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Germany

Germany

'Mixed bag' of reform in new German renewables law

GERMANY: The new renewable energy act, passed by the federal government, will lead to a significant slowing of the transition to clean energy, said the renewables federation Bundesverband Erneuerbare Energie (BEE).

The annual auction volume for onshore wind is fixed at 2.8GW in 2017-2019, and at 2.9GW from 2020
The annual auction volume for onshore wind is fixed at 2.8GW in 2017-2019, and at 2.9GW from 2020

WindEurope (formerly EWEA) described the reforms as a "mixed bag", more encouraging than anticipated for onshore development, but much less so for offshore, which has been subjected to lower-than-expected caps in installations.

The new Act, passed by the government on 8 July, takes effect from the beginning of 2017 and introduces a competitive auction system to set a 20-year rate of support for wind and other renewables projects.

Fixing the annual auction volume for onshore wind at 2.8GW in 2017-2019, and at 2.9GW from 2020, has been deemed a positive step by Germany’s wind energy association BWE.

This was a change from previous drafts of the law, which had onshore wind growth rates dependent on growth in other renewables sectors, despite wind being the cheapest technology.

Another change allows wind and other renewables generation that would otherwise have been curtailed due, for example, to grid bottlenecks, to feed into the heating and electric vehicle sectors.

The planned one-off reduction of 5% in support for new onshore wind in 2017, criticised as endangering projects already far advanced in planning, will now be implemented in steps of 1.05% per month over March-August 2017.

"This somewhat reduces the impact on manufacturers but does not alter the general uncertainty provoked by the measure," said engineering federation VDMA.

Offshore

The offshore wind sector is disappointed by last-minute changes. Expansion in 2021-2022 will be just 500MW a year (instead of the previously expected 730MW), and from 2023-2025 only 700MW a year.

Installations in 2021 are to be exclusively in the Baltic Sea. From 2026, 840MW is to be installed annually to 2030. The offshore target for 2030 remains at 15GW.

WindEurope CEO, Giles Dickson, said: "There is a lack of stability in the volumes. The buildout rate after 2020 will be uneven as the auctions vary in size from year to year.

"One of the biggest challenges facing Germany today is a lack of transmission infrastructure. Lawmakers must find a way to ensure that power generated in northern Germany from renewables such as onshore and offshore wind can be transferred to the power-hungry south."

Although there have been some concessions towards citizens’ projects that for many years spearheaded Germany’s onshore wind growth, the federal government has not adopted the "De-Minimus" option.

Expressly allowed by the European Commission, this would have provided exemption from the auction process by projects of up to six turbines and 18MW capacity.

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