German Solar Industry Association’s position on Federal Minister proposal to limit electricity price

GERMANY: This initiative is neither feasible nor capable of securing a majority. A limiting of energy costs must not be achieved by putting the brakes on the Energiewende, but rather by facilitating the rapid switch to renewable energy sources.

Altmaier’s initiative, by contrast, reduces the predictability and reliability necessary for investments in the Energiewende and amounts to a massive intervention in the grandfathering principle and the principle of protecting legitimate investment expectations. The national investment in renewable energy sources pays off, but it cannot be had for free. Freezing investments now will result in a significant throttling of the Energiewende.

Instead of closing the loopholes in the financing of the Energiewende, the proposed energy solidarity surcharge (“Energie-Soli”) amounts to a retroactive charge for the very drivers behind the Energiewende, the millions of operators of solar power, wind power and bio-energy plants. This is not only absurd, it is also legally questionable.

Furthermore, it would send an entirely wrong signal to new investors by adding to the already high degree of uncertainty created by the freezing of the EEG apportionment. Citizens who are taking the Energiewende into their own hands by consuming clean electricity generated on their own rooftop must not be asked to pay the price for misguided policies.

Instead of requiring operators of solar and wind power plants to pay more, the financing of the Energiewende should finally be distributed on broader shoulders again. The environmentally harmful industrial on-site electricity generation from fossil fuels should be more involved in the financing of the Energiewende, for example. At the same time, there needs to be a restriction of the industrial privilege, which transfers a significant measure of burden from industry to the population at large. In the future, the exemption from the EEG apportionment must be limited to those companies that are actually engaged in international competition.

Altmaier’s initiative curtails the predictability and reliability necessary for investments in the Energiewende, without solving any of the real problems that exist in the energy market. First and foremost perhaps is the paradox that while more electricity from regenerative sources lowers the price on the electricity market by creating a higher demand, the lower price on the exchange leads to a higher apportionment forrenewable energies and thus to higher electricity prices for customers – this systemic flaw is not tackled.

In the fall of 2012, the Federal Minister for the Environment launched a broad dialogue aimed at the further development of the EEG. Now, before this dialogue could even yield results, he wants to create a fait accompli.

In recent weeks, expert opinions by the Federal Ministry for the Environment and Prognos AG have repeatedly made clear that the continued robust expansion of photovoltaics is not a cost driver. Even a prolonged phase of strong growth in solar power generation at the level of the past three years would justify an increase of only one percent in the electricity price in coming years.