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Shift to tenders 'three goal' failure for German wind sector

Goals for installation targets, price cuts and diversity of players all missed since 2017 EEG reform, WWEA study finds

Germany’s government has missed all three self-imposed targets associated with a shift to tenders in the allocation of support for renewable energy, a joint study by the World Wind Energy Association (WWEA) and the Renewable Energy Association of North Rhine-Westphalia (LEE NRW) has found.

“The German government has missed all three goals, which it had linked to the introduction of auctions: neither has it reached its installation targets nor have the auctions achieved cost-effective results. Also the diversity of actors has suffered greatly since the beginning of 2017, which calls into question the acceptance of wind energy and the energy transition as a whole,” WWEA secretary general Stefan Gsänger said.

“Germany was once a global role model for the introduction of renewable energies, not only technologically but also through the strong involvement of its citizens. This role model has been lost since the introduction of auctions.”

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The government in a reform of its Renewable Energies Act (EEG) that kicked in in 2017 had shifted the allocation of most support for renewable energy to tenders.

While prices have fallen and the expansion has increased in the solar sector, wind energy was plagued by flaws in the auctioning system, prices that at first went down but then up again, and lately a dramatic fall in installations in the wake of a permitting malaise.

Within the scope of their two-and-a-half-year study, WWEA and LEE NRW investigated the effects of switching from fixed feed-in tariffs (FITs) to auctions on the community wind sector. In addition to an analysis of the legal framework conditions, affected community wind actors were interviewed several times in the years 2017 to 2019.

The study will be available in English next week, the German version can already be downloaded.

Industry experts interviewed for the report rated the auctions from the beginning as very negative, especially regarding the additional risk and greater complexity, WWEA stressed, adding that many in the sector wished for a return to the previous system of FITs.

At the same time, significant obstacles related to licensing laws, particularly inthe areas of air traffic control, military airspace use and nature conservation, are preventing the further expansion of wind energy throughout Germany, the association said.

Those factors have also been cited by other wind groups, such as the larger German wind power federation (BWE) as main reasons for a painfully slow permitting process that is currently pushing down wind power installation figures.

To find ways out of the crisis, energy minister Peter Altmaier this Thursday is meeting the wind industry and representatives of nature conservationist groups.

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Planning has been made even more difficult in the state of North Rhine Westphalia (NRW), where a new state development plan that came into effect in July 2019 in principle introduces a distance of 1.5km for new wind projects, practically a forest ban and obligatory regulation of wind energy via regional planning.

“In addition to distortions caused by the auctions and considerable barriers under licensing law, the state government's new planning law requirements are creating strong problems for community wind,” LEE NRW Managing Director Jan Dobertin said.

“In the future, hardly any land will be available for community wind projects. For wind energy development, this is highly counterproductive.”

The study has issued a series of recommendations to overcome the current crisis:

· A clear commitment to the full transition to renewable energy with wind energy as a cornerstone and as a fundamental part of an effective climate change mitigation strategy.

· In accordance with the principle of subsidiarity, a clear commitment to the importance of community energy and its many advantages, as well as to the creation of framework conditions conducive to the further development of community energy.

· Inclusion of the priority for renewable energies in a national climate protection law or in constitutional law at state and federal level.

· Creation of a non-discriminatory remuneration system beyond auctions, in Europe in accordance with the decisions by the European Court of Justice.

· Prompt and rapid reduction of bureaucratic barriers and hurdles under planning law such as general minimum distances.

· Strengthening local energy concepts and promoting local and regional approaches to sector coupling.

· Promotion and further development of prosumer models as e.g. decided at European level.

· Promoting cooperation of community energy actors, regional, national and cross-border.

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