Since I arrived in Namibia last year, I have been told on many occasions that energy supply is one of the greatest challenges for Namibia’s future economic and social development. Energy consumption could soon reach almost 900 MW of which only around one-third are generated locally. Facing such a situation, the government is confronted with different proposals from various sides for policy solutions.
Against this background, I thought it to be useful for Namibian readers to have an input from the land of the ‘Energiewende,’ namely Germany.
Sometimes it takes tragic events to take drastic decisions. Such an event was the nuclear meltdown with the release of radioactive materials in the Fukushima Nuclear Power Plant following an earthquake off the coast of Japan in 2011.
This catastrophe strengthened Germany´s determination to stop the use of nuclear energy and to accelerate its turn towards renewable energy.
The beginning, however, of Germany’s move towards renewable energy sources started much earlier: despite the odds and much less favourable natural conditions for the use of renewable energy sources, especially solar, than Namibia, Germany decided more than ten years ago to completely overhaul its energy infrastructure and to start the so-called ‘Energiewende.’
The Renewable Energy Sources Act (EEG) laid the foundations of the ‘Energiewende’. The act adopted in 2000 introduced the possibility for everyone to generate electricity in Germany from sun, wind, water or biomass, to feed this electricity into the general grid and to be payed a fixed remuneration for every kilowatt-hour of electricity – guaranteed for a period of 20 years. The costs are passed on to the electricity consumers via the “EEG surcharge”.
The funding from the EEG surcharge has transformed renewable energy from a niche product into one of the mainstays of our energy supply. Whereas in 2000 only around six percent of the electricity consumed was renewable, the share is roughly one-third today. And Germany is well on track to reach the next goals of a share of 40 – 45 percent in 2025 and 80 percent in 2050.
However, the rapid expansion of renewables also caused the EEG surcharge to rise considerably up to 2014. Thus, following the reform of the Renewable Energy Sources Act in 2014, the expansion of renewables continues to be encouraged and supported, but this shall be implemented at a slower pace to reduce costs.
As of today, renewable energies have become a central pillar of our energy supply. They must not be permanently sheltered in a separate system, but must increasingly survive in the face of competition on the electricity market. In future, the level of funding is to be determined by means of a competitive auction between the plant operators. As a first step, we are now testing this for ground-mounted PV installations.
To make sure that the cheap electricity generated from renewable energy can reach the consumers, the electricity grids need to be expanded and adapted to the changing structure of our energy production. We need to ensure that there is an optimal interplay between conventional power plants and renewables, and that security of supply continues to be ensured in future.
As a second pillar of the energy transition, energy efficiency has already improved considerably and will continue to do so. The environment-friendliest and cheapest kilowatt-hour is the one we do not consume at all. The more consciously and efficiently we use electricity and heat, the less we need to generate. This saves money while improving supply security and helps us achieve our climate targets.
Our aim is to make a 20 percent reduction in primary energy consumption by 2020 compared with 2008 and halve it by 2050.
To reach this target, the German Government launched a comprehensive strategy in December 2014: the National Action Plan on Energy Efficiency (NAPE). All the measures under NAPE adhere to a common principle: Supply information – Provide support – Demand action. Immediate measures include: expanding on-site energy consulting, tax incentives for energy retrofits, adding funding and improving the CO2 Building Modernisation Programme and improving the heating assessment.
As a long-term measure, an Energy Efficiency Strategy for Buildings is supposed to shift the focus more to the real estate sector, with its massive potential for energy conservation and use of renewable energy.
Already now, the German ‘Energiewende’ together with Germany´s strong position in international trade do demonstrate that even a highly industrialised country like Germany can switch to a sustainable energy supply without losing competitiveness in a globalised world. In fact in long-term annual average Germany´s industry has gained an increase in energy efficiency of nearly 1,4 percent per year between 1991 and 2012. More than that: a successful energy transition will combine environmental sustainability and climate change mitigation with a high level of industrialisation, high-tech innovation, higher prosperity and more jobs. Today, around 380,000 highly skilled and well-payed persons are working in the renewable energies sector in Germany.
Let us not forget energy security: the shift from imported resources like coal, oil and gas to the increased use of locally available never-ending renewable resources like the power of the sun and the wind reduces Germany´s dependence on imports from often politically unstable regions of the world. And it saves money: in 2013 Germany saved more than nine billion Euro for the import of fossil fuels because of renewable energy. In the case of Namibia the approximately three billion dollars spent each year for the import of electricity can be put to better use.
The technology is out there. And advances in technology have significantly cut the costs of generating electricity from renewable sources. The production costs for electricity from photovoltaic modules, for example, decreased by close to 70 percent since 2006, and from wind by about 30 percent since 2009. Thus, the price of energy produced from sun and wind power has become competitive compared to traditional sources like coal and oil. As prices are expected to fall even further this technology is becoming more and more affordable for every country. This bodes well particularly for countries like Namibia where a much higher level of efficiency is derived from solar power than in Germany. All this shows that substantial changes in the course of one country’s energy policy are possible – they do, however, require bold political decisions often against vested interests in the traditional power producing sectors.
Also Namibia has already embarked on this difficult, yet in the end rewarding journey. Namibia´s potential is huge and is waiting to be used to a much higher degree than today. Germany might serve as an example. We certainly are ready to partner with Namibia to further enhance this development.
Already, energy is a cross-cutting area of our economic development cooperation. On 25 June 2015, Namibia and Germany signed an intergovernmental agreement on Financial Cooperation for a loan of 45 million Euro for the energy sector. A German-funded debushing project is exploring the commercial viability of using encroaching bush – a renewable resource – for energy generation.
Other major German-funded projects using renewable energy in Namibia in the past have been the extension of the Ruacana power plant worth 42 million euros and the Caprivi-Link project worth 40 million euros.
Let me finish with a quote from Hans-Joachim Schellnhuber, Director of the Potsdam Institute for Climate Impact Research: “What happens today will determine the living conditions of our grandchildren and their grandchildren considerably. Let us all hope that we will make the right choices now.”
• Christian Matthias Schlaga is the Ambassador of the Federal Republic of Germany to the Republic of Namibia.