BMU: Funding of Energy and Climate Fund Secured for 2013

Funding of the Energy and Climate Fund (EKF) had been secured for 2013, but continued financing for 2014 still had to be agreed on in the upcoming debate about the fund’s budget for next year, the Federal Ministry for the Environment, Nature Protection and Nuclear Safety (BMU) informed.

In line with the law on the EFK (cf. Section 2 para. 2 sent. 2 EKFG) EFK funds are spent for various support programmes relating to energy efficiency, renewable energy, energy storage and grid technology, energy-efficient renovation, national and international climate protection as well as electromobility.

In support of the the German Energiewende (energy policy shift) away from nuclear power towards a renewable energy supply the state-owned development bank KfW would cover the expenses for support programmes provided by the bank itself, BMU informed. This comprises support in the amount of EUR 311 million for energy-efficient renovations of buildings and towns and cities as well as a new support programme for solar storage starting 1 May 2013.

There have been warnings of underfunding for quite some time. The fund was set up in autumn 2010 when the German government decided to extend the operating times of the then 17 active German nuclear power plants, which were intended to provide a bridging technology into a new age of renewable energy supply. In return the nuclear power operators agreed to pay millions of Euros into the fund. Besides revenue came from a nuclear fuel rod tax introduced at the time and the auctioning of CO2 emission allowances. Following the Fukushima nuclear disaster in 2011, however, the German government reversed its nuclear policy, deciding on a phase-out until 2022. Revenue of the EFK now comes mainly from the sale of CO2 allowances, the prices of which have continually fallen over the past years. This week the European Parliament narrowly voted against a proposal aimed at withholding around 900 million emission allowances from the EU emissions trading scheme (EU ETS) over the next two year in order to boost the emission allowance price. This sent prices further down. The effects of the EU parliament’s decision would have to be considered in the decision on a budget of EKF for 2014, BMU announced.

Source: Federal Ministry for the Environment, Nature Protection and Nuclear Safety

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