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German states call for renewables reform and greenlight removal of solar support cap

The council of German state governments has called for a speedy and comprehensive reform of the Renewable Energy Act (EEG) to ensure the country reaches its 2030 target of expanding renewables to a share of 65 percent of total power consumption. In the last session before the parliamentary summer break, the states said a systematic reform of the energy taxes and levies is necessary, starting with lowering the renewables levy consumers pay with their electricity bill with the help of CO₂ price revenues and budget funds. As part of the coronavirus recovery package, the government had recently decided to cap the surcharge by doing just that. The states emphasise that the increased use of electricity in sectors such as transport and buildings (sector coupling) will lead to additional power demand. The states presented other renewables reform proposals such as making self-consumption more attractive and better supporting citizens’ energy projects.
They also greenlighted the Bundestag (federal parliament) decision to abolish the 52 gigawatt (GW) solar power support cap, which had been a point of contention for months within the government coalition. This means that smaller new facilities – those up to 750 kilowatt capacity, which do not have to participate in auctions for renewables support – will continue to receive remuneration under the EEG.

In order to help reach climate targets, the German government has set the goal of increasing the renewables share in power consumption to 65 percent by 2030 with the climate package decisions from September 2019. While the solar industry has seen a positive trend in recent months, wind power expansion slumped in 2019 due to regulatory hurdles and increased opposition. The government has said it aims to present an EEG reform draft, including more ambitious annual expansion targets for each technology. It is expected for autumn 2020. Experts have called for a comprehensive reform of German energy taxes and levies for years.

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