China would possibly have provided up to $42 billion in unpaid subsidies for renewable energy, but this pales in comparison to the huge amount of cash Europe is injecting into ambitious renewable transition plans at a time when the continent is devastated by a global pandemic.
Germany recently presented a $145 billion (130 billion euro) stimulus package for Europe’s largest and most powerful economy. Of this amount, Bloomberg has estimated that approximately $48.7 billion (41 billion euros) have been allocated to renewable energy and electric cars. The government has been particularly beneficiary with electric cars: it has higher subsidies for electric cars to the extent that it has made some models less expensive to acquire than comparable models supplied with internal combustion engines. Some electric cars, Automotive News reported earlier this month, are even on the loose thanks to higher subsidies.
Other European countries are also beneficiaries with EV subsidies, not too beneficiary, according to this research by Argus Media. Germany is by far the ultimate beneficiary, providing electric car buyers up to $10,000 (9,000 euros) for less expensive electric cars. In France, Spain and Italy, diversity subsidies from $4,750 to $8,300 (4,000 to 7,000 euros).
However, most of this support focuses on low-end electric cars, not Teslas, some incentives, such as tax exemptions, are in place for all-electric cars.
China is by far the highest active investor in solar and wind energy, crowning global ratings for years. Last year, China announced that it would cut renewable energy subsidies to $807 million this year. This unpaid subsidy bill may have something to do with it, as does the fact that lower solar and wind energy prices have led to a reconsideration of the need for government of these industries.
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But this year, something attractive has happened. China’s Ministry of Finance reversed the 2019 decision, declaring that sun and wind subsidies would be $13.2 billion (92.39 billion yuan) this year, 7.5 percent more than last year. That, according to CMB International Securities analyst Robin Xiao, would charge the government about $28.6 billion this year (200 billion yuan), he told Bloomberg. The great beneficiary of the accumulation of this subsidy would be solar energy, despite the immediate decline in the structure and operating prices of solar farms and Beijing’s requirement that all renewable energy projects applying for subsidies have to be as reasonable as possible. the equivalent of coal. Plant.
Germany also actively spends on solar power. In fact, Merkel’s government last year removed the solar subsidy limit to increase capacity more quickly. Previous plans required suspension of subsidies for solar projects once Germany’s installed capacity reached 52 GW. However, the government will later eliminate this stipulation in the face of climate protests and the reality of having to comply with the call of the country’s force even after the closure of its coal-force plants.
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In fact, it’s smart news. It is not unusual, but it reluctantly accepted that renewable energy has a tendency to inflate application costs for the average taxpayer, despite all the government’s incentives to make the difference more acceptable. The fact that the prices of the sun and wind are falling as a result of the evolution of the generation should be appreciated.
Europe is also large in hydrogen. Clean hydrogen, to be precise. The EU plans to build a blank electrolysis capacity of around 6 GW in just 4 years, which means a production of 1 million tons of hydrogen. It is expected to succeed in 40 GW until 2040, capable of generating 10 million tons of hydrogen. Since the production of blank hydrogen is based on the use of electricity generated from renewable sources, the EU will need to be strict in its renewable energy capacity targets.
There are currently indications that governments are adhering to subsidies for renewable energy and electric cars for a observable future. Add to that hydrogen cars, which are not reasonable either. How much you would charge taxpayers is a complex consultation based on government policy. One thing is certain, however: this will not be minimal, especially if Germany and France are willing to release electric cars for consumers in order to stimulate demand.
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