Germany needs power market overhaul to reach renewables targets - industry group
The upcoming reform of Germany’s Renewable Energy Act (EEG) has to make sure that wind, solar PV and biogas installation plans receive a considerable boost, otherwise the country will not meet the government’s goal of 65 percent renewables in power consumption by 2030, Simone Peter, president of the German Renewable Energy Federation (BEE), told journalists at a press conference. Because renewables are already dominating the power market, the whole system of levies, allocations and CO2 pricing needed to be adjusted, Peter said. Currently, both onshore wind and biogas additions are lagging behind while around 17,000 MW of wind and solar capacity could be retired in the next five years due to a lack of follow-up remuneration after their 20-year-funding runs out as of next year, according to Peter. “We need to adjust the annual targets for renewables expansion upwards and find a good interim solution for the old installations,” she said.
The BEE suggests a growth path of 4,700 MW onshore wind, 2,000 MW offshore wind, 10,000 MW solar PV and 600 MW biomass annually to reach the 2030 target. Also, the government had to base its targets on a more realistic power consumption because more electricity will be needed when integrating heating, mobility and power-to-x processes into the grid. To make the use of renewable power more attractive, the renewables surcharge on self consumption of renewable power had to be abolished, the BEE demands.
Germany’s economy ministry is preparing a reform of the EEG which is due to be discussed in the government cabinet at the end of September. A first (unpublished) draft has drawn criticism for its “unrealistic” power consumption assumptions. While the EEG is hailed for triggering Germany’s renewable growth by guaranteeing generous feed-in tariffs to renewable installations, recent reforms have been all about making green energy producers more market-ready and aligning their growth with a much needed grid expansion.