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2016 Report – Implementation of energy transition

Dec 21, 2016

0 Summary

0.1
We audited the steps taken by the Federal Ministry for Economic Affairs and Energy to implement energy transition. On the basis of our audit findings we developed the following audit conclusions:

0.2
The Federal Ministry for Economic Affairs and Energy has assumed lead responsibility in this task and ensures overall coordination. According to the Federal Ministry, energy transition is a major national challenge, but lead responsibility lies solely with the Federal Ministry. We consider it appropriate that responsibilities are merged and that coordination and lead responsibility is assigned to one government department. However, our audit findings show that the Federal Ministry can do more to perform its overall coordinator function. No coordinated exchange is taking place either within the Federal Ministry or with other government departments or the German federal states. The Federal Ministry does not have an overview of the financial impact of energy transition. Key questions such as “How much does energy transition cost the government?” or “How much should energy transition cost the government?” have not been asked and remain unanswered (numbers 3 to 5).

0.3
So far, the Federal Ministry has failed to establish an appropriate grant controlling. The Federal Ministry does not evaluate the results of its funding programmes, although we repeatedly highlighted this shortcoming. The shortcomings become apparent in the way in which the Federal Ministry implements its funding programmes. For instance, inefficient funding programmes have been launched, extended and increased. The Federal Ministry for Economic Affairs and Energy has not ensured that programmes with little efficiency which at the same time add little value to energy transition are phased out and that the funds thus released can be put to better use. We therefore perceive the risk that bringing energy transition forward will become an ever more costly exercise. The Federal Government and the Federal Ministry, being its overall coordinator, have not yet managed to strike the right balance between ambitious climate protection goals and efficient grant-funding programmes (numbers 7 and 8).

0.4
To achieve energy transition, Federal Government has relied on the goals of the energy policy triangle – environmental compatibility, energy safety and security and affordability. The annual monitoring report on energy transition issued by the Federal Ministry shows that the two goals “energy safety and security” and “affordability” are neglected (number 6).

0.5
On the basis of audit findings, the German SAI has developed the following recommendations that are addressed to the Federal Government and specifically to the Federal Ministry for Economic Affairs and Energy as the body having lead responsibility:

  • The Federal Government needs to pool information centrally to obtain a comprehensive overview of the financial impacts of energy transition. A reliable decision about how to enhance and limit energy transition can only be made if those in charge have a complete overview over its impacts. We recommend that this comprehensive overview be included in the annual monitoring reports on energy transition issued by the Federal Ministry for Economic Affairs and Energy and be regularly updated.
  • The monitoring of energy transition needs to be enhanced with regard to the targeted structure and impact analysis. The goals of energy security and affordability therefore need to be specified, evaluated and quantified to the same extent as the adequately quantified environmental compatibility target. In particular, cost ceilings need to be set for energy transition. Energy safety and security and affordability need to be perceived as limiting factors for further enhancing energy transition.
  • Measurable targets need to be set that cover all aspects of implementing energy transition. Also the effectiveness and efficiency of the steps taken need to be monitored continuously. Furthermore, the comparability of programmes needs to be ensured (e.g. CO2 savings per funding).
  • Deadweight effects need to be avoided and inefficient programmes need to be phased out.
  • The results of energy transition monitoring need to be used as input for designing the future funding strategy. Grant monitoring in connection with energy transition needs to be carried out on a comprehensive basis.

 

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