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Germany’s 2014 Renewable Energy Law Reform Is A Resounding Failure

Originally published on Lenz Blog.
By Karl-Friedrich Lenz

The German government has in its infinite wisdom dumped the successful feed-in tariffs and is transitioning to a model based on auctions instead.

German flagNow the latest report on investment levels in 2015 was published, and it shows some rather embarrassing figures.

Investment in Germany was down compared to 2014 by a whopping 46%, leaving the country at place six in the top ten worldwide (see Figure 14 on page 23 of the report).

German GDP is estimated at $3.371 trillion in 2015, so those $8.5 billion are somewhat around 0.25% of German GDP.

No other country in the top 10 has such a horrible record. On a world-wide scale, 2015 was a new record year with a solid 5% increase to a $285.9 billion.

That’s still far from the level of growth needed to adequately deal with the climate crisis, but it’s much better than the 46% decrease Germany has shown.

The good thing about this development is that it clearly shows what happens when you phase out feed-in tariffs and use an auction model instead. A massive breakdown of the market, making the climate crisis worse.

So while the German failure apparent in these numbers is bad news for the climate, Germany can still serve as an excellent model on how not to do things.

Reprinted with permission.

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