Law aims to boost German green integration, CO2 neutrality

Sep 1, 2020 | Montel

(Montel) An amendment to Germany’s Renewable Energy Act aims to improve the integration of green energy in the market, whiles also aiming at carbon neutrality by 2050, according to a draft seen by Montel on Tuesday.

Under the change, green power producers would be exempt from subsidy payments as soon as 15 consecutive minutes of negative spot prices occurred, though existing installations would not be affected by the change planned from 1 January.

Lawmakers hoped to spur cooperation between renewables producers and storage operators and boost renewables hedges in the forward market.

“There will be competition for the best concepts and markets for flexibility, which are urgently needed for the further expansion of renewables,” said the draft.

The current regime scraps subsidy payments after six consecutive hours of negative prices in the day-ahead auction. 

In addition, the changes would apply to all new units exceeding 0.1 MW. The current rules only apply to wind installations bigger than 3 MW and other forms of renewables exceeding 0.5 MW.

Germany recorded 39 days of negative prices during the first eight months of this year, with a total of 240 hours trading below zero, according to Montel calculations. 

Green target
The draft law also detailed an expansion path that should see 65% of German power consumption covered by renewables by 2030.

To achieve this goal, it targeted total onshore wind capacity of 71 GW by 2030, 20 GW of offshore wind, 100 GW of solar and 8.4 GW of biomass.

Under the plan, the country aimed to achieve 100% carbon neutral domestic power production by 2050, compared to a previous target of 80%.

In addition, the country aimed to only import carbon neutral power.

“The federal government will work to ensure that appropriate regulations are adopted in the European context.”

Reporting by:
Christian Driessen
08:16, Tuesday, 1 September 2020