The cabinet of Chancellor Olaf Scholz has approved a wide-ranging reform of Germany’s energy laws that should triple the expansion of renewables additions on land and at sea within a decade to reach climate neutrality, and ensure energy supply security in the wake of Russia’s war on Ukraine.
At the heart of the so-called “Easter package” of legislation is a new principle to be anchored in the country’s constitution that the use of renewable energies is in the “overriding public interest” and serves public safety. Economics and climate minister Robert Habeck expects the priority stipulation will greatly reduce the possibility for court challenges, particularly against wind power.
With the amended legislation and improved conditions for green energy expansion, Berlin aims to boost the share of renewables in the country’s power mix to 80% by 2030 and nearly 100% by 2035.
“The Easter package is part of our agenda and has been worked out under high pressure in recent months,” Habeck said on Wednesday.
“In view of Russia’s war of aggression against Ukraine, which violates international law, it has now taken on a double urgency.
“For one thing, the climate crisis is taking on threatening dimensions. On the other hand, the invasion of Russia shows how important it is to phase out fossil fuels and to consistently push ahead with the expansion of renewables.”
10GW of onshore wind and solar each per year
To achieve the 80% renewable power share by 2030, onshore wind installations are targeted to rise to an average of 10GW per year (from a mere 1.9GW in 2021), to reach a cumulated capacity of 115GW at the end of the decade (from 56GW at the start of this year).
The solar expansion is slated to soar to a staggering 22GW per year on average (from 5.3GW in 2021), to reach 215GW of cumulated capacity by 2030 (from 59GW at the end of last year) spread over ground-based and rooftop arrays.
Community wind power projects of up to 18MW will be exempt from the need to go through tenders, as will solar arrays of up to 6MW. Rooftop solar power fed into the grid will also receive higher support levels than previously.
To boost the expansion of onshore wind, the government wants to introduce legislation in May to reserve 2% of Germany’s entire territory for wind power. But the measure is still being discussed with states, and would meet with resistance from Bavaria — the country’s largest state by land mass, which so far has refused to scrap a damaging wind distance rule.
Non-price criteria for offshore
In offshore wind, the government in the future will hold current tenders of pre-developed areas as contract for difference (CfD) auctions. It also plans to allocate further capacity in tenders for new areas that have not been pre-examined, which will have non-price criteria as additional feature in auctions.
Non-price criteria could be the energy yield, signing of power-purchase agreements (PPAs) to facilitate the decarbonisation of industry, or the use of recyclable rotor blades.
Offshore auctions will also include an additional payment by the developer for the acreage — which in essence means negative bidding — that among other things is slated to finance grid access.
Wind at sea will also gain the status of being of “overriding public interest”, watering down a prohibition to build projects in nature conservation areas.
Berlin aims to boost Germany’s offshore wind capacity to 30GW by 2030, 40GW by 2035, and 70GW by 2045.
Simpler permitting for grids
The government also plans to simplify planning and permitting to boost the expansion of power grids, and has already announced it will abolish the renewables levy (EEG surcharge) on 1 July, which so far has had to be paid by consumers to finance the expansion of renewables.
Support for operators in the future will be financed through a climate fund that is in part fed by CO2 pricing and the federal budget.
In addition, a new tendering segment is to be introduced to boost innovation linked to green hydrogen. In order to stabilise the fluctuating generation from renewables and to test storage in hydrogen and reconversion in practice, innovative concepts of renewable energies with local hydrogen-based electricity storage are to be promoted, thereby promoting the market ramp-up of hydrogen technology.
“To this end, system combinations are funded in which renewable energy systems are supplemented as an energy supplier by a local chemical electricity storage system with hydrogen as the storage gas,” the economics and climate ministry said.
‘Example for rest of Europe’
Renewables groups were mostly positive in their reaction to the more than 500 pages of legislative changes contained in the Easter package.
Manufacturers association VDMA Power Systems welcomed the accelerated renewables expansion as well as the goal to make gas-fired power stations hydrogen-ready.
Its managing director Dennis Rendschmidt cautioned however that “there is an urgent need for close scrutiny of the planned qualitative criteria for offshore tenders.
“Qualitative criteria, for example on the sustainability of technologies, must be simple, internationally standardised and implementable in order not to unnecessarily increase production costs or delay processes.”
WindEurope CEO Giles Dickson said Germany’s Easter Package is an outstanding collection of measures that will drive the expansion of both onshore and offshore wind.
“Big auction volumes. A clear long-term auction schedule. And crucially, major steps to simplify the permitting of wind farms — without which the targets would be purely academic,” Dickson said.
“It’s a great example for the rest of Europe.”
The Easter package still needs to be approved in parliament, where it could suffer slight amendments.