APPENDIX 7: VISIT TO GERMANY
24-26 January 2005
Members of Sub-Committee II attending: Baroness Perry
of Southwark, Lord Patel, Lord Oxburgh, Baroness Sharp of Guildford,
Lord Paul. Also in attendance: Professor Roland Clift, Specialist
Advisor and Dr Jonathan Radcliffe, Specialist Assistant.
Embassy briefing
Jeremy Cresswell, Deputy Head of Mission; Lynn Sheppard,
First Secretary Environment; Sara Lines, Environment Officer
Mr Cresswell welcomed the Committee and briefed Members
on the economic and political situation in Germany, noting the
strong UK-Germany relations. Since the 1980s, Germany had been
keen on international environmental regulation, having suffered
the effects of pollution from other countries. As a result of
their taking the initiative, EU directives resembled German laws.
It was noted that 80 percent of domestic environmental legislation
originated in Brussels.
Environmental standards were now uniform across Germany.
Prior to unification, half of the water in the former German Democratic
Republic (GDR) had not been drinkable.
Germany had one third of the world's wind turbine
capacity, and had almost reached its Kyoto target for reducing
greenhouse gases by 21 percent. The Government, with a Green environment
minister, had stated it would commit to a 40 percent reduction
in greenhouse gases by 2020, if the EU set a 30 percent reduction
target (though this was thought unlikely). In 2004 over nine percent
of electricity came from renewable sources.
The German government was reviewing its climate change
programme, and expected to focus on transport. Germany favoured
taxing aviation fuel, compared to the UK's preferred approach
of emissions trading.
Federal Government briefing
Dr Wolfgang Stinglwagner, Ministry of Economic Affairs
and Labour (BMWA); Franzjosef Schafhausen, Ministry of the Environment,
Nature Conservation and Nuclear Safety (BMU); Wolfgang Ornth,
Ministry of Transport, Construction and Housing (BMVBW); Dr Anneliese
Bohn, Ministry for Education and Research (BMBF)
Officials from the Federal Government presented an
overview of German energy policy. In 2002, energy intensity in
Germany stood at 5.34 GJ/$1000 GDP, compared to 6.89 GJ/$1,000
GDP in the UK. This reflected a drop of almost 2 percent per annum
between 1990 and 2001, the most in the IEA, and compared to 1.3
percent per annum for the UK. Over the same period, though final
energy demand had fallen by 2.8 percent, electricity demand had
increased by 8 percent. The Government had adopted a policy of
phasing out nuclear generation, from its 27 percent contribution,
by 2022. This was projected to lead to an increase in use of fossil
fuel, forecast to supply 80 percent of electricity production,
and might have implications on security of supply and the environment.
The Government was investigating CO2 reduction
technologies, including ways to improve the efficiency of power
plants, and "carbon capture and storage" techniques.
Support was being given to combined heat and power (CHP) by means
of a feed-in tariff similar to that for renewables. CHP plant
in the former GDR had been modernised to make it cost effective.
Industry was reducing CO2 emissions through
voluntary commitments. For example, the chemicals industry had
accepted a 50 percent reduction over the period 1990-2012, the
cement industry 28 percent, and the steel industry 22 percent.
In the transport sector, the industry was committed to improving
the fuel consumption of cars by 25 percent by 2005 compared to
1990. The question was now how to combine these commitments with
the EU's Emissions Trading Scheme (ETS).
A challenge was reducing electricity demand from
household electronics, set to reach an annual level of 55 TWh
by 2010 (11 percent of overall demand, equivalent to seven big
power stations), 2 TWh of which was standby and off-mode power
consumption. A solution was required at an EU level, with an eco-design
directive. The "Green TV", with standby consumption
of 0.25W, demonstrated that it was technically possible.
Eco-taxes were levied on transport and energy use,
vehicle tax was set according to CO2 emissions, up
to €1,000, and new technology was being used to charge heavy
goods vehicles according to motorway usage. Overall mileage had
decreased since the tax was introduced in 1999, with 2.5 MtCO2
saved.
Buildings were responsible for 35 percent of energy
consumption. Germany's housing stock consisted of 75 percent built
before 1975, with 17.5 million residential buildings, of which
12.5 million were one or two family households.
In the buildings sector, Kyoto targets had almost
been met, but the trend in emissions was upwards because of a
desire for more living space. Low interest rate loans were available
for renovations from the state-owned bank KfW, which had funded
€4.5 billion worth of energy saving projects.
Energy conservation regulations from 2002 increased
requirements for thermal insulation such that energy demand for
space heating should be no more than 70 kWh/m2 a year
for new buildings. The new EU Directive would require energy certificates
for existing residential building and new national standards for
lighting and air conditioning of non-residential buildings.
The German research ministry funded four programmes
of energy research carried out at Helmholtz Centres: renewables,
energy efficiency, nuclear fusion and nuclear safety, amounting
to about €210 million. €40 million was dedicated to
energy efficiency, focusing on how to use fuel more efficiently
in new power plants, fuel cells and the use of superconductivity
technology. Other government departments agencies and the Länder
also funded research.
Federation of German Consumer Organisations (VZBV)
Dr Krawinkel, Head of Department, Construction, Energy
and Environment
The Federation of German Consumer Organizations provided
free, independent, advice to assist in the decision making process
when buying appliances or buildings. It spent €4 million
a year, providing 80 thousand advice sessions. Initial advice
was free, with further consultation on site charged at €35,
a subsidy of €140.
There was a strong regional divide—those in
northern Germany used the service much more than those in the
south. Regional campaigns had shown that awareness of standby
power consumption could be raised to 40 percent, but it was an
expensive method and would be easier to control by enforcing tighter
standards.
German Energy Agency (DENA)
Annegret-Cl. Agricola, Head of Division, Energy Efficiency
in the Electricity Sector; Felicitas Kraus, Head of Division,
Energy Efficiency in Buildings
On energy labelling for buildings:
The German Energy Agency (DENA) employed 75 people,
covering energy efficiency and renewables. It was owned 50:50
by the Federal Government and state-owned bank, KfW.
EU co-ordination in advance of the forthcoming buildings
Directive was only just starting, and thought to be too little,
too late. Innovation in the buildings sector was seen to have
a low impact on carbon emissions. It was felt that energy consumption
when buying a building was not a decision factor for consumers.
Two types of energy label had been field-tested:
one similar to that used for appliances, with A-I ranking (category
'A' allowed space heating up to 80 kWh/m2 a year);
the other was a softer touch sliding scale. The latter had been
chosen for implementation. The full Energiepass certificate
ran to several pages, including information on insulation, heating
systems and CO2 emissions, and recommendations for
renovations.
Two methods of energy use assessment had been tried:
individual analyses of buildings issued by engineers, architects
and energy consultants costing €350-€900; and a standardised
analysis to be issued by trained master craftsman and chimney
sweepers costing €100-350. Both considered building design
rather than actual energy usage.
The field test had shown good results: lower costs
than expected and the certificates were liked by private owners
and landlords. The response was not so positive from housing companies:
30 percent of owners and landlords said the certificates gave
a motivation to modernise the building, and 90 percent thought
that a better rating would translate to higher market value.
The scheme would be implemented by 2006 for the domestic
sector. The commercial sector was perceived to be harder, with
energy calculations more complex.
On the Energy Efficiency initiative:
The German energy efficiency campaign was launched
in 2002, and being re-launched in 2005. It put across a basic
message that consumers could avoid unnecessary electricity consumption
by making intelligent decisions when buying and using household
equipment, leading to reduced bills and carbon emissions.
Information was provided at the point of sale—DENA
worked in co-operation with about 7,000 retailers (both local
and national chains)—and through advertising/press reports.
The Committee was impressed by simple cardboard "calculators"
which allowed consumers to work out the energy consumption and
running costs of appliances.
The Committee visited a demonstration fuel cell project
operated by Vattenfall Europe.
Berlin Energy Agency
Frau Furth-Deutschländer, Berlin Ministry for
Urban Development, Environment and Technology; Ralf Goldmann,
Division Manager, International Know-How Transfer, Berlin Energy
Agency; Bernd Schulz, Manager, Saar Energie AG
The Berlin Energy Agency is a public-private partnership
between the Berlin Government, the energy supply company Bewag,
and state-owned bank KfW. It was founded in 1992, has a staff
of 29 specialists and turnover of €4 million.
Berlin had 6,000 public buildings with annual energy
costs of €250 million and emissions of 3 MtCO2.
The Energy Concept Bill passed in 1994 set a target to reduce
carbon emissions by 25 percent by 2010 compared to 1990 levels.
Energy Saving Partnerships were created to manage
the energy requirements for a pool of (typically tens of) buildings,
such as schools, swimming pools or prisons. Private third party
finance was used to modernise systems and services, reducing costs
and energy use, with savings shared between the private company
and public body.
For each pool a contract would be drawn up, specifying
the cost sharing and period (normally between 10 and 15 years).
The private company would take on all initial investment costs,
and then take 70-90 percent of the savings made. The return on
investment stood at about 10 percent. Pools of buildings helped
spread the risk.
A baseline of the energy consumed in the previous
three years was used against which to establish potential savings.
Contracts were then put out to tender. Bids had to show detailed
investment plans. There had not been any cases where contractors
had failed to fulfil the terms of the contract.
There were 17 pools, covering 361 buildings. Carbon
dioxide emissions had been reduced by 100,000t, and the city had
guaranteed savings of €9 million. Total initial investment
stood at €37 million.
The contracts were standardised and transferred to
the new Member States of the EU through a European platform (see
www.clearcontract.net).
The Committee then heard from Saar Energie, which
had won three pools, covering about 100 sites across Berlin. It
needed well trained staff, with experts on energy management systems
and contracts. It was felt that this expertise was lacking in
the UK.
The investment phase for a pool lasted about a year,
followed by 10-14 years of operation. Modern building controls
were managed remotely from the company's Berlin office. It was
essential for the utility meters to communicate with the control
system so that savings could be measured. Such systems were sub-contracted
to specialist companies.
Saar was achieving energy savings of about 25 percent
below the baseline. It was in its eighth year of operation with
running costs about €250,000 a year. The initial analysis
of a project took about 5 percent of the investment budget. Long-term
contracts gave confidence to investors, and included an option
to continue operating at the end.
Reichstag
Manfred Jakel, Head, Energy Supply
The Committee visited the Reichstag Parliament building
and heard about its energy management system. The contract for
renovation of the Reichstag and construction of three new Parliament
buildings, awarded to Foster and Partners, had specified an energy
efficient design, and use of renewables.
A CHP plant (generating 380 kW of electricity and
320 kW of heat, along with 60 kW from low temperature waste heat)
was fuelled by biodiesel from rape seed oil, achieving 82 percent
efficiency. In the summer it could be used to provide cooling.
The plant consumed five million litres of biodiesel a year, 1
percent of Germany's total production, and helped sustain jobs
in the sector. A 10kV connection to the grid provided a back-up.
Boreholes provided access to underground heat and
cold stores. In summer, the excess heat from the CHP plant heated
water which was then pumped into porous rock 300 metres below
the surface, and pumped back up for space heating in winter. At
a depth of 60 metres, groundwater at 11°C was used as a coolant
in summer.
Bavarian Ministry for Economic Affairs
Dr Martin Mitterer, Director, Energy Department;
Dr Gerhard Olk, Head of Department, Energy Technologies; Bernhard
Wiesner, energy efficiency and renewables
In Munich, the Committee met officials from the Bavarian
Government. Energy was a priority for Bavaria because of its importance
to economic development. Over 30 years Bavarian policy had developed
a network of gas pipelines. Bavaria also had had the first trial
nuclear reactor and power station in Germany. Nuclear now supplied
two thirds of its electricity. Bavaria produced the most hydropower
in Germany, but being so far inland was not a suitable region
for wind turbines. It was felt that a broad energy mix was the
best solution for avoiding an energy crisis.
Bavaria's carbon emissions were one third lower that
the German average. After liberalisation prices had stabilised
and did not restrict economic development. District heating was
promoted where the housing density was high enough to justify
it.
The Länder saw a risk in that federal
policies were setting different priorities on energy policy by
phasing our nuclear, increasing the price of energy, and giving
high subsidies to wind power. Länder had some influence
on national policy through the upper house (Bundesrat). Bavaria
was in favour of retaining nuclear power, and restricting government
intervention in the market.
Along with a neighbouring Land, Bavaria was
funding research to improve the efficiency of coal power stations,
aiming to increase efficiency by 25 percent. Industries in Bavaria
had invested €150 million over seven years to improve processes.
A similar amount had been invested in fuel cell technology. Voluntary
agreements with industry were used to increase efficiency and
reduce costs and carbon emissions.
Bavaria did not have state targets for energy efficiency,
and it was felt that national targets should take account of geographical
factors.
Fraunhofer Institute for Building Physics (IBP)
Professor Karl Gertis, Chair of Physics of Building
and Structures, University of Stuttgart, and former Director of
IBP
The Committee travelled to the IBP site in Holzkirchen
outside Munich. Members heard from Professor Gertis, and were
shown some of the Institute's facilities. The IBP had a budget
of €12 million, 25 percent coming directly from central government
(the Federal Research Ministry), the remainder from the marketplace,
including 50 percent from private contract work, and 16 percent
from public contracts. There were about 100 permanent staff across
seven departments, but overall the IBP concentrated on heat technologies.
The work of the IBP was very market related, and
it earned €1.2 million from licensing agreements. However,
it was felt that the Federal ministry which had responsibility
for construction was more interested in those transport issues
falling within its remit.
On building construction, research showed that large
thermal masses in buildings were beneficial, as they retained
heat and slowed down temperature changes. However, architects
preferred light partitions in buildings which led to rapid heating
in the summer.
Though the Federal ministry thought that Germany
would be ready for implementation of the buildings directive in
2006, Prof Gertis was more cautious. IBP had had input on the
design of the standards through an EU working group, on which
the Director sat.
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