Energy Efficiency and the Energiewende
Although Energiewende policies focus primarily on the nuclear phase-out, ramping up the share of renewables in the power mix, and corresponding grid infrastructure needs, many people are looking for solutions to the “affordability” challenges of the Energiewende due to rising concerns over transition costs. Removing market barriers to energy efficiency and establishing foundational policies to capture efficiency resources will help to achieve the Energiewende at least-cost, and decouple economic growth from energy consumption.
By coining the phrase “Wirtschaftseffizienzwunder” or “economic efficiency miracle” in a Deutschland Financial Times editorial in early 2012, RAP helped establish a new narrative for energy efficiency in Germany–namely as the engine for Energiewende economic growth along the lines of the “economic miracle” policies put in place by Ludwig Erhard to increase labor productivity following World War II. What Would Ludwig Erhard Say? was highlighted by European parliamentarian Claude Turmes at a conference on the imperative of increasing energy efficiency investments during Germany’s transition to a low-carbon economy.
RAP co-authored and presented The Positive Effects of Energy Efficiency on the German Electricity Sector at the 2014 International Energy Policy and Programme Evaluation Conference in Berlin. It summarizes the results from five different scenarios with a range of power consumption trends, which determine that a significant reduction in electricity consumption can reduce the mid- to long-term costs of the power system—even with much greater use of renewable energy. This paper draws from Positive Effekte von Energieeffizienz auf den deutschen Stromsektor (Positive Effects of Energy Efficiency on the German Electricity Sector), a study commissioned by RAP, in partnership with the European Climate Foundation and Agora Energiewende, to quantify the system benefits to Germany of achieving ambitious efficiency targets. Prognos AG and IAEW Aachen conducted the study, with RAP technical advisors involved throughout the scoping and project development process.
A large portion of the efficiency reduction potential in Germany is associated with retrofit improvements to existing residential buildings. RAP’s Residential Efficiency Retrofits: A Roadmap for the Future (Zusammenfassung Energetische Sanierung von Wohngebäuden: Ein Fahrplan für die Zukunft), presents eight principles to increase the effectiveness of current retrofit programs in Germany. The principles are premised on the lessons learned from more than two decades of international experience and on the imperative to achieve much deeper levels of savings per building, and reach a much broader swath of the market than any region, nation, or state has achieved to date.
As Germany grapples with how to meet its Energiewende targets for end-use efficiency, and debates a number of proposals for energy savings obligations, including implementation of the recent European Energy Efficiency Directive, RAP has also shared global experience with energy savings obligations. RAP summarized these recommendations in Rethinking and Reframing Energy Savings Obligations (Energieeinsparverpflichtungen neu denken, neu gestalten). One of the most successful approaches to achieving large-scale energy efficiency goals is the “Efficiency Utility” model, which includes a clear obligation, a capable and motivated efficiency entity, stable funding, and quality control. Germany’s influential energy efficiency industry association, Deutsche Unternehmensinitiative Energieeffizienz (DENEFF), draws on RAP’s examples and global best practices in its Proposed Solution for Implementation of a Market-Based Energy Efficiency Incentive Scheme for Germany (Lösungsvorschlag zur Umsetzung eines marktorientierten Energieeffizienz-Anreizsystems in Deutschland).
RAP identified the efficiency disincentives embedded in Germany’s existing “Concession fee” regulations, and is working with these partners and other German stakeholders to neutralize these disincentives, by decoupling municipal franchise revenues from increased electricity sales. Reform des Konzessionsabgabenrechts describes the nature of these disincentives, the legal basis for changing the Concession law, and language changes enabling a decoupling approach to be implemented under the law is now available in German. An English abstract is provided in Section D of the report.
Visit our Making Germany’s “Energiewende” (Energy Transition) a Reality page to learn more about our work in support of the Energiewende. Other Energiewende topics of interest include: