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Photovoltaic energy in Germany

General
For renewable electricity, the Renewable Energy Sources Act (Erneuerbare Energien Gesetz, EEG) came into operation on April 1st, 2000. It ensured independent power producers, either individuals or companies, to be able to deliver power to the electricity grid: grid operators were obliged to accept this power and to pay fixed tariffs to the producers: feed-in tariffs. The Act was revised in the year 2004 (August 1st, adopted on July 21st, 2004). For the year 2009 new amendments were made to the Act (adopted on June 6th, 2008). A feed-in tariff is guaranteed for 20 years for most technologies (only hydropower has a different period). In order to compensate for technology learning effects (through economies of scale and efficient production and conversion) the tariff is each year decreased with a certain percentage. The objective of the Renewable Energy Sources Act (EEG) has been to increase the share of total power supply that is derived from renewables to at least 12.5 per cent by 2010 and at least 20 per cent by 2020. As of 2007 the long-term targets have been made more ambitious: the 2020 share of renewable energies in electricity generation aimed for has been increased to 25-30%, and a continued steady expansion after 2020 is also aimed for.

Regarding renewable heating and cooling, the Bundestag adopted on 6 June 2008 a law on the promotion of renewable energies in the heat sector (Erneuerbare Energien Wärmegesetz, known as EEWärmeG). This law, which will take effect on January 1st 2009, obliges the owners of new buildings to cover a part of their heating needs from renewable energy. The law recognises solar energy, biomass, geothermal energy and ambient air heat. The obligatory part depends on the type of renewable energies used in the building. It is 15% for solar energy, 30% for biogas and 50% for all the others. Among these other renewables, biomass fuels (firewood, pellets, chips, etc.) can only be used in high-yield boilers that comply with air quality legislation. The owners can, if they so desire, combine several different sources of energy. A solar collector can in this way be completed by a wood pellet burning boiler. The EEGWärmeG law does not only consist of obligations. It also reinforces the program of development of the renewable energies market in allotting it €500 million per year up to 2012.

For biofuels, a law on biofuels (Biokraftstoffquotengesetz) came into force on 1st January 2007, consisting of a partial taxation associated with a quota policy.

On November 7th 2007, the renewable energy law was evaluated and judged pertinent by the German Parliament. This evaluation is based on indicators of installed capacity, on the number of tons of CO2 prevented and on the creation of jobs. The Parliament’s report also recommended increasing the share of renewable electricity to 27% in 2010. The report also called on the adjustment of the feed-in tariff of certain technologies including onshore and offshore wind power.

According to the draft Directive of the European Parliament and of the Council on the promotion of the use of energy from renewable sources the target for the share of energy from renewable sources in gross final consumption of energy in the year 2020 for Germany is 18% (in the year 2005 the share was 5.8%) (European Parliament legislative resolution of 17 December 2008).

Renewable energy projections according to the National Renewable Energy Action Plan for Germany
The National Renewable Energy Action Plan (NREAP) for Germany was submitted in August 2010. The target according to Annex I of Directive 2009/28/EC is 18% for the year 2020 and the projected NREAP share in that year is 19.6%.  According to the projection, the most important contribution in the year 2020 is expected from biomass (renewable heating and cooling) (11355 ktoe, 29% of all renewable energy). Second important contribution is expected from wind power (104.4 TWh or 8980 ktoe, 23% of all renewable energy). The third largest contribution is from biodiesel (renewable transport) (4443 ktoe, 12% of all renewable energy). Wind power contributes with 45.8 GW (104.4 TWh) in the year 2020 (onshore wind 35.8 GW and 72.7 TWh, offshore wind 10.0 GW and 31.8 TWh). For solar photovoltaic the 2020 contribution is projected to be 51.8 GW (41.4 TWh). For solar thermal the 2020 contribution is projected to be 1245 ktoe. The two most important biofuels are projected to contribute 4443 ktoe (biodiesel) and 857 ktoe (bioethanol / bio-ETBE) by 2020. The renewable electricity production from solid biomass amounts to 24.6 TWh (2113 ktoe) and for biogas it is expected to be 23.4 TWh (2015 ktoe). The consumption of renewable heat is expected to amount to 8952 ktoe for solid biomass and 1692 ktoe for biogas.

Renewable electricity: photovoltaic energy (PV)
Since August 2004, the renewable energies law (EEG) obliges electricity suppliers to buy photovoltaic electricity. The tariff applicable for a period of 20 years  The tariff varies according to the capacity of the installation. Changes accounced in the Renewable Energy Sources Act (Progress Report 2007) regard a stepped increase in degressive rates to a standard 7% from 2009 and to 8% from 2011 onwards. Also, a reduction of 1ct/kWh in the basic rate of remuneration from the 1st of january 2009 will be in place. Finally, a new category for roof systems with a capacity of over 1000 kWp has been introduced, for which a reduction in the remuneration rate to 34.48 ct/kWh has been defined. On buildings, the feed-in tariff is established in 2008 at between 0.4675€/kWh for power plants smaller than 30 kW and 0.4399€/kWh for power plants larger than 100 kW. A 5 €c bonus is added for power plants that are integrated in building facades. Ground based PV systems benefit from a tariff of 0.3549€/kWh.

Duration of tariff payment:
The minimum tariffs are paid from the time of commissioning for a period of 20 years, as well as for the year in which the installation was commissioned. Tariffs for installations commissioned after 2009 are lowered on 1 January of each following year by a fixed percentage (degression rate). The amended Renewable Energy Sources Act (EEG) of 11 August prescribes a two-stage reduction in feed-in tariffs for electricity from solar energy. Firstly, on 1 July 2010 a reduction in tariffs for installations attached to or on top of buildings of 13 percent, for free-standing installations of 12 percent and for free-standing installations on converted land (previously used for military or industrial purposes, for example) of 8 percent. Secondly, a further 3 percent reduction on 1 October 2010.

Dynamic degression
Degression for electricity from solar installations is dependent on the annual installed capacity increase (market volume) in Germany. As a rule there is a 9 percent degression rate. However, degression may be higher or lower depending on the installed capacity in the previous year. Operators of photovoltaic installations have therefore been obliged since 2009 to register their installed capacity increase with the Federal Network Agency. If the installed capacity registered between 1 June and 30 September 2010 multiplied by a factor of 3 is between 2,500 and 3,500 megawatts, the degression rate of 9 percent does not change at the end of the year. If the installed capacity registered exceeds 3,500 MW, 4,500 MW, 5,500 MW or 6,500 MW, degression increases accordingly by 1, 2, 3 or 4 percentage points. As the 6.500 MW threshold was exceeded, the Federal Network Agency announced that the total regression rate in 2011 will be 13 %. From 2012 degression increases by 3, 6, 9 or 12 percentage points if the installed capacity registered in the 12 months before 30 September of the previous year exceeds the above-mentioned limits. It decreases by 2.5, 5 or 7.5 percentage points if the installed capacity registered falls below the above-mentioned limits. The Federal Network Agency publishes the installed capacity registered, the resulting degression percentage for the following year and the tariff rates in the Federal Gazette by 31 October each year in agreement with the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety and the Federal Ministry of Economics and Technology.

Free-standing installations (installations on sealed land and converted land) :
- Basic degression from 2010: 9%.
- A degression of 13% is in effect from 1 January 2011.

Free-standing installations (installations on sealed land and converted land) 
from 1 July 2010 : 26,15 ct/kWh
from 1 Oct 2010 :   25,37 ct/kWh
from 1 Jan 2011:    22,07 ct/kWh

Installations attached to or on top of buildings
- basic degression from 2010: 9%.
- degression of 13% from 1 January 2011
- degression can vary between 1.5% and 21% per year from 1 January 2012
From 1. Jan 2011  building integrated (roof, facade), feed-in
up to 30 kW  :       
28,74 ct/kWh
30 – 100 kW : 27,33 ct/kWh
100 – 1,000 kW: 25,86 ct/kWh
from 1,000 kW : 21,56 ct/kWh

Other free-standing installations
from 1 July 2010 :  25,02 ct/kWh
from 1 Oct 2010 :   24,26 ct/kWh
from 1 Jan 2011 :   21,11 ct/kWh


Own consumption

Tariff rates for own consumption are possible values only. An average household electricity price (net) of 20 ct/kWh is assumed for calculations. The difference between the tariff rate for direct consumption plus avoided costs for household electricity and the tariff rate for the respective installation attached to or on top of buildings leads to an incentive of 3.6 ct/kWh for own consumption up to 30%.

From 1 Jan 2011 PV in/on buildings (direct consumption up to 500 kWp)
Share of direct consumption > 30 %
up to 30 kWp 16,74 ct/kWh
30 - 100  kWp 15,33 ct/kWh
100 - 500 kWp 13,86 ct/kWh
Share of direct consumption < 30 %
up to 30 kWp 12,36 ct/kWh
30 - 100 kWp 10,95 ct/kWh
100 - 500 kWp 9,48 ct/kWh

Future programme changes expected
The EEG remains the main RE support instrument for PV in 2011 and beyond. The EEG is regularaly reviewed in progress reports. Feed-in adjustments according to market development. The degression can vary between 1.5% and 21% per year from 1 January 2012, depending on market volume in 2011.


Sources

Bundesministerium für Umwelt, Naturschutz und Reaktorsicherheit (BMU): Tariffs and sample degression rates pursuant to the new Renewable Energy Sources Act (Erneuerbare-Energien-Gesetz - EEG) of 25 October 2008 with amendments of 11 August 2010, (sourced March 2011; also available in Spanish and French)
http://www.erneuerbare-energien.de/files/english/pdf/application/pdf/eeg_2009_verguetungsdegression_en_bf.pdf (sourced March 2011)

Bundesministerium für Umwelt, Naturschutz und Reaktorsicherheit (BMU), The Renewable Energies Heat Act in brief,  http://www.erneuerbare-energien.de/files/pdfs/allgemein/application/pdf/ee_waermegesetz_fragen_en.pdf (sourced January 2009)

Bundesministerium für Umwelt, Naturschutz und Reaktorsicherheit (BMU), List of English documents concerning the renewable energies sector 16th legislative term, http://www.erneuerbare-energien.de/english  (sourced March 2009)

Bundesministerium für Umwelt, Naturschutz und Reaktorsicherheit (BMU), Renewable Energy Sources Act Progress Report 2007, http://www.erneuerbare-energien.de/files/pdfs/allgemein/application/pdf/erfahrungsbericht_eeg_2007_zf_en.pdf (sourced March 2009)

Bundesnetzagentur 2010: Degressions- und Vergütungssätze für das Jahr 2011 (pdf/17 KB), (sourced March 2011)

The National Renewable Energy Action Plans (NREAPs) are all published on the Transparency Platform on Renewable Energy: http://ec.europa.eu/energy/renewables/transparency_platform/action_plan_en.htm (sourced July - December 2010)

Renewable Energy Projections as Published in the National Renewable Energy Action Plans of the European Member States, http://www.ecn.nl/nreap (sourced December 2010)

BSW- Solar 2011: Die veränderten EEG-Vergütungssätze von PV-Anlagen im Überblick, January 2011, http://www.solarwirtschaft.de (sourced March 2011).

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Last update: March 2011


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The EurObserv'ER barometer is a project supported by the European Commission within the DG ENER 'Intelligent Energy Europe' programme and by Ademe, the French Environment and Energy management Agency. The EurObserv'ER Barometer is the result of the investigation and research work of its authors. The European Commission is not responsible for any use that may be made of the information contained therein.