On Friday, the German Federal Ministry of Economics published the key points(link is external) of a law to tender renewable energy projects, which will come into effect in 2017. According to the document, the tendering process, which was tested earlier this year, will be mandatory for ground-mounted solar parks.
Photovoltaic systems on buildings with an output of 1 MW or more, as well as those installed at sites such as landfills, have been newly included in the process. The tendering process will be mandatory for wind farms from 2017 onwards. The only exceptions are plants with less than 1 MW capacity, prototypes and test facilities. The maximum size of wind farm projects is not specified.
Tendering process also for on-roof photovoltaic systems starting at 1 MW
The majority of private and commercial photovoltaic systems will continue to be subsidised through a predetermined feed-in tariff under the German Renewable Energies Act (EEG). In these cases, quantity control will still be implemented via the so-called 'flexible ceiling', and systems installed through the tendering process will be included in the calculation.
In the specific implementations of the tendering systems, technologies will be differentiated using customised tender designs. According to the Federal Ministry of Economics, the draft document focuses on technologies "that will make the most significant contributions to achieving the development goals of the EEG in 2014, specifically onshore wind energy, offshore wind energy and solar energy."
Federal Minister Sigmar Gabriel is utilising the leeway provided by the EU's energy subsidy guidelines, which require funding for renewable energy to be transitioned to the tendering model but nevertheless allow exceptions. The German Solar Industry Association noted that it is still too early to say with certainty whether the tendering process will be more efficient than the existing feed-in tariff model for solar energy in achieving the goal of expanding photovoltaics, as policy-makers intend. In general, however, the association welcomed the fact that small and medium-sized systems were not included in the tendering process. Nevertheless, it criticised some of the details. In the association's view, for example, it is "unacceptable that the Federal Ministry of Economics wants to exclude large roof-mounted PV systems that allow own-consumption of solar power from participating in the tendering process."
Tenders for wind energy as well
The tendering process will be mandatory for wind farms from 2017 onwards. The only exceptions are plants with less than 1 MW capacity, prototypes and test facilities. The maximum size of wind farm projects is not specified.
In order to participate in the tendering process, a permit pursuant to the German Federal Emission Control Act (BImSchG) must be obtained. The purpose of this is to ensure that bids are based on projects that have a high probability of being carried out, that their location and performance are specified and that they can be clearly categorised. In addition to this material qualification requirement, financial collateral must be deposited along with the bid. The so-called 'bid bond' will be 30 euros per kW installed capacity of the bid amount. The collateral can be submitted in the form of a bank guarantee conditioned upon successful participation or a cash deposit into a blocked account.
Criticism from the conventional energy industry
By contrast, representatives of conventional energy immediately criticised the key points. They had repeatedly demanded that small and medium-sized photovoltaic systems should only receive funding through the tendering process.
Statements, in particular regarding the consultation questions formulated in the key points document, can be submitted at the following email address until 1 October 2015: Ausschreibungfirstname.lastname@example.org(link sends e-mail). After carrying out a consultation procedure, the German Federal Government will submit a bill this year, which will then be discussed in the first half of 2016 in the Bundestag.