sou · GWB313d2 · 2009-01-01 00:00:00 — The Renewable Energy Sources Act foresees special regulations for re-powering systems and offshore wind power. However, there is no obligation to pay remuneration for wind power systems which do not achieve at least of a defined reference yield at the planned site. Table 3-4 to Table 3-9 on the following pages list the feed-in tariffs for the different renewable energy technologies based on the RES Act from 2004. It can be seen that a feed-in tariff is defined for almost all renewable energy technologies. One exception exists for hydropower. According to § 6 I RES Act, if the hydropower plant has no spatial connection to a barrage weir with lock or a weir that has entirely or partially already been existing or has been newly built for predominantly other purposes than hydropower generation or contains a full cross lining or if it can be proved that there re- sults an unfavourable ecological state or that the ecological state has not been substantially improved in comparison to the previous situa- tion. According to the regulations of this law, hydropower of more than 5 MW up to incl. 150 MW is only remunerated if the facility has been renewed between 1 2004 and and if the renewal has resulted in an increase in electrical capacity of a minimum of 15 percent and if after the renewal a proven good ecological state has been achieved or if the ecological state has been substantially improved in comparison to the previous situation. The feed-in tariff is always paid by the network company to which the renewable generation unit is connected. The network company hands the associated cost over to the corresponding transmission company in the area. The transmission companies pass the costs further on to all retailers in . Each retailer gets a similar share, depending on the number of its , and it pays the average feed-in costs of all eligible renewable energy fed into the German power system (calculated on a monthly basis). The idea is that all electricity consumers take a similar share of the renewable energy produced and pay a similar amount of money for it, i.e. the impact of the higher costs for the renewable energy is shared by all Only certain energy intensive industries receive a special treatment, which means their share of renewable energy is lower. Feed-in tariffs for based on Renewable Energy Sources [c/kWh] [c/kWh] [c/kWh] [c/kWh] *Exact time of final reimbursement depends on the reference yield and really achieved yield, at the earliest after five years, though. The initial reimbursement can be extended if the new plant replaces other plants in the same county and at least triples the effect. **Time of the final reimbursement at the earliest after 12 years and only for plants that have become operative prior to . An extension of the timeframe depends on the distance to shore and water depth. Note: Based on the 2000 version of the Renewable Energy Sources Act, the feed-in tariff for the first five years was (after 5 years) 9.10 c/kWh (6.19 c/kWh ) until end of 2001, for 2002: 9.00 c/kWh (6.10 c/kWh ) and for 2003: 8.90 c/kWh (6.00 c/kWh ). Feed-in tariffs for Photovoltaic based on Renewable Energy Sources Installed on or part of a Not part of a > 30 kW to > 30 kW to > 100 KW [c/kWh] [c/kWh] [c/kWh] [c/kWh] [c/kWh] [c/kWh] [c/kWh] Note: Based on the 2000 version of the Renewable Energy Sources Act, the feed-in tariff was 50.62 c/kWh until end of 2001, for 2002: 48.10 c/kWh and for 2003: 45.70 c/kWh. Table 3-6: Feed-in tariffs for Hydro units based on Renewable Energy Sources Act 2004 For existing units that increase its efficency by ; payment only for the additional power production due until end of 2007 > 50 MW to [c/kWh] [c/kWh] [c/kWh] [c/kWh] [c/kWh] [c/kWh] [c/kWh] Feed-in tariffs for Geothermal based on Renewable Energy Sources up to 5 MW > 5 MW to > 10 MW to [c/kWh] [c/kWh] [c/kWh] [c/kWh] Note: Based on the 2000 version of the Renewable Energy Sources Act, the feed-in tariff for units up to 20 MW was 8.95 c/kWh between 2001 and 2004 and for units larger than 20 MW it was 7.16 c/kWh. Table 3-8: Feed-in tariffs for Biomass based on RES Act 2004-Part 1 Biomass excluding the use of wood [c/kWh] [c/kWh] [c/kWh] [c/kWh] [c/kWh] [c/kWh] [c/kWh] [c/kWh] [c/kWh] Note: Based on the 2000 version of the Renewable Energy Sources Act, the feed-in tariff for units up to 500 kW was 10.23 c/kWh until end of 2001; 10.10 c/kWh for 2002 and 10.00 c/kWh for 2003. For units larger than 500 kW and up to 5 MW, the feed-in tariff was 9.21 c/kWh until end of 2001; 9.10 c/kWh for 2002 and 9.00 c/kWh for 2003. For units larger than 5MW and up to 20 MW, the feed-in tariff was 9.21 c/kWh until end of 2001; 9.10 c/kWh for 2002 and 9,00 c/ kWh for 2003. Table 3-9: Feed-in tariffs for Biomass based on RES Act 2004-Part 2 Year of up to > 150 kW > 150 kW > 150 kW >150 kW >150 kW >150 kW >150 kW a1: Exclusively biomass from a) plants and parts of plants without processing, b) liquid manure and malt residuum/slop c) substance mix a+b and if the plant is authorized for such substances and if the plant is authorized for such substances and there is no biomass plants of a different variety on the premises for the proportion up to including 500 kW; a2: Exclusively biomass from a) plants and parts of plants without processing, b) liquid manure and malt residuum/slop c) substance mix a+b and if the plant is authorized for such substances and if the plant is authorized for such substances and there is no biomass plants of a different variety on the premises for the proportion of 500 kW up to including 5 MW a3: Use of wood for the proportion of 500 kW up to 5 MW. b: Exclusively biomass according to biomass regulation without spec. matured and plant in CHP operation or biomass production through thermochemical gasification or dry fermentation or if biogas has natural gas quality or if the power is produced through fuel cells, gas turbines, steam engines, organic-cycle plants, multi-substance plants (e.g. Kalina-Cycle plant) or engines. Figure 3-7 provides an overview of the different cost factors that influence the final electricity price for German consumers. In 2005, the costs of the feed-in tariff added (or 0.56 c/kWh) to the final power price. In 2006, the costs related to the feed-in tariff increased to 0.7 c/kWh or about 2.10 per months for an average household with an annual electricity consumption of 3,500 kWh per year. Figure 3-7: Composition of the electricity price in the household sector, 2005TPF62FPT (EEG = Renewable Energy Source Act). 3.3Application Procedure for Access and Connection to the In , non-renewable electricity generators have to individually negotiate access to transmission and distribution grids with the grid operator. A special treatment is defined for renewable energy gene- rators in the Renewable Energy Sources Act § 4. It defines that grid operators shall immediately and as a priority connect plants generating electricity from renewable energy sources and guarantee priority purchase and transmission of all electricity from renewable energy sources. to its importance, the complete Paragraph § 4 of the Re- newable Energy Sources Act is included below:TPF63FPT 62TP PT Source: application/pdf/broschuere_ee__en.pdf 63TP PT Source: Obligation to purchase and transmit electricity 1)system operators shall immediately and as a priority connect plants generating electricity from renewable energy sources or from mine gas to their systems and guarantee priority purchase and transmission of all electricity from renewable energy sources or from mine gas supplied by such plants. After of a register of installa- tions pursuant to Article 15(3), such obligation for the purchase pur- suant to the first sentence above shall apply only if the plant operator has submitted an application for entry into the register. Notwith- standing Article 12(1), plant operators and grid system operators may agree by contract to digress from the priority of purchase, if the plant can thus be better integrated into the grid system. When determining the charges for use of the grid, grid system operators may add any costs incurred in accordance with a contractual agreement pursuant to the third sentence above, provided that such costs are substantiated. 2)The obligation under paragraph (1) first sentence above shall apply to the grid system operator that is most closely located to the plant site and is in possession of a grid technically suitable to receive electri- city if there is no other grid with a technically and economically more suitable grid connection point. A grid shall be deemed to be techni- cally suitable even if – notwithstanding the priority established under paragraph (1) first sentence above – feeding in the electricity requires the grid system operator to upgrade its grid at a reasonable economic expense; in this case, the grid system operator shall upgrade its grid without undue delay, if so requested by a party interested in feeding in electricity. If the plant must be licensed in accordance with any other legal provisions, the obligation to upgrade the grid in accordance with the second sentence above shall only apply if the plant operator sub- mits either a license, a partial license or a preliminary decision. The obli- gation to upgrade the grid shall apply to all technical facilities required for operating the grid and to all connecting installations which are owned by or passed into the ownership of the grid system operator. 3)The obligation for priority connection to the grid system pursuant to paragraph (1) first sentence above shall apply even if the capacity of the grid system or the area serviced by the grid system operator is temporarily entirely taken up by electricity produced from renewable energy sources or mine gas, unless the plant does not have a technical facility for reducing the feed-in in the event of grid overload. The obli- gation pursuant to paragraph (1) first sentence above for priority pur- chase of the electricity produced in these plants shall apply only if the capacity of the grid system or the area serviced by the grid system operator is not already used up by electricity produced in other plants generating electricity from renewable energy sources or mine gas which were connected prior to these plants; the obligation to upgrade the grid system without undue delay pursuant to paragraph (2) second sentence above shall remain unaffected. In the event of non-purchase of such electricity, the grid system operator shall, if so requested by the plant operator, provide proof of fulfillment of the conditions set out in the second sentence above in writing within four weeks and produce veri- fiable calculations. 4)The relevant data on the grid system and on the electricity generation plants, which are required to test and verify the grid compatibility, shall be presented upon request within eight weeks where this is necessary for the grid system operator or the party interested in feeding in elec- tricity to do their planning and to determine the technical suitability of the grid. 5)The obligation for priority purchase and transmission of electricity in accordance with paragraph (1) first sentence above shall also be applied, if the plant is connected to the grid of a plant operator or a third party who is not a grid system operator within the meaning of Article 3(7) and if the electricity is offered to a grid system in accordance with Article 3(6) via a merely budgeted transit through this grid system. 6)The upstream transmission system operator shall guarantee priority purchase and transmission of the quantity of energy purchased by the grid system operator in accordance with paragraph (1) or (5) above. If there is no domestic transmission system in the area serviced by the grid system operator entitled to sell electricity, the most closely located domestic transmission system operator shall purchase and transmit electricity in accordance with the first sentence above. The first sen- tence above shall apply mutatis mutandis to other grid system operators. In principle under the Renewable Energy Sources Act a renewable power generation has the legal right to be connected to the power system, i.e. in principle not even a separate agreement or contract should be required anymore between a network operator and an operator of a renewable energy plant. However, based on a recent court decision this legal right applies only to an already installed renewable energy generator, i.e. a renewable energy generator must still negotiate an access agreement if it wants to be sure in advance of how much it can connect and when. This small difference is im- portant, because a network upgrade takes time and no investor will build a wind farm without knowing in advance how much wind power can be connected and when. From the network operators perspective the contractual agree- ment is important because the Renewable Energy Sources Act 2004 (for the first time) allows the network companies to, in principle, curtail renewable energy if this allows more wind farms to be con- nected to the grid and if both parties agree in advance on this (RES Act: agree by contract to digress from the priority of purchase, if the plant can thus be better integrated into the grid system. Particular E.on , the TSO with the largest share of wind power has defined a number of bottlenecks within its transmission network for times with high wind production and low local load, see Figure 3-8. E.on has signed special contracts with around 1000 MW of wind power since the introduction of the RES Act in 2004 which allows E.on to curtail the wind power in situations with high wind and low load. Of the 1100 MW, about 300 MW are directly con- nected to E.ons network, the remaining 800 MW are connected to the local distribution network. For the curtailment, E.on sends a signal with the level of power generation allowed to the wind farm operator which then has to confirm receiving the signal and has to act. That means that not E.on actually regulates the wind farm down via remote control, it is the responsibility of the wind farm owner to do so. The curtailment can be used in case of bottlenecks, in case of power system stability risks and during power system maintenance. In 2006, about of the energy production of the participant wind farms was lost due to curtailment. The wind farms are not paid for regulating down their power output. Figure 3-8: Potential bottlenecks within E.on transmission system. Network connection costs, i.e. from the wind farm to the connec- tion point have to be paid by the wind farm operator. The network companies are required to upgrade the network and cover the cor- responding costs. This typically results in a conflict regarding the best connection point. According to § 17, paragraph (1) and (2) of the National Energy Act 2005, grid operators are obligated to give access to generation units (and others) as long as no technical or economic reasons object against it. This paragraph allows a wide range of interpretation and has caused a large number of court cases. The wind farm lobby argues that in principle even a low voltage system must be upgraded to allow the connection of wind farms, while the network companies typically argue that this is not economically reasonable. The general rule for defining the grid connection point applied for many years was based on the understanding that the total network connection costs, i.e. connection plus upgrade costs, should be minimized independent of who covers which part of the costs.TPF64FPT A new court decision from 2007 followed the same principle but also defined that a low voltage network must be upgraded to accommodate wind power even if it required the construction of new overhead lines from the connection point to another substation as long as this leads to the lowest overall network connection costs.TPF65FPT The argument of the network company was that the new connec- tion is not a network upgrade but part of the network connection, however the court did not accept this argument. In practice, the network upgrade issue is often solved differently, because the network upgrade based on overhead lines can take years due to very long permit-granting processes. The permit-granting process is typically faster for cabling connections, however they are not considered economically reasonable by the network companies. However, due to declining feed-in tariffs (depending on the year of first connection/operation), time delays have a significant impact on the overall economics of wind farms. , many wind farm operators have decided to take care of the network upgrade issue themselves by their own cable network to a suitable con- nection point, often a substation of the next higher voltage level. Some German wind farms have connected different clusters of wind farms to their own cable network to aggregate wind power (up to 64TP PT Clearingstelle nach §10 Abs.3 Erneuerbare-Energien-Gesetz (EEG), Vorläufige Handlungs- grundlage, 08. 65TP PT =en&az=VIII%20ZR%20288/05 100 MW) and then connect these networks to the high voltage system. Legally, even though some of these connections are 30 to long, these cable networks are considered part of the wind farm so they are not considered a public grid, i.e. they do not fall under the legal regulations for medium or high voltage networks. The various laws do not define a clear application process for grid access with timelines or deadlines,TPF66FPT but companies has published a guideline for the application and connection of renewable energy systems under the RES Act.TPF67FPT The guideline clearly defines which data have to be submitted to the net- work company and which methods network companies should apply to calculate the possible interconnection capacity for possible inter- connection points. 3.3.1Definition of the Capacity of a Production Installation While other countries have certain clear definitions what maximum capacity can be connected to which voltage level, such definitions do not exist in . From the technical perspective the VDN guidelineTPF68FPT regarding network connection is typically used to define the suitable capacity, however, the final decision for a suitable connection point typically depends on the available capacity and the overall costs for network connection and upgrade, see last Section. The German wind power association, however, points out that often the published data from the network companies are not suffi- cient to independently verify the technical calculations regarding the available capacity. The regulator points out that in case of com- plaints, it is the network companies responsibility to demonstrate how the results where obtained. 66TP PT A principle timeline is outlined in Artikel 4, paragraph 4, RES Act: The relevant data on the grid system and on the electricity generation plants, which are required to test and verify the grid compatibility, shall be presented upon request within eight weeks where this is necessary for the grid system operator or the party interested in feeding in electricity to do their planning and to determine the technical suitability of the grid. 68TP PT ibid. No generation licence or similar is needed for starting up a renewable energy generation unit. Of course a permit etc. is needed, but from the power system side only an interconnection agreement is needed (which is – as discussed earlier – legally not really re- quired), which is negotiated with the local network company. 3.4Obligations of a Regarding According to § 19, paragraph (1) of the National Energy Act from 2005 (EnWG 2005) grid operators are obligated to define detailed minimum technical requirements for the grid connection of genera- tion units (both conventional and renewable) and to publish these requirements on the internet. The technical minimum requirements mentioned above differ for each voltage level. At transportation level (110 to ) the TransmissionCode 2003 and at distribution level (< ) the DistributionCode sets the requirements.TPF69FPT In addition, according to § 19, paragraph (3), of the same law these requirements must be communicated to the regulatory body (Bundes- netzagentur). According to § 17, paragraph (1) and (2) National Energy Act 2005 grid operators are obligated to give access to genera- tion units (and others) as long as no technical or economic reasons object against it. According to § 18 Energy Act, an entity that operates a power generation facility in order to cover its own demand does not fall under the general obligation of a network connection according to Section 1 1 of National Energy Act. As opposed to this, it results from § 4 V RES Act, that the obligation to purchase and transmit renewable energies even applies if the facility is connected to the network of the facility operator or of a third party that is not a network operator according to § 3 7 and if the power will 69TP PT TransmissionCode: TransmissionCode2003.pdf be commercially transmitted through this network to a network according to § 3 6. In Case of Conflicts The Bundesnetzagentur, the German regulator, is the arbitrating entity in case of conflicts. According to § 13 I of the National Energy Act individuals and associations of individuals whose interests are substantially affected by the behavior of the operator of a power supply network can request the regulating authority to examine such behavior. The authority has to examine whether the behavior of the operator of power supply networks corresponds to the requirements of the regulations. Such a claim has to include name, address and signature of the claimant as well as company and headquarters of the respective net- work operator. Furthermore the behavior of the respective network operator that has to be examined, a list with the individual reasons of why there are serious doubts regarding the legality of the net- work operators behavior, and a list with individual reasons of why the claimant is affected by the network operators behavior. Unless the claim complies with these prerequisites the regulating authority will not admit the claim. According to § 13 III of the National Energy Act, the regulating authority will make a decision within two months after receiving the complete claim. This period can be extended by another two months after receiving the complete claim. Given the consent of the claimant, this period can be further extended. If – according to 1 – the claim refers to the grid connection of larger new generation faci- lities, the regulating authority may further extend the period. As mentioned before, there are no clear legal rules regarding the de- finition of available capacity, except the legally non-binding method outlined within a guidelineTPF70FPT from the network association. , legally network companies are required to upgrade the network for renewable energy sources whenever capacity is not sufficient – as long as no technical or economic reasons object against it. 70TP PT ibid. limitations are related to § 11 I 1 National Energy Act, which de- fines that operators of power supply networks are obligated to ope- rate, maintain and – based on demand – extend without discrimina- tion a safe, reliable and efficient power supply network. 3.4.2Reservation of Transmission Capacity In principle it is not possible to reserve transmission capacity in the German system. However, renewable energy sources receive a priority treatment, i.e. conventional power plants must reduce their power output or must even shut down in case of network limitation in order to guarantee priority access to renewable power generation. This even applies to large generation plants such as nuclear power stations. This way, renewable energy sources can feed into the power system until the bottleneck is entirely created by renewable energy sources.