GERMANY'S RENEWABLES LAW

PLATTS - 23 Sep 2020 - The German cabinet Sept. 23 approved a reform of the EEG 2021 renewable energy law, setting a detailed expansion path for wind and solar to meet a target by 2030 of a 65% share of green electricity in the generation mix.

The law sets a legally binding target to achieve a carbon neutral power mix by 2050, energy and economy minister Peter Altmaier said.

The final version of the agreed draft adds annual targets for renewable generation, starting at 259 TWh for 2021 and rising to 376 TWh by 2029, with the government steering capacity additions accordingly.

To this end, some 40 GW of subsidized solar and wind contracts are to be tendered between 2021 and 2025, including offshore wind, with details to be set out in a separate law.

The draft also sets interim targets for installed onshore wind and solar capacity, with 2030 targets increasing solar's contribution from the climate change law passed a year earlier.

Installed onshore wind capacity is set to rise from 54 GW now to 65 GW by 2026, and then to 71 GW by 2030, via tendering of 2.9-5.8 GW a year and the management of first-generation turbines whose 20-year support periods will end from 2021.

Solar would benefit from up to 2 GW of annual tenders for ground-based projects, plus continued feed-in-tariff support for commercial and residential rooftop projects.

For biomass, the EEG is targeting 8.4 GW of installed capacity by 2030 with various forms of support.

Wind, solar, biomass and hydro combined generated 244 TWh in 2019, a 43% share in the power mix.

That share rose to 50% in the first half of 2020 amid record wind and sluggish demand due to the coronavirus crisis and a mild winter.

Cabinet also passed measures to speed-up grid expansion to integrate renewables across sectors.

Altmaier pointed out improved legislation for vessels to access electricity at ports as well as an exemption from the EEG levy for green hydrogen producers.

The levy bridges the gap between agreed tariffs for RES operators and the market value of the energy in the spot power market currently pegged around Eur25 billion for 2020 with income from a carbon tax on transport and heating to offset future gains from 2021.

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