Robert Habeck appears to reside in a world of his own, where the sun shines, the wind blows and the energy supply is turning green.
Minister of Economic Affairs Robert Habeck © dpa"We are now embarking on the path to achieve our goals," said the Minister of Economic Affairs at a recent climate conference. He added:
If we maintain this momentum, we will succeed.
According to Habeck's vision, 80 percent of Germany's electricity will come from renewable sources by 2030. However, achieving this requires expanding solar and wind parks, upgrading the power grids and building new gas power plants.
Robert Habeck visits a solar park © dpaIn a special report, the Federal Audit Office (Bundesrechnungshof), paints a starkly different picture of the energy transition.
It's a design for disaster. That's what the experts think.
Here are the key points from their assessment:
#1 Energy Security is at Risk:
The energy transition is not on track when it comes to electricity supply: security of supply is at risk, electricity is expensive and the Federal Government is unable to comprehensively assess the impact of the energy transition on the landscape, nature and the environment. Overall, the risks have worsened since the Federal Audit Office's last audit in 2021. Electricity storage systems cannot compensate for longer fluctuations in generation and load.
Eine Infografik mit dem Titel: Sun and Wind: Unreliable Energy Sources
Daily share of renewable energies in net electricity generation in Germany, in percent
#2 Reality is Being Glossed Over:
The Bundesrechnungshof considers the assumptions in the Federal Network Agency's monitoring of security of supply to be unrealistic. The result is an unlikely best-case scenario.
The Federal Ministry for Economic Affairs and Climate Protection has accepted the fact that threats to the security of supply are not identified in good time and the need for action is recognized too late. This effectively undermines the purpose of monitoring as an early warning system for identifying the need for action.
Eine Infografik mit dem Titel: Energy Transition: Not in Sight
Expansion of solar and wind energy, in gigawatts
#3 Renewable Energy Expansion Not Progressing Quickly Enough:
The expansion of renewable energies, especially onshore wind energy, is not progressing as legally required. There is no guarantee that the necessary backup capacities will be available in time; grid expansion is lagging considerably behind planning. The backlog is now seven years and 6,000 km.
Eine Infografik mit dem Titel: Grid Expansion Targets Missed by a Long Shot
Planned grid expansion and actual grid expansion, in kilometers
#4 Power Plant Strategy is Too Late:
The Ministry is unlikely to be able to meet its timetable for the expansion of secure, controllable backup capacity with the 2026 power plant strategy. The Federal Audit Office sees the risk of a considerable gap in secured, controllable power plant capacity at the end of the current decade.
#5 Electricity Prices Continue to Rise:
The affordability of the electricity supply is already in question. Electricity prices have risen continuously in recent years and are among the highest in the European Union: at 41.25 cents per kilowatt hour (kWh), private households paid 42.7% more than the EU average in the first half of 2023, for example, while commercial and industrial customers paid around 5% more. At the same time, further cost increases in the energy system are foreseeable.
#6 Government Conceals Costs of the Energy Transition:
By 2045, massive investment costs of more than 460 billion euros will be incurred for the expansion of the electricity grids; grid congestion management is expected to cost 6.5 billion euros per year.
As early as 2022, the German Federal Audit Office criticized the fact that the BMWK is not taking into account significant additional costs for the energy transition. This creates a false picture of the actual costs of the transformation outside the specialist public.
Eine Infografik mit dem Titel: The Expensive Grid Expansion
The cost of grid expansion until 2045, in billions of euros
#7 Permanent Subsidies Are Not an Option:
Selective state subsidies of the energy system according to cash flow undermine the transparency and steering effect of prices. Instead, the Federal Government must use a systematic approach to determine in a comprehensible manner how the costs of the transformation are to be borne.
#8 Risk for Economic Competitiveness:
The German government faces major challenges on the way to a secure, affordable and environmentally friendly supply of renewable energies. These have hardly been mastered to date. The Federal Government must react immediately, otherwise the energy transition is in danger of failing. This would have serious consequences for Germany as a business location.
Eine Infografik mit dem Titel: Energy transition: An expensive affair
Cumulative costs of the energy transition up to 2045, in billions of euros
Bottom line: Achieving a historic climate transition requires more than just empty words. While alternative energy offers promise, alternative truth is poisoning the debate. The Chancellor should remind his Minister of Economics that he is a servant of the nation, not the Little Prince.
Or, as Thomas Mann famously said:
A painful truth is better than a lie.
German Elections: How Olaf Scholz might be the chancellor of peace.
Porsche will be releasing four new models in 2024.
The vinyl record celebrates its comeback and positively affects inflation in the UK.
Dr. Norbert Röttgen's credibility in foreign policy is underscored by his significant roles. As a seasoned member of the German Parliament (Bundestag), former Federal Minister for the Environment, Nature Conservation and Nuclear Safety, and former Chairman of the Foreign Affairs Committee, he has been instrumental in shaping and overseeing the German government's foreign policy, particularly in the lead-up to major international decisions.
And don’t forget: Mister Röttgen is a strong supporter of the transatlantic relationship. His commitment to the US extends beyond mere words; it's reflected in tangible actions.
In today's episode of the Pioneer Podcast, we had the opportunity to discuss the situation in Ukraine with Dr. Röttgen. Reflecting on the debates surrounding the provision of arms to Ukraine, he emphasized:
Putin doesn’t have to do anything; he can simply watch the West’s weakness and reluctance escalate in parallel.
Is it time for negotiations? Over the weekend, the Pope suggested that Ukraine show “courage in waving the white flag” to avoid self-destruction. Dr. Röttgen, however, disagreed, stating:
Click here to listen to today's episode of the Pioneer Podcast in German.I find this statement incomprehensible, both politically and morally.
The stakes are high:
We are dealing with the fate of Europe and the West. It’s about whether war will become a method of politics in the 21st century or whether we will succeed in banishing it. Those who want to banish war must ensure its failure.
Our conversation didn’t just focus on Ukraine; we also turned our attention to the situation in the Middle East.
He says that Mr. Netanjahu has walked straight into “the trap of Hamas.”
You can listen to our interview in German in today’s Pioneer Podcast episode.
Recent investigations by the New York Times revealed discussions within the Kremlin about using nuclear weapons in response to territorial losses in Ukraine, which prompted U.S. intelligence agencies to inform German federal authorities of a possible escalation.
Scholz in China: Chancellor Scholz met with Chinese President Xi Jinping in Beijing shortly after that. Scholz was well prepared to urge his Chinese counterpart, both publicly and privately, to make it clear to Russia that there is no room for the use of nuclear weapons.
Xi Jinping © imagoXi Jinping’s Response: After the meeting with Scholz, Xi Jinping called on the international community to prevent a nuclear crisis in Eurasia. He stressed that nuclear weapons cannot be used and atomic wars cannot be fought.
Olaf Scholz © dpaThe Scholz Moment: It seems that the Chancellor has been able to contribute to peacekeeping efforts, which has struck a chord with the German people. His neutrality regarding the situation in Ukraine may turn out to be his greatest strength. According to ARD Deutschlandtrend, 61 percent of the population agrees with Scholz’s “no” to Taurus. His calm demeanor could help the SPD (Social Democratic Party) climb out of its polling slump.
Conclusion: Before Olaf Scholz, the last SPD (social democratic) chancellor to secure re-election with a focus on peace was Gerhard Schröder. Schröder’s stance against German involvement in the Iraq war resonated with voters. Whether Scholz prevented a nuclear conflict or not is of secondary importance. What’s crucial is that his image as a prudent, peace-focused leader could ensure his prolonged stay in the Chancellery.
As Albert Einstein famously remarked:
A clever person is not concealed beneath a steel helmet.
Last year, the savings banks posted record profits, surpassing even Deutsche Bank and Commerzbank. The 353 publicly owned institutions generated a pre-tax profit of €6.8 billion, a significant increase of 70 percent over the previous year. They also added €10.2 billion to their reserves.
The “Interest Game”: The savings banks owe much of their profit to the European Central Bank’s interest rate policy. Last year, the institutions earned €28.4 billion in interest income, an increase of 35 percent over the previous year.
Less Benefit for Customers: While savings banks benefit from a deposit interest rate of four percent, customers have been offered meager interest rates on their fixed-term deposit accounts. According to various comparison platforms, Deutsche Bank customers currently receive around 3.3 percent interest on fixed-term deposits, while savings bank customers receive an average of 2.34 percent.
Porsche has achieved remarkable financial growth, with sales surging from €37.6 billion to €40.5 billion (+7.7 percent) and net income rising from €4.9 billion to €5.1 billion (+4.1 percent) in the past year.
In 2024, Porsche is preparing to launch four new sports cars - more than ever in a year. CEO Oliver Blume states these new models would appear in the Panamera, Macan, Taycan and 911 model lines. The aim is to offer every customer a suitable model. Porsche is pursuing a three-pronged approach to powertrains: fully electric vehicles, plug-in hybrids and traditional internal combustion engines.
Temporary slowdown in profitability: Launching new products involves higher costs. The downside of the latest models is the expected pressure on revenue margins. Porsche expects its sales margin to be between 15 and 17 percent in the fiscal year 2024, down from 18 percent last year. The long-term target is 20 percent. Revenue for this year is expected to be between 40 and 42 billion euros - barely higher than last year, possibly even lower.
Fuel for the Porsche share: Investors are responding positively to the shifts planned in 2024, paving the way for a strong 2025. The share price rose by 11.4 percent over the day.
This week, the UK’s Office for National Statistics released the list of the 700 goods and services used to measure inflation. These items are selected based on what the average consumer spends their money on in everyday life, and the composition changes annually depending on British spending habits. For the first time since 1992, vinyl records were included in the list. Six million were sold in the UK in 2023.
Although vinyl records have been made obsolete first by CDs, then by MP3 files, and now by streaming services, this iconic form of music presentation is experiencing a cultural resurgence. In 2022, 41 million vinyl records worth $1.2 billion were sold worldwide, compared to only 33 million CDs during the same period.
Artists such as Taylor Swift have embraced the hype. Her album “1989 (Taylor’s Version)” was the best-selling vinyl record in the UK last year, with 100,000 copies sold.
Taylor Swift's album "1989 (Taylor's Version)" on vinyl © imagoWishing you a wonderful start to your day. Stay informed. Stay with me.
Best wishes,