Evaluation of selected measures of the Energiewende

Transcription

1 Executive Summary Evaluation of selected measures of the Energiewende Project No. 30/13 Study commissioned by the German Federal Ministry of Economics and Energy Contact IER Stuttgart: Dr. Ulrich Fahl IZT Berlin: Britta Oertel Stuttgart, Berlin July 2014

2 Authors Institute of Energy Economics and the Rational Use of Energy (IER), Universität Stuttgart Sebastian Bothor, Steffen Bubeck, Thomas Eberl, Ulrich Fahl, Johann Gottschling, Erik Heyden, Martin Steurer Institute for Futures Studies and Technology Assessment (IZT) Berlin Britta Oertel, Michael Scharp, Stefan Meyer, Michael Knoll with the assistance of Jakob Kluge and Jonas Schachtschneider i

3 Executive Summary The energy concept for an environmentally friendly, reliable and affordable energy supply developed by the federal government is a comprehensive strategy for Germany's transition to a highly efficient and renewable energy system. To achieve the associated objectives, a range of new cross-sectoral as well as sector-specific measures have been introduced and existing instruments have been adapted to the German energy and climate policy (laws, regulations, instruments to expand renewable energies, subsidy programmes for energy-efficient building refurbishment, CO 2 strategies in transport as well as subsidy programmes for energy research) in recent years. Objective In light of the above, this project aims to subject the key measures of the Energiewende to a comprehensive qualitative and quantitative evaluation. It will thus particularly focus on the following points: - Description of the measures and packages of measures that are essential for successful implementation of the Energiewende ; - Development of a catalogue of criteria based on which the individual measures can be assessed with regard to their potential for energy savings and emissions reduction, their cost efficiency, their overall economic impact, etc.; - Preparation of a methodological concept for the separate evaluation of the individual measures; - Detailed cause-effect analysis on the previous achievement of objectives and the impact of measures that have already been implemented, as well as the preparation of projections on the long-term effects and costs of the individual instruments; - Identification of interactions between the measures and central levers that are essential for the success of the Energiewende ; - Assessment of the extent to which the objectives of the energy concept can be achieved with the present measures based on a consistent, quantitative model analysis; - Derivation of key problem areas as well as political improvement options for the implementation of the Energiewende. A supporting expert workshop was held in Stuttgart in June 2014 to permit the knowledge and recommendations of experts from science, associations, business and politics/government to flow into the project work. 1

4 Selection of measures and methods of selection First, a description of the key energy policy measures will be provided based on the first and second "Energy of the future" monitoring report. A catalogue of criteria will also be developed in order to classify these measures, followed by a criteria-based selection of nine important measures to be evaluated. The results include: 1. Briefings: no simple and clear description of the measures of the Energiewende has been available up until now, due to the genesis of the federal government's energy concept. A standard descriptive concept was used in this project for the first time in order to present the measures of the Energiewende in an easily comprehensible form. The briefings include a clear description of the measures, the status of implementation, a classification of the measures based on the instrument types, stakeholders (business, households and government) and energy sectors (power, thermal and transport) as well as legal and scientific references. The result is the preparation of a standard description, a briefing, for 152 measures. 2. Excel database: the briefings were summarized in a clearly organized Excel database. The database includes an easily understandable description of the database, the evaluation criteria and the evaluation of the measures according to four indicators, a complete list of references, a concordance list to compare the numerations of the first and second monitoring report, the briefings of all the measures, including those that are no longer mentioned in the second monitoring report, and tables for sorting and filtering the measures. 3. Catalogue of criteria: four criteria emissions reduction (indicator A1), reduction of the import-dependency of energy carriers (indicator A2), impact on the power supply (indicator A3) and cost of the measure to the government (indicator A4) were used to propose measures for a more in-depth evaluation as well as to define the importance of some measures with regard to these criteria. 4. Evaluation of the measures: the term "relevance of the measures" was used to establish approximate comparability of the measures. The "relevance of the measures" was viewed as the objective of the measure with respect to the use or provision of final energy within the scope of the relevant measure. Indicators A1, A2 and A3 were specified by converting the energy use and provision for indicator A1 to emissions, while energy use and provision was compared to energy imports for indicator A2 and to power consumption for indicator A3. This understanding of the relevance of the measures provides a common benchmark for all the measures and the opportunity to compare very different measures with one another. 5. Selection proposal: a simple point-score evaluation was performed based on the evaluation of the measures using the catalogue of criteria. Based on this, 17 measures of 2

5 high importance and 23 alternative measures were proposed to the Federal Ministry for Economic Affairs and Energy. Evaluation of the selected measures A pragmatic solution was required in order to select nine of the 40 proposed measures for evaluation, which covered the target groups, the energy sectors and the three target dimensions, while only considering measures that have not previously been/are not currently being evaluated by others. This resulted in the selection of the following nine measures: 1. Measure 26 Energy-efficient procurement: obligation on the public sector VgV 2. Measure 41b EDL: energy advice for consumers VZ energy saving checks 3. Measure 41c EDL: energy advice for SME RKW incentive consultation 4. Measure 52 Nuclear energy: specification of a reserve power plant ResKV 5. Measure 75 Grid development: federal requirements plan NABEG/EnWG 6. Measure 83 Grid stability: load management by process shut-down AbLaV 7. Measure 85 E-storage: exemption from charges for new storage facilities 8. Measure 89 KfW "Energy-efficient refurbishment" subsidy programme 9. Measure 96 Contracting: heat supply contracting in tenancy law MietRÄndG The evaluation of the selected measures was focussed on the questions of whether, and the extent to which, the targets had been achieved (goal achievement monitoring; effectiveness: relationship between the achieved and the defined objective), whether the measure was the cause of and appropriate for achieving the objective (effectiveness check) and whether the measure was efficient (cost-benefit relationship). A distinction was made here between implementation efficiency and the efficiency of the measure. In summary, the following evaluation results were defined for the individual measures. Energy-efficient procurement: obligation on the public sector VgV The 4 th regulation amending the regulation on the procurement of public contracts (Regulation on the Awarding of Public Contracts, VgV) established a direct legal obligation for the procurement of products, services and construction services with high energy efficiency. The public sector must act as a role model. This is significant due to the considerable leverage effect on the achievement of emissions reduction objectives as well as due to their considerable investment volume. Apart from the direct financial benefits on the side of the procuring facilities due to energy savings and energy cost reductions, this also aims to increase awareness about more energy-efficient technologies and influence the market. The VgV includes various mandatory and target regulations. If energy-related services are tendered, the highest demands must be placed on their energy efficiency. Besides providing information on the energy consumption, in appropriate cases, bidders are also required to indicate the results of a life-cycle costing. Regardless of the type of service to be procured, its 3

6 energy efficiency must be appropriately considered in the award criteria. A calculation method for the procurement of road vehicles is defined in the annex (a specification of parameters that must be taken into account). In principle, the consideration of energy-efficiency criteria in the procurement process is always associated with additional expenses for all the parties involved. The use of vague legal terms means that in many cases users are uncertain of the relevance of the provisions for individual services. As a result, the provisions of the VgV are frequently not, or not completely, adopted in tenders, whereby there is generally a dependency on the service to be procured. These provisions are most frequently adopted in tenders for (energy-related) goods, especially IT equipment. The procurement of vehicles is generally characterised by information on the performance and/or specific consumption values in the specifications for tenders; specific emission costs are rarely considered. Given that, for services, in addition to deficits relating to their definition, the energy costs also do not arise for the authority awarding the contract, almost no requirements are defined with regard to the level of energy efficiency. A multi-criteria evaluation of proposals in consideration of the energy consumption is rarely included in the award criteria, quite independently of the type of service to be procured. A correlation generally exists to the quality of the implementation of the additional requirements pursuant to the VgV in the tenders. Energy advice for consumers VZ energy saving checks To promote rational energy use, the Federal Ministry for Economic Affairs and Energy and the Federal Office for Economic Affairs and Export Control (BAFA) support the cooperation and implementation of independent and provider-neutral energy checks for private consumers by the Federation of German Consumer Organisations (vzbv). The offer was introduced across the country in September The energy checks are intended to encourage demand for energy advice based on a low-threshold, but independent, competent and comprehensive offer. The objectives are to raise awareness of energy efficiency measures amongst consumers as well as to inform them of further advice and subsidy measures to increase energy efficiency, if applicable. For example, the energy checks do not compete with offers from engineers and trade businesses. The goal of the on-site energy check advice is primarily to encourage tenants to take energy saving measures through qualified advice ("basic checks"): the savings potentials of heating energy (incl. hot water) and power are reviewed and recommendations for action are provided. The second goal is to raise awareness of energy efficiency measures amongst house and apartment owners as well as private landlords ("building checks"). In this case, advisers check the consumption of heating energy and power as well as the hot water system, the building envelope and the opportunity to use renewable energies. They encourage individuals to make appropriate and corresponding investments. Thirdly, so-called "efficiency technology checks" are offered for operators of condensing boilers. This takes place by making the relevant measurements on-site. If deficiencies are detected, the advisers provide information on 4

7 solution approaches and additional consulting services as well as potential subsidies. The consulting service for the energy efficiency checks is expected to be extended in the future: the "heating check" will then not just focus on condensing boilers, but on heating systems in general. It is expected that, from 2015, the energy efficiency checks will also include checks for solar thermal systems ("solar checks"). The planning, coordination and organisation, as well as the technical supervision of the energy checks are performed by the vzbv energy team. It is implemented by the regional consumer organisations and experts, who also provide other consulting services for the consumer organisations. Both the success monitoring carried out by the vzbv in 2013, as well as the survey carried out by the IZT Berlin as part of the evaluation of selected measures of the Energiewende in 2014, show that those seeking advice are highly satisfied with the energy checks. This has particularly resulted in the implementation of measures in the power area (e.g. to save electricity with household appliances and building services) as well as energy efficiency measures in relation to heating systems. The survey by the IZT also confirmed that the energy checks provide provider- and product-neutral information on energy efficiency measures and that a wide range of topics are considered. This also includes references to other consulting and subsidy offers. A total of 23,617 energy checks (as at May 2014) were performed in the previous eligibility period. The number is lower than what was initially expected by the vzbv. It can be assumed that the demand for energy checks was below expectations due to the relatively warm winters in 2013/2014. In some regions, advisors are not yet available for all consumers. However, the cost-benefit ratio per energy check is still within the framework estimated in the vzbv's project application. The measures contribute to implementation of the federal government's energy policy objectives. Energy advice for SME RKW incentive consultation To promote rational energy use by small and medium-sized businesses (SME), the Federal Ministry for Economic Affairs and Energy has been supporting the coordination and implementation of energy efficiency incentive consultations, held by the RKW competence centre in Eschborn and the RKW network, since 12/10/2011. This is a low-threshold offer and the energy incentive consultations are held on the companies' premises. The target group includes decision-makers in small and medium-sized enterprises, who have previously not taken any, or only a few, measures to increase energy efficiency in the company. The focus is on companies in the manufacturing sector, the hotel and catering industry as well as trade businesses with 20 or more employees. The overarching objective of the measure is to raise the awareness of these companies with regard to the implementation of energy efficiency measures and to motivate them to contribute to the achievement of the energy policy objectives. As part of the energy efficiency incen- 5

8 tive consultation provided the eligibility conditions are met the companies are informed of comprehensive energy advice and subsidy offers supported by the Federal Ministry for Economic Affairs and Energy (BMWi). In each case, the company's attention is drawn to specific energy efficiency potentials; individual and customised steps are designed and they are then encouraged to implement these steps. The focus of the information consultation is on cross-sectional technologies, which are not limited to an application sector. For example, this includes building services (hall heating systems, ventilation systems, lighting) as well as compressed air systems, refrigeration, blower and pump systems. The energy efficiency incentive consultations are provided free of charge for companies. They consist of an introductory meeting and a tour of the premises. Energy efficiency potentials are then discussed with the meeting partners in the company based on specific examples. The decision-makers receive factsheets on the energy efficiency topics that are relevant for them. It is estimated that each energy efficiency incentive consultation lasts about two hours in total. The success and effectiveness of the measures are monitored by the RKW competence centre in Eschborn about eight weeks after the energy efficiency incentive consultation. According to the centre, about 95% of participants assess the RKW energy consultants as "competent", while 93% would recommend the incentive consultation. 30% of the companies surveyed are planning a KfW consultation as their next step. Independent tests carried out as part of this project confirmed that the energy efficiency incentive consultations are performed in a targeted, competent and efficient manner. Based on the results of the success monitoring, it can be assumed that the SME energy incentive consultations encourage energy efficiency and energy savings and that the offer meets the expectations and requirements of the target group. Almost 6,000 energy efficiency incentive consultations were held in the past eligibility period. This corresponds to about 250 energy efficiency incentive meetings held by the RKW network every month. The target figure was only just missed, and it can be said that the objective has been essentially achieved. In 2013, the cost-benefit ratio per energy efficiency incentive consultation slightly exceeded the framework set in the project application. The measures contribute to the implementation of the federal government's energy policy objectives. Specification of a reserve power plant ResKV Delays in the grid expansion mean that the requirements for a secure grid operation have increased. Regional grid bottlenecks can occur in the winter months in particular, as the necessary transport capacities are not yet completely available. In order to ensure the grid stability, power plant operators have to implement schedule changes (redispatch) for requested power plants at the instruction of the Transmission System Operators (ÜNB). In addition, until the completion of important grid expansion projects, it is also necessary to have certain power plant capacities available, which can be used as reserve power plants outside the energy market, exclusively to maintain the security of the system. Although the number of power- and voltage-related redispatch measures has increased in the past few years, since the current 6

9 practice of contractually committing reserve power plants was introduced in 2011, this has only been required on rare occasions. The reserve power plants were primarily used as an emergency mechanism in the winter of 2011/12. Based on the Energy Industry Act (EnWG), the temporary Reserve Power Plant Regulation (ResKV) introduced in June 2013, which will run until the end of 2017, regulates the procurement of reserve capacities. The construction of a new power plant to provide grid reserves may be put out to tender, if the redispatch requirements cannot be covered by the existing power plants. As a secondary measure with regard to the Energiewende, the ResKV supports the integration of renewable energies into the power supply with the opportunity of effectively removing regional grid imbalances until the grid infrastructure is adapted to the increasingly decentralised generation with the expansion of renewable energies. Although the ResKV has generally increased transparency in the process for the admission of power plants to the grid reserve, there is still a lack of transparency with regard to the reimbursement of the costs that arise for the reserve power plants. There are also concerns about the competitiveness of these measures. Costs resulting from the ResKV beyond those defined in the EnWG regulations could only arise for consumers as a result of the potentially necessary construction of new power plants for grid reserves. Several factors, such as the type of plant, the capacity and location on the one hand, and the development of the investment and fuel costs on the other, are decisive in this respect. For example, the construction of a gas turbine power plant could result in annual costs of up to 90 EUR/kW. As a result, a four-person household would be charged an additional 95 cents per annum for a period of 15 years. However, according to the most recent estimates by the Federal Network Agency, there is no necessity to construct new power plants for the grid reserve, as a sufficient number of existing power plants would be available if required. Federal requirements plan NABEG/EnWG The enactment of the Bundesbedarfsplangesetz (Federal Requirements Plan Act) establishes the mandatory necessity and urgent requirement for future high voltage lines. This aims to accelerate the planning and approval procedures for grid expansion projects at the very high voltage transmission network level (BMWi 2014c). The BBPIG contains a list that includes the start and end point of future high voltage lines. A total of 51 measures were identified, which were pooled into 36 projects in the first BBPIG from July For all federal requirements plan projects that only affect a single federal state, the responsible state authority initiates a regional planning procedure in order to reach a decision on the application. In contrast, the Federal Network Agency (BNetzA) will be responsible for very high voltage lines that run through several federal states or abroad. Federal planning for transmission systems will take place for 16 projects in connection with the federal requirements plan. The Transmission System Operators must submit an approval application for the BBPIG's measures for this purpose. This means that very high voltage lines will be planned by the federal government as part of a transmission system planning process and not by the 7

10 states as part of regional planning procedures. The nationwide determination of requirements is through a federal requirements plan established by the BNetzA for 10 or 20 years based on the Transmission System Operators' grid development plan, which must be prepared at least every three years and submitted to the federal government as the draft for a Federal Requirements Plan Act. The Transmission System Operators implemented joint requirements planning for the first time in The Federal Requirements Plan Act of 23 July 2013 incorporates particularly important strategic expansion projects from the 2012 grid development plan and defines the necessity and urgent requirements for the transmission system in relation to energy. The Federal Requirements Plan Act effects financial changes in federal, state, company and household management. While this relieves planning and approval authorities, it also increases the burden on business by transferring the initial responsibilities to the Federal Administrative Court. No additional personnel requirements exist for states or communities. Furthermore, the BBPIG introduces a reporting requirement for companies. In the future, companies will have to report on the experiences gained in the pilot projects for the federal requirements plan. In addition, the regional planning procedure is no longer performed in parallel in several federal states. The criticisms and proposals for improvement addressed in the BBPIG process evaluation were classified in the four categories scenarios, the environment and public, methodology and implementation. This showed that the scenarios and the applied methodology to prepare the BBPIG measures were most frequently addressed. Alternative scenarios were requested remarkably often as well as adaptations to the scenarios framework. However, the categories of the environment and public and implementation were also extensively covered. The process phases, which affect the specific implementation of the grid expansion measures enacted by the BBPIG, are particularly critical. Expert know-how and standardised processes often still have to be established and developed. Load management by process shut-down AbLaV The regulation on interruptible loads (AbLaV) regulates the agreements between the Transmission System Operators (ÜNB) and the operators of interruptible loads. Interruptible loads refers to major consumption units in industrial operations, whose constantly high external electricity purchases can be quickly reduced or disconnected for a defined period on demand. The regulation is in force from 1/1/2013 to 31/12/2015. The objectives of the regulation are to improve the security of the system and to tap the unused potentials of interruptible loads. These objectives are to be achieved by paying a fixed remuneration for the retained breaking capacity of EUR 30,000 per megawatt and year and a variable remuneration if this is required. The prequalification requirements ensure the suitability of the providers and their ability to make a contribution to alleviating crisis situations in the grid. 8

11 With regard to the first objective, interruptible loads could contribute towards rebalancing system imbalances in two situations. They represent an automated and reliable product for the Transmission System Operators, with the ability to relieve the control energy in the event of consistently high demand. However only just under 30% of the volume of 3,000 megawatts (MW) of interruptible power prescribed by the regulation has been attained to date. With regard to the second objective, from the perspective of the Transmission System Operators, the AbLaV has enabled a somewhat higher breaking capacity with considerably better availability to be achieved than by tenders for control energy, and experience in the product definition and system management has been gained. However, on the side of the industrial operations, only a very small number of companies have managed to get through the prequalification stage. It is expected that only a limited number of companies will be added in the future. Significant barriers particularly include the definition of availability (1 min non-availability = 1 day non-availability), the connection level (at least 110 kv) and the minimum batch size (50 MW) in connection with the regulation that a maximum of five generator sets can be connected together on the same very high voltage node. Overall, the AbLaV has currently enabled the Transmission System Operators to achieve a load interruption potential of about the output of an average hard coal-fired power plant, which can relieve the electricity grid in crisis situations with a drop in capacity. In addition to their use as a control option, flexible loads could also contribute to a more secure and cost-effective energy supply in Germany in the future through other marketing options. In order to develop the potential of more flexible loads cost-effectively in the future, the barriers to increased flexibility on the demand side need to continue to be reduced and the development must be organised in a competitive manner. Exemption from charges for new storage Storage is an important part of the electricity system. Storage technologies that are available on a large-scale include pumped-storage power plants and compressed air storage power plants. Other storage technologies that may be available in the future are systems with water electrolysis and methanation. Pumped storage reservoirs have been/are traditionally used in enhancement operations. Pumped-storage reservoirs also support the stability of the grid as both consumers and generators with regard to the power-frequency and the voltage-reactive power regulation. However, the expansion of renewable energies also has negative effects on the economic situation of storage reservoirs. The resulting changes to the prices on the wholesale market, also as a result of the merit-order effect due to the preferential feed-in of renewable energies, have reduced the margins available to the storage plant operators to cover investment and fixed operating costs. This has resulted in a deterioration in the economic situation of existing storage reservoirs and potential investments in new electricity storage facilities are less attractive. The measure to be evaluated in this section targets the incentive to invest in new electricity storage facilities and the improvement of the economic situation of existing, expanded 9

12 pumped-storage reservoirs. It consists of exempting new power storage facilities and existing, expanded pumped-storage reservoirs from paying grid utilisation fees for the procurement of electricity. The revision of the EnWG in 2011 exempted new or expanded plants from paying grid utilisation fees for 20 or 10 years. Since 2012, pumped-storage power plants have also been exempted from paying the EEC reallocation charge and do not have to pay any electricity tax. Exempting extended storage facilities from grid utilisation fees established the initial incentive to increase the repower potentials of existing pumped-storage reservoirs. Seven applications are currently pending with the BNetzA in this respect. Whether the effectiveness of this incentive is sufficient for generating investment in new pumped-storage power plants is uncertain, as in addition to the grid fees the EEC reallocation charge and the electricity tax, the potential income on the wholesale market as well as possible earnings from a conceivable capacity market also play a role. In the event of the hypothetical approval of all the pending exemption applications, this would result in an additional charge of between 50 ct/a and several EUR/a for an average household. The existing exemption of pumped-storage reservoirs from electricity tax as well as the exemption of electricity storage facilities from the EEC reallocation charge must also be considered in connection with the grid fee exemption measure as additional relief for pumped-storage power plants. The resulting additional costs for other electricity consumers cannot be precisely determined due to a lack of data; however, based on the assessment described above, they could be similar to, or even exceed, the reallocation amount that arises as a result of exempting storage facilities from grid fees. As a result, all the financial relief components must be jointly considered in any future evaluation of relief for storage facilities. KfW "Energy efficient refurbishment" programme The heating sector is extremely important for the achievement of energy saving and climate protection objectives in Germany. About a third of the total final energy is used for room heating and hot water in buildings, which is why efficiency measures in this area play a key role. According to the federal government's energy concept in 2010, the final energy demand for heat should fall by about 20% compared to By 2050, the primary energy demand in buildings should be reduced by about 80% and the building stock should essentially be climate neutral. This means that buildings should have a very low energy demand and that this should predominantly be covered by renewable energies. The energy efficient refurbishment of existing buildings plays a key role in achieving this objective. Residential buildings, which account for 65% of the overall final energy consumption for room heating in buildings, are an extremely important factor. The refurbishment of residential buildings is promoted as part of the KfW "Energy efficient refurbishment" subsidy programme. The funding is available for individual energy-efficiency measures or comprehensive redevelopment measures to establish a so-called "KfW efficiency house". This takes place based on investment subsidies or low-interest loans, which can be supplemented by a 10

13 repayment allowance. As a result, the assistance provides financial incentives for property owners and investors and limits the financial impact on tenants, users and owners. Moreover, the professional energy consulting connected with the funding reduces information deficits and makes it easier for owners to decide on a comprehensive refurbishment concept for their buildings. In 2012, the refurbishment of residential buildings supported by the KfW achieved a final energy saving of about 6.2 peta joules per annum. This corresponds to about a 31% reduction in the final energy consumption in refurbished buildings compared to their consumption prior to modernisation. With regard to the overall final energy consumption for room heating in residential buildings in 2012, the saving corresponds to a reduction of about 0.4%. Over 90% of the savings relate to fossil fuels. Due to the high import share for these fuels, this contributes to the reduction of Germany's dependency on imports. Heat supply contracting in tenancy law MietRÄndG Another option for achieving final energy and CO 2 emissions savings in residential buildings lies in the use of heat supply contracting. In this case, a commercial heat supplier (contractor) provides the building owner (contracting party) with heat for heating and hot water. The contracting party pays an agreed price for the quantity of heat supplied. The contractor is obliged to supply the heat from a modern heating system or a heat grid. The contractor is responsible for the upgrades to the heating system that are often required. This means that the owner is not required to invest in a new heating system, for which often no incentive or capital exists. As a result, contracting can help to achieve significant final energy and CO 2 emissions savings when supplying heat to residential buildings. In rental housing, the costs for the heat supply are transferred to the tenant by the landlord. An amendment to the tenancy law (Tenancy Law Amendment Act MietRÄndG) in 2013 laid the statutory basis for the allocation of the contracting costs to the tenant and thereby removed the legal uncertainties that existed in the past. The Heat Supply Regulation (WärmeLV), introduced as part of the Tenancy Law Amendment Act, regulates the details of the contracting. The aim of the WärmeLV is to introduce statutory regulations to establish the requirements for the large-scale use of heat supply contracting in rental housing and to achieve efficiency increases. No specific figures are yet available with regard to the use of contracting in rental housing and the average energy savings and costs. As a result, no specific statement can yet be made on the precise contribution of the WärmeLV to achieving a better market penetration of heat supply contracting. In future, corresponding statistical surveys covering implemented heat supply contracts will be able to quantify the costs and effects of the WärmeLV. Based on the figures available to the Verband für Wärmelieferung (VfW) and the Bundesverband deutscher Wohnungs- und Immobilienunternehmen (GdW), the contracting in residential houses is currently already enjoying reasonable popularity, but with a high potential for improvement. 11

14 Energy system analysis and options for action In order to complete the evaluation of the various measures of the Energiewende, the overall effect to be expected with regard to the future reduction in greenhouse gases and energy savings is assessed based on scenario calculations using the TIMES PanEU energy system model. This consistent model framework allows the effects of the individual measures identified above to be considered and the interactions between the measures as well as additional climate protection instruments, especially the EU emissions trading, to be simultaneously evaluated. To assess the effectiveness of the individual measures of the federal government's energy concept, two scenarios are prepared for the development of the greenhouse gas emissions from the German source sectors for the period between 2010 and 2020 with an projection up to the year The climate and energy policy measures introduced in the energy concept are considered in a policy-based scenario with implemented measures (SiM). In contrast, the target-based scenario with achieved objectives (SeZ) focuses on the achievement of the German greenhouse gas reduction objectives, which will be used as a basis for the implementation of additional climate and energy policy instruments (or corresponding objectives). This may take place via a comprehensive, all-inclusive emissions trading system, the introduction of a standard greenhouse gas tax for all emitters or the implementation of further individual measures. The scenario with implemented measures (SiM) shows that the quantitative objectives of the Energiewende will not be achieved in key areas with the previously agreed measures and their continuation. This affects both the overarching objective of the Energiewende, the reduction of greenhouse gas emissions in Germany by 40% by 2020 compared to 1990, as well as the sub-objectives regarding the ratio of renewable energies in the gross power consumption and the sub-objectives in the area of efficiency. Only the ratio of renewable energies in the gross final energy consumption will be above the targeted value in the scenario with implemented measures (SiM) in From the contractor's perspective, a comparison between the scenario with implemented measures (SiM) and the scenario with achieved objectives (SeZ) shows the areas in which additional approaches exist in Germany which can cost-effectively achieve the overall objective of the Energiewende, i.e. the reduction of greenhouse gas emissions. The increased use of wind and solar energy makes a smaller contribution to the achievement of the objective, whereby the ratio of renewable energies in gross power consumption and gross final energy consumption will rise accordingly. However, the key contribution to a reduction will be made by a significant drop in energy consumption, in which the household, the trade, commerce and services as well as the industrial sectors are the primary focus. This is where, from the contractor's perspective, there is a need that the measures of the Energiewende should be reinforced to enable them to catch up. The list of measures that has previously been heavily focussed on the (power) supply side, should be strengthened by an approach focussed on the energy demand side. 12

15 It must be noted that clear perspectives with clear statements on the future incentive signals and frameworks are particularly important for necessary investment in these areas. The contractor believes that this is where there is an opportunity to strengthen and introduce the corresponding incentive, funding, information and consulting programmes, under which a uniform support framework with regard to climate protection, e.g. a subsidy of EUR 50 for every tonne of CO 2 emissions saved, based on the technical life cycle of the supported measure should be envisaged. The contractor also thinks that a review should take place to confirm whether alternative instruments, instead of the measures-based policy, could ensure that the objectives are met more cost-effectively. This could include the introduction of a "White Certificate" system as well as the implementation of a standard CO 2 or greenhouse gas tax across all sectors. 13