Feed-in tariff (EEG feed-in tariff) as of the 12.01.2011
The most important means to promote electricity from renewable sources in Germany is the feed-in tariff as set out in the EEG.
Promoted technologies
In general, all technologies used in the generation of electricity from renewable sources are eligible for feed-in tariffs (§ 16 par. 1 EEG). The following conditions shall be met:
System registration. In pursuance of the EEG, electricity generated by a renewable energy system is eligible for the feed-in tariff only if the system operator has applied for the system to be registered in the "Register of Installations" (§ 16 par. 2 EEG). The Register of Installations has not yet been introduced. The date of its introduction is yet to be decided on. Systems that generate electricity from solar radiation or from bioliquids must be registered in separate registers.
Systems with a capacity of over 100 kW. Systems with a capacity of over 100 kW are eligible for tariffs only if they are equipped with a technical or operational facility to reduce output by remote means in the event of grid overload and to call up the current electricity exports (§§ 16 par. 6; 6 EEG). Operators of solar installations with a capacity of over 100 kW are also recommended to install a technical facility to reduce output.
Direct selling. System operators that sell their electricity directly are not entitled to the tariff (§ 17 par. 1 sentence 2 EEG). System operators may sell their electricity directly if they report this to the grid operator before the start of the previous calendar month (§ 17 EEG).
Wind energy
Both onshore and offshore generation are eligible with the following exceptions (§§ 29; 31 EEG):
Inefficient onshore generation. Electricity from wind energy is not eligible if generated by systems whose output exceeds 50 KW and for which the system operator provided no proof prior to commissioning that they are able to achieve at least 60 per cent of the reference yield at the planned location (§ 29 par. 3; 4 EEG). This proof shall be furnished by presenting a technical expert opinion (§ 29 par. 4 sentence 1; Annex 5 EEG).Offshore generation in protected areas. Electricity is not eligible if generated by systems located in an area of environmental importance, such as systems constructed in a protected area or at a site of Community importance (§ 31 par. 3 EEG).
Solar energy
Eligible unless one of the following circumstances is present (§§ 32; 33 EEG):
Future production sites. Electricity from a ground-mounted system is eligible only if the system was erected within the territorial application of a formal development plan (e.g. a local development plan). Systems erected within the territorial application of a local development plan drawn up after 01/01/2009 must be located on certain plots of land.
The most important means to promote electricity from renewable sources in Germany is the feed-in tariff as set out in the EEG.
Promoted technologies
In general, all technologies used in the generation of electricity from renewable sources are eligible for feed-in tariffs (§ 16 par. 1 EEG). The following conditions shall be met:
System registration. In pursuance of the EEG, electricity generated by a renewable energy system is eligible for the feed-in tariff only if the system operator has applied for the system to be registered in the "Register of Installations" (§ 16 par. 2 EEG). The Register of Installations has not yet been introduced. The date of its introduction is yet to be decided on. Systems that generate electricity from solar radiation or from bioliquids must be registered in separate registers.
Systems with a capacity of over 100 kW. Systems with a capacity of over 100 kW are eligible for tariffs only if they are equipped with a technical or operational facility to reduce output by remote means in the event of grid overload and to call up the current electricity exports (§§ 16 par. 6; 6 EEG). Operators of solar installations with a capacity of over 100 kW are also recommended to install a technical facility to reduce output.
Direct selling. System operators that sell their electricity directly are not entitled to the tariff (§ 17 par. 1 sentence 2 EEG). System operators may sell their electricity directly if they report this to the grid operator before the start of the previous calendar month (§ 17 EEG).
Wind energy
Both onshore and offshore generation are eligible with the following exceptions (§§ 29; 31 EEG):
Inefficient onshore generation. Electricity from wind energy is not eligible if generated by systems whose output exceeds 50 KW and for which the system operator provided no proof prior to commissioning that they are able to achieve at least 60 per cent of the reference yield at the planned location (§ 29 par. 3; 4 EEG). This proof shall be furnished by presenting a technical expert opinion (§ 29 par. 4 sentence 1; Annex 5 EEG).Offshore generation in protected areas. Electricity is not eligible if generated by systems located in an area of environmental importance, such as systems constructed in a protected area or at a site of Community importance (§ 31 par. 3 EEG).
Solar energy
Eligible unless one of the following circumstances is present (§§ 32; 33 EEG):
Future production sites. Electricity from a ground-mounted system is eligible only if the system was erected within the territorial application of a formal development plan (e.g. a local development plan). Systems erected within the territorial application of a local development plan drawn up after 01/01/2009 must be located on certain plots of land.
Where a solar installation is attached to a building, this building must meet certain statutory requirements (§§ 33, 32 par. 2 EEG).Reporting of installations to the Federal Network Agency.
Electricity from a ground-mounted system or a solar installation attached to a building structure used for the generation of electricity is eligible only if the system operator has reported the location and capacity of the system to the Federal Network Agency (§ 16 par. 2 EEG).
Amount
Calculation. The amount of tariff for a given system is the statutorily fixed tariff minus the degression percentage, which depends on the year in which the system was put into operation. The current version of the EEG sets out the tariffs for 2009.
Differentiation according to technology. The amount of tariff differs for every source of energy (§§ 23 – 33 EEG). For some technologies there are several tariffs depending on the system capacity, the system location and the technology and raw materials used. The more efficient the respective technology is, the more closely the tariff will reflect the market price.
Special system classification if tariff is output-based. In cases where the tariff is based on system output (e.g. photovoltaic energy, biomass), several systems shall be classified as one installation, notwithstanding ownership, and solely for the purpose of determining the tariff to be paid. For this rule to apply, the systems must be located on the same plot of land or in direct spatial proximity, generate electricity from the same kind of renewable energy source and have been commissioned within a period of twelve consecutive calendar months (§ 19 EEG). This regulation aims to prevent system operators from splitting their systems in order to avoid higher output categories. Whether several systems shall be regarded as one will be established on a case-by-case basis.
Criteria for amount of tariff. The amount of tariff depends on the costs of constructing and operating a certain type of plant, i.e. investment costs, operational costs, the costs of measurement and the cost of capital. Cost and efficiency audits are carried out in exceptional cases only. The calculation of the tariff is based on the expected costs. This aims to guarantee the cost-effective operation of most systems.
Solar energy
31.94 – 43.01 €ct/kWh (depending on energy source and system size) (§ 32 par. 1 EEG; § 33 par. 1 EEG).Payment of 25.01 €ct/kWh for electricity the operator uses himself (§ 33 par. 2 EEG).
Degression
The tariffs will be gradually reduced. The degression principle is meant to provide an incentive to reduce costs through technological progress. The tariffs for new systems will be reduced by a legally fixed percentage depending on the year of commissioning and the energy source used (§ 20 EEG). The degression percentage is fixed for all technologies except for electricity from solar radiation. The reference tariff applicable in the year a given system is put into operation is applicable during the entire period in which the tariff is paid. A progress report shall be filed on a regular basis to evaluate the tariffs and recommend adjustments (§ 65 EEG).
Solar energy
The degression rate is statutorily fixed and applies to a statutorily defined capacity of new installations ("regular degression"). When the total capacity of new installations exceeds or falls below a certain amount, the degression percentage increases or decreases by a statutorily fixed number of percentage points ("flexible cap"). The amount of degression differs for roof-top and ground-mounted systems. For example: From 2011 onwards the regular degression for ground-mounted systems will be 9 % (§ 20 par. 2 EEG). According to market developments
in 2011, this percentage will increase by up to 4 percentage points or decrease by up to 3 percentage points.in 2012, this percentage will increase by up to 12 percentage points or decrease by up to 7.5 percentage points (§ 20 par. 3 EEG). Every autumn, the Federal Network Agency will publish the tariffs applicable in the following year on its website http://www.bundesnetzagentur.de/
Amount
Calculation. The amount of tariff for a given system is the statutorily fixed tariff minus the degression percentage, which depends on the year in which the system was put into operation. The current version of the EEG sets out the tariffs for 2009.
Differentiation according to technology. The amount of tariff differs for every source of energy (§§ 23 – 33 EEG). For some technologies there are several tariffs depending on the system capacity, the system location and the technology and raw materials used. The more efficient the respective technology is, the more closely the tariff will reflect the market price.
Special system classification if tariff is output-based. In cases where the tariff is based on system output (e.g. photovoltaic energy, biomass), several systems shall be classified as one installation, notwithstanding ownership, and solely for the purpose of determining the tariff to be paid. For this rule to apply, the systems must be located on the same plot of land or in direct spatial proximity, generate electricity from the same kind of renewable energy source and have been commissioned within a period of twelve consecutive calendar months (§ 19 EEG). This regulation aims to prevent system operators from splitting their systems in order to avoid higher output categories. Whether several systems shall be regarded as one will be established on a case-by-case basis.
Criteria for amount of tariff. The amount of tariff depends on the costs of constructing and operating a certain type of plant, i.e. investment costs, operational costs, the costs of measurement and the cost of capital. Cost and efficiency audits are carried out in exceptional cases only. The calculation of the tariff is based on the expected costs. This aims to guarantee the cost-effective operation of most systems.
Solar energy
31.94 – 43.01 €ct/kWh (depending on energy source and system size) (§ 32 par. 1 EEG; § 33 par. 1 EEG).Payment of 25.01 €ct/kWh for electricity the operator uses himself (§ 33 par. 2 EEG).
Degression
The tariffs will be gradually reduced. The degression principle is meant to provide an incentive to reduce costs through technological progress. The tariffs for new systems will be reduced by a legally fixed percentage depending on the year of commissioning and the energy source used (§ 20 EEG). The degression percentage is fixed for all technologies except for electricity from solar radiation. The reference tariff applicable in the year a given system is put into operation is applicable during the entire period in which the tariff is paid. A progress report shall be filed on a regular basis to evaluate the tariffs and recommend adjustments (§ 65 EEG).
Solar energy
The degression rate is statutorily fixed and applies to a statutorily defined capacity of new installations ("regular degression"). When the total capacity of new installations exceeds or falls below a certain amount, the degression percentage increases or decreases by a statutorily fixed number of percentage points ("flexible cap"). The amount of degression differs for roof-top and ground-mounted systems. For example: From 2011 onwards the regular degression for ground-mounted systems will be 9 % (§ 20 par. 2 EEG). According to market developments
in 2011, this percentage will increase by up to 4 percentage points or decrease by up to 3 percentage points.in 2012, this percentage will increase by up to 12 percentage points or decrease by up to 7.5 percentage points (§ 20 par. 3 EEG). Every autumn, the Federal Network Agency will publish the tariffs applicable in the following year on its website http://www.bundesnetzagentur.de/
Cap
The EEG does not limit the total annual electricity production or the total installed capacity to be covered by the feed-in tariff.
Eligibility period
Duration of payment. Entitlement to the payment of tariffs as guaranteed by the EEG is limited in time and is usually 20 years plus the year of commissioning of the installation. Hydro-electric power stations are subject to a different eligibility period. The tariffs for hydro-electricity from large installations is 15 years plus the year of commissioning of the installation (§ 21 par. 2 EEG).Credit for direct selling. The period in which electricity is sold directly is credited against the duration of the payment of the tariffs (§ 17 par. 1 EEG).
Addressees
The system operator is entitled against the grid operator to the payment of tariffs (§ 16 par. 1 EEG). A system operator is one who, irrespective of the issue of ownership, uses a system to generate electricity from renewable energy sources or from mine gas (§ 3 no. 2 EEG). Grid operators are the operators of grid systems of all voltages for general electricity supply (§ 3 no. 8 EEG). The conclusion of a contract must not be made a condition for the entitlement to tariffs (§ 4 par. 1 EEG).
Procedure
Procedure Statutory law does not provide for a formal tariff procedure. According to the EEG, the conclusion of a contract between the grid operator and the system operator must not be made a condition for the payment of tariffs (§ 4 par. 1 EEG). Only systems generating electricity from solar radiation and systems generating electricity from bioliquids have to complete a registration procedure.
Competent authority The implementation of the EEG is not managed or monitored by a designated authority, as the EEG is a framework for private individuals – system operators and grid operators – rather than authorities. The Act is evaluated by the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety on behalf of the Federal Government (§ 65 EEG).
Cooperation mechanism
The feed-in tariffs will not be used to implement the Flexibility Mechanism.
Funding
Consumer
The costs of the feed-in tariffs are borne by the final consumers.
Distribution mechanism
System operator—grid operator. On the first level, power is transferred from the system operator to the grid operator because of the obligation to purchase electricity and pay tariffs (§§ 8 par. 1, 16 par. 1 EEG).Grid operator – transmission system operator. On the second level, the grid operator is obliged to transfer the electricity received to the transmission system operator without undue delay (§ 34 EEG). The grid operator is entitled to the purchase of and payment for the quantity of electricity he has paid tariff for (§ 35 par. 1 EEG). Transmission system operator – transmission system operator. On the third level, the transmission system operators divide the power as defined by the EEG among themselves according to the quantity of energy and the fees paid (§ 36 par. 1-3 EEG).Transmission system operator – spot market. On the fourth level, the transmission system operators sell electricity from renewable sources on the spot market at the stock exchange price (§ 2 AusglMechV).Transmission grid operator – utility company. On the fifth level, costs are passed on to the utility companies, which are obliged to reimburse the transmission system operators for their costs (§ 3 AusglMechV). Utility companies – final consumers. On the sixth level, which is not explicitly covered by law, the final consumers have to pay their electricity bills, which reflect the amount of power consumed. Final consumers that are manufacturing companies or rail operators are exempt from this regulation. Their costs arising from the compensation payments as specified by the EEG may be reduced upon request ("special equalisation scheme", §§ 40 ff. EEG).
The system operator is entitled against the grid operator to the payment of tariffs (§ 16 par. 1 EEG). A system operator is one who, irrespective of the issue of ownership, uses a system to generate electricity from renewable energy sources or from mine gas (§ 3 no. 2 EEG). Grid operators are the operators of grid systems of all voltages for general electricity supply (§ 3 no. 8 EEG). The conclusion of a contract must not be made a condition for the entitlement to tariffs (§ 4 par. 1 EEG).
Procedure
Procedure Statutory law does not provide for a formal tariff procedure. According to the EEG, the conclusion of a contract between the grid operator and the system operator must not be made a condition for the payment of tariffs (§ 4 par. 1 EEG). Only systems generating electricity from solar radiation and systems generating electricity from bioliquids have to complete a registration procedure.
Competent authority The implementation of the EEG is not managed or monitored by a designated authority, as the EEG is a framework for private individuals – system operators and grid operators – rather than authorities. The Act is evaluated by the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety on behalf of the Federal Government (§ 65 EEG).
Cooperation mechanism
The feed-in tariffs will not be used to implement the Flexibility Mechanism.
Funding
Consumer
The costs of the feed-in tariffs are borne by the final consumers.
Distribution mechanism
System operator—grid operator. On the first level, power is transferred from the system operator to the grid operator because of the obligation to purchase electricity and pay tariffs (§§ 8 par. 1, 16 par. 1 EEG).Grid operator – transmission system operator. On the second level, the grid operator is obliged to transfer the electricity received to the transmission system operator without undue delay (§ 34 EEG). The grid operator is entitled to the purchase of and payment for the quantity of electricity he has paid tariff for (§ 35 par. 1 EEG). Transmission system operator – transmission system operator. On the third level, the transmission system operators divide the power as defined by the EEG among themselves according to the quantity of energy and the fees paid (§ 36 par. 1-3 EEG).Transmission system operator – spot market. On the fourth level, the transmission system operators sell electricity from renewable sources on the spot market at the stock exchange price (§ 2 AusglMechV).Transmission grid operator – utility company. On the fifth level, costs are passed on to the utility companies, which are obliged to reimburse the transmission system operators for their costs (§ 3 AusglMechV). Utility companies – final consumers. On the sixth level, which is not explicitly covered by law, the final consumers have to pay their electricity bills, which reflect the amount of power consumed. Final consumers that are manufacturing companies or rail operators are exempt from this regulation. Their costs arising from the compensation payments as specified by the EEG may be reduced upon request ("special equalisation scheme", §§ 40 ff. EEG).
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