IEEJ：November 2016 © IEEJ2016

Going for deep decarbonisation:
Integrated strategies to strengthenenergy efficiency and renewable energies.
Lessons learned from planning andimplementing Germany’s Energiewende
German-Japanese Energy Dialogue» Energy efficiency first and renewable energies. How energy
transition can be made a success «Dr. Felix Chr. Matthes
Tokyo, 15th November 2016

IEEJ：November 2016 © IEEJ2016

ReminderA goal without a planis just a wish.
Antoine de Saint-Exupéry (1900 - 1944),
French writerIEEJ：November 2016 © IEEJ2016‘Energiewende’: The German energy transitionas a comprehensive and long-term project

Targets as of …
2010

2016

2016

2016

2016

2016

Greenhouse gas emissions
Total

2011
2015
2017
2019
2020
2021
2022

Energysector2010

2010

Renewableenergies

Buildings Transport Industry

Agriculture

Gross
final
energyPower
generation

2010

2010

2010

Energy efficiecy
PrimaryenergySpace
heating

2011
NuclearenergyFinal electricity
energyconransport sumption
-41%
-47%
-54%
-60%

-40%

18%

35%

-20%

-20%

-10%

-10%
-80%
-100%

40 to
45%

2025
2030

2014

-55%

-61 to-62%-66 to-67%-40 to-42%-49 to-51%-31 to
-34%

30%
55 to
60%2035
2040

-70%

45%

65%

2050

-80 to-95%

60%80%-50%-80%

-40%

-25%

Baseyear

1990--2008

2008

2005

2008

1990

1990

1990

1990

1990

(2010)

BReg 2010, 2011, 2016, BT 2014

IEEJ：November 2016 © IEEJ2016

The evidence from modelling: Emission reduction
contributions: energy efficiency, renewables & more... are key pillars (each representing 1/3 of the total implemented potential).
Aggressive policies are needed for each of these major pillars.
Reference Scenario

0-100
-200

Others-400

Land-use (change) and forestry
Agriculture-500

Waste sector-600

Blueprint GermanyInnovation Scenario

mln t CO2e vs 2005

-300

Industrial processes
Brennstoffwechsel (fossil)-700

Electrification
Erneuerbare Energien-800

Efficiency other applications
Efficiency buildings-900

Efficiency electric appliances
Demand patterns-1,000
2005

2010

2020

2030

2040

2050

Prognos/Öko-Institut 2009IEEJ：November 2016 © IEEJ2016

Emission reduction contributions
A fresh look on priorities …
... is needed. The appropriate timing of modernization is key - if one
reflects the key role of long-living capital stocks (~60% of potential)
Reference Scenario

0-100-200

Less long-living capital stock-400

Land-use (change) and forestry
Agriculture-500

Waste sector-600

Blueprint Germany

Innovation Scenario

mln t CO2e vs 2005

-300

Industrial processes
Fuel switch (fossil fuels)-700

Electrification
Renewables-800

Efficiency other applications
Efficiency buildings-900

Efficiency electric appliances
Demand patterns-1,000
2005

2010

2020

2030

2040

2050

Prognos/Öko-Institut 2009IEEJ：November 2016 © IEEJ2016

Emission reduction contributions
A fresh look on priorities …
... is needed. Innovation is key, innovative greenhouse gas emission
reduction options must deliver in time (representing 60% of potential)
Reference Scenario

0-100
-200

Less innovation-intensive-400

Land-use (change) and forestry
Agriculture-500

Waste sector-600

Blueprint Germany

Innovation Scenario

mln t CO2e vs 2005

-300

Industrial processes
Fuel switch (fossil fuels)-700

Electrification
Renewables-800

Efficiency other applications
Efficiency buildings-900

Efficiency electric appliances
Demand patterns-1,000
2005

2010

2020

2030

2040

2050

Prognos/Öko-Institut 2009IEEJ：November 2016 © IEEJ2016

Designing strategies for sustainable energy systems
Key challenges (The four “A” questions)•

Will the (supply/emission abatement) potentials be available?
••Will t be possible to exploit these potentials over time in a way thatthe targets are achievable?
Lifetime of capital stocks is key

Infrastructures are keyInnovation is key

Will the costs and the related distributional effects emerge at levels
that make the transformation affordable?
•

Huge technological progress during the last decades and manytechnological promises

Many analysis shows: it is affordable (GDP ±1% in 2050, managing
transition costs and distributional effects is however crucial)

Will it be possible to design the transformation in a robust way that is
acceptable for the public?
Interfaces between the energy system and the society will broaden,(economic) participation is key

IEEJ：November 2016 © IEEJ2016

Energy transition
What do we know and what are the challenges?
•

Energy transition: a policy-driven structural change of the energysystem•

The target system is technically feasible and affordable•

manifold options at the supply & flexibility side exist already or are inthe pipelinetotal system costs of the target system do not differ significantly fromthe counter-factual, transition costs and distributional effects could
however be significant

The real challenges arise from structural changes that needs to bereflected carefully for the design of the transition process

structurally changing technology patterns

structurally changing economics (a zero marginal costs system)

structurally changing players / market participants

structurally changing spatial patterns

IEEJ：November 2016 © IEEJ2016

A comprehensive and well-designed policy mix
needs comprehensive and well-designed analysis

Abatement costs [€/t CO2e]

Pricing policies will becomplementary:Locked (and homogeneous)potentials: regulations,targeted incentive programs
etc. as primary mechanisms

Pricing policies will be
Pricing
policies will becomplementary:complementary:
Pricing
policies will beInnovation-intensive
Potentials
relatedto longcomplementary:potentials:
regulations,lived
capitalstocksandPotentials
creatinghighinfratargeted
incentive
programs
respective
windows
ofmarginalrents
and significant
etc. asprimarymechanisms
opportunities:
regulations,distributionaleffects
targetedincentiveprograms(NB:market
design failures):etc. as primarymechanisms
regulations,targeted
incentive
programs etc. as primarymechanisms

Pricing policies will/can workand be effective & efficient:
Matured/competitive (andheterogeneous) potentials,
incremental innovation:
ETS, tax or other mechanisms

NB: pricing policies
for heavily infrastructurerelated potentials?!

Abatement potential [mln t]

Öko-Institut 2010. IEA 2011+2015

IEEJ：November 2016 © IEEJ2016

Effective, innovative & efficient strategies
The Four-Pillars Approach••Paving the way – for energy efficiency, clean generation & flexibility
options (renewables & complementary flexibility)

innovation, level playing field & roll-out for renewables () and energy
efficiency ()sustainable economic basis (coordination & enabling investments) ()Designing the exit-Game – for the non-sustainable capital stocks

•appropriate mechanisms that address security of supply, flexibility,emission levels and fixed costs () – for nuclear power () andhigh-carbon assets ()Triggering the necessary infrastructure adjustments – with sufficientlead-times •integration of centralized, distributed, storage & DSM/flexibility options

reflection of the new geography of the energy system

Making the necessary innovation work – in time for energy efficiency, generation, flexibility, storage and integration

IEEJ：November 2016 © IEEJ2016

Thank youvery much
Dr. Felix Chr. Matthes
Energy & Climate Division
Berlin Office
Schicklerstraße 5-7
D-10179 Berlinf.matthes@oeko.de
www.oeko.de
twitter.com/FelixMatthes
Contact :report@tky.ieej.or.jp