Germany's major renewables reform triggers hopes, but also fears of delay

Industry groups and analysts have voiced hopes that the German government’s next reform of the Renewable Energy Act (EEG), the so-called “Easter Package”, can lead to a breakthrough for the roll-out of wind and solar power and other energy transition measures - but warned the ambitious plans could not be fulfilled as quickly as expected. The planned reform that was debated in parliament on 12 May would be “a first and important step towards the expected renewables push”, said Simone Peter, head of the German Renewable Energy Federation (BEE). The package contains “ambitious goals” for renewables expansion but still needs to be amended to really become effective and use the full range of available clean power sources, Peter said. The potential of bioenergy “is not at all used enough”, Peter said, arguing it could help to replace fossil fuels both for power generation and heating, and also provide more flexibility to the grid. Solar power producers that also consume part of their own power production (prosumers) should receive more support, while both solar and wind power had to be given more space to add capacity, she added. Moreover, small hydropower would effectively be chocked off with the EEG reform, amounting to a “worst-case-scenario” for the industry, Peter said. In a different study, the German Association of Energy and Water Industries (BDEW) warned that faster renewables expansion to power heat pumps and produce green hydrogen would be a prerequisite for Germany to also reach its goals in reducing heating sector emissions.

Rating agency S&P said the Easter Package, announced by economy and climate minister Robert Habeck from the Green Party, could give renewables in Germany “an enormous boost”, but it would be “unlikely” that all goals until 2030 are met. S&P’s Sabrina Kernbichler said the package would pave the way for a stable long-term expansion of renewable power capacity and “sends a clear signal that investments in fossil fuel infrastructure no longer pays off”. However, the 2030 capacity goals will not be met, given the short time span left, Kernbichler said.  

The latest changes to the EEG have been dubbed the “biggest energy policy reform in decades” as the coalition of Social Democrats (SPD), Greens and Free Democrats (FDP) hopes to lift the rollout of wind and solar power “to a completely new level.” It aims to free up new land for green power production, speed up permit procedures, and massively increase wind and solar additions to achieve a nearly 100-percent renewable power supply by 2035.