Germany is drafting an economy-wide plan to achieve deep emission cuts by mid-century, but its struggle to phase out coal is teeing up a crunch early battle in the global clean energy transition.

The strategy, due to be agreed by the government by July, would firm up Germany’s already-agreed 2050 aim of reducing GHGs 80-95% under 1990 levels, and Environment Minister Barbara Hendricks is pushing to set the target at the upper end of that range.

“For us in the EU and Germany, the Paris Agreement means working to reduce emissions 95% by 2050 … This is a mammoth task,” Hendricks told the Berlin Energy Transition Dialogue event in Berlin last week.

“No sector will be excluded – not agriculture, transport, heating and cooling, or manufacturing. But above all, we must switch electricity completely to renewable energy, [a strategy] for which our Energiewende [energy transition] remains the centrepiece,” she said.

Such a profound long-term transformation requires cross-party support, Hendricks added, explaining that this is why her ministry has consulted widely among associations, states, and communities before drawing up the plans.

This has culminated in a 345-page document featuring 97 climate measures published over the weekend that the ministry intends to use to shape a draft strategy and consult with other government agencies.  A final version of the plan will then be handed to the federal cabinet for approval by the end of June.

Hendricks’ push to achieve the higher end of both Germany’s and the EU’s 2050 goals tallies with her state secretary Jochen Flasbarth’s call earlier this month for the EU to consider more ambition in its 2030 target in response to the Paris Agreement.

EMISSIONS STUBBORNLY FLAT

Germany’s efforts since the late 1990s to offer feed-in-tariffs to fund solar and wind units are widely credited for helping bring down the cost of renewables worldwide.

“We all owe a debt of gratitude to Germany,” said Adnan Amin, director-general of international renewable energy agency IRENA, reflecting on the country’s support structure that from next year will switch to an auction-based system as renewable energy costs become more competitive with thermal output.

But Germany’s current focus on formulating long-term climate plans masks the country’s difficulties in curbing its own emissions in the near term.

Greenhouse gas output was 908 million tonnes of CO2e last year, some 27% below 1990 levels, according to government estimates.  Emissions rose 0.7% or 6 million tonnes year-on-year, barely budging for a fourth straight year as the country grapples with a nuclear phase-out due to be completed in 2022.

Hendricks has blamed Germany’s stubbornly flat emissions on coal power production, which she said was thwarting the climate benefits gained from the country’s massive roll-out of solar and wind power, which last year accounted 32.5% of national electricity generation.

German power exports have risen markedly, hitting 10% of total generation last year as the local and federal governments have struggled to map a future for the country’s coal-fired plants and abundant supply of carbon-intensive lignite extracted from massive open cast pits.

And Germany’s powerful regional structure has created pockets of vehement opposition to advancing the phase-out of coal, fearful of the loss of jobs and risks to energy security.

This came to a head last year as the government proposed extra measures needed to meet its domestic 2020 target of a 40% cut from 1990.

Industry, unions, and senior members of the centre-right partner of the ruling coalition forced the government into a compromise to pay to idle several coal power stations rather than fining them for staying open.

In an effort to front-run the coal exit debate, independent think tank Agora Energiewende has outlined how a coal phase-out can be managed gradually by 2040-45, including the cancellation of EU carbon allowances to counter the effects of distributing excess permits elsewhere in Europe.

“We need a smart retirement strategy,” said Agora’s Barbara Praetorius, stressing that while renewables create more jobs than fossil fuels, coal mining regions could be hit hard and therefore need substantial government support.

But the pace of developments in building design and technology could ensure coal’s demise at a far more rapid rate, according to Amory Lovins of the US’s Rocky Mountain Institute, who said these were already capable of drastically cutting energy demand and effectively managing supply from renewables.

“The pace is not set by the incumbents, investors flee even before customers do …  The market can flip with breathtaking speed,” he said, referring to the recent collapse in the share prices of US coal companies and the rise of firms such as electric vehicle producer Tesla.

POSTCARD FROM LUSATIA

Around 90 minutes drive from Berlin is Lusatia, Germany’s second biggest lignite mining region. Its coal sector has shed jobs in recent decades due to automation, but it remains one of the area’s few major employers.

Some 8,000 people there work in coal today, down from as much as 100,000 in 1990 – the height of a boom that decades earlier swelled the population of this historically agricultural region.

Over that period, some 136 villages had to be resettled to make way for the massive pits. Some of these have enough coal to mine until mid-century, but their immediate future is now in doubt as majority owner Vattenfall wants to sell them.

The former East Germany energy powerhouse region has suffered from 25 years of depopulation following the country’s reunification with West Germany, with many younger people opting to leave for the prospect of more lucrative jobs in Berlin or other major cities.

Lusatia’s politicians and citizens, increasingly aware that a coal phase-out is a question of ‘when, not if’ over the past few years, but are demanding government support to attract alternative employment and safeguard the local economy.

“We need to manage this is a sustainable way … we can be a first mover in the transition and gather organisational experience and how to ensure societal acceptance,” said Gerd Lippold, a Saxony state MP for the Alliance 90/Greens, told a panel of lawmakers and academics held in Grossraschen, Lower Lusatia.

He said as many as 2,500 workers will be needed to manage government requirements for the rehabilitation of the pits, though it is estimated to take as long as 80 years before the scarred landscape is fit to farm crops.

Simone Wendler, a veteran reporter at the local Lausitzer Rundschau newspaper, was fearful that politicians wouldn’t deliver on their promises of keeping jobs in the area.

“I would like to see Lusatia become an industrial region, but I have major doubts. Even if local efforts are successful, we will only see jobs come in [lots of] 20s, 25s, I don’t think we can compensate for 8,000.”

Both Wendler and local business leader Maik Bethge noted that the coal phase-out was being discussed while pits in Poland’s neighbouring Silesia are opening up, reflecting a largely unfounded suspicion rife across Lusatia.

While the Polish government’s speaks of an ambition to strengthen its coal sector, no companies currently have developed advanced plans to invest in new mines.

By Ben Garside – ben@carbon-pulse.com

This feature was inspired by a trip to Berlin and Lusatia sponsored by Clean Energy Wire