Germany has presented a climate policy package detailing cross-sector targets for CO2 emissions reductions by 2030, to mixed reactions from the renewable energy industry.
The package, passed by Chancellor Angela Merkel's climate cabinet on Sept. 20, aims for 65% of German power demand to be met by renewables by 2030.
Part of the plan is the extension of Germany's 2030 offshore wind target from 15 GW to 20 GW, subject to binding agreements with the affected coastal states. The current 52 GW ceiling for solar parks, beyond which no subsidies are paid to providers, will also be canceled.
Renewable energy companies operating in Germany, such as RWE AG and Ørsted A/S, will be among those to benefit from the enhanced offshore wind targets, said analysts at Alliance Bernstein in a Sept. 23 note. "E.ON SE, now Germany's largest electricity distributor (covering ~40% of Germany) will also benefit from the higher growth in the medium term from connecting more distributed renewables (solar, onshore wind) in its footprint," they added.
The association representing offshore wind park operators, Bundesverband der Windparkbetreiber Offshore, or BWO, welcomed the plan to increase offshore wind capacity by 5 GW to 20 GW by 2030. "Operators of offshore wind parks will now need to get together with local and federal governments as quickly as possible to work together on the implementation," BWO said.
However, to many in the renewable energy industry, the climate plan does not go far enough, with certain groups voicing disappointment over the targets and expressing concerns around their implementation. German solar power association Bundesverband Solarwirtschaft expressed relief over the abandonment of the solar subsidy cap, but said the package was overall "timid and vague."
New turbines
To help distribute the installation of wind farms more evenly across the country, the government also announced a "regionalization bonus," details of which are not yet finalized.
Onshore wind development will continue to be subject to planning limitations in Germany. A minimum distance for turbines of 1,000 meters from residential areas has been set, which communes will be able to opt out of in the future in return for higher financial contributions to the wind farms' operation cost.
In Bavaria, wind farm operators have to adhere to a minimum distance of 10 times the height of the turbine to the nearest house. A 150-meter turbine will therefore have to be at least 1.5 km away from the nearest house.
German onshore wind association Bundesverband Windenergie criticized the policy. "Blanket distance requirements massively restrict local development opportunities," the group said. "Higher auction volumes for onshore wind are necessary. They are entirely absent from the cabinet's model."
Carbon price
Another key element of the climate package is the introduction of a price on CO2 emissions for the transport and heating sectors not yet covered by the EU's emissions trading scheme, or ETS, from 2021.
Certificates will be generated at a fixed price of €10 per tonne of CO2 in 2021, rising to €35 by 2025. In 2026, the credit price will be determined in an auction setting out a pricing corridor between €35 and €60 per tonne of CO2.
Commenting on the legislation, Patrick Graichen, director at the think-tank Agora Energiewende, said: "This climate package frighteningly lacks power and courage. In particular the proposed CO2 pricing is a joke. €10 per tonne of CO2 does not change the trajectory at all."
He added, "No progress was made in the development of renewables — in fact conditions for wind power are being worsened."
