Renewable Portfolio Standard Already Existing in Germany

When discussing minority loser proposals to get rid of the Law on Priority for Renewable Energy and replacing them with a renewable portfolio standard, it might be of interest to note that the current law already has a renewable portfolio standard in Article 39, the privilege for green electricity.

That works like this: An utility may reduce its surcharge payments by 2 cents per kWh if it meets the criteria.

The first is that over 50 percent of their electricity must come from renewable sources.

The second is that over 20 percent must come from intermittent sources (wind and solar).

The third is that the electricity must be sold directly by the generators. That means they don’t get paid feed-in tariffs, but whatever the utility using that “green electricity privilege” is prepared to pay.

This whole exercise is one of the ways the law tries to prepare the market for the time after the support schemes are phased out. For solar that will be as soon as 2015, since the overall ceiling of 52 GW is predicted to be reached in that year. For new installations after that phase-out, this renewable portfolio standard will be the only support scheme, which will be better than nothing.

Wikipedia says that already about 3.4 TWh of electricity have been sold under this model in 2011.

There is nothing wrong in principle with a renewable portfolio standard, if it comes on top of the most effective feed-in tariff model. Especially for the time after the feed-in tariffs run out, it is obviously better for solar energy than being left with nothing at all.

Published by kflenz

Professor at Aoyama Gakuin University, Tokyo. Author of Lenz Blog (since 2003, lenzblog.com).

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