As a leader of renewable energy, Germany’s renewable energy sector has experienced rapid growth in 27 years, from 5% of the entire electricity sector in 1990 to 36% in 2017, and aims to increase its renewable energy proportion to at least 69% in 2036. To further address the problem of climate change, the country goes hand in hand with France to urge the European Development fund to invest solely on renewable energy. It demonstrates the commitment of the country to the further development of renewable energy and in particular wind energy which is the major source of renewable electricity generation.
“Yet, behind the scene, the Wind sector is in big trouble,” according to Brussel Trade Group WindEurope. The development of new wind energy projects is slowing down rapidly in recent years. Only 35 new windmills of 290 MW were installed in the first half of 2019, an 80% decline compared with the same period in 2018 and is the lowest in two decades. As reference, the new wind turbines installed in 2018 have a total capacity of 2800 MW which is more than half of the capacity in 2017. The drop is alarming enough for the German Economic Ministry to hold a summit to discuss the slowdown in the growth of the sector and how it threatens its climate goal which effectively phases out coal and nuclear energy.
The reasons behind the slowdown are multi-fold. One of the main reasons is increasing public resistance. Mr Günther Schultze is one of the tireless local campaigners in Ober-Ramstadt, a small town in the south of Frankfurt. He was concerned about the effect of wind farms on the environment, the birdlife and the groundwater. “We have more than 30,000 wind turbines in Germany now and we can’t build any more. This has to stop,” he said. Some of the environmentalists are trying to bring lawsuits against wind farms. The Germany Wind Industry Federation BWE estimates about 300 turbines with a total capacity of 1200 MW are being blocked by the lawsuits. This has led to increased costs for the wind industry to develop new turbines.
Other concerns from local residents include the impact on the residents’ health from the infrasound emissions by turbines and how to store excess electricity.
As a result of public concern, the planning permissions are becoming much stricter. In Bavaria, for instance, the regional government has imposed a minimum distance of 10 times the height of the turbine between a turbine and a settlement. The approval time of wind projects has also significantly increased from a few months to 7-8 years, leading to problems of reluctance to invest by investors and outdated technology.
On the other hand, the government is partially responsible for the slowdown of the development. Luise Pörtner, the managing director of BayWa r.e., a leading renewable energy developer, stated the cut of subsidy to the industry has had “a massive impact on the onshore wind industry.” The government introduced a market-based tendering model for new capacity which cuts subsidy and forces fierce competition. Consequently, 4000 MW of wind turbines will drop out of the subsidy scheme this year and Pörtner estimates older turbines which accounts for a quarter of the existing wind power may be cut when they become unprofitable in 2025. The offshore wind turbines development projects by the government also failed to fully materialise. The high risk of fluctuation of electric prices after a 5-year guarantee set price makes investors reluctant to invest in the projects, leaving only half of the 1,350 MW tendered this year.
The German Economic Ministry has promised for a “Diversity of Measures” with the federal government and the federal states to tackle the existing problems in the wind industry, including better synchronisation of grid expansion measures, increased transparency of species conservation policy, and collaboration with federal states to re-zone land for new wind farms. Yet, apart from federal measures, the Ministry has a long way ahead to persuade the general public wind energy should be the main energy source in the future.
By Timothy Cheung
Sector Leader: Robert Hamblin