German Cities Face Ruin As Green Energy Transition Causes Havoc
Germany’s green energy transition threatens to become a financial disaster for many communities, according to the assessment of North Rhine-Westphalia’s Finance Minister Garrelt Duin. In an interview, the Labour (SPD) minister warned the Ruhr region in particular faces dramatic consequences.
The background to his warning are the economic problems of many municipal utilities and of the energy company RWE in which numerous local authorities in North Rhine Westphalia (NRW) are involved. “If the losses of the power plants are realised and the cities have to make adjustments, it will be a disaster. The last public swimming pool will have to be closed because the power plants are making huge losses”, the minister said.
According to Duin cities will have to “make spending cuts in a way that is unparalleled.” In discussions with administrators he noticed “great panic”. The Ruhr region in particular is affected.
The Socialdemocrat minister is demanding billions euros in subsidies for fossil fuel power plant operators who should be compensated for operating power plants as an energy reserve. “We are going to end up with costs of six billion euros a year. A lot of money.” However: “You have to see it in relation to the 20 billion euros that currently flow into renewable energy sources.” Coal power plants belong to fossil fuel power plants too.
The funding, he claims, was needed to make investment in fossil fuel power plants attractive again. “The forecasts for the security of supply through 2022 demands that we need all the currently existing fossil fuel capacity. Moreover, since old power plants are mothballed, new plants are necessary.”
Moreover, the development of renewable energy should be slowed down, Duin said, referring to the upcoming reform of the Renewable Energy Act (EEG). “A real EEG reform must reduce the pace of expansion of renewable energy sources.” He also said that even more businesses should be exempt from the energy price due to the EEG. It is wrong, he says, that the current, rigid boundary – the energy costs of a company have to be at least 14 percent of revenues – is the yardstick for being exempted.
In contrast, the Baden-Württemberg Minister for European Affairs and Deputy SPD state leader Peter Friedrich said at a national party convention in Reutlingen that the expansion of renewable energy should be pursued quickly. “We do not want to replace the decrease in nuclear power with coal power as at the moment, but with electricity from renewable sources.”
Translation Philipp Mueller