From THE DAILY SKEPTIC
by Eugyppius
The climate in Germany is attended by all naive ideas and bright pink fairy tale slogans. Among the latter is a dubious saying that says “The sun doesn’t send bills” (in German: “Die Sonne schickt keine Rechnung“). Such sayings are always seen at first (is there anything freer and more democratic than sunshine?) In fact, the energy transition has landed German taxpayers in the position of paying billions of Euros for the sun to shine. This is an unmitigated disaster, and to make matters worse, the more solar capacity increases, the more we have to pay. For things that don’t send a bill, sunlight has always been very expensive in the Federal Republic.
World call it the “solar trap,” and it works like this: The Renewable Energy Sources Act (EEG) promises to pay renewable producers a fixed rate for every kilowatt-hour of electricity they plug into the grid. Whether you are an ordinary climate-conscious person who has solar panels on your home or you run a massive solar farm, the EEG entitles you to receive this fixed “feed-in tariff” for 20 years. The EEG also requires network operators to accept your electricity regardless and sell it on the electricity exchange.
Now the sun, although it may not charge for service, it turns out that it has this naughty habit of shining in many places at once. When this happens, the supply of electricity often exceeds the demand for electricity and the exchange price falls. They can fall all the way to zero, or in extreme conditions of excessive sunshine can even become negative. A negative price means you have to pay the “buyer” to get rid of the excess power. Whether the price is simply too low, or zero, or negative, German taxpayers have their own obligation, through the EEG, to pay electricity producers that they do not want if they are rarely green and climate-friendly. That is, we are on the hook for the difference between the real exchange value of excess electricity and feed-in tariffs promised to producers. In this way we have literally paid the sun to shine.
In September alone, Germany paid €2.6 billion to renewable energy producers for electricity with a market value of just €145 million. A sunny autumn has damaged the Government’s already fragile budget. Federal number-crunchers initially provided €10.6 billion for feed-in tariffs in 2024, but already the Government has a debt of €15 billion and this year has not yet been completed. Scholz’s cabinet is trying to provide an additional €8.8 billion for the rest of the year. Parliament has not yet approved additional funds, but even the damned sun will not stop shining blood, and perhaps this additional allocation will not be enough. We’re bleeding money, all for the sun that doesn’t send any bills.
This problem will get worse before it gets better. The more solar panels we install, the more oversupply we will face when the sun shines, and the greater the spread between fixed feed-in rates and the real market value of this green electricity. In 2024, as I said, the Government estimates that the feed-in tariff will cost €10.6 billion, but it could cost at least €20 billion. Next year, the cost is expected to be higher, and the year after, the cost will be even higher. As World report, the German Government plans to triple our solar capacity to 215 gigawatts over the next six years – “equivalent to 215 nuclear reactors” every time the sun rises from behind the blessed cloud.
Energy transitioners know they are messed up. The new plan is to change the rules for solar subsidies. When prices go negative, larger producers will not accept fixed rates, and will also have to sell their own electricity. In this way, they will be more sensitive to market demand and stop producing electricity when no one wants it. It’s almost like making a blind system totally oblivious to market incentives is a bad idea. Unfortunately, the new rules will only apply to new solar installations. The German government still has to honor a crazy agreement to pay operators of old solar plants for years to come. We will burn billions for nothing.
You’ll also note that these new rules only target larger carriers. The millions of small operators out there – all ordinary people who put solar panels on their roofs – are a serious and persistent problem that no one has a solution for:
In the long term, (energy economist and Government adviser) Lion Hirth believes that “all electricity producers must operate directly on the electricity market”. Even owners of small rooftop photovoltaic systems should theoretically be direct marketers, as this alone would provide an economic incentive to turn off the system when there is an excess of electricity. “In principle, I consider direct marketing expansion to be the only sensible approach in the long run,” Hirth said. … Direct marketing, however, is also highly regulated at a bureaucratic level and also expensive, so it is not an option for small systems.
Hirth notes that the installation on the rooftop also does not make economic sense. They are three times more expensive, per unit of capacity, than large solar panels. However, we cannot get rid of this small operator, because the climate change propaganda has produced the entire population of beaver German greenists who want to make a personal contribution to stop climate change by using renewable technology to the roof. As always, climate politics prioritizes the choices and experiences of individual consumers over pragmatic and systemic outcomes, because fundamentally Green voters do not want to end CO.2 emissions. He wanted to have experience from ending CO2 emissions, and that is not even close to the same.
In the meantime, all budget planners can do is “hope for bad weather” to “reduce solar power feed-in and cause electricity exchange prices to rise again”. Before the Renewable Energy Sources Act, the sun really didn’t deliver the bill, but in our desperation to change the weather, we’ve created an artificial system that won’t stop delivering. Ours is one of the dumbest times in human history.
This article originally appeared in the Substack Eugyppius newsletter. You can subscribe here.
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