Heading for carbon neutrality – Key strategies for Germany and Japan
The challenges posed by the increasing global climate crisis call for more substantial actions. COP-26 has brought new momentum towards achieving climate neutrality. At the GJETC Outreach Event “Heading for carbon neutrality: Key strategies for Germany and Japan” on Thursday, 25th November 2021 Dr. Karsten Sach, Director-General of Climate Policy, European and International Policy Department at the Federal Ministry of the Environment, Nature Conservation and Nuclear Safety/Germany and Prof. Jun Arima, Professor for Energy & Environmental Policies at the University of Tokyo and GJETC Council Member, shared their impressions and conclusions from COP 26 in Glasgow.
The German and the Japanese study teams of GJETC gave insights into the ongoing comparative study on long-term scenarios assessing the different strategies and approaches of reaching carbon neutrality by 2045/50 in Germany and Japan.
We would like to say thank you to all the participants. Please find below some of the answers to the questions posted in the chat by the participants.
Question 1: Working for leading Japanese companies covering among others decarbonization of industry I had the most fruitful discussions with operators and researchers involved in actual CCUS/hydrogen utilization projects. This gives a good insight view of the possible realization of scenario considering TRLs, market developments etc. I hope it will be possible soon to have direct exchange of view again with experts in Japan as well as visit promising projects in Japan and Europe. (Ralf Eyssen Japanese-European Environment & Energy Center)
Answer by the German study team:
Dear Ralf Eyssen, thank you for your comment. As we have already announced, we are planning to present the results of our studies upon finalization in February 2022 on the occasion of the next Council Meeting. The complete studies will then be published on our website in March 2022.
Concerning the direct exchange of views, we are planning to continue Outreach Events. Recently, we have also started Innovation Roundtables that aim to enhance the dialogue between suppliers and users as well as science and industry to stimulate innovations and find solutions, among others for the decarbonization of industry. The first Innovation Roundtable was held on November 5th.
Question 2: Are you trying to achieve these carbon neutrality goals while eliminating nuclear power plants in Germany? In order to build a hydrogen society, the question is how to produce hydrogen cheaply, in large quantities, and without carbon. In Japan, there is a debate about whether to import blue carbon or to procure hydrogen from a nuclear power plant called FTTR. Will Germany be able to procure the required amount of green hydrogen alone? How will you secure the power to regulate the connection of renewable energy to the grid if you abolish fossil fuel-fired power generation? Can all of this be provided by pumped storage and storage batteries alone? It is inevitable that fuel prices and electricity bills will rise if we go carbon free. And if the cost rises further due to carbon pricing policies, will Germany be able to maintain its international competitiveness? (Fujio Mitsui)
Answer by the German study team:
Following the accident at the Fukushima Daiichi plant in March 2011 the German government has decided the nuclear phase-out, which will be realized in 2022. While some people in Germany argue that nuclear power would be needed in order to reach climate-neutrality, the owners of nuclear power plants have come to the conclusion that nuclear power, in Germany, is not profitable anymore. All scenarios assume the phase-out of nuclear energy as well as the coal phase-out (differing in the year) and conclude that reaching carbon neutrality by 2045 would be technically and economically feasible, given a considerable increase of renewable energies, increasing energy efficiency, and electrification, to name the three most important strategies.
While the studies acknowledge a rise of electricity prices, economic feasibility as well as aspects of social justice (“just transition”) are also been discussed. The assumed increase of the supply of green electricity is driven by the higher demand of electric power in all sectors, especially for E-mobility, heat pumps and electricity-based process transformation in industry. Rising costs can be partly compensated by energy cost savings due to increased efficiency – it is ultimately energy bills that matter, not the price per kWh. Some scenarios (e.g. BDI) calculate an amount of total energy costs in 2045 comparable to the reference case (see also answer to question 5) To ensure social justice and public acceptance, the studies also discuss mechanisms to compensate for higher energy costs for vulnerable households.
Concerning the international competitiveness of Germany’s industry, the necessity for transformation and decarbonization can also be considered as a huge opportunity to further develop innovative technologies (“GreenTech”) for global “lead markets” (e.g. energy and resource efficiency, sustainable mobility, renewables) enabling decarbonization strategies all over the world and by that potentially create competitive advantages.
Question 3: German energy mix in 2045 is almost 100pecent renewable with hydrogen. How intermittency can be dealt with? Hydrogen is good or abundant enough? How much does energy cost (Masakazu Toyoda, Former Co-Chairman of the GJETC)
Answer by Stefan Thomas (from the chat on Nov 25th)
To Mitsui-san and Toyoda-san: demand response and vehicle2grid have potential for flexibility too. Scenarios also assume 5% of power from green hydrogen. Most hydrogen and synfuels are assumed to be imported, but this is a point in which different scenarios are analyzed, because the potential and cost of imports is not very clear today. About the incremental cost of 100% renewables (incl. ca. 5% of green hydrogen) in the power system: the BDI study estimated it to be 0.6 ct./kWh compared to the reference scenario; and no increase vs. 2020; see our presentation slide no. 20.
Question 4: Is geothermal Energy in Japan not possible due to stark vulcanic activity? (Sebastian Ortlieb)
Answer by Hideaki Obane:
Thank you for your question. In Japan, geothermal power potential exists in national parks, where Japanese law regulates the construction of power plants. Moreover, hotel owners of hot springs also sometimes oppose to the construction. Hence, social consensus must also be considered.
Question 5: While the average temperature rise is a global approach, why aren’t funds dedicated to reduce GHG applied to investments with the highest carbon reductions globally. Limiting these investments to our own countries are not the best utilization for money to reach the global goal. (Hisham Alsharif)
Answer by the German study team:
In our view this position can be counterproductive because it does not reflect on the principle of “common but differentiated responsibilities.” Industrialized countries have a historical and per capita responsibility to reduce their high energy and resource consumption by domestic decarbonization strategies. On the other hand, they should help the global South by capital and know-how transfer to leap-frog to advanced technologies and to protect especially vulnerable countries against the damages of climate change. Thus, the pledge of $100bn annual aid by rich countries for poor countries should be implemented earlier than 2025.
Question 6 to all speakers: The Glasgow Climate Pact adopted at COP26 calls on countries to phase down coal and to phase out subsidies for fossil fuels. Again, the background of Japan already having a new government and Germany is about to have one, what are your expectations regarding coal and fossil fuel finance? (Florentine Koppenborg)
Answer by the German study team:
The debate on phasing out coal as early as possible under the specific frame conditions of Japan (e.g. security of supply as an Island country) and Germany (e.g. probably strong regional impacts in two coal regions) is ongoing. In Germany, decarbonization scenarios up to 2045 show that a complete phase out of coal should be reached in 2030 at the latest. Thus, “ideally” this target was accepted by the new government. The implication of this decision is of course a strong signal to the financial sector to stop external financing of coal. Japan is also heading for tightening rules for foreign coal-fired power stations and ending government funding for projects. The debate on the use of natural gas is ongoing in Germany. There seems to be a consensus that natural gas is needed for a certain transition period. But e.g. the necessary build-up of gas power plants as a flexibility option and to stabilize security of fluctuating supply from renewable sources should not lead to lock in effects. Thus, newly built gas power plants should be constructed “hydrogen ready”.
Answer by the Japanese study team:
Japan has declared carbon neutrality in 2050 and direct burning of coal shall be diminished until then. Private sectors have already started moving toward the direction and this movement may become faster and stronger in the future. Japan is also seeking new technologies to make coal power plants decarbonize e.g. like CCUS. Japan is open to any type of decarbonization options to prepare for an uncertain future.
Beyond Climate Emergency – Steps towards Carbon Neutrality
German-Japanese study results on key questions
The COVID-19 pandemic reminded the world community that global threats must be dealt with on a global level, rendering international cooperation indispensable. This holds especially true for the ongoing climate crisis threatening the lives of future generations. To meet the targets proclaimed in the Paris Agreement, joint efforts fostering energy transitions and other climate policies worldwide are needed.
Since its foundation in 2016, the German-Japanese Energy Transition Council (GJETC) has been working on a strategic and systemic analysis to develop policy advice for new and long-term perspectives on the way to an ambitious energy transition.
Also, new study topics for the 3rd phase of the GJETC were presented. Amongst others, the Council gave an update on Germany’s / Japan’s climate strategy and its implications and discussed possible pathways and solutions for carbon neutrality. Participants were invited to participate in the Q&A session.
In an Online Outreach Event on July 2, 2021 (9:00-10:30 CEST / 16:00-11:30 JST), members of the GJETC presented results and policy recommendations from recent studies that deal with key questions for the energy transition in both countries:
- How can Artificial Intelligence (AI) and big data be utilized to optimize power grid operation?
- To what extend can Carbon Capture, Use and Storage (CCUS) and Hydrogen contribute to the decarbonization of energy-intensive industries?
- And which impact of COVID-19 can be observed on energy consumption, social behaviour and climate policy?
Webinar: Results & Policy Recommendations of the GJETC Phase II 2018-2020 in the light of Covid-19
On Thursday, 2nd July 2020 the GJETC presented the final results of the 2nd phase (2018-2020) along with the policy recommendations derived from the reports in it’s first Webinar Outreach. Aside from the 2 core topics of the 2nd phase, Hydrogen Society and Digitization & Energy Transition, the working groups have prepared input papers in bilateral cooperation between the respective GJETC experts on numerous issues such as Long-term Scenarios and Review Mechanisms, Transportation & Sector-Coupling and Integration Costs of Renewable Energy Sources. In addition, a special spotlight has been put on the topic “energy transition and the corona crisis”. With over 300 participations and 200 participants from Germany and Japan we had a lively discussion and the Outreach was a great success.
Unbundling of Electricity Markets and Management Options
Japan is in the process of restructuring its electricity market, e.g. introducing competition in supply, unbundling, and competitive balancing markets. Germany, as a member state of the European Union, has already restructured its power market in the years since 1998. Both countries, however, will have to develop their electricity markets further to master the energy transition. This concerns particularly the integration of large shares of generation based on mostly variable renewable energy.
Following the 7th GJETC Council Meeting the GJETC had organized an Outreach Event for 24th September 2019, to discuss this issue with the public. Guests were among others experts from the German Energy Market with Mr. Steffen Riediger (EEX AG) and Dr. Boris Rigault (Siemens) as well as Deputy Director of the DG Energy of the EC, Prof. Dr. Klaus-Dieter Borchardt. With over 180 applications and 150 attendees the topic drew a lot of interest especially from Japanese Stakeholders.
The Importance of International Cooperation under Disruptive Changes – Tokyo Edition
Complementary to the Outreach in April 2018 in Berlin, the GJETC hosted a second event for the dissemination of the first phase study results in Tokyo on 10th September 2018.
The joint recommendations for the various stakeholders from politics, industry and civil society were presented by the Co-Chairs and Council Members and discussed with the audience.
The Importance of International Cooperation under Disruptive Changes: Recommendations and Lessons Learnt from a Fruitful German-Japanese Dialogue on the Energy Transition
During the first phase of the GJETC, German and Japanese experts have analyzed the challenges of the energy transition in Germany and Japan and made recommendations on how the energy transition can be accelerated in both countries. The joint recommendations for the various stakeholders from politics, industry and civil society were presented by the co-chairs and council members at a public outreach event, back-to-back with the German-Japanese Energy and Environment Forum on 20th April 2018 in Berlin.
GJETC invited to the Committee for the Environment, Nature Conservation and Reactor Safety of the German Bundestag (German)
The Committee for the Environment, Nature Conservation and Reactor Safety of the German Bundestag invited the German GJETC Council Member Dr. Stefan Thomas, on the occassion of the 7th anniversary of the Fukushima Nuclear Accident, to present and discuss the results of the 1st phase of the GJETC in a public expert discussion on March 14th 2018.
The Energy Transition in Japan & Germany: Consensus and Controversies. Insights of the German-Japanese Energy Transition Council GJETC
On 16th February 2018 the GJETC held its second Outreach event in the Federal Press Conference in Berlin. With around 120 participants the facility was “sold out”. Under the participation of high-ranking government officials and members of the German Bundestag the Co-Chairs presented the results and policy recommendations to the public and discussed them in a broader context among others with Dr. Karsten Sach, Head of International Cooperation at the BMU.
German Japanese Dialogue – How far can the energy transition go? Perspectives and first results of the German-Japanese Energy Transition Council
One main task during the first phase of the GJETC was to create a study program using evidence-based scenarios and system analysis. One year after the council took up its work, the preliminary results of the studies were presented and discussed by the German and Japanese GJETC Council members in Tokyo in the first Outreach event of the GJETC. Around 100 participants took part in the public event held at the Institute of Energy Economics Japan on 6th September 2017.