Germany’s support for renewable energy is “breaking” the nation’s ability to pay for power and threatens the competitiveness of electricity producers, Handelsblatt cited a former [green] industry group leader as saying.
Guaranteed prices for solar and wind power, paid for by consumers, are threatening the renewable-energy industry’s ability to compete, the report said, citing Johannes Lackmann, the former head of Germany’s BEE renewable-energy lobby group.
Installations of solar panels may more than double this year to 9,000 megawatts, Handelsblatt said. That may help to boost the total cost of installed solar capacity in Germany to 85.4 billion euros ($106 billion) from 2000 to 2010, according to a study by the RWI economic institute, Handelsblatt said.
> Hypnos says:
June 22, 2010 at 9:37 am
Yeah, subsidies.
Fossil fuels receive twice the subsidies renewables energy do. 72 billion against 29.
Yes, what you say is likely true. But here is the problem, wind which provides the lions share of renewable energy, (after you take out hydro), provides only 1.3% of our nations electriciy (and it is highly debatable whether it actually “replaces” that amt of traditional or is duplicate energy) and provides only .3% of our nations energy when compared to other energy sources using OilEquivalents.
https://docs.google.com/fileview?id=0B5vbWLK5dTl2YTE2NGViZTEtZWI5OC00YzkxLTkwOTUtZTcwMTFkMWE5OTAz&hl=en
Then we can look at another source, EIA – Us Energy Information Admin.
http://tonto.eia.doe.gov/energy_in_brief/energy_subsidies.cfm
Scroll down to table. Fossil recieves less than $1/MW of production while Wind receives $23. And nuclear which is considered “highly subsidized” only receives $1.59/MW. So you see numbers can be spun around quite easily to deceive the naive and gullible. So Wind receives ONE HUNDRED times more in subsidies per unit of energy than does NatGas-Oil. It really is that simple.
I say, no problem, get rid of the energy subsidies, all of them, because energy is something you can’t create out of money anyway. Let’s see if you would to pay for your wind and solar then? Actually I am surprised that wind has the same $/MW subsidy because from my knowledge solar knocks wind out of the park in subsidies.
Hypnos. This is not a subject that can be considered superficially to find the truth. Be very careful of the information that certain groups pass on as true, it might be true, but in a very deceptive manner.
Re: BillD says:
June 22, 2010 at 9:07 am
It makes more sense to make polluting sources pay a higher price, than to susidize renewables.
—
I disagree and we’ve seen why this is bad in Europe. Polluters just move to countries where regulations are less stringent and the problems continue, or often become worse. In a recession, it makes even less sense. Charge businesses more to reduce pollution means they have to find that money from somewhere, so prices increase or they go bust.
Alternatives may make more sense. A commentor here mentioned a turbine upgrade in a power station. Increased output, no increase in ‘pollution’. I think there was also a mention of hydro stations in the US or Canada being made deliberately smaller/less efficient to come in under subsidy caps. If the goal is to reduce pollution, and increase business efficiency, then a more positive subsidy may be more effective. Provide tax breaks or cheap loans to upgrade plant instead. But that wouldn’t transfer billions in subsidies to new ‘green’ businesses that need that subsidy to exist in an artficially created market.
Dang, “wind in solar” should read “wind and solar”……happy fingers.
Funny enough, there’s not much brainwashing going on in German schools, at least if my kid tells the truth. I keep him up to date about the PDO and the solar minimum just so he doesn’t wonder where all the snow and cold is coming from and i ask him whether global worming is a big theme. No, nothing. No “how we can save the world” projects, nothing. Public school. I guess the teachers at his school are just too lethargic to make a fuss.
Maybe the subsidies actually work in neutralizing the political enemy. The greens are probably busy keeping their windmills and solar cells in shape and collecting the money and re-investing it in carbon offseting rackets.
There is an agonizing peace in Germany, only interrupted by the occasional burning Mercedes set ablaze in the night by left-wing radicals. But don’t worry. They have insurance.
“mjk says:
[…]
etc… in the mean time? You and the rest of the “conservative neandrethals” (your descrption not mine) should take pause next time you shout that feel good chant –Drill baby drill.
MJK”
It’s your crisis. Don’t let it go to waste, MJK.
And speaking of large scale reshiftables and greening –
http://www.telegraph.co.uk/earth/energy/windpower/7840035/Firms-paid-to-shut-down-wind-farms-when-the-wind-is-blowing.html
The sinister moves of the liberals. A judge has just blocked Obama’s 6 month drilling ban. He doesn’t have the legal authority to hurt an industry.
“Hypnos says:
June 22, 2010 at 9:37 am
Yeah, subsidies.
Fossil fuels receive twice the subsidies renewables energy do. 72 billion against 29.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a2ygdsSj.KQI
”
“the Environmental Law Institute said.”
“The institute is a nonprofit research group that works to “strengthen environmental protection,” according to its Web site. ”
Hypnos says:
“If fossil fuels were priced at market rates, without government intervention, renewables would already be competitive.
”
Does taxing them count as government intervention in your book, Hypnos?
@nc June 22, 2010 at 9:14 am
‘9,000 megawatts of solar? Is that a typo?’
That would be installed capacity, not actual generated capacity. So no typo. Germany has the largest installed capacity, almost half the world’s.
Solar is like wind, they always use installed capacity when selling or needing to use protected land, but actual generated capacity when they need financial help.
>> Hypnos says:
June 22, 2010 at 9:37 am
Yeah, subsidies.
Fossil fuels receive twice the subsidies renewables energy do. 72 billion against 29. <> http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a2ygdsSj.KQI
If fossil fuels were priced at market rates, without government intervention, renewables would already be competitive. They are nonetheless becoming competitive in some places. And they will only become more competitive as oil prices go back up – or you have already forgotten 2008? <<
If you read the actual article, you find that they are considering tax allowance for foreign taxes (i.e., not double taxing) and government fuel purchases for the emergency stockpile and for aid to the poor as 'subsidies' to the fossil fuel industry.
By that standard, food stamps are a subsidy to the agricultural industry.
Hypnos (June 22, 2010 at 9:37 am) says:
“Yeah, subsidies.
Fossil fuels receive twice the subsidies renewables energy do. 72 billion against 29.”
As others have pointed out, once you scale the numbers you see that fossil fuel subsidies are miniscule on a per megawatt unit basis compared to renewable energy subsidies. And in the case of oil and natural gas, royalties and various land usage fees paid by companies to governments are huge (which is appropriate, since the people as represented by governments owns the rights to the hydrocarbons). In effect, there is a very large existing wellhead fee structure in oil and gas extraction that does not exist in the renewables sector.
Hypnos’ point is ridiculously misleading in the extreme.
And the list goes on. Spain, Germany, who’s next? It is absolutely maddening that the U.S. can’t look over to Europe as an example of what happens when renewables are totally embraced.
To Atomic Hairdryer, a tax break or a cheap loan is a subsidy by a different name.
MJK,
Ixtoc I oil spill, Gulf war spill, WWII (almost 10,000 ships sunk). Yup the whole planet is covered in oil.
Of course oil is a natural product and over millions of years nature has been exposed to it and can cope with it. There are natural processes that degrade the oil. With cleanup the impact is even less.
Wind and Solar power might not have much impact on nature as such. However, it is a low density energy. It is intermittent. Believing that abruptly shutting down current energy system using an intrusive goverment simply reeks of socialism, which is a failed economic model period!
Germany recently suffered 12% unemployment (2005). Is that what you suggest for the US?
Yes, drill, baby, drill, because electricity is not something we get from oil. Our transportation system doesn’t run on electricity. We can reduce our use of oil as raw material for manufacturing, but windmills don’t create plastic or any of the other things we create from oil.
Perhaps the Germans can reduce their mandatory 6 week vacation/spa leisure time to two weeks/year just like in the USA. That way the Europeans prols can pay their overlords the tithings they deserve.
The subsidy model of financing loss making industries has never worked, the UK kept trying from the 70s to the 90s and it was an expensive nightmare and produced such delights as the British leyand maxi/allegro/metro/marina and when the funding plug was pulled nothing had been achieved.
The EU common agricultural policy sucking in vast subsidies for years and causing untold harm to world food production especially in developing nations that simply cannot compete with the EU food mountains caused by oversupply.
A vibrant industrial economy needs one single ingredient, cheap reliable energy and without that bedrock no civilisation will succeed in supplying a growing population with a decent standard of living.
The entire strategy being pushed so hard by the alarmists will simply serve to make it that much harder for the world to cater for an ever expanding population properly, capitalism can do this if only its allowed to do so and the one main ingredient is cheap reliable energy, it will power our homes,our facories,our services,our agricultural industries.
At this time in human history we do not need a Luddite fear driven cowardice, we need confidence and a capitalist economy using the cheapest energy and a governing structure that can just step back and enable instead of dictate and supress.
The gusher in the Gulf wasn’t a predictable outcome of drilling there, as you imply. It occurred because standard safe-practices were deliberately not followed by upper management. Exxon-Mobil followed safe practices, as have the other oil companies; it testified that when it ran into a highly pressurized potential gusher. it stopped drilling and capped the hole.
nc says: (June 22, 2010 at 9:14 am)
9,000 megawatts of solar? Is that a typo?
Nope!
Germany: solar PV power capacity
9.83 GW as of 2009
(source: Eurobserver Photovoltaic Barometer 2010 http://www.eurobserv-er.org/pdf/baro196.pdf)
….for which the producers are paid 0.29-0.55 EUR/kWh
mjk,
Ah, wise man say, green who go to solar panel factory no longer use term “clean renewable.”
Ah, wise man say also, those that know no thermodynamics believe out of sight, out of mind.
It is my opinion that a good and proper job of government is to promote new things until they become economically competitive (or not). Without government subsidies, the price of PV (photovoltaic solar cells) would not have fallen nearly as rapidly as it has. The question is HOW to subsidize, and when to REMOVE the subsidy. Of course, utility scale power production is far cheaper using solar thermal processes than to use PV. The 360 MW desert power plant in Kramer Junction is a good example: http://www.nrel.gov/csp/solar_field_tech.html
I subscribe to several alternative power industry blogs and most of them are concerned about getting more subsidy. For non-baloney information on the PV industry, go here: http://www.solarbuzz.com/
HaroldW says:
June 22, 2010 at 10:33 am
Hypnos June 22, 2010 at 9:37 am
Fossil fuels receive twice the subsidies renewables energy do. 72 billion against 29.
harold, you are on the right track
there are some subsidies, but they are actually really small.
1: royalties paid to foreign countries and states are credited for tax purposes…. as it should be.
if you paid for raw material, it has be considered as expense.
2: research credit that is available to ALL INDUSTRIES is available to oil&gas. there is nothing special here.
3: govt pays poor people for heat. that is welfare. not a subsidy to oil&gas. That money can be used for electric heat, even if it is hydro electric or other “renewable” source.
4: investment credits available to everyone is available to oil&gas. where is the subsidy there?
when statistics is generated by extremely biased people, with no math skills, they can make it look like anything they want
@ur momisugly Hypnos
This is like saying let’s compare my apple with your orange. Let me put my blindfold on first though (after all justice is blind…) Sheesh.
First, considering that ~70% of all the power produced in the US is fossil fuel generated with <10% being generated using renewables, that means in order to consider the two equally subsidized on a relativistic basis, you would need to have the fossil fuels collecting $210 billion in subsidies every year. On a per unit of output basis, the only basis subsidies should ever be measured on for comparative purposes, renewables are far more subsidized and still remain uncompetitive.
I would also read the study referenced, if I were you. It is a fascinating read and completely duplicitous in nature. Examine all of tax breaks provided to the renewables, which are in fact direct subsidies of the energy being produced. Then examine the items classified as "subsidies" for fossil fuels.
The worst item for inclusion on the list is the $6 billion for strategic petroleum reserve purchases. It has been proven time and time again, that this does very little to support or move the market other than short term. Not to mention that these reserves could be sold at any time for what amounts to book value or better without moving the market.
Then there is the $18.6 billion dollars in heating and energy bill subsidies for the poor. This one is mind-blowing for the fact that it is not allocated to a specific production method. It applies to all methods of power production equally. Since we have more fossil fuel production, we have more going to fossil fuels on a pro-rated basis. But it is not, let me repeat is not a fossil fuel specific subsidy. It is a life-style subsidy for the poor at best.
Finally, there is the matter of the $15.6 billion for the foreign tax credit provision. Though the approximate history of this tax credit is correct, it is not exclusive to the oil industry as they would lead you to believe. In fact any and every applicable industry takes advantage of this particular credit, that basically says production of a product should not be unfairly burdened through double taxation (Income tax in the country the oil was produced in and then income tax in the US). The particular ruling in question was in relationship to countries establishing a specialized tax rate for the oil and gas industry that far exceeded the local business income tax rate, without calling it an income tax. The IRS correctly ruled this duplicity by said countries as income tax.
So if we exclude the items that are not drafted to be specific to a particular industry and the strategic petroleum reserves, we are left with roughly $32 billion in fossil fuel specific subsidies (that are in fact actual subsidies) vs. $29 billion over the same period. If I had the time, I could in fact take another cut at the fossil fuel specific items and probably cull another $5-10 billion out as is today's market they don't actually have a net tax impact so they are a subsidy in name only, though if you go rid of them, the tax revenues would remain identical.
Again, I say on a per unit output, renewables are far more subsidized than fossil fuels. That is the truth now, and will probably remain so for the forseeable future.
“mjk says:
June 22, 2010 at 10:14 am
Max Hugoson says:
June 22, 2010 at 9:38 am
On what scientific piece of research are you basing your 3-4 year recovery?? In any event ,even if the gulf –by magic–suddenly repaired itself within this time frame, what are your thoughts on the countless people that have lost their jobs and businesses, animals that have died, fish populations destroyed, marsh lands lost etc etc… in the mean time? You and the rest of the “conservative neandrethals” (your descrption not mine) should take pause next time you shout that feel good chant –Drill baby drill.”
The Ixtoc I oil spill in the Gulf of Mexico leaked from June 3rd and was only capped in March 23rd 10 months later with flows of 10,000 – 30,000 barrels a day. The beaches were cleaned and then a hurricane Allen? in August 1980 finished the cleaning. Reports were that no oil could be found after that. It may be that wetlands could be different but nature has coped with oil for millenia indeed the bloom of bacteria and algae feeding on the oil could be an initial problem. It does seem that oil spills on littoral boundaries seem to clear within ~ 3 -4 years adn in the case of Ixtoc in less than a year after the well was capped.
So BP funds the fishermen and businesses for 3 years. By then nature will have recovered. It may well be that the moratorium on deep-sea drilling will take longer to recover from.
Spain is in the same boat as Germany. They also have high subsidies.
Britain started the same sort of subsidy scheme as Germany quite recently. It is even more generous: you get a subsidy simply by producing electricity for yourself, you don’t have to sell it. In case of PV, you will be paid up to 61 US cent/kWh for the electricity you generate with solar panels for yourself:
The Generation Tariff:
You earn a fixed income for every kilowatt hour of electricity you generate and use in your property.
The Export Tariff:
You earn an additional fixed income for every kilowatt hour of electricity you generate and sell back to the grid.
http://www.fitariffs.co.uk/eligible/levels/
One £ is approximately 1.5 US dollars (1.482)