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Germany details tender rules for combined-heat-power plants

London — * New units between 1 MW to 50 MW have to compete for subsidies
* First tender set for December 2017 with 100 MW on offer
* Germany wants to boost power output from CHPs to 110 TWh by 2020

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Germany's energy ministry has set out details for the planned auctions for combined-heat-power plants (CHPs) with up to 50 MW capacity, with 100 MW on offer in the first auction set for December.

According to a first draft of the regulation based on last year's reform of the CHP bill (KWKG 2016), the energy ministry plans two auctions each year for 100 MW each time.

Last year's KWKG 2016 bill is set to boost electricity output from CHPs to 110 TWh by 2020 and 120 TWh by 2025 as well as improving support mechanisms for new gas-fired CHP plants.



New-build gas-fired CHP projects that replace an older coal-fired CHP unit will receive an additional bonus while existing coal and lignite-fired CHPs will no longer receive support through this mechanism.

The most striking part of the reform bill was a move to a new tender process for government support for new CHP units between 1 MW and 50 MW of capacity.

Following approval by the EC, the bill was passed at the end of last year with the ministry's draft regulation now in the consultation phase until June.

Germany's potential CHP capacity is near 50 GW ranging from large-scale new-built coal-fired units like the 900 MWe GKM 9 plant at Mannheim to mid-sized municipally-owned urban CHP units down to small-scale or even micro- units, data from Platts Powervision shows.

Last year, power output from CHP plants was 77.5 TWh with gas-fired CHP plants accounting for almost 50 TWh, data from the German statistical office shows.

As CHP generation does not participate in the power market the way conventional wholesale power only generation does, but is more driven by the heating requirements, the output from CHP units is more difficult to predict and track, according to industry sources.

--Andreas Franke, andreas.franke@spglobal.com
--Edited by Jeremy Lovell, jeremy.lovell@spglobal.com