WANTED - A LITTLE LATERAL THINKING

Although industrial companies in Germany are free to install a renewable energy plant and sell electricity from it to the grid at premium rates laid down by law, electric utilities have no such option. The Electricity Feed Law does not apply to them. Left on the sidelines all they can do is helplessly watch as their monopoly is encroached upon by a growing body of independent generators producing attractively clean electricity.

But before shedding a tear for the downtrodden German utility, let us look at the facts. If utilities went into wind plant development, it would not necessarily cost them anything. A legal precedent has already been set allowing them to hike the price of electricity to pay for any extra cost of operating a renewable energy plant. The utility just has to apply to the electricity tariff supervisory authorities for permission to do

Big industry is not likely to accept such a price rise without a fight, so the burden would most probably fall on ordinary households. This need not matter. Public opinion surveys abroad have shown that households are usually more than willing to pay a little more for electricity generated from a renewable resource. Another option for finding more cash, seldom considered in the monopolistic structure of the German energy supply industry, would be cost cutting elsewhere.

But utilities are only accustomed to introducing change when and where it suits them. The radical re-thinking needed to accept the arrival of wind plant operators in their midst is still a long way off. Nonetheless there are some emerging models of lateral thinking. Traditionally, industrial companies like BASF in Ludwigshaven have always had their own power stations. These days, when such a plant needs renewing, utilities are stepping in with offers to build the new plant or participate in a joint venture to do so. They are motivated by a desire to bind the industry to them well into the future.

In another model, described under the umbrella definition "contracting," utilities work hand in hand with power station construction companies to install new power plant for large electricity consumers as part of a general energy-saving and environmental improvement package. The power station is paid for out of the money saved from reducing consumption through energy saving.

A third model, surely, would be for utilities to come to a similar arrangement with industrial clients wanting to install wind turbines. It might only be possible at prime wind sites, but impossible it cannot be.

Sara Knight, Correspondent in Germany