1. Professor Jänicke, you are currently on a foreign tour explaining the economic success story of Germany’s climate policy. What contribution has politics made to this success?
Market failure has always played a major role in both environmental protection and climate protection. Politicians have had to counteract this. The situation is even more dramatic in the field of climate protection. The issue here is not only the need for a massive innovation process to move towards climate-friendly technologies; it’s also about speeding up this technical transformation and the global effects this will have. Markets cannot achieve this on their own. It requires action from the government and the international community. Germany has assumed a pioneering role in this field since 1990, and especially since 1998. Here, a climate policy based on technological innovation was pursued at an early stage and across party-political boundaries. This is now paying off.
2. Experts speak of a “third industrial revolution”. How profound is the transformation?
His phrase is entirely appropriate, given the drama of the impending changes. Today we are witnessing the demise of the 20th century’s model of economic success. Industrial mass production based on cheap raw materials is in crisis. This model of resource-intensive industrialism has been defining almost every aspect of our lives – from our energy systems to transport structures to the global division of labour. The continuous process of replacing labour by cheap energy was also part of this model. All this will soon be radically changed into a knowledge-intensive method of production that will revolutionize the efficiency of our use of resources – materials, energy, water or land.
3. What key technologies are behind this?
Certainly, the most dramatic transformation is taking place in renewable energies and energy efficiency. Up until last year, growth rates were highest in photovoltaics, which in my opinion is the most important of the renewable energies. Technologies that use energy more efficiently do not grow quite as quickly, but they have a wide spectrum of applications, and their importance is certainly increasing. The possibilities range from efficient electric motors to plus-energy houses to biocatalysis in chemistry. Technologies that reduce the amount of materials used are an underestimated, but extremely important way of saving energy. This applies both to the successful German technologies for separating waste products and to processes for recycling building materials.
4. Companies are now becoming involved in large-scale projects like Desertec that would otherwise not have been expected to enter this field. Are entirely different companies emerging in the course of these changes?
This project has been under discussion since the 1970s, but it took climate change and the rise in energy prices to bring about a breakthrough. This is one symptom of an energy turnaround. Companies that used to be stubborn opponents of this energy turnaround are now getting involved, as are entirely new players such as Munich Re.
5. Opinions differ on Desertec. Do great challenges require unusual measures?
I’m not a great fan of centralized projects. But there can be no doubt that the productive use of the world’s deserts has a win-win potential that goes far beyond energy generation. The involvement of local populations will be a critical factor in this context.
6. How is Germany positioned internationally in green technologies? Where do its strengths lie compared to other industrialized nations?
It’s pretty clear that Germany holds a leading position in this field: in terms of its share of the global market for environmental technology; in terms of the corresponding patents; and not least in terms of the economic importance of the environmental industry within the country. Whichever way you define this heterogeneous sector, it’s bigger in Germany than in other EU countries, and more important in the EU than in other regions of the world – although China and the United States are catching up fast. Roland Berger Strategy Consultants confirm that the environmental industry accounted for 8% of Germany’s GDP in 2007; they forecast a figure of 14% for 2020.
7. Why is the industry so dynamic in Germany?
Today’s environmental industry is no longer made up primarily of companies that supply filters and cleaning plants. This “end-of-pipe” technology was expensive and ultimately put the brakes on productivity. The modern environmental industry consists of suppliers of eco-efficient processes, products and services that will ultimately raise productivity. So the modern environmental industry not only has a high growth rate, it also benefits the economy as a whole. This was the core idea of the principle of an “ecological modernization” that was developed in Germany during the 1980s and is today supported mainly by China.
8. How do people respond to you on your travels? Is the transformation having an impact on Germany’s image abroad?
Ten years ago, in countries like the USA, France or Japan, we would hear reactions like: “These Germans are crazy”. Now things are completely different. It has become clear in the meantime that eco-efficiency – in other words, raising resource productivity in an environmentally friendly way – can generate marked economic success. It has probably become the most important dimension in international innovative competition. More and more countries are adjusting to this competition, especially China and the United States. Germany is recognized as a paradigm here. “Lesson drawing” is the aim of many visitor groups.
9. But for all this success, can the ambitious climate targets really be met?
The bad news is that climate change is much more dangerous than even the Intergovernmental Panel on Climate Change (IPCC) once calculated. In fact, there is now no doubt among experts that climate targets will have to be further tightened. The good news is that the technologies needed, and their potential to solve problems, have also been underestimated. Another factor is an experience that Germany made, especially after 1998, that ambitious climate targets stimulate technical progress and can lead to successes in new forward-looking markets. We recognize this now. Germany already beat the Kyoto target in 2007, and the green electricity target has been raised twice. What is new is what you might call the “acceleration effect” of such a policy: the innovation effects of an ambitious climate policy expand the political room for manoeuvre. Where the issue used to be simply modest energy conservation in buildings, now we’re talking about passive houses or even plus-energy houses which can also power an electric car. This pace of technological progress, therefore, justifies ambitious climate targets – also for economic reasons.
10. This sounds very optimistic, Professor Jänicke ...
Well, I’m only talking about the half-full glass. I haven’t mentioned our coal-fired power stations, or the mistakes made by the German car industry that are losing us tens of thousands of jobs. These issues relate to the other half of the glass and to the effects of our wrongdoing on the climate. Nevertheless, I believe that the German tendency towards self-pity shouldn’t prevent us from recognizing the roads to success, moving forward along these roads, and sharing positive experiences.
