Annual Report 2016
Country Reports


Jochen Bard and Fabian Thalemann Fraunhofer IWES

The further expansion of renewable energy is one of the main pillars in Germany’s energy transition. To achieve this, a successful instrument to promote green electricity was conceived: the Renewable Energy Sources Act, which entered into force in 2000. This law had the aim of enabling new technologies such as wind and solar energy to enter the market with support provided by fixed tariffs, a purchase guarantee and priority feeding-in of renewable electricity into the grid.

The Renewable Energy Sources Act has built a platform for the expansion of renewables, enabling them to emerge from a niche to become one of the mainstays of Germany’s power supply, generating 25% of electricity. However, the rapid expansion also resulted in a rise in the surcharge imposed under the Renewable Energy Sources Act (“EEG surcharge”). In addition, it posed a growing challenge for the stability of the electricity grids and the security of our energy supply. 

The amendment of the Renewable Energy Sources Act in 2014 was therefore an important step towards ensuring the continued success of Germany’s energy transition. The revision particularly aims to substantially slow any further rise in costs, to systematically steer the expansion of renewable energy, and to bring renewable energy more and more to the market. It is clear that for energy-intensive industries, the price of electricity is a major factor in their level of competitiveness.

It is vital that the competitiveness of electricity-intensive industries - which already pay high electricity rates in comparison to their international competition - is not jeopardised and that value creation and jobs are retained in Germany, because the economy’s industrial core is of vital importance to prosperity and employment in Germany. At present, there are plans to alter certain aspects of the special equalisation scheme of the 2014 Renewable Energy Sources Act (inclusion of hardening plants and forges). The Federal Government adopted a corresponding bill on 1 April 2015.

The expansion of renewable energy in Germany is successful - renewables accounted for roughly 32% in 2015, and the policies now being put in place mean that their share is to rise to 45% by 2025. The 2014 Renewable Energy Sources Act (EEG 2014) paved the way for expanding renewables in a way that is both reliable and easy to plan, and that makes them fit for the market. The 2017 Renewable Energy Sources Act now heralds the beginning of a new stage of the energy transition - one that will be based on new rules: rather than being fixed by the Government, future rates of renewables funding will be determined by the market by means of dedicated auction schemes from 2017. This is because renewables have matured and are now ready to compete on the market. The new auction scheme is to ensure that the expansion of renewables proceeds at a steady and controlled pace and at a low cost.

The legislation also enables us to make sure that the high level of market-player diversity that has characterised the energy transition will be upheld. The law gives the first-ever definition of a “citizens’ energy company” and provides for these to participate in the auctions on simplified terms. Also, small installations are exempted from the auctions. The new (2017) version of the Renewable Energy Sources Act will enter into force on 1 January 2017.

The Federal Ministry of Economics and Energy (BMWi) is promoting research and development in the field of renewable energies within the framework of the energy research programme of the Federal Government. Projects are supported in wind energy, photovoltaics, deep geothermal energy, low temperature solar thermal, solar thermal power plants , hydropower and ocean energy and finally integration aspects of renewable energies in general.

For the production of electricity from hydropower the natural flow of the water - primarily from rivers or reservoirs - is used. In the area of the seas, the tidal and the energy content of the currents and the waves can be used for the generation of electricity. The advantage of hydropower and ocean energy compared to wind energy and photovoltaics is seen in the fact that the energy can be provided with less fluctuation and can be predicted more reliably. Hydropower is a proven source of energy, but it is already used in most of Germany’s suitable locations. The use of ocean energy, on the other hand, is still in the demonstration stage worldwide and is not considered suitable for use in Germany.