 7th Nov 2016 read more »