Germany Power Report Q1 2015 - New Market Study Published

Germany has moved to slow the pace and constrain the cost of the Energiewende but remains dedicated to its green energy transition . In spite of the economic costs and threats to industrial competitiveness, the country is committed to strong growth in renewables capacity . This will drive radical changes to the traditional utility model - as evidenced by E.ON decision to spin off its fossil fuel business.

Although reform of the Renewable Energy Sources Act (EEG) may slow the pace of renewables expansion so as to reduce the costs associated with the Energiewende (energy transition), we emphasise that there is little to indicate any major change in green energy policy trajectory. Germany will continue to register rapid growth in renewable-based electricity generation and retain its position as a global renewables powerhouse. This will, however, have significant implications for the economy and we maintain that structural problems in the utilities sector are unlikely to recede.

Full Report Details at
- http://www.fastmr.com/prod/938369_germany_power_report_q1_2015.aspx?afid=301

Our core view is that the Energiewende will lead to higher electricity prices over the next decade and ultimately damage the competitiveness of German industry. This will continue until Germany either reverses its commitment to renewable energy or adopts a more accommodative fiscal policy - both of which are unlikely under the current government. Furthermore, the government will not be able to protect industry from higher energy costs indefinitely, as workers will ultimately demand higher compensation for the cost of living - meaning Germany will continue to pay the macroeconomic costs of Energiewende regardless of who pays the bill. As such, we maintain that the Energiewende will erode German competitiveness and the structural challenges facing traditional utilities will remain in place in 2015 and 2016.

Key Developments

* Reform of the EEG became effective on August 1 2014, and is aimed at constraining the annual expansion of renewables capacity and fundamentally changing...

The Germany Power Report features Business Monitor International (BMI)'s market assessment and independent forecasts covering electricity generation (coal, gas, oil, nuclear, hydro and non-hydro renewables), electricity consumption, trade, transmission and distribution losses and electricity generating capacity.

The Germany Power Report also analyses the impact of regulatory changes, recent developments and the background macroeconomic outlook and features competitive landscapes comparing national and multinational operators by sales, market share, investments, projects, partners and expansion strategies.

Key Benefits

* Use BMI's independent industry forecasts for Germany to test other views - a key input for successful budgeting and strategic planning in the power market.

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