![]() Now, there’s a draft on the table spelling out how the new rules will work. The government first decided to address these issues by reforming the Renewable Energy Act in 2014. In addition, the EU said it favoured the introduction of market-based mechanism for renewable support - But opinions differ on whether this was an important factor for the reform. Household power prices have gone up, prompting calls to put a cap on development. On top of this, integrating all that fluctuating renewable power into the existing grid has become increasingly complicated, resulting in further costs. In 2015, consumers paid more than 20 billion euros to green energy producers through these surcharges. The difference between the feed-in tariffs and the (mostly falling) market price is passed on to consumers in the form of a surcharge added to their power bills. With more and more green power fed onto the grid at above-market prices, the bill has got bigger and bigger. The share of renewables in the country’s electricity generation rose from 3.6 percent in 1990, when the law was enacted, to 30 percent in 2015.īut critics point out that costs have also shot up. As a result, Germany now boasts more than 1.5 million renewable power facilities. Growing demand meant the cost of renewable installations fell fast and the fixed tariffs offered lucrative returns. These so-called “feed-in tariffs” for green energy spurred a huge wave of renewable energy projects in Germany by offering safe returns on investment. Under the Renewable Energy Act, which has been imitated around the world, any renewable power investor – be it a household installing a solar array on the roof, a cooperative erecting a windmill, a farmer running a biogas installation, or an institutional investor operating an offshore wind park – could sell their green electricity at a guaranteed price above wholesale market price, fixed in advance for 20 years (for more details, see the factsheet Defining features of the Renewable Energy Act (EEG)). With Germany’s energy transition – or Energiewende – so far largely limited to the power sector, the country is in effect revamping the cornerstone of the project. This law is about to undergo the most profound changes since its inception a quarter of a century ago. ![]() This achievement has been possible thanks to Germany’s financial support system for green power, enshrined in the so-called Renewable Energy Act ( EEG). Over the year, the world’s fourth largest industrial nation now covers around a third of its total electricity needs with renewables. On the rare spring and summer days when bright sunshine comes with strong winds, pushing renewable power production to a peak, Germany can almost cover its entire electricity demand with green power, at least for a few hours at a time. ![]() The renewable sector, which employs hundreds of thousands of people in Germany, fears that “putting the breaks on the energy transition” will put many jobs at risk. They say the changes will put Germany’s climate targets beyond reach, and sound a death knell for citizen-owned energy, so far a fundamental part of Germany’s shift to green power. In effect, it will slow down the rate of renewable expansion seen in 20. The controversial reform will expose the renewable power sector to market forces, and at the same time set strict caps on its growth for the first time. Patrick Graichen, head of energy think tank Agora Energiewende, begs to differ: “It’s the logical next step for renewables.” “The reform is Germany’s first fall of man since the Paris Climate Agreement,” says Greenpeace energy expert Tobias Austrup. But Germany’s overhaul of the core law behind the country’s shift to renewables has touched a nerve. ![]() Renewable companies sending employees out to demonstrate, Twitter campaigns, protest advertisements, and repeated late-night negotiations at Angela Merkel’s chancellery – rarely has a rather technical energy policy reform caused such a storm. ![]() Content: A controversial reform Rapid Growth of renewables What is the Renewable Energy Act? A new era for renewables Will the reform lower costs? Climate targets in danger? The end of citizens’ energy cooperatives? ![]()
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