The continued expansion of renewable energy is and continues to be one of the key pillars of the energy transition. According to preliminary data, renewables accounted for roughly 32% in 2016, a figure which is to rise to 45% by 2025. The 2014 Renewable Energy Sources Act (RES) paved the way for expanding renewables in a way that is both reliable and can be planned, and that makes them fit for the market. The 2017 heralds the beginning of a new stage of the energy transition.
Promoting renewable energy in a continuous, controlled and cost-efficient manner
The 2017 Renewable Energy Sources Act brings in a change in the way that renewable energy is funded. Since the start of the year, the level of payments for electricity from renewable energy is now determined by auctions. This is because renewables have matured and are now fit enough to compete on the market. The basic principle is that funding will go to those who demand the least for operating new renewables installations in a way that is economically viable. The idea is that auctions will be open to as many different operators as possible – from large companies to citizens' energy undertakings.
Linking the expansion of renewable energy with that of the power grid
The 2017 version of the Renewable Energy Sources Act will ensure that the pace at which renewables capacity is added corresponds to the pace at which the grids are developed. The growing shares of renewable energy are creating new challenges for the grid as, in some cases, getting electricity from generators to consumers means transporting it over long distances. In order to tackle this problem, Germany needs an efficient grid infrastructure. On top of this, the continued expansion of renewable energy needs to be well coordinated. The 2017 Renewable Energy Sources Act therefore restricts the expansion of onshore wind power in certain areas of northern Germany that suffer from grid congestion in a bid to reduce this. In addition, the 2017 RES also introduces an instrument designed to make use of electricity that is otherwise curtailed, based on the use of ‘connectible loads’.
Offshore Wind Energy Act (WindSeeG)
The (WindSeeG) (reference: p. 53, Federal Law Gazette) entered into force on 1 January 2017 as part of the 2017 Renewable Energy Sources Act. The Act stipulates that the level of funding for offshore wind-power installations is also to be determined itself by means of competitive auctions. It additionally ensures dovetailing between site planning, regional planning, approval of installations, funding under the Renewable Energy Sources Act, and grid connection. This will improve the system and render it more cost-effective. The aim is to boost the installed capacity of offshore wind energy installations to a total of 15 gigawatts between 2021 and 2030, following a set plan and in a cost-efficient manner.
On 14 November 2016, the Federal Ministry for Economic Affairs and Energy concluded the hearing of the Länder and associations on the draft schedule of fees for offshore wind auctions. Where authors have given permission for publication of their comment, the comments have been published (in German) (). The ordinance entered into force on 4 January 2017. It serves to levy fees on bidders who take part in the offshore wind auctions of the Federal Network Agency during the transitional period of the Offshore Wind Energy Act.
Revision based on an extensive consultation process
The RES 2017 is the result of an extensive consultation process, which means that the new auction scheme was discussed with the German Länder and a wide range of associations and companies.
- A comprehensive agreement between the Federal and Länder governments was reached in June 2016. The draft legislation was then presented to the Bundestag on 21 June 2016, which adopted it on 6 July 2016 following several amendments.
- In April 2016, the Economic Affairs Ministry launched the hearing of the Federal Government and the Länder regarding the draft Renewable Energy Sources Act. Subject to the author’s consent, the comments from the Länder and the associations have been published .
- The Ministry had presented the main substance of the draft act in a ‘’ (in German), which set out the details of the competition-based auction scheme and explained how these details were to feed into the draft legislation amending the Renewable Energy Sources Act. The paper set out proposals and measures for maintaining the diversity of stakeholders, particularly for funding auctions for onshore wind energy installations.
- This key issues paper was based on a consultation. The Federal Ministry for Economic Affairs and Energy had invited comments from the Länder, business associations, and companies on a previous version of the paper over a two-month period at the end of 2015. A total of 177 comments were received from the ; these were then evaluated by the Ministry.
- In the ’ (in German) the Federal Ministry for Economic Affairs and Energy had presented the broad parameters of the auctions in July 2015. The key elements were taken from recommendations in a scientific report drawn up by Ecofys, Fraunhofer ISI, Consentec, the Centre for Solar Energy and Hydrogen Research Baden-Württemberg (ZSW), Takon, and two law firms: Görg and BBG und Partner.
Funding for landlord-to-tenant electricity approved
Landlord-to-tenant electricity is electricity that is generated by a solar installation on the rooftop of a residential building and then passed on to final consumers (particularly tenants) living within this building or in a residential building or ancillary facilities located within close proximity of this building, and that are connected directly to the installation rather than via the public grid. This type of supply has the advantage of eliminating certain costs, such as grid charges, grid surcharges, electricity tax and concession fees. In summer 2017, the Bundestag and the Bundesrat approved legislation granting funding for this type of electricity. The Landlord-to-tenant Electricity Supply Act entered into force on 25 July 2017.
Under this legislation, a bonus is available for every single kilowatt hour of landlord-to-tenant electricity that is generated. This makes supplying electricity to tenants more attractive and profitable for landlords, whilst at the same reducing tenants’ electricity bills. Landlord-to-tenant electricity supply is an effective way of developing renewables in Germany. The premium is only payable to landlords who began operating their solar installation on the day the 2017 Renewable Energy Sources Act entered into force or subsequent to this date. Further information (in German) can be found .