PHOTON International The Photovoltaic Magazine

German Ministry of the Environment publishes its draft for Renewable Energy Law revision

On Aug. 13, the German Federal Ministry of the Environment completed the draft for the revision of the Renewable Energy Law (EEG). On the same day, the various government departments were asked for their opinions on the 15-page document. The solar lobbyists already have provided the first comments: their first impression is satisfaction, though they still see room for improvement, especially when it comes to the subject of systems on undeveloped areas.


Unequal treatment: In the future, subsidies for solar electricity will depend on size and system location.

The Federal Ministry of the Environment's (BMU) draft amendment of the EEG looks like it will be a good thing for renewables in general, and PV in particular. Both the 5 MW cap for a single PV system and the limit of 100 kW for systems on undeveloped areas have been removed. Moreover, the draft bill imposes no restrictions on the total installed PV system power in Germany eligible for the feed-in tariff, which under the current law is limited to 1 GW. With the removal of all three caps, the BMU has satisfied the major claims of the solar industry lobby.

After Jan. 1, 2004, remuneration for solar electricity for newly installed systems will be as follows: the base feed-in tariff will be 43.4 euro cents (48.7¢) per kWh – that's the level of the funding foreseen by the current EEG for 2004. As long as the system is on top of a building, the rate rises by 15.6 euro cents (17.5¢) per kWh for up to 30 kW, and by 11.6 euro cents (13¢) per kWh for more than 30 kW. This increase is designed to compensate for the expiration of the 100,000 Roofs Program (see PI 8/2003, p. 10). Facade systems receive an additional 5 euro cents (6¢) per kWh, which brings the incentive to a maximum of 64 euro cents (72¢) per kWh for this type of application with power levels of less than 30 kW.

The lowest incentives are paid out to ground-mounted PV systems, whose operators have to live with a tariff of 43.4 euro cents (48.8¢) per kWh regardless of system size. Systems on undeveloped areas are only eligible for funding if »the system is being operated within the scope of a development plan according to paragraph 30 of the construction bill."« Furthermore, when designating future construction sites, the premium rate is only paid if the system is located on an already »sealed« area or on grassland that was previously used as farmland. This could prove to be a handicap, since up until now, PV systems could be installed in almost any area with few exceptions (for example, nature reserves), without the need for a development plan. In the future, this will make the search for a suitable location much more difficult.

Solar industry and nature conservation lobbyists wrangled in particular over how systems on undeveloped areas would be treated up until the last minute before the EEG draft was released. The current arrangement is a concession to the opponents of ground-mounted PV systems.

One positive aspect of the draft is that it clarifies several controversial legal questions, which will help prevent clashes between system and grid operators in the future. It especially clarifies that grid operators can't make payments dependent on the conclusion of feed-in contracts. Hence, the BMU follows the view recently expressed by the German Federal Court of Justice. In the future, the revised EEG should make it impossible for grid operators to force system operators to accept inauspicious contracts.

By and large, it's good for PV

Yet the level of the new feed-in tariff is very tightly calculated. Investors will only be able to make up for the loss of the 100,000 Roofs Program if the alternative low-interest loan program, the CO2 Reduction Program, goes smoothly and if it can be used without restrictions. A rate of 43.4 euro cents (48.8¢) for ground-mounted systems could prove to be too low to attract investors. If the obstacles built into the EEG for systems on undeveloped areas prove insurmountable, it could have a braking effect on the growth of the solar industry.

The first opinions on the draft came from the Green Party's parliamentary group, the German Solar Energy Business Association (UVS), and the Federal Solar Industry Association (BSi). All of them were quite satisfied, though they still see room for improvement, especially when it comes to incentive levels and systems on undeveloped areas. Carsten Körnig, UVS managing director, considers the conditions set for systems on undeveloped areas »a sad, unnecessary compromise with nature conservancy groups."« According to Körnig's estimates, the law should provide a minimum rate of 53 euro cents (60¢) per kWh. Georg Salvamoser, BSi's chairman of the board, is certain that »remuneration rates [for systems on undeveloped areas] will only be enough in exceptional cases."«

There's still time over the next few weeks to make improvements. The draft resolution was only sent to the appropriate departments on Aug. 13. In one or two months, the comments should have been received at the BMU, which will revise the draft, and submit it to the Reichstag, Germany's lower house. In the weekly magazine Die Zeit, the Minister of Environment Jürgen Trittin was quoted saying that the revised EEG will go into effect »sometime between Jan. 1 and July 1, 2004.« But the current draft ensures that investors whose systems go online starting Jan. 1 will receive the newer, increased feed-in rates.