Latest Posts

Home

Facebook

Twitter

Search
About

If Renewables Are So Cheap Why Is Germany’s Electricity So Expensive?

Renewable energy advocates like to say we should be a lot more like Germany when it comes to generating more electricity from wind and solar. This argument often goes like this: “Wind and solar are already less expensive than fossil fuels, and greedy corporations are the only reason we don’t have a clean energy revolution!!!”

My question for people making this argument is, “If renewables are so gosh-darn cheap, why does Germany now have the highest electricity prices in Europe?” In fact, the average cost of electricity is nearly 30 cents per kilowatt hour, almost three times higher in Germany than it is in the United States.

The website Clean Energy Wire puts it this way:

In 2018, the monthly energy bill for an average German household consisting of three people with a combined annual consumption of 3,500 kWh is 85.8 euros, the BDEW says. This is about 32 percent above the level of 1998 if adjusted for inflation, and 72 percent higher in nominal terms. While the share of supply, distribution, and grid fees in the price fell by 21 percent if inflation is taken into account, that of taxes, levies, and surcharges grew by 202 percent. This is partly due to a substantial increase in the renewable energy surcharge, up from 0.08 ct/kWh in 1998 to 6.79 ct/kWh in 2018.

The renewables surcharge now accounts for just over 23 percent of a household’s electricity bill. It corresponds to the difference between the wholesale price and the higher, fixed price for green energy, which is guaranteed by law to renewable power producers for 20 years. Grid operators pass on the difference to consumers.

There are legislators in Minnesota who think that Germany’s experience with wind and solar is a success. I would argue it is not.

Electricity is a vital component to modern society. It has become as important to our daily lives as food, water, air, and shelter. Indeed, electricity has become a prerequisite for obtaining these basic commodities in the modern world. Therefore, in order for the full benefits of electricity to be realized, it must be reliable and affordable for everyone. 

Comments

Subscribe

Categories

Upcoming Events

  • 2019 Annual Dinner Featuring Candace Owens

    Location: Hilton Minneapolis 1001 South Marquette Avenue Minneapolis, MN 55403

    From Brexit to Blexit… Britain’s exit from the European Union has not been smooth sailing. Since the leave date has been pushed back to October, Nigel Farage is now running for a seat in the European Parliament. That election date is May 23 which has forced him to cancel all American speaking engagements, including our Annual Dinner. Center of the American Experiment is pleased to announce that Candace Owens, the founder of the Blexit movement and host of The Candace Owens Show, will now be presenting the keynote address at our 2019 Annual Dinner on May 18. We are excited…

    Register Now
  • The Diversity Delusion

    Location: Hilton Minneapolis 1001 South Marquette Avenue Minneapolis, MN 55403

    Please join Center of the American Experiment on Wednesday, April 24th at the Hilton Hotel for a lunch forum with Heather Mac Donald as she discusses her new book, The Diversity Delusion: How Race and Gender Pandering Corrupt the University and Undermine Our Culture.  Heather Mac Donald is the Thomas W. Smith Fellow at the Manhattan Institute, a contributing editor of City Journal, and a New York Times bestselling author. She is a recipient of the 2005 Bradley Prize. Mac Donald’s work at City Journal has covered a range of topics, including higher education, immigration, policing, homelessness and homeless advocacy, criminal-justice reform, and race…

    Register Now