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Turning energy around: coal and the German Energiewende

This brief examines how Germany’s coal sector has affected the progress of the Energiewende, and how policy-makers might be able to overcome resistance to the energy transition.

Stefan Bößner / Published on 4 August 2016
Citation

Bößner, S. (2016). Turning Energy Around: Coal and the German Energiewende. Discussion brief. Stockholm Environment Institute: Stockholm.

The energy systems of most developed countries have traditionally been centralized and based mostly on fossil fuels. As awareness of climate change has grown, however, it has become clear that energy systems need to be fundamentally transformed, to become low- or zero-carbon.

Germany, a long-time leader on environmental and climate issues, has set out to reshape its energy system, aiming to reduce greenhouse gas emissions to 40% below 1990 levels by 2020 and to 80–95% below 1990 levels in 2050, and to phase out nuclear power by 2022. The goals are to be achieved by increasing the share of renewable energy and improving energy efficiency.

This Energiewende – typically translated as “energy transition”, but more literally “energy turnaround” – creates significant challenges. The renewable technologies that will replace the existing system produce energy in a decentralized manner, requiring different infrastructure and a different market design. Moreover, new actors are involved, whose interests are likely to clash with those of the incumbents keen on maintaining as much of the old, centralized energy system as possible. This is especially true in Germany, where the electricity market is dominated by four big players, and coal retains a significant role in the economy.

This brief examines the coal sector in Germany amid the Energiewende, starting with a review of the transition so far, including related economic and energy security challenges, as well as the role of the coal sector in the German economy and energy system. The analysis then focuses on how key coal sector actors have responded to a government proposal to levy an additional charge on coal-fired power plants. The goal is to shed light on how stakeholders in the status quo are framing their case against the Energiewende, and how their arguments might be countered constructively.

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SEI author

Stefan Bößner
Stefan Bößner

Research Fellow

SEI Asia

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