Germany’s energy transition increasingly seen to be key to the economic recovery after the coronavirus pandemic

Freja Eriksen and Julian Wettengel write on the Clean Energy Wire about the importance given to the energy transition in Germany as a means to have the country recover from the serious economic impacts of the crisis.


German states and utilities say Energiewende central to economic recovery

The energy transition must remain high on the political agenda despite the impacts of the coronavirus pandemic, energy industry association BDEW head Kerstin Andreae has said in a press release. The association says the coronavirus crisis has increased the urgency of taking political decisions on energy and climate policy, instead of making them less important. Andreae argued that, in the short term, the necessary stimulus for the energy industry requires a reduction in power price taxes and levies and the removal of obstacles to renewables expansion. A position paper by the association added: “In the energy sector in particular, there are many companies that want to invest, but are prevented from doing so by political and bureaucratic obstacles.” In addition, the continued phase out of fossil fuels, a clear framework for a heating transition, and investments in building modernisation, hydrogen technologies, e-mobility and intelligent grids are necessary, said Andreae.

The state of North Rhine-Westphalia also said the energy transition should be considered a key part of Germany’s and Europe’s economic recovery after the corona crisis. In a position paper prepared for a meeting of state energy ministers in May and seen by energate messenger, the state suggests to make the expansion of Germany’s power grid and renewable energies part of an economic stimulus package, and calls on the federal government to remove a cap limiting support for new solar PV installations to a total of 52 gigawatt (GW). It also called on the government to raise the expansion target for offshore wind power to 20 GW by 2030. The state government, like BDEW, proposed lowering the electricity price by reducing taxes and levies. Lower Saxony’s state premier Stephan Weil similarly told news agency dpa that “a new start for the energy transition must become part of a new start for our economy as a whole,” adding the climate action was not possible without renewable energies.

The course of economic recovery from a deep recession caused by the coronavirus outbreak will determine key developments in sectors crucial to the global energy transition for years after the pandemic is over. Renewables expansion is a key priority in the energy sector and crucial legislative steps to enable a continued roll-out have fallen prey to the virus outbreak.

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