EC approves state aid in German EEG law; top court rules 2030 law insufficient

London — The European Commission has approved changes to Germany's renewable energy law (EEG 2021) under state aid rules, it said April 29.

Payments under the scheme for 2021 have been estimated at around Eur33.1 billion ($40 billion).

"The German EEG 2021 scheme will provide important support to the environmentally friendly production of electricity, in line with EU rules," competition commissioner Margrethe Vestager said.

The reform introduces new features to ensure that state aid is kept to a minimum and electricity production aligns with market signals, while ensuring the competitiveness of energy-intensive companies.

New renewable projects generally receive support via a sliding premium on top of the wholesale power price, with the exception of very small installations, which will be eligible to receive feed-in tariffs.

Rules to sell electricity in line with market signals had been improved in the EEG 2021, the EC said.

Other approved modifications to the law related to levy exemptions for energy intensive companies, an exemption for the production of hydrogen and levy reductions to promote the use of shore-side electricity by ships while at berth instead of on-board fossil fuel generators.

Some details within the EEG 2021 required further EC assessment such as a special bonus for wind turbines in southern Germany, the Germany energy ministry said in a statement.

Other details required further regulation in Germany such as the exemption of hydrogen-producing electrolyzers from the EEG levy, the ministry said.

The Commission meanwhile rejected plans for an additional tender to extend support for wind turbines older than 20 years beyond end-2021.

Constitutional court rules on 2030 law

In a second landmark decision on April 29, Germany's constitutional court (BVerG) ruled the 2030 climate law as insufficient with regard to a post-2030 plan.

Environment minister Svenja Schulze said specific targets beyond 2030 would follow, but had no majority within government when the law was approved in 2019.

Environmental pressure groups had challenged the climate bill, arguing it would leave future generations with too great a burden in reducing emissions.

German 2020 emissions fell 8.7% year on year to 739 million mt CO2e, the ministry said March 16, based on preliminary data.