ZEW Contributes to the Energy Debate at the BMBF-Forum for Climate Economics in Berlin

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FONA Economics of Climate Change

The Centre for European Economic Research (ZEW) co-organised the second forum for climate economics, which took place on April 13, 2015 in Berlin. The event represents the funding priority "Economics of Climate Change" which is part of the programme Research for Sustainable Development (FONA), launched by the Federal Ministry of Education and Research (BMBF). Under the slogan "Energy, Economics and Climate in competition?", scientists and practitioners discussed the energy and climate policies of the EU and Germany and the impacts of these on German competitiveness. Around 70 participants from the fields of research, politics, business, and civil society attended the event.

In his keynote, ZEW research associate, Prof Dr Andreas Löschel from the University of Münster, emphasised the strong link which exists between the German Energiewende (energy transition) and the energy and climate policies adopted by the EU. As part of the climate and energy targets set for 2020, the EU member states have committed to reducing Greenhouse gas emissions by at least 20 per cent and increasing energy efficiency levels by 20 per cent, as compared to 1990 levels, by 2020. In addition, they have set themselves the target of ensuring that, by 2020, 20 per cent of all energy is produced from renewable sources. In view of these 20-20-20 objectives, Löschel argued that the German Energiewende can only be a success within a European context. By drawing links between various political levels and the effects of various measures of energy policy, Löschel concluded that energy, economy and climate are indeed competing with each other. Despite this, the majority of companies have thus far been able to bear the burdens resulting from European and German energy and climate policies. It was by reference to this fact that Löschel highlighted the importance of a binding international agreement, not least to ensure the success of the GermanEnergiewende. It is essential that the ambitions of Germany and those of the European Union do not drift apart.

Christoph Bals (Germanwatch e.V), subsequently gave a short lecture regarding the potential of expanding the use of renewable energy sources and increasing energy efficiency, in order to tackle the issue of competition between climate policy and economics. One example success story is that of the German Renewable Energy Act (EEG), which, thanks to the extreme reduction in the world price of solar panels, has contributed to the expansion of solar energy worldwide. This development of self-sufficiency in the field of energy production, which increases European energy security whilst also enabling additional economic benefits, illustrates that the German Energiewende can be considered an EU-project. In addition, green investments are an important solution approach, as they also offer a solution to the European economic crisis. It is in this way that climate policy, rather than competing with the economy, may be able to stimulate economic growth.

Participants subsequently worked in four small groups in order to discuss selected key topics in view of the results from current research projects. One group, working under the direction of Prof Dr Karen Pittel (ifo Insitut, LMU Munich), discussed the role of fossil fuels in European energy and climate policy. The discussion group led by Dr Johann Wackerbauer (ifo Institute) discussed the integration of European energy markets. A third discussion topic was dealt with by a group led by Dr Klaus Rennings (ZEW); this group focused on the conflicting goals of climate protection and economic competitiveness. Dr Katrin Sommerfeld (ZEW) worked with a fourth discussion group, in which the acceptance of climate-protection technologies was considered.

The forum on climate economics concluded with a panel discussion in which the participants discussed the German and European energy and climate policy. Seated on the panel were Ingmar Jürgens (European Commission, Representation in Germany), Dr Carsten Rolle (Federation of German Industries), Christoph Bals (Germanwatch e.V.) and Prof Dr Andreas Löschel (ZEW and University of Münster). Participants agreed that the energy-union shall be developed more intensively towards a climate and energy-union (Bals). There were diverging opinions, however, regarding which objectives should be pursued through energy and climate policy. Whilst Prof Löschel and Dr Rolle spoke in favour of prioritising the CO2-objective, Bals argued that objectives concerning energy efficiency and renewable energies should be considered to be equally important.

The event was the second of four forums organised within the dialogue about climate economics. The two remaining forums will take place in Berlin on May 4 and June 22, 2015. ZEW is represented by the following three projects in the four different key topic areas and corresponding events:

  1. CliPoN – Climate Policy and the Pattern of Growth of Nations
  2. Eval-MAP – Establishing a Household Panel for the Evaluation of Climate Protection and Adaptation Measures
  3. VolFair – The Significance of Voluntary Contributions and Fairness Preferences for the Success of International Climate Policy: a Theoretical and Empirical Analysis on the Level of the Individual