Raise of maximum support rate for onshore wind power auctions “a necessary correction”

The decision by Germany’s Federal Grid Agency (BNetzA) to increase the maximum support rate for onshore wind power installations in renewables auctions to 6.3 cents per kilowatt hour was “a first step to correct undesired developments” in the tender system, Hermann Albers, head of the German Wind Energy Association (BWE), says. The move was necessary to avoid a “rupture” in expansion of the energy source as bidders could now be sure to operate their installations at a profit. This is because  the original price that would have been derived from previous auction results is lower than current energy generation costs for onshore wind power, the BWE says. The reason for this is that citizen energy projects in the tenders are allowed to submit bids for projects that will only be implemented about four years later, which enables them to speculate on price drops in the future, the lobby group says.
The German Association of Energy and Water Industries (BDEW) says that the increase was “a necessary correction” to the current auction system. The special rules for citizen projects led to “market distortion”, which warranted an amendment in the Renewable Energy Act that obliges citizen projects to abide by the same licensing and implementation rules as their competitors, BDEW head Stefan Kapferer said.

Read the BDEW press release in German here.

See the CLEW factsheet High hopes and concerns over onshore wind power auctions and the CLEW article Booming German wind power sector fears 2019 cliff for background.