European Union Energy Commissioner Guenther has said Germany’s plan to curb the growth of renewables and review lavish subsidies is a step in the right direction but the country needs to do more to keep in check soaring retail power prices.
Chancellor Angela Merkel’s conservatives and the centre-left Social Democrats (SPD) have clinched a coalition deal, agreeing on a reform of the renewable energy law, which has sent costs for consumers soaring because of generous incentives for solar and wind power.
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The agreement is cautiously going in the right direction,” Mr Oettinger told Reuters Newsagency on the sidelines of an industry conference in Berlin.
“But I remain concerned that the deal will only slow the rise in power prices. Over the next four years, significantly stronger revisions are needed.”
German households on average pay about €0.29 a kilowatt-hour of electricity, up from about €0.21 in 2007, as the incentives for solar and wind power are slapped on consumers’ power bills via a surcharge.
While sparse on specific details, the coalition agreement aims for reductions to some subsidies for green energy to make Germany’s €550 billion energy transition affordable.
The government, which aims to be in place by Christmas provided SPD members vote for the coalition deal, wants to get revisions to the renewable energy law through parliament by the northern summer of 2014.
Reuters reports as part of the coalition agreement, power generated from renewable sources will be increased to 40-45 per cent of total production by 2025 and to 55-60 per cent by 2035, up from about 25 per cent now.
That is broadly in line with the outgoing government’s goal to raise the renewable share to 35 per cent in 2020 from roughly 25 per cent today.
However, it falls far short of SPD demands for a target of 75 per cent by 2030.
This further expansion, Mr Oettinger said, would drive up power prices for consumers.
He added he was concerned about whether this may impede the necessary expansion of power lines as well as the development of storage technologies in Germany.
