Coming of Age. How Will Germany’s Renewable Energy Pioneers Fare in the Free Market?

“There is no one-size-fits-all solution,” Philine Derouiche, a lawyer at the German Wind Energy Association (BWE), said. The future options for old or rather “pioneer” wind parks hinge on their capacity, the condition of the turbines, their location and their operating costs, she explained.

“The capability of a pioneer wind park to continue its operations on the free market primarily depends on its maintenance costs,” she told Clean Energy Wire.

Reinhard Christiansen, operator of several wind farms in Germany’s windy northern state of Schleswig-Holstein, has already gone through the motions of ensuring the future of his pioneer wind farm. As of 2021, he will sell the electricity of his six turbines in Ellhöft, with 1.3 megawatt capacity each, to power provider Greenpeace Energy.

According to their contract, Greenpeace Energy will pay an agreed base price for the electricity, which is adjusted if the wholesale price on the electricity exchange should be higher.

It is this kind of so-called power purchase agreements (PPA), often long-term delivery agreements, that many experts think will become the new default procedure after the feed-in tariff period ends. Under PPAs, the buyer bears the risk of weather-related fluctuations in power supply but therefore only guarantees a limited remuneration per kWh.

In a survey by Germany’s energy agency dena, over 85 percent of surveyed market representatives said PPAs are “important” or “very important” for the country’s renewable energy future. The main reason for this was the prospect of price stability and older installations dropping out of the EEG support scheme were seen as most suitable for this purpose.

Source: RenewEconomy

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