4 Market Integration of Renewable Energy Sources

• Goal:

  Switch from a regulated feed-in tariff to a more

  market-oriented remuneration scheme

• Capacity of RES plant to be tendered is set by a

  controlling authority or regulator

  (e.g. Bundesnetzagentur in Germany)

• Invitation to RES plant investors to participate in

  tender

• RES plant investor submits bid containing the

  capacity of the RES plant, which he intends to

  construct, and the demanded feed-in tariff.

• Bids with lowest feed-in tariff are awarded subsidy

• Goal:

  Incentive for a more market price-oriented investment and dispatch of RES plants

• RES Plant owners are responsible for the marketing of the produced electricity from RES (direct marketing).

• Market premium is based on market value of the average electricity production of a RES plant type

  (onshore wind turbine, offshore wind turbine, solar plant) and the feed-in tariff (regulated or tendered).

• Market premium is paid out to the RES plant owner by the respective DSO.

• Electricity production at higher prices than the average electricity production can lead to higher revenues than feed-in tariff and vice versa.

Goals

− Sustainable development of the energy supply

− Reduction of macroeconomic costs for the energy supply by including long-term external effects

− Saving fossil energy resources

− Further technological development of electricity production from RES

(80% RES consumption by 2030 and Greenhouse gas neutrality by 2045)

General content of the Renewable Energy Act

 Priority feed-in of electricity from RES as well as from CHP plants (combined heat and power)

 Obligation for DSO to connect RES plants and feed-in the produced electricity

 Obligation for DSO to expand their network, if economically reasonable

 Guaranteed and fixed feed-in tariffs for 20 years depending on technology, plant size and age

 Subsidised direct marketing according to market premium model

 Tenders for competitive determination of feed-in tariffs: RES specific and open-technology tenders

The wholesale price in a market

with higher infeed from RES is

lower than with low infeed from

RES. The effect on the household

consumers is the same.