Record year as biggest national market peaks -- German wind slowing

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German wind power capacity increased as never before in 2002, with 3247 MW going online to bring the country's total to 12,001 MW. But 2002 is also expected to go down in history as the year the German wind market passed its peak. Despite the record volume of new megawatt, the annual growth rate slowed from 44% to 37%, the biggest drop in three years. Moreover, the increase in the year-on-year increment dropped dramatically, from 59% for 2001 to just 22% in 2002. The next ten years will see decreasing volumes of wind capacity installed and by 2012 growth onshore will be zero, according to Deutsches Wind-Energie Institut (DEWI), the German wind energy institute.

Offshore wind power, however, is expected to take up some of the slack. It will begin at 50 MW in 2004, with annual installations rising year by year to 1200 MW in 2013 and peaking at new installations of 2300 MW in 2017, DEWI says. Over the whole period, the sum of new installations onshore and offshore is not expected to drop below 1000 MW a year, but it's still a far cry from more than 3000 MW a year.

Lack of further wind sites to develop is the main reason for the German market's maturation, not lack of public and political goodwill towards wind power. Land earmarked by local authorities for wind is slowly being fully developed, particularly in the coastal windy states such as Schleswig-Holstein, which has been overtaken by three inland states this year (table). Activity has been moving to the windswept more open areas in the east, Brandenburg being a prime example, where the permitting procedure is finally running smoothly. Wind power still has the strong support of the federal Social Democrat/Greens coalition government which, although currently under pressure, has in principle another three and a half years in power before the next general election.

In January, federal environment minister Jürgen Trittin of the Greens Party -- who has wrestled responsibility for renewables development out of the hands of the economy ministry -- mapped out the cornerstones for an amendment to the all-important Erneuerbare Energien Gesetz (EEG), the renewable energy law which obliges utilities to buy all wind power at a premium price stipulated by government. The price falls each year according to a declining scale. The amendment is to be put before parliament later this year.

Trittin stresses the importance of reaching a consensus with the opposition and recent statements from the conservative Christian Democratic Union and Christian Social Union parties indicate they support his plans. Trittin wants support for wind stations onshore to be targeted more carefully "because I don't want to create a stimulus for development of weak wind sites."

Offshore wind stations, on the other hand, will benefit from shifting the deadline by which plant must be commissioned to qualify for the highest rate of payment for a nine year period. Instead of 2006, the deadline is now 2010. If developers miss this later deadline, offshore stations will get the highest rate of payment for just five years, as do stations on land. Rates of pay for kilowatt hours generated by wind stations far offshore may also be raised to encourage siting away from coastlines. The economy ministry is also thinking about reducing the amount by which the kilowatt hour rates decline each year for offshore stations, or waiving the declining scale entirely for offshore wind.

In a third helping hand for wind energy, Trittin hopes to co-ordinate an "export initiative" with the federal foreign and economics ministries. A world conference for renewable energies is scheduled for 2004 to promote this aim. With the domestic market now dwindling, Germany's wind turbine manufacturers need to step up their exports to survive. According to Christian Hintsch of wind association Bundesverband Windenergie exports actually dipped last year. "Enercon exported 225 MW in 2002 compared with 280 MW in 2001 and other companies look likely to have dropped back too," he says. Hintsch blames the instability of export markets for what seems to be falling German wind business overseas.

The opposition

Wind power might have broad political support in Germany, but powerful industrial forces are none too happy with the electricity levy they must pay in order to support wind power. They have the backing of an economics minister, Wolfgang Clement, who makes no secret of his support for the fossil fuel sector. The aluminium industry and others with enormous electricity needs are lobbying to be freed from their full share of the costs of the EEG's premium payments, with Clement's backing.

Trittin initially stood his ground, arguing that industry pays very low prices for its electricity. Waiving some of the EEG charges for big industry will result in a heavier burden falling on small and medium sized enterprises, families, pensioners and students, he argued. But at the end of February he indicated he was willing to examine individual hardship cases.

The large electricity utilities, too, are complaining, this time not about the cost of the EEG, but about the extra cost of balancing supply and demand that it claims are inflicted on the system by an intermittent energy source. Energy giant E.on claims to be hardest hit. Wind generated power displaced about 3 TWh of E.on's coal generation in 2002, equivalent to 0.8-1.0 million tonnes of steam coal, reducing efficiency of the coal units. At the same time E.on stepped up expensive gas-fired generation by about 1 TWh to supply balancing power for "smoothing" intermittent wind energy output.

Trittin brushes off these concerns, observing that network operators can significantly cut their costs through improved forecasting, more efficient network management and with more flexible power stations. "Replacement of old power stations is already on the agenda," he notes, adding: "The EEG serves only to promote renewable energies, not the interests of the network operators."

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