Seeking Green Utopia, The US And EU Are Quietly Killing Vital Industries

German CO₂ emissions are the lowest since the 1950s. Is this a success or a failure?

Agora Energiewend reports Germany’s CO₂ Emissions Drop to Record Low. The details and results are interesting, emphasis mine.

Last year, Germany’s greenhouse gas emissions fell to 673 million tonnes of CO₂. Emissions thus fell by 46 percent compared to the reference year 1990 – their lowest level since the 1950s. At the same time, CO₂ emissions were about 49 million tonnes of CO₂ below the annual target of 722 million tonnes of CO₂ derived from the Climate Protection Act.

Two main developments were responsible for the decrease of 73 million tonnes of CO₂ compared to 2022. First, coal-fired power generation fell to its lowest level since the 1960s, saving 44 million tonnes of CO₂ alone. The reasons for this were a significant drop in electricity demand, increased electricity imports from neighbouring countries – around half of which came from renewable sources of energy – as well as a commensurate decrease in electricity exports and a slight increase in domestic green electricity generation. Second, emissions from industry fell significantly. This was largely due to the decline in production by energy-intensive companies as a result of the economic situation and international crises. While overall economic output shrank by 0.3 percent according to preliminary figures, energy-intensive production fell by 11 percent in 2023.

“2023 was a two-speed year as far as climate protection in Germany is concerned: the energy sector notched up a climate policy success with its record level of new renewable power, taking us closer to the 2030 target,” said Simon Müller, director of Agora Energiewende Germany. “However, we don’t consider the emissions reductions seen in the industrial sector to be sustainable. The drop in production due to the energy crisis weakens Germany’s industrial base. If emissions are simply shifted abroad as a result, this won’t benefit the climate. The buildings and transport sectors are also lagging as far as structural climate protection measures are concerned.”

According to Agora’s calculations, only about 15 percent of the CO₂ saved constitutes permanent emissions reductions resulting from additional renewable energy capacity, efficiency gains and the switch to fuels that produce less CO₂ or other climate friendly alternatives.

CO₂ emissions in the transport and buildings sectors stagnated again in 2023, meaning that the sectors continue to fall well short of their climate goals. Instead of the legally binding maximum of 101 million tonnes of CO₂, buildings caused 109 million tonnes of CO₂ emissions. This means that the buildings sector missed the annual target for the fourth time in a row.

According to Agora’s calculations, transportation in Germany emitted 145 million tonnes of CO₂, which corresponds to a reduction of just 11 percent compared with 1990. This means that transport emissions exceeded the legally binding limit of 133 million tonnes of CO₂ by 12 million tonnes of CO₂. The target of 15 million electric cars by 2030 remains a long way off: as in the previous year, the share of electric cars among new registrations was unchanged at just under 20 percent.

German De-Industrialization

“Good Morning from Germany, where a creeping deindustrialization is taking place. Industrial production has recently continued to fall and is now at the same level as in 2006.”

I used that Tweet in my previous post, written yesterday. Today found two interesting articles to show why that’s happening.

In Search of the Green Utopia

In the name of green utopia, political leaders are quietly killing vital energy-intensive industries.

The Wall Street Journal reports Davos Devotees Deindustrialize Europe

Political, business and security leaders gather in Davos next week under the mantra of “rebuilding trust.” Key topics include security cooperation, artificial intelligence, energy security and job growth “for a New Era.” Undoubtedly there will also be calls to phase out fossil fuels and aspirations for a hydrogen-based green economy. Amid this grand planning for the industries of 2050, leaders likely will pay little attention to how government pressure to reach this utopian vision is destroying the industries that made Europe the envy of the world.

Over the past two years, dozens of energy-intensive manufacturers of our most basic materials—chemicals, steel, ceramics, glass and fertilizers—have ceased or slowed production in Europe. As the leader of a U.S.-headquartered chemical company that once had more than 50% of its revenue and employees in Europe, I have witnessed this devolution firsthand.

According to a recent report from the think tank Agora Energiewende, German greenhouse-gas emissions dropped 20% in 2023 to their lowest levels in 75 years primarily due to a collapse in energy-intensive manufacturing. Media reports largely overlook the scale of this catastrophe, but the political ramifications are beginning to show in the polls. Agricultural protests against emission crackdowns in the Netherlands helped populist Geert Wilders win a surprise election victory, and similar demonstrations in Germany killed a green budget proposal.

The deindustrializing politics of Europe essentially seek to reverse all this by organizing the economy around limiting byproduct waste from the products that enable the world to sustain itself. Low-cost, abundant energy is the lifeblood of profitable industrial manufacturing. The production of virtually everything requires it. Every time an industrial facility closes, high-paying jobs disappear and the middle class shrinks.

If Europe won’t make what the world needs, then production will go elsewhere. It is environmentally and economically irresponsible for Europe to outsource its energy-intensive industry to countries with weaker regulation, employment laws and safety standards. To believe differently is naive, dangerous, and detrimental to the environment. Serious people understand this reality and must speak out. Voters already are.

Taxing the World

Europe and the US are hell bent on creating a “green utopia”. It does not exist and never will.

In Germany and the EU, the search for utopia is leading to deindustrialization. In the US, Biden’s efforts are leading the US to become the high-cost producer.

Carbon Leakage

To prevent “carbon leakage” the European Parliament Reached a Deal on a Carbon Border Adjustment Mechanism, CBAM for short.

I wrote about CBAM on December 19, 2022 in EU Imposes the World’s Largest Carbon Tax Scheme

“The only effect CBAM would have is a resource shift whereby clean energy capacity in already under-resourced countries will be shifted for export production while industry aimed at local consumption and energy access will depend on dirty fuels.”

Is that not what’s happening?

World Class Irony

We don’t use roof solar panels because they cost to much. They cost too much because we insist they be produced here.

We demand EV policies that require more minerals and mines, but we won’t allow more mines in the US.

We want more EVs but we insist on union manufacturing driving up price.

Holding the whole damn mess together is a policy of higher tariffs.

All Hail France

Amusingly, France is leading the way to a solution that actually makes sense.

In a proposal in French parliament that has a good chance of passing, a bill weakens France’s climate objectives. The objective would no longer be to “reduce” but to tend towards a reduction in “our greenhouse gas emissions.

For discussion, please see French Legislation Weakens Clean Energy Commitments and Favors Nuclear

The legislation defines nuclear as sustainable. And so here we are. France is actually making sense while the US and most of the EU is in green utopia la-la land.