German reforms restore confidence

Germany’s energy reforms are built around the role of wind power. The revised version of the Renewable Energies Act, which entered into force on 1 August, sets the course for the development of onshore and offshore wind for the coming years.

The main objective was to create a stable investment environment, while also stabilising electricity prices and adjusting funding schemes to enhance competition.

The expansion targets set out in the revised act provide clear information to all of the players involved (including operators of conventional power plants and systems operators) as to what they need to prepare for. Onshore capacity is to be increased by 2.5GW a year, while offshore will rise to a total of 6.5GW by 2020 and up to 15GW by 2030.

Together with solar, wind will thus play a key role in Germany’s energy supply — so ensuring that the different forms of renewables complement each other in the best possible way is crucial, for both the energy system and our wider economy.

In addition to providing incentives to reduce costs, we must create market-based mechanisms to ensure that the electricity markets of the future take account of the specific characteristics of wind and solar.

WindEnergy Hamburg is an ideal forum for discussing possible adjustments within the electricity markets, and for exploring possibilities for future development by showcasing innovative products. There should be a clear focus on dialogue between policymakers and representatives of industry, science and academia.

The reforms are winning back the confidence that had been lost among investors in the funding schemes for renewables. The new rules of play — some of which have been fundamentally altered — are now settled and provide a basis for investment decisions along the entire value chain.

In the offshore sector, we are seeing increased interest from investors, which will soon be reflected in the bidding procedure for the second wave of expansion in the North and Baltic seas. This means we are approaching the industrialisation phase — the stage of the learning curve at which there is potential for considerable cost reductions.

Unless costs are brought down significantly, offshore wind will not be viable in the long term. In addition to experience and innovation, uniform standards will be indispensable, so I welcome the European-level initiative taken by the German wind industry, together with counterparts in other countries bordering the North Sea.

Onshore, developers and investors are pressing ahead with their projects for the next few years, which indicates that the economic incentives are working. Our aim should be to choose those locations for construction that best serve the energy needs of our country as well as the interests of the local population, while also taking into account nature conservation. The greater the number of potential locations, the more competition, and the lower the costs along the entire value chain.

The scope for onshore expansion in Germany depends on how potential conflicts with other uses of airspace — ie, civil and military aviation and navigational facilities — can be resolved.

Whether it is introducing a blanket protection radius around civil radio navigation systems, as is being mooted, or changing the design of aircraft warning lights at wind farms, we need innovative solutions that are developed by industry and for which government creates the necessary legal framework. Ultimately, the future of wind energy will hinge on whether such solutions can be found.

I am looking forward to attending WindEnergy Hamburg this month, particularly because it highlights the importance of the wind-energy cluster in northern Germany. At the same time the city is the ideal location for a leading international trade fair because of the many wind companies, organisations and scientific institutions located there.

The Free and Hanseatic City of Hamburg has been successful in building on a stable domestic market to gain and retain a strong position in the global market. It is my hope that WindEnergy Hamburg will write another lasting, successful chapter in the city’s long, illustrious history.

Uwe Beckmeyer is parliamentary state secretary at the German Ministry for Economic Affairs and Energy

This piece was published as part of the Thought Leaders series. Recharge’s Thought Leaders Club brings together leading thinkers and participants from the renewable-energy sector to examine the key challenges facing our industry