Wind industry manager says German govt risks massive drop in new investments

The German government’s plans for cutting energy transition costs are putting the sustained expansion of renewable energy sources at risk and leave the country reliant on fossil fuel imports for longer, the head of the German Wind Energy Association (BWE), Bärbel Heidebroek, said in an interview with newspaper Die Zeit. “Never before has a government ignored practical expertise this much,” Heidebroek said with a view to upcoming laws, the so-called grid package and the reformed Renewable Energy Act (EEG). 

The economy ministry under Katherina Reiche plans to end support for certain renewable energy categories and to reduce compensation for curbed electricity for new wind turbines and solar panels in areas with limited grid capacity. If adopted in their current form, the plans would likely lead to a significant drop in renewable energy expansion, said the renewable energy industry lobby group representative.

Cutting compensation in areas with limited grid capacity at times of grid overload would mean that operators could expect a 20-percent reduction in their earnings, she argued: “This massively worsens funding conditions and means that projects in these regions can no longer be financed.” 

Instead, the government should ensure that grid expansion happens faster and remove hurdles in the way of operators storing excess electricity and feeding it into the grid at a later stage. “This is exactly how you reduce power prices,” Heidebroek said. Renewable power operators currently have to turn off installations if the grid is at risk of overloading, with the threshold being five percent of the expected output that cannot be absorbed. “This makes no economic sense,” she said, adding that excess electricity should instead be used to fill storages, or directly supply specific end users.

The wind power industry manager said that the government should focus on grid operators. These have so far not had to face any tighter rules to ensure that electricity transmission infrastructure is put into place on time “even if bottlenecks ultimately arise due to lacking grid capacity,” she argued.  

Renewable energy industry representatives have repeatedly criticised law proposals coming from Reiche’s ministry, arguing that the planned measures could undermine the progress made in building more clean energy sources in the past years, ultimately leading to greater demand for fossil energy sources. The government argues that many renewable energy installations today are able to finance themselves on the market and that the distribution of new capacity should be better aligned with available transmission grid connections to reduce costs.