BSW slams surcharge extension plan

Extending a surcharge to finance renewables to include self-consumption, as Germany’s government plans, would lead to €300m ($410m) in additional costs for the country’s Energiewende – its move from nuclear to renewables – industry federation BSW Solar claims.

A draft proposal for a reform of Germany’s renewable energies act (EEG) by energy minister Sigmar Gabriel foresees that owners of renewable installations from 1 August 2014 will have to pay 70% of the surcharge for power they use themselves.

The surcharge – currently at €0.062 per kilowatt hour – currently only has to be paid for electricity fed into the power grid. It finances the difference between wholesale power prices and feed-in tariffs (FITs) and thus is slated to help the build-up of renewable energy capacity.

Gabriel and many in Chancellor Angela Merkel’s conservative-social democrat coalition argue that owners of roof-top PV installations are free-riders of the power grid, using it when needed while not contributing enough for its expansion and operation.

At the same time, the government grants an increasing number of energy-intensive industries an exemption to the payment of the surcharge.

“The intention of the federal government to distribute the costs of the Energiewende on more shoulders is correct,” says BSW managing director Carsten Körnig.

“Yet it is those causing environmental and climate damages who should carry the costs of the Energiewende first. It is incomprehensible that the power to run coal plants and mining operations remains exempt from the EEG-surcharge to a great extent, while users of self-produced solar power should pay up.”

The BSW explains that the €300m in extra costs would arise as without the incentive to save costs by using self-produced energy, fewer solar panels would be installed that are aligned for an optimum self-consumption. Instead, owners would feed more electricity to the grid for which they would receive FITs.

The measure, coupled with an ongoing degression in PV FITs, would also slow down the expansion of solar power further, the federation says.

The levy on self-consumption would also extend the amortization period for solar plants by several years, likely choking off the fledgling trend toward renewable self-consumption among businesses.