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While the attack on wind power is on-going in Britain, an attack on the feed-in law is on-going in Germany. The argument is basically: renewables increase electricity prices because they decrease electricity prices!

Sounds bizarre? Here is how it goes:

  1. The feed-in law guarantees fixed rates for renewables producers which are above the average market price.
  2. At the time the feed-in law was first adopted, to make it acceptable to Big Industry (and its backers in politics), there was a compromise: energy-intensive industries would be exempted from sharing the extra costs of the feed-in law.
  3. This exemption was implemented in practice the following way:
    • At the end of every year, network operators prepare a prediction of electricity demand, market prices and renewables production for the next year.
    • Next year's surplus cost of electricity under the feed-in law is calculated, and the difference of the calculated and real surplus cost for the current year is added.
    • This cost is then divided by the predicted consumption of private homes and small business, which is then added as a surcharge to their electricity bills.

  4. This year, renewables (especially solar power) heavily reduced demand for variable power with a daily variation. This depressed wholesale electricity prices, in particular spot market prices at the  at the European Energy Exchange (EEX) in Leipzig. The effect is expected to be even stronger next year. (This is the merit order effect at work, discussed several times on ET.)
  5. For existing plants, lower spot market prices mean a higher difference between the rate guaranteed by the feed-in law and market price. Now, network operators expected higher EEX prices for this year and now expect even lower prices for next year, thus they doubled the feed-in law surcharge for normal consumers.

In a fact-based policy discussion, this would be a good opportunity to attack the exemption of energy-intensive industries: the system actually provides a virtual subsidy to them (they benefit from lower wholesale prices due to the merit order effect). It would also be a good opportunity to attack the profit-taking of utilities, because announced electricity prices don't reflect the reduction in spot market prices.

Instead, the crescendo in the media is all about renewables making energy bills more expensive, and the usual suspects (FDP, the business wing of the CDU, established power companies) demand an end to the feed-in law (ignoring the fact that to be built new plants with their degression-reduced rates would contribute little to the total surcharge).

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Mon Oct 22nd, 2012 at 05:22:27 AM EST
I posted an article below directly relevant to your comment.

Wind power
by Jerome a Paris (etg@eurotrib.com) on Mon Oct 22nd, 2012 at 05:28:24 AM EST
[ Parent ]
"Instead, the crescendo in the media is all about renewables making energy bills more expensive, and the usual suspects (FDP, the business wing of the CDU, established power companies) demand an end to the feed-in law"

But yesterday the CDU lost another election in the blackest of black states, Baden-Württenberg. Middle class voters increasingly find their interests represented by the Greens, and this is no good news for the energy establishment.

by Katrin on Mon Oct 22nd, 2012 at 07:40:54 AM EST
[ Parent ]
You mean the Stuttgart mayoral election, where the CDU did not even run with an own candidate (hiding behind an independent instead).

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Mon Oct 22nd, 2012 at 07:54:09 AM EST
[ Parent ]
Right, that's what I mean. I expect that those in the CDU who argue against green topics will meet more resistance from now on.
by Katrin on Mon Oct 22nd, 2012 at 08:47:36 AM EST
[ Parent ]
I had to check op-eds in conservative media. No deeper conclusions yet:
  • FAZ: one excuse is the resurgence of Stuttgart 21 criticism (after the latest cost increase), another the CDU failure to mobilise own voters (although total turnout actually grew...): no drawing of consequences (instead some ridiculing of the Greens).
  • Die Welt: their columnist focuses on the conservative failure in cities, with only two CDU mayors in the 20 biggest German cities (Dresden and Wuppertal), and blames the lack of proper candidates on the part of the Baden-Württenberg CDU. But when analysing the Greens' success, it's not about topics but the personality of Baden-Württenberg's Green PM Kretschmann.


*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Mon Oct 22nd, 2012 at 10:02:43 AM EST
[ Parent ]

Süddeutsche interprets it as an general sign of CDU trouble in the cities and a CDU in Baden-Württemberg still adrift after the loss of power in the last state election.

http://www.sueddeutsche.de/politik/cdu-schlappe-in-stuttgart-abseits-vom-urbanen-lebensstil-1.150250 3

by IM on Mon Oct 22nd, 2012 at 10:47:10 AM EST
[ Parent ]
All this is right but there is more: The Swabian housewife wants green energy. The CDU should better stop to seek alliances with energy dinosaurs. If there is anything the CDU has to fear, it's not the left, but conservative Greens. Merkel probably understands that now. The left wing of the Greens will probably learn that too, fairly soon.
by Katrin on Mon Oct 22nd, 2012 at 11:28:59 AM EST
[ Parent ]
That is more or less the interpretation of Kuhn too. He said something of (cultural?) hegemony of the greens and their success among conservative voters.
by IM on Mon Oct 22nd, 2012 at 11:44:12 AM EST
[ Parent ]
But then Kuhn is former Maoist; so knows all about long marches.
by IM on Mon Oct 22nd, 2012 at 11:44:44 AM EST
[ Parent ]
Interesting - there are still people who use the word 'conservative' to imply 'preserve, maintain, steward'.

(And not 'fire sale, everything public must go'.)

-----
sapere aude

by Number 6 on Wed Oct 24th, 2012 at 09:34:59 AM EST
[ Parent ]
Not the Tories
Michael Gove, the education secretary, is writing to all MPs in areas where schools are said to be underperforming - mainly schools in Labour-led authorities - demanding that they side with him to open up the education system "to the new providers who can raise standards".

Gove has started his campaign against "the forces of conservatism" by writing to MPs in Leicester and Derby on Tuesday asking them whether they want to "keep the door closed to new solutions and stick rigidly to the status quo, which is failing the children in their areas".

by gk (gk (gk quattro due due sette @gmail.com)) on Wed Oct 24th, 2012 at 09:50:50 AM EST
[ Parent ]
Hmm, 'New solutions', does that mean 'more money' or 'less money'. Tricky to predict.


-----
sapere aude
by Number 6 on Wed Oct 24th, 2012 at 10:03:52 AM EST
[ Parent ]
Heh, the internal debate started now. With inputs from the usual suspects. Heiner Geißler, former CDU general secretary and more recent Attac member:

"Es gibt immer noch zu viele konservativ-neoliberale Kräfte, die altmodischen Positionen nachhängen. Mit einem antiquierten Familien- und Frauenbild, ständiger Kritik an der Energiewende und der europäischen politischen Einigung und einer marktradikalen Wirtschaftspolitik kann eine Volkspartei nicht erfolgreich sein", sagte Geißler den Ruhr Nachrichten. Der Widerstand gegen Frauenquote und Mindestlohn müsse endlich beendet werden."There are still too many conservative-neoliberal forces who cling to old-fashioned positions. With an antiquated image of family and women, permanent criticism of the energy revolution, the European political union, and with radical free-market economic policies, a popular party will not be successful", Geißler told the paper Ruhr Nachrichten. Opposition to quotas for women and minimum wage should finally be given up.

Then he went on to attack the FDP and called on the CDU to differentiate themselves more before it is pulled into the abyss with the falling liberal party.

A usual suspect on the other side, Wolfgang Bosbach (leader of the interior commission of theBundestag) told that he doesn't want a separate CDU [profile] for cities and rural areas, and that it wouldn't make sense for the CDU to copy the Greens because voters will choose the original (interesting twist on the argument on how to deal with right-populist success). Armin Laschet, the new leader of the Northrhine-Westphalia CDU (in opposition after the re-election of an SPD-Greens state government) spun that further and claimed that the Stuttgart Greens copied the CDU.

Well, that's how far internal debate went so far. FAZ moans that "yet again" no consequences have been drawn.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Tue Oct 23rd, 2012 at 03:13:23 AM EST
[ Parent ]

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