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Germany

Germany

Onshore projects fail to win over federal government

While federal plans appear to promote offshore wind at the expense of onshore, two state governments' new rules favour onshore. Animosities are emerging in the German wind industry, as the country's federal environment ministry looks set to favour offshore wind, while reducing support for onshore. The changes were revealed in amendments to the renewable energy law for implementation at the start of 2012.

Among the federal government changes affecting onshore wind, the 1% annual cut in feed-in tariff for new turbines on line each year is to be enlarged to 2%. Bonus payments for new turbines with sophisticated equipment to support transmission network operation will stop at the end of this year instead of 2013. The bonus for retrofitting old turbines will continue until the end of 2015, but will be restricted to those commissioned between 14 and 17 years ago.

In contrast, offshore wind energy, which mainly involves major energy companies, is to receive a new optional starting tariff of EUR0.19/kWh, payable for eight years, which is particularly helpful for energy companies that are funding projects from their own resources. The current tariff of EUR0.15/kWh is payable for 12 years. The introduction of an annual decrease in payments is to be postponed to 2018 from 2015, but will fall more sharply by 7% instead of 5% when it does come into play. A EUR5 billion credit programme for securing finance for the first ten wind stations should facilitate project financing.

"The cocktail of changes for onshore wind will not accelerate its wind growth but rather cause a measured shrinkage," president of the German Wind Energy Association Hermann Albers told delegates at the "Branchentag Windenergie NRW" conference in Essen last month. "We must fight to change this, if necessary with public demonstrations," he added.

Referring to the grip that major energy companies' have on the offshore wind industry, North Rhine Westfalia's (NRW) environment minister Johannes Remmel added: "It is wrong to set offshore against onshore wind. Small companies must continue to have a perspective. If policy is made for the large companies it obstructs the surge of initiatives towards a new energy landscape."

But Thorsten Herdan, managing director of the power systems division of major engineering federation VDMA, was more optimistic. "I don't believe offshore will oust onshore," he said. "The wind lobby won't need to take to the streets."

Albers fears poor treatment of onshore wind may be part of a federal government return to its pro-nuclear stance. Initial announcements on speeding expansion of renewables in parallel with a swifter phase-out of nuclear after the Fukushima nuclear disaster are fading in the face of warnings from the conventional energy sector against moving too fast; about high costs; and that renewables capacity will be insufficient, he said. Indeed, the federal environment ministry admitted earlier in May that it is merely sticking to the Energy Concept ambitions for renewable energies decided in September 2010 rather than taking steps to speed renewables growth to replace nuclear power.

States favouring onshore

The changes faced by onshore wind are frustrating, in particular for federal states such as NRW and Baden-Wurttemberg in which new governments have brought a more positive attitude to wind. Across Germany, onshore wind energy potential is huge if conditions are right to exploit it. Using suitable locations covering just 2% of Germany's total area for wind energy would allow 198GW of onshore capacity. This would generate around 390TWh a year or 65% of current annual electricity use (600TWh), according to a report published in March for the federal wind energy association.

The new Social Democrat/Greens Party coalition government of NRW, which came to power in May 2010, is preparing a new climate protection law, expected to be passed this month to cement a move away from nuclear power. Permitting guidelines will be transformed, removing turbine height restrictions and bringing distance-to-housing limits into line with other federal states. The NRW government targets would see wind energy comprising 15% of electricity supply by 2020 compared with 3% at present. A five-fold increase in wind energy capacity would raise the state's wind fleet to around 15GW compared with just under 3GW at the end of 2010.

Baden-Wurttemberg's change to a Green Party/Social Democrat coalition after elections in March 2011 has also signalled a change in attitude to wind energy. "We will end the blockade against wind energy instituted by the previous state government," the government partners say. Its aim is for wind to make up a 10% share of the state's electricity supply by 2020 compared with about 1% in 2010. This ten-fold increase would raise Baden-Wurttemberg's capacity to about 4.7GW.

Given attractive support conditions, these two states alone could achieve up to 16GW of new onshore wind by 2020 - more than the 10GW offshore that is due online over the same period from projects in the North and Baltic Seas but at considerably lower cost to the consumer.

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