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Germany’s $412 Billion Green Energy Plan Meets Harsh Reality

Michael Bastasch, The Daily Caller

Germany has been rapidly increasing its green energy production but hasn’t gotten the results it planned. Consumer energy bills have been spiking for years to the point where electricity in the country has been called a “luxury good”

The Switzerland-based FAA Financial Advisory AG looked at the consequences of Germany’s “Energiewende” and found that the $412 billion effort did “not provide net savings to consumers, but rather a net increase in costs to consumers and other stakeholders.”

“Over the last decade, well-intentioned policymakers in Germany and other European countries have created renewable energy policies that have slowly revealed themselves to be unsustainable, resulting in profound, unintended consequences for all industry stakeholders,” reads FAA’s report which was prepared for the Edison Electric Institute and other European groups.

“Accordingly, the United States and other countries should carefully assess the lessons learned in Germany, with respect to generous subsidy programs and relatively rapid, large-scale deployment and integration of renewable energy into the power system,” FAA warns.

Germany was once touted by President Obama as a shining example of green energy policy. The country aims to get 80 percent of its power from green energy by 2050 in an effort to drastically cut its carbon dioxide emissions, which scientists say cause global warming.

A mix of subsidies and production quotas have allowed the country to rapidly expand its green energy production, growing from 4.3 percent of total energy consumption in 1990 to a whopping 23.5 percent in 2012 (this includes hydroelectric power). But the cost has been astronomical to consumers.

Consumer energy bills have been spiking for years to the point where electricity in the country has been called a “luxury good” by major media outlets. German households have seen electricity prices more than double in the last decade “increasing from €0.14/kilowatt hour (kWh) ($0.18) in 2000 to more than €0.29/kWh ($0.38) in 2013,” according to FAA. This is compared to U.S. household prices, which have been stable at $0.13 per kilowatt hour over the last decade.

FAA also reports that German consumers will pay $31.1 billion for energy subsidies this year alone. Furthermore, in the past five years Germany has suffered $67.6 billion in net export losses from high energy costs — a huge blow to an export-led economy like Germany.

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