The BMWK’s Photovoltaics Strategy: German Federal Government Presents Policies

Industry News – June 26, 2023 | Sarah Hommel de Mendonça

After revising the Renewable Energy Sources Act (EEG) 2023 , the German Federal Ministry for Economic Affairs and Climate Action (BMWK), led by Robert Habeck, has entered into a new phase of opening up more opportunities for the comprehensive expansion of solar energy:

The photovoltaics strategy presented on May 5, 2023 specifies measures which, under the name "Solar Package I", are to be submitted to the German cabinet for approval before the parliamentary summer recess. In "Solar Package II", the same strategy paper sets out measures that are to be addressed later in the year.

Back in March, the Minister announced the development of a comprehensive strategy, and industry representatives have been satisfied with the result. The German Solar Industry Association (BSW-Solar) comments: “The PV Strategy includes a number of important measures for reducing barriers to market, land and grid access, and to accelerate planning processes.”

While the action paper is divided into 11 fields of action, it also has an explicit focus on optimizing the energy supply system as a whole.

Field of Action 1

The first field of action focuses on ground-mounted systems, which involves relaxing the Federal Land Utilization Ordinance to achieve a 50 percent deployment share in the ground-mounted segment. Agricultural and biodiversity PV are also to be subsidized through measures for ground-mounted systems. However, the argument of lower cost per kilowatt hour of solar power from ground-mounted systems does not apply to electricity from agricultural PV, which is currently more expensive. For this reason, special subsidy models are needed for land used for both agriculture and power generation, as well as floating PV. The strategy paper addresses the revision of floating PV specifications with a view to improving their profitability.

Field of Action 2

The second field of action are roof-top installations. The main goal here is to make direct marketing easier both from a technical and from a regulatory point of view. Furthermore, it seeks to relax regulations for roof-mounted installations, such as cable pooling, and to allow repowering.

Field of Action 3

Tenant power is the third field of action. Landlords of smaller residential buildings with few tenants in particular have been reluctant to take advantage of the existing options for self-supply due to the red tape involved. the Solar Package I includes the introduction of virtual totalizers and the removal of tax barriers for building owners. It also aims to introduce a model for a shared solar electricity supply, which emulates the successful Austrian model.

Field of Action 4

Balcony PV is booming and the fourth field of action of the Solar Package I responds to this: Registration duties are to be simplified and double registration duties completely eliminated. Analog meters that run backwards when balcony PVs feed power into the grid are to be tolerated until they are replaced with bi-directional meters. Moreover, plug-in solar installations are to be included in the catalog of privileged measures in the German Act on the Ownership of Apartments and the Permanent Residential Right (WEG), which means, for example, that a building’s community of apartment owners would have to give its approval.

Field of Action 5

The fifth point focuses on the urgent need to accelerate grid connections. Digitalization, simplified certification and registration, especially for small-scale systems as well as the access rights for connecting cables would be valuable contributions to this. Grid operators are urged to simplify the technical requirements for grid connections.

Field of Action 6

The sixth field of action concerns public acceptance of solar deployment. The Solar Package I promises success, in particular by adding photovoltaics to the catalog of topics covered Fachagentur Windernergie an Land, especially when it comes to ground-mounted systems. Furthermore, red tape and other barriers to community energy projects are to be further reduced.

Field of Action 7

Tax-related barriers that hinder the expansion of PV are the topic of the seventh field of action. This includes changes in the areas of annual tax report on revenue tax, commercial tax for rental income from electricity supply and the classification of ground-mounted PV systems as agricultural and forestry assets.

Field of Action 8

The eighth field of action includes the reestablishment of PV production in Germany. The measures listed in the strategy paper comprise investment incentives, subsidies for research and development and the introduction of a hybrid capital instrument. However, these requirements have already been clearly identified elsewhere, so the focus now is on their fast implementation and introduction.

Field of Action 9

Securing skilled workers for PV deployment is the ninth field of action. The BMWK banks on strengthening education and further training as well as recruiting qualified specialists from third countries.

Field of Action 10

The tenth field of action concerns research funding, which is closely linked to restoring the domestic PV manufacturing. After all, the majority of innovations come from Germany and Europe in general.

Field of Action 11

As the eleventh and final field of action, subsidies for PV is declared to be in line with European policy instruments. Under this field of action, planning and approval procedures are to be accelerated by classifying renewable energy systems as in the “overriding public interest”.

The BMWK’s photovoltaics strategy is an important step towards improving the framework conditions for solar expansion. However, important issues such as subsidies for PV systems on sealed surfaces or the targeted promotion and widespread use of energy sharing are still being put off by being deferred to the Solar Package II. That being said, if comprehensive laws are actually passed in line with this package of policy measures before the summer break, this will mark an important step toward accelerating solar deployment.

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