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Germany Power Report Q1 2014

Germany Power Market: New market analysis released


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2014-02-07 22:21:01 - Germany Power Report Q1 2014 - a new market research report on companiesandmarkets.com

Our view that Germany´s energy policy would be a fundamental tenet of the political discourse in the months preceding the September 2013 general election has proven correct - underscored by the proposed changes to the Renewable Energy Resources Act (EEG) and the country´s Energiewende (energy transition) outlined in the preliminary version of the coalition deal between CDU-CSU and SPD. The debate has crystallised around the way in which Germany phases out nuclear capacity and transitions to generating electricity using a greater share of renewable sources - without pushing domestic electricity prices any higher and damaging the economic competitiveness of its major industries. As such, although we caution that a grand coalition deal is yet to be fully endorsed by the

 

 

SPD, we maintain our core view that the Germany´s Renewable Energy Resources Act is unlikely to survive in its current form and note that some of the proposals made under a grand coalition deal could have some significant implications for the future of German energy policy.

At the time of writing, Germany appears to be close to forming a coalition government. While Angela Merkel and the Christian Democrats (CSU-CDU) recorded their best result since 1990 in the September 2013 general election, they still fell short of securing an outright majority in the Bundestag and have turned to the Social Democrats (SPD) to form a grand coalition. With the SPD deciding to ballot its entire 470,000- strong membership on the proposed deal, we emphasise that although we maintain our core view that a grand coalition government will take power, there is a risk that SPD members might reject the proposed coalition agreement.

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