Merkel Lobbied by Wind-Energy State to Ease Renewable Aid Cuts

March 19, 2014 by  
Filed under Green Energy News

Chancellor Angela Merkel’s planned
revamp of the German energy industry may crimp the onshore wind
expansion that’s key to her unprecedented switch from nuclear to
renewable power sources, the country’s top wind state said.

Schleswig-Holstein, a region of 2.8 million people that
borders Denmark, is pressuring Merkel’s government to accept a
more generous target for land-based wind installations and give
developers more time to claim the current, higher subsidies,
said the state’s Prime Minister Torsten Albig.

“Onshore wind is the cheapest and most developed renewable
source and can help” reduce the cost of Merkel’s plan to raise
the share of renewables in the power mix to 80 percent by 2050
from about a quarter now, Albig said in an interview in Kiel.
“That’s why we so vehemently support it.” The region last year
added the most onshore wind capacity of all 16 German states.

From Schleswig-Holstein in the far north to Bavaria on the
Alpine rim, German states are jostling to slow plans hatched in
January to lower aid for new clean-power projects. Merkel says
the “Energiewende,” or energy switch, is her most important
project and has set a deadline for April 8 to get states and
industry to back a bill setting new subsidies and capacity caps
in a major overhaul to the 14-year-old EEG law.

‘De-Industrialization’

So far, Economy and Energy Minister Sigmar Gabriel hasn’t
budged on his proposals for new tariffs or capacity targets,
Albig said. Gabriel said in January that Germany risked “de-industrialization” unless electricity costs are cut. The
country’s consumer power bills are the highest in the 28-state
European Union behind Denmark, according to Eurostat data.

Squabbling over the costs of expanding renewable energy may
jeopardize the core aim of Merkel’s energy switch — phasing out
nuclear plants operated by EON SE (EOAN), RWE AG and EnBW Energie
Baden-Wuerttemberg AG by 2022. That deadline may have to be
postponed to help reduce energy costs, Peter Ramsauer, chairman
of the parliament’s Economic Committee, told Der Spiegel this
week. Albig said Ramsauer’s comments are “irresponsible” as
nuclear power is expensive and is “killing people.”

The government’s proposal to cap onshore wind installations
at 2.5 gigawatts a year should not include projects to replace
older turbines, the so-called repowering, because doing so would
lead developers to rush through projects, Albig said. Developers
should also be able to claim the current aid if they connect
their projects to the grid by year-end, from the current
proposal of Aug. 31, he said.

Tariffs Cut

Merkel aims to slash feed-in-tariffs across all renewable
sources to 12 euro cents a kilowatt-hour on average by 2015,
from the current 17 euro cents, according to an Economy Ministry
document. New onshore projects in northern Germany may get as
little as 6 euro cents under the new plans, Deputy Economy
Minister Rainer Baake said March 17.

Germany added a record 3 gigawatts of onshore wind last
year, including 766 megawatts of repowering according to the BWE
industry group. Schleswig-Holstein accounted for 14 percent of
the domestic market and hopes that an increase in offshore wind
installations will be a boon to its ports including Buesum and
Brunsbuettel.

Merkel’s government needs to voice “a clear commitment”
to offshore projects that have been derailed by insecurity over
future aid, Albig said. It’s “very questionable” that Germany
can reach its new, lower target of 6.5 gigawatts of sea-based
turbines by 2020 with current proposals, he said.

Merkel and Gabriel have invited Albig and the 15 other
state premiers to discuss the reform on April 1, Sueddeutsche
Zeitung reported today. Albig said he’s “confident” that an
agreement can be found soon.

To contact the reporters on this story:
Brian Parkin in Berlin at
bparkin@bloomberg.net;
Stefan Nicola in Berlin at
snicola2@bloomberg.net

To contact the editors responsible for this story:
Reed Landberg at
landberg@bloomberg.net
Alex Devine, Randall Hackley

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