Germany's Energy Reforms to be Outlined Next Week

Germany's new economy minister will outline reforms to Germany's renewable energy policy - one of the most challenging tasks facing the new government - during a cabinet meeting next Wednesday, newspaper Handelsblatt reported on Friday.

The economy ministry, which under Angela Merkel's right-left coalition has been merged with the energy portfolio and is run by Social Democrat (SPD) leader Sigmar Gabriel, was not immediately available for comment.

Europe's biggest economy is in the midst of shifting away from fossil fuels and nuclear energy and embracing green energy sources, however its incentive system to industry to help pay for the shift has sent electricity costs for consumers soaring.

When striking a coalition deal late last year, Merkel's conservatives and Gabriel's SPD agreed to limit the growth of renewables and reform discounts and subsidies to industry for solar and wind power.

The subsidies are largely paid for by households, whose bills have almost doubled to an average of 300 euros ($410) per megawatt-hour (MWh) over the past decade to become some of the highest in Europe.

Germany industry fears however that paying more for power will make it less competitive.

Germany has pledged to exit nuclear power altogether by 2022. The move was accelerated by Merkel after the Fukushima nuclear disaster in 2011.

Source