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The fairy tale of the "green economic miracle" in Germany

Written by Hans Heckel for the Preußische Allgemeine Zeitung.

The Greens promise that their climate policy will also be an economic success. But that has already gone wrong with solar subsidies.

Very little of the talks between the SPD, the Greens and the FDP about the formation of a “traffic light” coalition leak out. However, all three are clearly trying to gain the upper hand, at least on their central issue, so that their profile remains visible in the respective electorate. With the SPD it is about what the Social Democrats understand by “social justice”, with the Free Democrats it is tax and budget policy and with the Greens it is “climate protection”.

At the same time, the Greens are making great efforts to relieve the Germans of their concerns about their prosperity and the economic future of the country when the burdens intended by climate policy press ever more heavily. Therefore, already in the election campaign, Chancellor candidate Annalena Baerbock assured: "Climate protection safeguards jobs, our industrial location and thus social prosperity."

In other words: The green climate policy not only does not burden the German economy in any way, it even offers domestic companies undreamt-of profit opportunities from which everyone in the country will benefit.

But is this claim true? Two decades ago, green politicians like the then Environment Minister Jürgen Trittin made the same promise. At that time it was said that the massive promotion of solar energy could make Germany the world market leader in the manufacture of solar cells and modules, which would result in huge profits and many well-paid jobs. As is well known, the end customers had to pay for the subsidy via the EEG surcharge.

In truth, however, it turned out quite differently. Chinese companies in particular quickly noticed how easy it was to make money with solar technology in Germany. The funding was not only for German providers, but for everyone.

This time it's the turn of the whole place
After a few years, the Chinese had largely ousted their German competitors from their own home market, and from the world market anyway. At the end of 2020, seven of the ten largest solar module manufacturers in the world were Chinese, one US, one Korean and finally one Canadian, which, however, mostly produces in China. When the black and yellow government coalition cut solar subsidies, most German manufacturers were already bankrupt or marginalized.

But the “green economic miracle” was not only a blow in the water from an economic point of view, but also ecologically: According to a US study from 2014, the ecological footprint of Chinese manufacturers - that is, the impact on the environment through resource consumption and pollution - was twice as large like that of European producers.

This economic as well as ecological disaster of green climate policy threatens to repeat itself on a much larger scale. While hundreds of new coal and nuclear power plants are being built around the world, Germany is pulling out of these technologies. At the end of the year, three of the six remaining German nuclear power plants will go offline, the others will follow next year. The coal phase-out is to be brought forward by eight years to 2030.

That will drive up electricity costs in Germany even further. Starting with the particularly electricity-intensive industries such as aluminum and copper smelting, it is feared that more and more industrial production will eventually migrate abroad, where energy will not only be cheaper but also more reliable than in the country of the "fluttering electricity" from wind and sun.

Countries in particular can look forward to offering cheaper electricity as well as more lax environmental regulations than Germany. The only difference to the solar fiasco will be that it will no longer affect just one industry, but the entire domestic industrial location and thus the basis of our prosperity.

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