Case Study: 100% Renewable Energy – Part 1

by Anna Leindreiter

It is a fact that non-renewable energies will, by definition, run out. It is also a fact that in the meantime, dependence on these energy sources is causing multiple existential global crises. If human beings are to preserve modernity and planetary habitability, we must soon shift to 100% renewable energy in all sectors. A fossil-free energy system is the only way forward as it results in socio-economic development and regional value creation.

The world’s leading scientists have issued a mandate that we must change our energy system to a sustainable one based on conservation, efficiency and renewable energy in the near future or risk losing planetary habitability. The energy transition is not a lifestyle choice; it is an essential way to combat climate change and save our planet. Fukushima and BP’s Deepwater Horizon catastrophe are only the most recent reminders of the hazards of our current energy system. Energy infrastructure is outdated and much of the world’s power generation capacity is nearing the end of its life. Major investment decisions to modernize the world’s energy system are unavoidable. Now is the time for the energy transformation.

There are many people who would consider themselves supporters of renewables but doubt the feasibility of 100% in the near future. Indeed, it is one of the biggest challenges humanity has ever faced. In times of economic crisis and budget cuts in most parliaments people are mainly concerned about jobs and price increases in their daily lives. However, the evidence shows that investments in renewable energies actually tackle these issues. Energy is a cross-cutting issue.

Looking at countries like Germany and Denmark that are successfully moving towards 100% renewable energy, we see that high citizen participation and regional value creation from decentralised renewable energy production are the key success factors.

In Germany renewable energy deployment has already resulted in more than 380,000 jobs. Especially in 2008 – the year of the global economic crisis – the sector proved its importance for growth and employment with an increase of more than 10%. By reducing costs for energy imports by € 6 billion in 2011, renewables enabled politicians to spend the limited resources on local development.A study from the German Renewable Energy Agency (2010) calculates that German municipalities can expect at least € 1.2 billion a year in tax revenue from the use of renewable energies by 2020. The more job-intensive a system technology or a value creation chain is, the more tax revenue municipalities can expect from their shares of the income tax.

The successful development of renewable energies has been a decentralised phenomenon in Germany. In almost every municipality in the country, a wide variety of stakeholders have in recent years brought many thousands of renewable energy systems into operation. Currently, over 80,000 citizens hold shares in collectively run systems for the generation of regenerative electricity and heat. Over 500 of the energy cooperatives founded in recent years have already invested a total of around € 800 million in renewable energy sources.

Across the country there are over 100 regions that have understood the enormous potential of renewables and therefore implemented – and even, in some cases, already achieved – a 100% renewable energy (RE) target. These so-called 100 RE regions encompass about a quarter of the country’s population.

In a number of ways, municipalities have played an important part in the development of renewable energies in Germany and will continue to do so in future. They have far-reaching instruments of control with regard to the authorisation and installation of systems. They partially fund the installation of renewable energy systems and may even be involved in their operation as lessors through their municipal departments of public works. Increasingly, they are adopting their own renewable energies development goals and trying to attract companies active in the renewable energy industry to invest in them.

One may wonder how this is linked to the problem of empty coffers. The fact is that municipalities profit from positive regional economic development generated by the use of renewable energies by:
– saving fossil fuel costs
– creating jobs
– obtaining tax and lease revenues

Read Part 2 tomorrow.

Anna Leindreiter is a Policy Officer Climate Energy at the World Future Council

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