The three surviving “EEG parents” Dietmar Schütz (SPD), Michaele Hustedt and Hans-Josef Fell (both Greens) have made an urgent appeal to the green electricity industry to make cheap green electricity available to consumers instead of pocketing the current exchange electricity price gains, Renewable energy stocks in market.
Fell blamed trading Renewable energy stocks in market and the scarcity of fossil fuels for the current electricity price explosion. The direct marketing and not the stock market marketing of green electricity was the original goal of the EEG.
Mr. Fell, when you co-invented the EEG, the Renewable Energy Sources Act, more than 22 years ago: did you and your three colleagues in the Bundestag believe that solar or wind power would one day be so cheap would how current? The last tenders yielded guaranteed electricity revenues for the operators of sometimes less than five cents per kWh.
Hans-Josef Fell: Yes, it was our goal to make electricity from renewable energies the cheapest in comparison to nuclear, coal and natural gas electricity. That was our clear strategy. We knew: In contrast to fossil energies, solar, wind, water power and geothermal energy are free of raw material costs. And today, a reliable supply of renewable energy, even with storage, is the cheapest way to generate electricity. That’s phenomenal.
When developing the EEG, did you have in mind that at some point:
Green electricity would be marketed on the stock exchange?
The clear goal was marketing via green electricity companies Renewable energy stocks in market. There have been a number of clearly certified companies that sell green electricity directly to their customers for a long time. But green electricity should not be marketed on the stock exchange.
On the contrary! The idea behind the EEG levy was: Anyone who pays for electricity production from renewable energies should also get green electricity. We realized this basic principle in the year 2000. If that were still the case, everyone would officially get 50 percent cheap green electricity today.
Many reasons for the current electricity price spiral, Renewable energy stocks in market
The exchange electricity prices have been rising sharply since mid-2021 and are currently through the roof. In your opinion, why did this current high electricity price spiral come about?
Fur: There are many reasons. An important one is: Sigmar Gabriel (then Federal Environment Minister, SPD, ed.) abolished the original EEG principle in 2009 by changing the calculation of the EEG surcharge. I couldn’t prevent it from being in the opposition at the time.
In the years since, there have been significant upheavals. Above all, the EEG surcharge rose massively as a result, although the prices for RES producers fell. And today?
The most expensive power plant determines the price of electricity when it is marketed on the stock exchange. And that is very expensive because of the rise in natural gas prices. A nonsensical construction! This is because not only green electricity producers, but above all operators of coal or nuclear power plants, achieve oversized profits. “Renewable energy stocks in market”
This market design must be abolished, we must siphon off the profits. It has to be said again and again: It is not green electricity that is too expensive, but this merit order mechanism is wrong.
Renewable energy stocks in market, So is only the current stock exchange to blame for the price development? Renewable energy stocks in market
Fur: No, not alone. A key reason is the shortage of global energy resources, primarily natural gas and oil, but also coal and uranium. On top of that came the Russian war of aggression against Ukraine. That’s why our rulers are pushed to their limits wherever they go. Because there simply isn’t enough fossil energy to replace Russian energy supplies.
Except from the sun: it radiates 10,000 times more energy to the earth than we consume. And then there are also many technical problems, for example with the nuclear power plants in France. Many are ailing or lack cooling water.
Incidentally, this also applies to coal-fired power plants, which are also responsible for climate change. And because coal and oil transport on the rivers is hardly possible due to the climate-related low level, the fossils also bring additional high prices into the house.
Decoupling of the Electricity price from the gas price can bring relief, Renewable energy stocks in market.
That doesn’t sound good for the foreseeable future.
Fell: No, because actually all nuclear power plants in the Ukraine should be shut down immediately because of the war in order to avoid the danger of radioactive contamination. The decoupling of the electricity price from the gas price, which is currently being demanded by many, could bring a certain relief in the electricity price, because the price of electricity from gas-fired power plants determines the price of electricity on the exchange due to the high costs of natural gas thanks to the merit order effect.
What could a real solution to the problem look like then? Renewable energy stocks in market.
Fell: We need two markets: A fast-growing one for renewable energies, the generation of green electricity must be massively promoted. And it needs an extra market for the old energies. Because it’s getting so expensive, customers there will quickly disappear. The current mixing of renewables with fossil energies is the crucial problem.
The example of Naturstrom AG shows that there is another way: They already generate a third of their own green electricity and can now make their new customers cheaper offers than most of their competitors. But everyone can also produce cheap green electricity themselves, in the company, on the house, collectively in the neighborhood. You don’t have to wait for offers.
Wind or solar power plant operators should refrain from marketing Renewable energy stocks in market.
So you recommend wind or solar power plant operators to market their green electricity differently than on the stock exchange?
Smaller wind or solar power generators can look for customers themselves and sell them directly to municipal or municipal utilities via PPA contracts. Photo: Heinz Wraneschitz
Fur: Yes. Because green electricity has a different character than “conventionally” generated electricity. The corporations aim to maximize profits, so they want to go public. Smaller wind or solar power generators can initially use their power themselves, look for customers themselves, for example via so-called
PPA sell contracts directly to city or municipal utilities. This must be expanded so that the low-cost green electricity can reach consumers.
At the same time, operators of solar power systems that have been subsidized are currently licking their fingers: they were promised a good two cents per kWh for continued operation after the 20-year subsidy system, for 2022 it should probably be almost 20 cents as the average electricity price on the exchange will. What do you make of it?
Fell: The decisive factor is that homeowners with their own system massively increase the use of their own electricity. A lot is gained if they use 60 to 80 percent of their own electricity. Switch the heating to a heat pump, charge the electric car at home. It is also true that specialist companies are currently not able to keep up with the installations. But many could have done something for 20 years, that must not be forgotten either.
Legal changes are necessary, But more self-powered electricity in a family home can’t be the only solution.
Fur: No, legal changes are also necessary. Energy sharing among neighbors must be allowed. Why not use the neighbor’s roof if your own is in the shade? The EU directive requires this – Germany has still not implemented it. Something else has been talked about for a long time: the clean electricity producers should be relieved, but the dirty fossil and nuclear ones burdened.
If green electricity were exempted from the electricity tax, we would have an additional relief and steering effect for climate protection in one fell swoop. But this basic principle, i.e. relieving the clean and charging the dirty, has still not reached the government. As of today, the new gas levy should also be levied on biogas.
Robert Habeck shouldn’t fly around the world looking for LNG
Speaking of legislators: Your Green Party is one of three coalition partners in the Bundestag, i.e. in power. What do you expect from the government? Even the EEG is now a juggernaut. Do you see an urgent need for action?
Fell: Yes, this excessive bureaucracy, the switch to tendering for larger systems, the non-implementation of the energy sharing required by the EU: My Greens have to look more closely at that. And Energy Minister Robert Habeck shouldn’t fly around the world looking for LNG (liquid gas), but go to Bavaria and wash his head with Prime Minister Söder, especially when it comes to wind power.
After all, the much-cited energy problems in Bavaria are the result of failed energy policies by Seehofer and Söder. But the government must finally take action in the other federal states as well.
The EEG account at the Federal Network Agency has continued to fill up. Because the electricity network operators marketed electricity purchased at the EEG price via the exchange, the account balance at the end of July was almost 17 billion euros. Can’t you just use the money to relieve end consumers? After all, they and not the bulk consumers have paid the EEG levy up to now.
Fell: The example shows again how wrong the construction of marketing via the stock exchange is. The faulty construct must be changed. Likewise, changing the EEG surcharge to tax financing was a blatant mistake. Actually, the EEG surcharge would have slowly melted away anyway. Now the EU has sovereignty over the EEG because it is now a subsidy. But it is positive that the EU itself wants to change something about the merit order principle.
Green electricity industry should forego excessive profits ” Renewable energy stocks in market “
I heard that the three EEG parents who are still alive are appealing to the green electricity producers: They should pass on the cost advantages achieved through the EEG to the consumers.
Fell: Yes, we appeal to the green electricity industry to forego excessive profits in order to prevent social problems caused by excessive electricity prices. I’m afraid that AfD and Die Linke will soon take to the streets and claim that green electricity is to blame. That’s why larger community systems, solar or wind power, shouldn’t just take the big profits from the stock exchange, but pass on the cheap generation costs of renewables to many customers.
The company Westfalenwind, for example, is leading the way: It provides its investors and citizens in the area with cheap green electricity. When people see how cheap green electricity is, they no longer fall for the right-wing fake news. But I would like to make it clear: the profits from conventional providers are far higher than those from renewables. The old energy companies would have to help even more.
You addressed the appeal to the operators: How have the reactions been so far?
Fur: Unfortunately, there have hardly been any. The first positive comes from a wind power operator from Franconia. The fact is: the possible marketing models to relieve electricity customers must be made better known. That is also the job of the media.
You should make money with climate protection and not with climate destruction
Last question: What do you say to people or companies who are now complaining about the expensive electricity prices and blaming renewables for it?
Fur: That’s just wrong! My basic thesis has always been: You should make money with climate protection and not with climate destruction. That’s why I recommend village communities, for example: Generate your electricity and heat yourself in a renewable way instead of buying it expensively from corporations. So you can free yourself from the expensive dependence on energy companies.
After all, renewable energies are the cheap ones, supplying the cheapest electricity today. But the legal changes described above are also needed for this price to reach people. And because many have not understood this principle, they are taken in by fake news producers.