German Energy Transition and Energy Security
Youngho Chang (yhchang@suss.edu.sg),
Ridwan D. Rusli (ridwan.rusli@th-koeln.de) and
Jackson The (jacksonteh@ntu.edu.sg)
Additional contact information
Youngho Chang: Singapore University of Social Sciences, SG
Ridwan D. Rusli: Technische Hochschule Köln, DE
Jackson The: Nanyang Technological University, SG
DEM Discussion Paper Series from Department of Economics at the University of Luxembourg
Abstract:
The natural gas supply disruptions and European energy crisis following the Ukraine-Russia war and the West’s economic sanctions made energy security a top priority issue for the German government. We use the 4A framework of energy security to analyze Germany’s energy transition (“Energiewende”) over the last 20 years. While the acceptance of climate change policies is very high among its society and voters, affordability to energy consumers and availability of energy resources have steadily decreased in recent years. High feed-in tariffs and fuel taxes force German households to pay the highest electricity tariffs and among the highest fuel prices worldwide. More of the country’s fiscal capacity is required to support energy-intensive industries and fund energy subsidies. Exit from nuclear and coal electricity production necessitates increasing natural gas imports, requiring new LNG terminals, extensive collaboration with European neighbors and partially undermining the environmental benefits of the coal exit. Moreover, growth in renewables capacity has slowed down, hampered in part by local public resistance and increasing bureaucratic hurdles. The technological leadership of the country’s multinationals and SMEs has been challenged by increasingly sophisticated and efficient competitors, for example from China. To ensure Germany’s energy security the country must accelerate domestic renewables capacity and infrastructure, expand European gasand power interconnector investments and diversify its natural gas supply options.
Keywords: Energy transition; Energy security; 4-A framework; Energiewende; Power interconnector investments; Diversification. (search for similar items in EconPapers)
JEL-codes: Q41 Q42 Q48 (search for similar items in EconPapers)
Date: 2024
New Economics Papers: this item is included in nep-cis, nep-ene, nep-env and nep-sea
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Persistent link: https://EconPapers.repec.org/RePEc:luc:wpaper:24-09
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