German solar industry hoping for new opportunities following election


German Chancellor Angela Merkel's conservative Christian Democratic Union (CDU) won a decided victory in Sunday's federal elections, achieving an impressive 41.5% — the party's best showing since 1990 – but just short of the necessary majority to govern alone.

While most observers reckon the CDU will form a grand coalition with the left-of-center Social Democrats (SPD), which garnered 25.7% of the national vote, the other, unprecedented, option would be a coalition with the Green Party, who many see as Germany’s only political party to stand solidly behind renewable energy development.

It was Merkel, however, who embraced the country's "energy transition" following the Fukushima nuclear disaster in Japan and set a complete phase-out of nuclear energy plants by 2022 instead of the previously scheduled deadline of 2036.

The liberal Free Democratic Party, which until now had served as the CDU's junior coalition party, failed to achieve the necessary 5% hurdle to make it into the German parliament, or Bundestag. For renewable energy proponents, it was good riddance to a party that many saw as a major supporter of big business and energy conglomerates.

In a statement, the German Renewable Energy Federation (BEE) said, "The extreme positions of the FDP against the energy transition and the Renewable Energy Sources Act (EEG) have duped the important renewable medium-sized business sector. As a result, climate protection and energy policy can now be made for four years without the FDP."

The BEE expressed fear that a coalition with the SPD could mean renewed support for coal and said that neither the SPD nor the CDU have shown support for the growing grass-roots climate protection and renewables movement seriously nor indicated a desire to develop forward-looking economic and environmental policies.

The group added, however, that a coalition with the Greens could provide the CDU's energy policy with new dynamic "and launch a successful further development of the energy transition," pointing out that the energy transition means sustainable economic policy: employment for small and medium-sized businesses, technology development in the crucial future sector and a regional economic boost for states and communities.

German Solar Industry Association CEO Carsten Körnig said, "There has long been a broad coalition for the energy transition in the population. After the election, energy policy needs to be better aligned to the objectives of the energy transition. An energy transition moratorium or other reckless subsidy cuts are hopefully now off the table. Germany needs a more powerful and priority development of renewable energies. A broad coalition of solar, wind, bioenergy and other renewable energy and efficiency technologies would be able to cover up to 50% of the electricity mix by 2020 without any significant additional costs and completely supply Germany in the long term. This essential course must be set in this term."

Körnig added that the association would support the new federal government with advice and assistance.

According to German journalist and author Franz Alt, the CDU and its Bavarian sister party Christisan Social Union (CSU) "took only a half-hearted exit from nuclear energy. Part of the Union would like to see an extension for nuclear power plants. They’re not really serious about the energy transition."

Likewise, Alt argues, "large parts of the SPD still support the old coal industry. Many in the SPD would rather see a coal transition rather than a renewable energy transition."

While many are hoping for a CDU-Green coalition, such a partnership may prove unrealistic. While Green Party leaders have not ruled out holding discussions with the CDU, they have expressed skepticism about the chances of a coalition, citing the many contradictory positions on diverse issues the two parties hold.

Indeed, ideologically, the Greens and the CDU remain very far apart. Speaking to German public broadcaster ARD on Monday, the Greens' co-chair Renate Künast said if Merkel invites the party to discusss a possible coalition, "we would sit down and talk," but added that she could not imagine how the two parties could reach a consensus.

Green vice chair Bärbel Höhn echoed the sentiment: "We cannot refuse a discussion, but I don't see a viable option," she told German broadcaster ZDF.

In addition, the CSU has flat-out rejected a CDU/CSU coalition with the Greens.

The Greens, which suffered a 2.3% drop to 8.4%, have been reeling from a decades' old pedophile scandal that overshadowed the party's campaign. Green co-leader and former environmental minister Jürgen Trittin has admitted "mistakes" over the party's support for pedophile groups calling for the decriminalization of sex with minors in the early 1980s, a stance the Greens have long since distanced themselves from. Yet Trittin's involvement in the party at the time, along with more recent campaign positions that proved unpopular with voters, including proposed tax increases and a mandatory vegetarian day initiative, appear to have seriously hampered the party's prospects. Some Green party leaders, including EU Member of Parliament Werner Schulz, have blamed Trittin for the party's misfortunes.

Despite the obstacles, CDU deputy chair Julia Klöckner told German news magazine Focus that a CDU-Green coalition was indeed a possible alternative. "We have to see exactly how far the Greens are willing to go. Personally, I would not rule out anything at the moment."

For Germany's solar industry, it remains to be seen which direction the new Merkel-led government takes on renewable energy. While much could depend on the CDU's coalition partner, Merkel herself has more than once surprised her own party by adopting positions to the left of the CDU, including ushering in the country's energy transition.

Nevertheless, a reform of Germany's renewable energy law, which has resulted in higher energy costs for German households, is expected whatever the structure of the coalition. Among the pressing issues the new government will face are:

  • The future of feed-in tariffs, which have kept electricity prices high for German consumers despite falling wholesale electricity prices (caused by the excess of power from renewable sources)
  • The exemption of energy-intensive industries such as steel mills and aluminum smelters from paying renewables surcharges
  • Much needed investment in energy infrastructure upgrades to accommodate the vast amounts of renewable energy being fed into the national power grid, including grid expansion and creation of storage systems for solar and wind power.

German Environment Minister Peter Altmaier, who has unsuccessfully sought to reform the country's renewable energy law, has said that it is unacceptable that electricity consumers should continue carry the brunt of the costs for renewable energy. Altmaier has put the price of the country's energy transition at €1 trillion ($1.35 trillion).

Speaking to Focus, SolarWorld CEO Frank Asbeck, said, "I see a continuation of the CDU policy as constructive. I think the plans of Environment Minister Altmaier to modify and further develop the renewable energy law as very sensible. It certainly couldn't hurt if the SPD or even the Greens help to expand this policy."

Asbeck expressed little sympathy for the FDP, however. "It's always sad when a democratically elected party is forced to resign from the parliament. But the FDP has shown itself to be very imponderable and often very unreliable with respect to the reform of the Renewable Energy Act.

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