renewables wind

Germany Introduces New Law for Developing Offshore Wind Power for Homes

The German government aims to accelerate the development of offshore wind power for homes. Moreover, the goal is to increase the volume of electricity generation from offshore wind farms.

Thanks to a new law that authorities have passed, the volume of tenders will be increased, as well as the procedure for approving projects will be simplified.

The new rules will speed up the spread of renewable energy in Germany. In the future, this will increase the reliability of supplies and will benefit the energy independence of the country.

According to government plans, by 2030 up to 80% of Germany’s electricity needs must be met from renewable sources.

In particular, they adopted an amendment to the Law on Offshore Wind Energy. According to a bill submitted to Parliament, by 2030 a capacity of 30 gigawatts should be achieved, and by 2035 – up to 40 gigawatts.

Previously, it was expected that only by 2040 it would be possible to receive 40 gigawatts from coastal wind power for homes.

To achieve this goal, a new subsidy regime needs to be introduced, especially in deeper waters away from the coast. Funding for the implementation of wind energy projects will come through government-subsidized contracts.

The parties to such a contract are the German government and the wind farm operator. The operator declares a fixed price per kilowatt of electricity, which is the average value for a certain period of operation of the wind farm.

In the future, the difference between the operator’s price and the market price is settled by the terms of the contract: the surplus is returned to the state budget or the operator receives compensation. The average term of such a contract, according to the government, will be 20 years.

The state subsidized contract at the tender was received by the participant who offered the lowest price for it. This scheme has already been successfully applied in practice in the UK and France. However, in Germany, the traditional bidding model has been used until now since 2017.