Combined heat and power generation.

© Krüttgen

At today’s meeting, the Federal Cabinet adopted a draft ordinance on the introduction of auctions for CHP plants and innovative CHP systems and for the introduction of joint auctions for onshore wind and solar installations. In the field of cogeneration, auctions will be introduced for CHP plants and innovative CHP systems.

State Secretary Rainer Baake said: “The auctions for CHP plants are setting the course for the future. Cogeneration is a key element of the energy transition. We are on course to meet our CHP targets. The next step is to ensure that the plants are able to react in a flexible manner to the fluctuating heat and power from renewables.”

In future, funding for medium-sized CHP installations with a capacity of between 1 and 50 megawatts will be subject to successful participation in an auction of the Federal Network Agency. Plants of this size usually feed heat into urban heating networks, but they are also able to supply heat to larger commercial or industrial companies. For the first time, funding for innovative CHP systems will be auctioned. Such systems combine flexible CHP plants with renewable heat, for example from solar thermal systems or heat pumps, thus saving large amounts of greenhouse gases. The additional category of financial assistance is intended to open up promising new prospects for cogeneration and to provide incentives for necessary investment in flexible technologies.

Up to the year 2021, a total annual capacity of 200 MW will be auctioned each year, of which initially 150 MW are to come from conventional CHP plants and 50 MW from innovative CHP systems. The share of innovative CHP systems is slowly increasing.

In addition, joint auctions for onshore wind and solar installations will be introduced. The joint auctions will be introduced for a pilot phase of three years (2018-2020). The idea of the pilot project is to see in practice what effects a joint auction for onshore wind and solar installations will have. The total volume of installed capacity being auctioned in joint auctions is 400 megawatts in each of the three years.

Rainer Baake said: “Until now, the Federal Government has had good reason to opt for technology-specific auctions, as laid down in the Renewable Energy Sources Act. Such auctions increase security of supply and ensure better regional distribution of electricity generated from renewables. Yet, we want to use this pilot project to gain practical experience with cross-technology auctions. We will evaluate the results and draw conclusions on how to further design the auctions.”