Implementing the Energiewende in Germany (energy transition)
The Grand Coalition as well is adhering to the Energiewende objectives set in 2010 and 2011. Nuclear power is to be discontinued by 2022. At the same time, the proportion of renewable energies within the energy system is being greatly expanded. Emissions of greenhouse gases are to be reduced by at least 40 percent by 2020 and by at least 80 percent by 2050.
Last year, the Federal Ministry for Economic Affairs and Energy (BMWi) issued its first Energiewende in Germany progress report. The report shows that the expansion of renewable energies in electricity generation is following a very positive path and has even surpassed its set objective. Major efforts are still required with all other goals on energy transition. A similar conclusion is arrived at by the Federation of German Industries (BDI), which is supporting the Energiewende in Germany in the form of an “Energiewende navigator.” The Energiewende navigator’s findings are shown in the figure below and illustrate as a colored percentage figure the degree to which the Energiewende target has been achieved in 2014. The percentages in gray show the figures for the previous year 2013.
Renewable Energies Act (EEG) 2014
The new version of the Renewable Energies Act (EEG) in 2014 put down important markers for the Energiewende in Germany. The subsidy regime for new EEG installations was adjusted to curb the rising costs caused by the expansion of renewable energies. From the VDA’s perspective, however. Power exchange sales should have been significantly greater. Under EEG 2014, as in the past, matching funding is provided by the electricity consumer, who pays the so-called EEG levy. EEG 2014 was the first time that new self-generation power plants had been required to pay a pro rata EEG levy. These installations include, for example, combined heat and power plants.
A company operates these plants in order to use the electricity they generate for its own production. Decentralized electricity generation such as this is consistent with the Energiewende because this electricity does not need to be transported, thereby relieving pressure on networks. Despite that, the electricity from new self-generation power plants that have come on stream after August 2014, will now be liable pro rata to the EEG levy. This affects their profitability, slows their expansion and places a burden on industry, which is contributing to electricity supply through self-generation.
At least the electricity from existing self-generation plants will initially remain exempt from paying the EEG levy. However, the time limitation of this exemption and the liability of new plants to the EEG levy only apply to 2017. Thereafter, the regime for old and new self-generation plants can be completely recast under a new amendment of the EEG.
Next steps for the Energiewende in Germany
The Federal German Ministry of Economic Affairs is addressing itself to the future regulatory framework for the electricity market. The proportion of electricity generated by wind and solar is growing but the electricity network needs to remain stable. It must also be ensured that at times when only little wind and solar electricity can be fed in that sufficient electricity generating capacity is available. Legislation to this effect is planned. It is planned to amend the Cogeneration Act (KWKG). CHP plants are very common in the automotive industry. The target share of 25 percent of CHP electricity for 2020 will not be achieved by the amendment to the EEG given the prevailing circumstances. Currently, the share of CHP electricity is approximately
16 percent and is estimated to stagnate or even decline over the next few years.