New Study on Shortcomings of Renewable Energy Auctions

Dear Colleagues and Friends,

Despite the urgency of establishing effective climate protection and a sustainable economy, the expansion of renewable energy is lagging far behind its potential in many regions around the world. In Germany and other countries, it is becoming apparent that the recent shifts from feed-in tariffs to auctions are accompanied by a number of negative developments that include a decline in investments, the exclusion of community energy projects and the absence of cost reductions. For several years now, the Energy Watch Group has been observing and drawing attention to this dangerous development that has been widely neglected by politics and the public.
With a new large-scale study, we want to shed scientific light on the effects of the transition to auctioning

After months of intensive discussions with various stakeholders, we have assembled a team of leading scientists who are now compiling an extensive global summary on the shortcomings of renewable energy auctions. With this new scientific evidence, we want to give policymakers the necessary impetus for a change of course – towards an accelerated expansion of renewable energy worldwide. In order to finance this project, we have started a crowdfunding campaign and need your support!

New investments in renewables decrease, community energy is being pushed out of the market. Our president Hans-Josef Fell about the necessity of a political turnaround.

Please support this project with a few clicks!

Time is pressing, and the political course will be set this fall: With the European Green Deal in the pipeline, the German Bundestag scheduled to amend the Renewable Energy Act (EEG) and many legislative amendments pending outside the EU, the next decade of energy policy will be decided upon this year. Our planned study is already partially funded but in order to raise funds for the remaining costs of 24,000€, we have launched our first crowdfunding campaign. Our goal is to incorporate the results of the study into the public debate and policy-making processes already from September onwards, and we need your help to put this plan into action!

… and spread the word!

Stimulating investments in sector coupling and innovation: Energy Watch Group proposes new law for reliable and adequate renewable energy systems

Berlin (May 14, 2020) – On the occasion of this year’s 20th anniversary of the German Renewable Energy Sources Act (EEG), the Berlin-based Think-and-Do Tank Energy Watch Group (EWG) presents a legislative proposal to stimulate the system integration of renewable energy. The underlying purpose of the policy proposal is to allow renewable energy sources to finally assume responsibility for the system security of the power supply – i.e. to cover the required energy demand at every hour of the year. With a so-called combined power plant tariff, the instrument intends to stimulate investments for full demand coverage by 100% renewable energy. Based on own techno-economic cost estimates and a legal examination of EU regulations, the EWG proposes a fixed-feed-in-tariff of 8 cents/kWh, supported by a sliding market premium.

While renewables keep setting records in terms of their shares of national electricity mixes – Germany has recently hit the 50% mark –, a full transformation to an entirely renewable-based energy system is not yet widely regarded to be a tangible reality. One of the main reasons is the prevailing mistrust of the ability of renewables to provide year-round supply. Many scientific studies have already shown that a complete conversion to renewables is not only critical for reasons of climate protection, but also that it is technologically feasible (in combination with storage technologies and digital control technology) at any hour of the year and at cost-effective prices. What is still missing, however, is a legal basis to enable the market penetration of reliable and adequate 100% renewable energy systems.

“The newly proposed Sector Coupling and Innovation Act for Renewable Energy is intended to become a major impetus to overcome the current challenges of the coronavirus recession and the climate crisis. More than ever, it is necessary to find solutions that both stimulate the economy and protect our climate,” said Hans-Josef Fell, who, as President of the EWG and author of the draft law EEG 2000, was responsible for drafting the new legislative initiative.

Stefan Gsänger, Secretary General of the World Wind Energy Association, emphasized: “Renewable energy ultimately can, must and will assume responsibility for system security. Today, wind and solar power have become the cheapest forms of energy. As a next step, the investments in the optimised integration of all renewable energy sources must be massively increased. The EWG’s new policy proposal shows how this can be achieved effectively and deserves wide attention.”

The law would create a market for the very large number of start-ups and established companies that are in the starting blocks with innovative system developments for storage, digital controls, green power generation and sector coupling, but do not yet have a viable market environment to generate large-scale privately financed investments.

“The advantages of low, decentralised and transparent energy production costs can now be shared with those of climate protection and security of supply, especially since integration comes also from the regional level in support of the transmission network. Further innovations and growth markets can certainly develop if technologies such as batteries, hydrogen, heat pumps and heat storage in combination with solar and wind energy are dynamically developed towards decentral system responsibility.”, states Thure Traber, Chief Research Officer at the EWG and author of the legislative proposal.

A legal examination of the proposal has shown the compatibility with EU regulations. A distinction is made between a fixed feed-in tariff per kWh fed into the grid for small plants and a floating market premium for larger plants that participate in electricity competition via direct marketing. Similar options for policy implementation are expected at international level. With political majorities in national parliaments, the proposal can help to realise effective climate protection and, after the end of the coronavirus pandemic, a rapid recovery of the economy together with the phasing-out of fossil and nuclear energy in favour of clean renewable energy sources.

The full policy paper is available here.

Media contact: Charlotte Hornung / +49 30 609898815 / hornung@energywatchgroup.org

About Energy Watch Group  

Energy Watch Group (EWG) is an independent, non-profit, non-partisan global network of scientists and parliamentarians. EWG conducts research and publishes independent studies and analyses on global energy developments. The mission of the organisation is to provide energy policy with objective information. For more information, please visit www.energywatchgroup.org.
Contact: office@energywatchgroup.org, +49 30 609898815

Global Energy System Based on 100% Renewables

What leading experts say about our new study:

 

Prof. Mark Jacobson, Stanford University, California, USA

“The science is in that a transition to 100% clean, renewables for all energy is an achievable goal throughout the world. This new paper reaffirms this fact, plus it shows it is possible to avoid 1.5°C global warming by getting to zero net GHG emissions by 2050 without negative emission technologies, fossil fuels with carbon capture, or nuclear power, yet at an affordable cost.”

Prof. Martin Green, University of New South Wales, Sydney, Australia

“This is an impressive body of work that will not only provide a benchmark for future studies but will also provide a guide for coordinated policy action that is needed to limit the future impact of the world’s past dependence on fossil fuels for its energy supply.”

Prof. Claudia Kemfert, Hertie School of Governance, German Institute for Economic Research (DIW), Berlin, Germany

“The study shows impressively that a secure and cost-efficient energy supply to achieve the Paris climate targets with 100% renewable energy is not only technically possible, but also economically profitable. What is particularly significant about this study is that it shows that neither nuclear or CCS technologies nor geoengineering are required to achieve the climate targets cost-effectively.”  

Prof. Eicke Weber, former Director of Fraunhofer Institute for Solar Energy Systems, Freiburg, Germany

 “This is truly a landmark-study. A detailed analysis that covers the whole globe with a one-hour time resolution demonstrates that a reliable global energy system based on 100% Renewable Energy is technically possible and financially advantageous. It is noteworthy that the study comes to the conclusion that the world will need for such a secure energy supply about 70 Terawatts of Solar Power (essentially Photovoltaics, PV) installed, and 8 Terawatts of wind – numbers, that will be important in planning the world’s trajectory in the coming years to avoid catastrophic climate changes – in line with the demands of the current, global FridaysforFuture movement of our schoolchildren.”

Jeremy Leggett, Green Entrepreneur & Director of Solarcentury, United Kingdom

“1.5˚C zero-GHG energy from power, heat, transport & desalination sectors is possible before 2050. This 100% RE system, modeled hourly, globally, for the 1st time, allots solar 69% of the mix at lower cost than current global supply. A historic report.”

Daniel Fürstenwerth, Renewable Energy Expert & Green Entrepreneur, Berlin, Germany

“The best and most relevant piece of work on the energy transition in the last 5 years. Setting a new standard on energy system modelling: IEA/Irena scenarios have today become irrelevant, due to lack of quality!”

 

The full study is available here
The full study in high resolution (ZIP file) is available here.

Download material (in different languages)

Key Findings: English, French, German, Mandarin, RussianSpanish

Executive Summary: English, French, German, Mandarin, Spanish

Presentation on the global results

Presentations on the regional results: Europe, Eurasia, MENA, Sub-Saharan Africa, SAARC, Northeast Asia, Southeast Asia, North America, South America

Supplementary data (Excel file)
Presentation of numerical results of the modeling broken down to regions and sectors.

 

About the Study
The simulation “Global Energy System based on 100% Renewable Energy”, co-funded by the German Federal Environmental Foundation (DBU) and the Stiftung Mercator, comprises a state-of-the-art modeling, developed by LUT University and computes a cost-optimal mix of technologies based on locally available renewable energy sources. It determines the most cost-effective energy transition pathway for global energy supply on an hourly resolution for an entire reference year and structured in 145 regions. The global energy transition scenario is carried out in 5-year time periods from 2015 until 2050. The results are aggregated into nine major regions of the world: Europe, Eurasia, MENA, Sub-Saharan Africa, SAARC, Northeast Asia, Southeast Asia, North America and South America.

About Energy Watch Group
Energy Watch Group (EWG) is an independent, non-profit, non-partisan global network of scientists and parliamentarians. EWG conducts research and publishes independent studies and analyses on global energy developments. The mission of the organization is to provide energy policy with objective information.

About LUT University
LUT University has pioneered as a science university combining technology and business since 1969. It has been recognised in international rankings as one of the world’s top universities. Clean energy and water, a circular economy and sustainable business are pivotal questions for humankind. LUT University applies its expertise in technology and business to seek solutions to these questions. LUT University strongly promotes entrepreneurship stemming from its scientific research. An example of this is the business accelerator Green Campus Open, which supports new spin-off companies that are based on LUT’s research. LUT’s international science community consists of 6500 students and experts. www.lut.fi/web/en/

The new study by the Energy Watch Group and LUT University is the first of its kind to outline a 1.5°C scenario with a cost-effective, cross-sectoral, technology-rich global 100% renewable energy system that does not build on negative CO2 emission technologies. The scientific modelling study simulates a total global energy transition in the electricity, heat, transport and desalination sectors by 2050. It is based on four and a half years of research and analysis of data collection, as well as technical and financial modelling by 14 scientists. This proves that the transition to 100% renewable energy is economically competitive with the current fossil and nuclear-based system, and could reduce greenhouse gas emissions in the energy system to zero even before 2050.

“The report confirms that a transition to 100% renewables is possible across all sectors, and is no longer more expensive than the current energy system,” said Hans-Josef Fell, former Member of the German Parliament and President of the Energy Watch Group, in advance of the publication. “It shows that the whole world can make the transition to a zero emission energy system. That is why all political powers around the world can and should do much more to protect our climate than they currently envision.” Thanks to the developed model and the extensive existing database, EWG and LUT can now also develop national roadmaps for the transition to 100% renewables, tailored precisely for the individual countries’ respective context, Fell added.

“The study’s results show that all countries can and should accelerate the current Paris Climate Agreement targets,” said Dr Christian Breyer, Professor for Solar Economy at the Finnish LUT University. “A transition to 100% clean, renewable energies is highly realistic – even today, with the technologies currently available.”

Prof. Dr Claudia Kemfert, Head of the Department of Energy, Transport and the Environment at the German Institute for Economic Research (DIW), highlighted the economic viability of renewable energies: “The study is an impressive demonstration that a transition to renewable energy sources worldwide is not only feasible, but also makes economic sense.” David Wortmann, initiator of the Eco Innovation Alliance and founding member of Entrepreneurs For Future also called on policy-makers to put in place innovation-friendly frameworks and emphasised that “for us, an economically profitable energy transition has long since ceased to be a myth”. Franziska Wessel from Fridays For Future also called on policy-makers to take immediate action: “This study shows what is possible if our politicians are willing to act. We – Fridays For Future – call for a completion of the transition to 100% renewables by 2035.”

The study concludes with political recommendations for a rapid integration of renewable energy and zero greenhouse gas emission technologies. Among the most important measures suggested by the report are promoting sector coupling, private investments (which should ideally be incentivised with fixed feed-in tariffs), tax breaks and legal privileges with simultaneous discontinuation of subsidies for coal and fossil fuels. According to the report, the transition to a global energy system based on 100% renewables can be achieved before 2050 if a strong policy framework is implemented.

Some key findings of the study:

  • The transition to 100% renewable energy requires comprehensive electrification in all energy sectors. The total electricity generation will be four to five times higher than electricity generation in 2015. Accordingly, electricity consumption in 2050 will account for more than 90% of the primary energy consumption. At the same time, consumption of fossil and nuclear energy resources in all sectors will cease completely.
  • The global primary energy generation in the 100% renewable energy system will consist of the following mix of energy sources: solar energy (69%), wind power (18%), hydropower (3%), bioenergy (6%) and geothermal energy (2%).
  • By 2050, wind and solar power will account for 96% of the total power supply of renewable energy sources. Renewable energies are produced virtually exclusively from decentralised local and regional generation.
  • 100% renewables are more cost-effective: The energy costs for a fully sustainable energy system will decrease from € 54/MWh in 2015 to € 53/MWh in 2050.
  • The transition in all sectors will reduce the annual greenhouse gas emissions in the energy sector continuously from roughly 30 GtCO2-eq. in 2015 to zero by 2050.
  • A 100%-renewable electricity system will employ 35 million people worldwide. The roughly 9 million jobs in the worldwide coal mining sector from 2015 will be phased out completely by 2050. They will be overcompensated by the over 15 million new jobs in the renewable energy sector.

 

About the Study
The simulation “Global Energy System based on 100% Renewable Energy”, co-funded by the German Federal Environmental Foundation (DBU) and the Stiftung Mercator, comprises a state-of-the-art modeling, developed by LUT University and computes a cost-optimal mix of technologies based on locally available renewable energy sources. It determines the most cost-effective energy transition pathway for global energy supply on an hourly resolution for an entire reference year and structured in 145 regions. The global energy transition scenario is carried out in 5-year time periods from 2015 until 2050. The results are aggregated into nine major regions of the world: Europe, Eurasia, MENA, Sub-Saharan Africa, SAARC, Northeast Asia, Southeast Asia, North America and South America.

About Energy Watch Group
Energy Watch Group (EWG) is an independent, non-profit, non-partisan global network of scientists and parliamentarians. EWG conducts research and publishes independent studies and analyses on global energy developments. The mission of the organization is to provide energy policy with objective information.

About LUT University
LUT University has pioneered as a science university combining technology and business since 1969. It has been recognised in international rankings as one of the world’s top universities. Clean energy and water, a circular economy and sustainable business are pivotal questions for humankind. LUT University applies its expertise in technology and business to seek solutions to these questions. LUT University strongly promotes entrepreneurship stemming from its scientific research. An example of this is the business accelerator Green Campus Open, which supports new spin-off companies that are based on LUT’s research. LUT’s international science community consists of 6500 students and experts. www.lut.fi/web/en/

At COP24, LUT University and Energy Watch Group will present their new joint study

which shows that

A Rapid Transition to 100% Renewable Energy Across Europe is Possible
with Zero GHG Emissions from Power, Heat, Transport and Desalination Sectors before 2050

Join us on:

10.12. Monday, 13:30-15:00 in Pomorze Climate Action Room 1

Side-event of Energy Community: “Shifting to a low-carbon economy: Just transition pathways in the Energy Community and beyond

Following an opening by Energy Community Director Janez Kopač, a top-level panel, including EWG President Hans Josef Fell, will discuss how to achieve a just energy transition. The event will be chaired by KR Foundation Board Chair Connie Hedegaard.



11.12. Tuesday, 11.30-13:00 in Pieniny Room

Side-event of REN Alliance: “Stronger Together: Showcasing Success of a Global 100% Renewable Energy System

After a presentation of a new leading-edge study on 100% renewables in Europe across all energy sectors by EWG President Hans-Josef Fell, leading international renewable energy associations will discuss how to scale up this scenario worldwide.



11.12. Tuesday, 18:30-19:00 in Press-conference room “Katowice”

Official release of the study at press conference of CAN Europe, Energy Watch Group and LUT University

At the press conference, lead author of the study Prof. Dr. Christian Breyer of LUT University and EWG President Hans-Josef Fell will present the study results and discuss it with CAN Europe Director Wendel Trio.