Profile: Jochen Homann, Marathon Man for the Energiewende

April 22, 2013 | 00:00

Profile: Jochen Homann, Marathon Man for the Energiewende

The Merkel government thought it was getting something different when it appointed Jochen Homann to the powerful post of President of the Federal Network Agency (Bundesnetzagentur, BNetzA) just over a year ago. After all, the 59-year old Homann – even though member of no political party – had been a loyal cog in the machinery of the Federal Ministry of Economics and Technology, a bastion of neo-liberal conservatism, where he served as State Secretary since 2008 and in other functions since 2001.

Jochen Homann (c) Schoepal/ Edgar
During the 1990s the northern Germany native and father of three served in the Chancellor’s office working on economic and financial issues – and in his spare time ran marathons. Homann, who studied economics in Hamburg, cut his political teeth in the late 1980s writing speeches for the Free Democrats, Germany’s pro-business free-market party, and today the chief skeptic of Germany’s clean energy transition. According to insiders, the soft-spoken, bespectacled Homann was the economics minister Philipp Rösler’s personal pick for the job.

Even though it answers to the economics ministry, the BNetzA is a neutral regulatory agency, supposedly above the political fray when it comes to executing its wide-ranging mandate in the fields of electricity, gas, telecommunications, post, and railway markets. Yet, conservatives in the German administration had been bristling for time over the reigning president, Matthias Kurth, a life-long Social Democrat and thorn in their side. When Kurth finally retired in February 2012, Merkel administration critics of the Energiewende rejoiced at Homann’s appointment – finally one of their own at the top of Germany’s foremost regulatory authority. Occupying the BNetzA with a devotee would also give them more clout in Energiewende-related power jockeying with the federal environment ministry, for example, and other institutional players on energy issues.

Neutrality as key point

But contrary to those expectations, Homann has proven to be his own man in the course of his first year, a detail-minded independent thinker and no blinkered obstructer of the Energiewende. “There have been a number of big-ticket decisions where Homann could have played a political card,” explains Felix Christian Matthes, Research Coordinator of the Institute for Applied Ecology, and long-time acquaintance of Homann’s, who describes him as a formerly quite traditional but very smart energy policy strategist. “But he didn’t do this and it hasn’t pleased his backers who thought they signed him up for something else. He’s been remarkably neutral on the most controversial issues like security of supply and the remuneration schemes for power generation from renewable energy sources.”

“I’m convinced that in the long-term everyone’s going to benefit from the Energiewende,” Homann recently told the German periodical BIZZ Energy Today. “It is an investment in the future that we can’t make without paying for it. It’s going to be future generations above all that are going to benefit the most from it.” These aren’t the kind of sentiments you’ll hear every day from Rösler and the administration’s energy hawks. (In an interview with EER, Homann denied that there were tensions of any kind between his office and the ministry.)

The BNetzA is a kingpin in the Energiewende with powers so broad – and growing – that insiders already refer to the Bonn-based agency with 2,500 personnel as “the Energiewende ministry.” “What do we need an energy ministry for?” quipped one insider to me, referring to the debate in Germany about the need for an Energiewende ministry: “We’ve got one, it’s the BNetzA.” In terms of gas and electricity, its mandate is to promote competition, ensure discrimination-free grid access, broker the annual grid development plan, negotiate network issues with neighboring states, monitor the Energiewende, and ensure security of supply.

It is about the long run

The pressing issues on Homann’s desk are those that will make or break Germany’s energy transition, such as the expansion of the transmission grid to accommodate the growing supply of renewables in Germany’s energy mix and a revamping of the electricity market to suit the needs of an economy relying on fluctuating renewables for an ever greater share of its power.

It is an investment in the future that we can’t make without payment for it
These are projects that will stretch over years and even decades – the kind for which the stamina and discipline of a long-distance runner is definitely an asset. (Homann no longer runs marathons. The extent of his exercise these days, he says, is running between his office door and the elevator in Bonn.) Moreover, with the nuclear phase-out set in stone as of Fukushima and the Energiewende front-and-center, the agency’s powers and responsibilities have grown by leaps and bounds – and will continue to grow, say observers, as the Energiewende increasingly transforms Germany’s energy system.

One example of Homann’s independence was his downplaying of the threat of blackouts or lesser power outages this past winter. For the second winter in a row since Chancellor Merkel shut down a third of Germany’s nuclear capacity in spring 2011, the representatives of the fossil fuel and nuclear industry, some heavy industry, transmission grid operators, and old-school political conservatives warned in the shrillest tones about the very real possibility of bottlenecks, blackouts, prostrate German industry, and freezing cold German burgher. The clear subtext was that Germany’s reliance on wind and sun couldn’t ensure security of supply the way conventional energy producers do, and that Germany’s lights would go out during cold snaps or the country would rely on imported electricity from its unapologetically nuclear neighbors France and the Czech Republic. Homann refused to join the chorus. “We’re observing the supply quality very closely,” Homan told the weekly Die Zeit in December 2012, “and we have no evidence that the number of power outages in Germany has increased” or that German businesses should take special measures to prepare for winter outages “when the Energiewende is pursued intelligently.” And, in the end, he turned out to be right. In both 2011 and 2012 Germany exported surplus electricity to France, and Germany industry boomed at the peak of the eurocrisis, setting new export records.

Another signature moment in Homann’s first year in office was the BNetzA’s recommendations for the annual network development plan, which priorities the construction of new transmission and distribution lines in Germany – the hottest of topics with the supply of onshore wind and PV having exploded over the last decade without a corresponding upgrade of the grids. The plan originates with the transmission operators before it goes to the BNetzA, which makes recommendations to the cabinet. It is then finalized in the Bundestag (where it currently is now). Environmental and energy-progressive groups like Deutsche Umwelthilfe and German Friends of the Earth had been harshly critical of the network operators’ proposals for four super-highway corridors running north to south and a total of 3,800 kilometers of new cabling by 2020. The high-end figures, they charged, drove up the projected costs of the Energiewende and made the project as a whole look like a boondoggle. So much new costly grid, they charged, wasn’t necessary for the Energiewende to succeed.

Homann listened to all of the arguments – including groups like Deutsche Umwelthilfe – and amended the grid operators’ proposals significantly:

They saw that we were serious about engaging citizens
The BNetzA recommended three new corridors and just 2,800 kilometers of new transmission lines. Instead of 74 there would be just 51 priority construction sites. “We recommended to the federal government only new transmission network that we deemed absolutely necessary and that are certain to be used,” Homann told EER. “This doesn’t mean that next year other stretches of the grid – like a fourth north-south corridor – might not also be recommended.”

“We were very pleased to have the BNetzA take our recommendations seriously,” says Gerd Rosenkranz of Deutsche Umwelthilfe, an NGO that works extensively on transmission grid issues. “In the end there wasn’t that much distance between our ideas and those of the BNetzA. It signaled that the agency under Homann is thinking innovatively rather than in old-school terms, the way the network operators were.”

Enormous implications

German energy analysts who were initially skeptical of Homann, not least for statements made in the past about nuclear power, say they are positively impressed so far. “Homann understands that the Energiewende is Germany’s future and that it is his job to help make it happen,” said one Berlin-based expert who works closely with Homann and thus asked to remain anonymous. “He’s not, for example, resisting the fact that Germany’s energy supply of the future is going to be based on wind and PV. This has enormous implications for the grid, the energy market, security of supply, and many other issues. He understands this. It speaks for his open-mindedness that he looked at all of the evidence and then made a decision based on that, not on previous political commitments. He’s not willing to be instrumentalized by anybody.”

Perhaps even more telling than the content of BNetzA’s final recommendations for the grid was the way it went about coming to its conclusions. While in the not-so-distant past decisions about the electricity grid were made behind closed doors at the economics ministry, the creation of the BNetzA in 2005 and the preferences of both Kurth and Homann have made the processes public and transparent for the first time. In light of opposition to the grid expansion, foremost on behalf of Germans in the paths of the new cabling, the BNetzA has bent over backwards to be transparent and include ordinary citizens in the process. The BNetzA conducted local meetings across the country, above all though in affected areas such as Thuringia and northern Germany, and delegated an eight-week period for people to register their opinions on the matter with the agency. The BNetzA received over 3,000 inputs from private persons.

“In the past, German citizens had simply been informed about infrastructure plans after they’d been decided upon – and people felt steam rolled,” said Homann recently to the German press.

If we had a master plan ten years ago it would be in the garbage bin today
“We first answered the ‘why’ question: Why do we need these transmission lines in the first place? … We went to the sites where people would be affected by the new transmission lines. We visited the localities and talked with the people there. They saw that we were serious about engaging citizens. We laid out the energy system’s needs and production plans, and explained the network development plan.”

Even though this year’s network development plan is currently out of the BNetzA’s hands (and being debated in the Bundestag) Homann’s plate remains brimming full. The agency is desperately trying to help break the complicated logjam that has slowed the development of Germany’s ambitious offshore project to a virtual halt. Despite the setbacks, Homann is confident that once the ball gets rolling even the government’s stated goal of ten megawatt of capacity by 2020 can be put in place on the North and the Baltic Seas on schedule. After all, he says, 8.5 GW is already commissioned and in the works. In fact, it’s the 2030 goals – 25 GW – that give Homann more cause for concern.

New mechanisms required

Another burning issue is that of the outmoded German electricity market itself – a demand-oriented “energy-only” market built and developed for fossil fuels and nuclear power, not for fluctuating renewables in need of conventional back-up capacity. In terms of a solution, Homann and the BNetzA have yet to settle on a favored variant. “We have a real problem, not just here in Germany but also in other EU countries,” explains Homann.

“The electricity prices on the energy exchange don’t stimulate investment in new conventional power suppliers,” explains Homann. “Suppliers are even talking about shutting down plants. The question is how to stimulate investment in conventional capacity. Currently, the exchange prices aren’t doing the job because renewable energies are causing prices to drop. Thus we have to think about new mechanisms to spur investment. The discussion about capacity markets are part of this. I haven’t found a model yet that really solves the problem in the end. All of the models have negative side-effects. It’s a problem that won’t be solved tomorrow.”

Indeed, the former long-distance runner knows that preparing Germany’s infrastructure and energy markets for the long-term goals of the Energiewende is one Germany has only just begun. “The goals of the Energiewende reach a long way into the future – to 2050 and beyond,” he says. “That’s why there can be no master plan. If we had had a master plan ten years ago it would be in the garbage bin today.”

Where, EER asked Homann, would he say the Energiewende is today if it were a 42-km marathon? “I think we’re now just before the first refreshment stand at the five kilometer point,” he says, laughing a little. “That’s the phase where you ration your energy and not give everything you’ve got because you know you’ve got a long way ahead of you. That’s why it doesn’t make sense asking everyday if we’ve reached the end of the Energiewende. We’re just at the beginning.”


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