:Germany is concerned about climate change. Germany has always taken a proactive stance on international climate change agreements: Bonn 1995 Commitments of the government Hosting the UNFCCC Secretariat National and EU policies Current commitment: EU: 20 % emissions reductions by 2020; 20 % renewables, 20 % energy efficiency. In case of new climate agreement: 30 % reduction.

1. Renewable Energy Policy in Germany:
A FIT Success Story
Dr. Christine Wörlen
May 2009

2. Overview
• German Climate Change Policy
• The German Feed-in-Tariff (FIT) scheme to facilitate
investment in renewables
• Benefits: CO2 emission reduction, jobs, income

3. Emission Reduction Policy
in Germany

4. Germany is concerned about climate
change.
Germany has always taken a proactive stance on
international climate change agreements:
Bonn 1995
Commitments of the government
Hosting the UNFCCC Secretariat
National and EU policies
Current commitment:
EU: 20 % emissions reductions by 2020;
20 % renewables, 20 % energy efficiency.
In case of new climate agreement: 30 % reduction.

5. German Integrated Energy and Climate Package.
Meseberg 2007:
29 measures
Emissions Trading and Clean Development Mechanism
Support for climate-friendly energy production (renewables,
CHP)
Energy efficiency measures for residential households
Implemented to the largest part over 2008 and 2009

6. 29-Point Integrated Energy and Climate Programme
of the German Federal Government 2007.
1 Amendment to the Combined Heat and Power Act 16 CO2 strategy for passenger cars
2 Amendment to the Energy Sector Act (EnWG) on 17 Biofuels development
liberalising metering 18 Reform of the vehicle tax to a pollutant and CO2
basis
3 Low-carbon power plant technologies
19 Energy labeling for passenger cars
4 Smart monitoring of power consumption
29 Amendment to the Heavy Goods Vehicle (HGV) Toll
5 Clean energy technologies Ordinance
6 Adoption of a modern energy management system 21 Air traffic
7 Promotional program for climate protection and 22 Water transportation
energy efficiency (outside of buildings)
23 Reduced emissions of fluorinated greenhouse gases
8 Energy-efficient products
24 Procurement of energy-efficient products and
9 Feed-in law for biogas in the natural gas grid services
10 Energy Saving Ordinance 25 Energy research and innovation
11 Heating costs for rental housing 26 Expansion of electric transport
12 Low-carbon building retrofitting program 27 International projects for climate protection and
energy efficiency
13 Energy-efficient modernization of buildings and
social infrastructure 28 Energy and climate policy information programs for
German embassies and consulates
14 Renewable Energies Heat Act (EEWärmeG)
29 Transatlantic climate and technology initiatives
15 Efficiency retrofitting program for federal buildings
EFFIZIENZ ENTSCHEIDET

7. 29-Point Integrated Energy and Climate Programme
of the German Federal Government 2007.
1 Amendment to the Combined Heat and Power Act 16 CO2 strategy for passenger cars
2 Amendment to the Energy Sector Act (EnWG) on 17 Biofuels development
liberalising metering 18 Reform of the vehicle tax to a pollutant and CO2
basis
3 Low-carbon power plant technologies
19 Energy labeling for passenger cars
4 Smart monitoring of power consumption
29 Amendment to the Heavy Goods Vehicle (HGV) Toll
5 Clean energy technologies Ordinance
6 Adoption of a modern energy management system 21 Air traffic
7 Promotional program for climate protection and 22 Water transportation
energy efficiency (outside of buildings)
23 Reduced emissions of fluorinated greenhouse gases
8 Energy-efficient products
24 Procurement of energy-efficient products and
9 Feed-in law for biogas in the natural gas grid services
10 Energy Saving Ordinance 25 Energy research and innovation
11 Heating costs for rental housing 26 Expansion of electric transport
12 Low-carbon building retrofitting program 27 International projects for climate protection and
energy efficiency
13 Energy-efficient modernization of buildings and
social infrastructure 28 Energy and climate policy information programs for
German embassies and consulates
14 Renewable Energies Heat Act (EEWärmeG)
29 Transatlantic climate and technology initiatives
15 Efficiency retrofitting program for federal buildings
EFFIZIENZ ENTSCHEIDET

8. Example: Residential Households.
EnEV (Energy Savings Ordinance)
Prescribes tolerable energy consumption per square meter
Standards became tougher this year (30 %) and will be tightened
again in 2012 (30%)
Leading to more efficient houses (insulation)
EEWärmeG (Renewable Energy Heat Law)
In newly built or significantly renovated houses, a share of the heat
requirements (heat and hot water) needs to be covered from:
Solar thermal water heaters
Biomass-based boilers
Biogas
District heating
Marktanreizprogram (investment subsidies)

9. Integrated Climate and Energy Programme – Summary.
 Program of 29 key elements is without precedent both in the history of
Germany and internationally
 Translates into a package of 14 acts and ordinances
 CO2 emission savings of about 220 million tones in 2020 or 36% vs.
1990 levels
 Total costs of about 31 billion Euro
 Annually saved energy costs of about 36 billion Euro
 Net economic benefit of about 5 billion Euro per year.

10. Energy Supply Side Objectives.
20% of final energy consumption to come from renewable energy.
14% of heat demand in Germany to be covered from renewable
energy sources.
<10 % of fuels to be covered from biofuels.
27 – 30 % of electricity to come from renewables.
25% of electricity to come from CHP in 2020.

11. Renewable Energies in
Germany and the FIT

12. Renewables as share of total final energy consumption in
Germany in 2007.
Shares of renewable energy sources among total final
energy consumption in Germany
1)
Total: 8,585 PJ
Hydropower 0.9 %
Wind 1.7 %
90.2 % RES share 2007
Other energy resources, 9.8 % 1)
Biomass3) 6.8 %
e.g. hard coal, lignite,
mineral oils,
natural gas
Other renewables
0.4 %
RES - Renew able energy sources; 1) Compared to RES in figures - w ith the conditions of June 2008 - the value have strongly increased. The reason for this is that the
respective base value w ere adapted to more current data: for the RE-portion of the final energy consumption (FEC) so far the value of 2006 had to be used. The FEC 2007,
w hich w as published in the 2nd half of 2008, is 8.585 PJ and therefore fundamentally low er than the value of the previous year - mainly due to the mild w inter. 3) solid, liquid,
gaseous biomass, biogenic share of w aste, landfill and sew age gas;
Source: BMU-KI III 1 based on AGEE-Stat and ZSW, according to Working Group on Energy Balances (AGEB); all figures provisional; Version: 15.12.2008
Source: BMU 2008

13. Renewable energy shares in Germany, 1998 - 2007.
Renewable energy sources as a share of energy supply in Germany
8.0
7.0
Fuel consumption
1.2
6.0 Heat supply
Electricity generation 1.0
5.0
2.6
[%]
4.0
2.3
3.0
0.1
2.0 0.03 1.5
1.3 3.1
2.5
1.0
1.4
0.8
0.0
1998 (2.1 %) 2002 ( 3.0 %) 2006 ( 5.7 %) 2007 (6.9 %)
Deviations in the totals are due to rounding, provisional figures
Share of primary energy consumption (PEC) calculated according to the efficiency method (acc. to the substitution method: 9.4 % );
Source: BMU-Brochure: quot;Renew able energy sources in figures – national and international developmentquot;, Internet Update, KI III 1; Version: 15.12.2008; provisional figures
Source: BMU 2008

14. Renewable electricity in Germany, 1990 - 2007.
Development of electricity generation from renewable energies
in Germany, 1990 - 2007 EEG 2009
100,000 ex 1 January 2009
New EEG
90,000
Hydropower Wind energy 1 August 2004
80,000 Biomass* Photovoltaics
Electricity generation [GWh]
70,000 EEG
1 April 2000
60,000
50,000 Amendment to BauGB
November 1997
40,000
StrEG
30,000 1 January 1991
20,000
10,000
0
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
*Solid, liquid, gaseous biomass, biogenic share of w aste, landfill and sew age gas;
StrEG: Act on the Sale of Electricity to the Grid; BauGB: Constuction Code; EEG:Renew able Energy Sources Act;
Electricity from geothermal energy is not presented due to the negligible quantities of electricity produced;
Source: BMU-Brochure: quot;Renew able energy sources in figures – national and international developmentquot;, Internet Update, KI III 1; Version: 15.12.2008; provisional figures
Source: BMU 2008

15. Tariffs
• ..are granted for 20 years
• …vary by technology
• …vary by plant (resource quality, plant size, feedstock)
• …get lower over the years (degression)
• …negotiated such that at current investment prices some
(marginal) profit is attained.

16. Tariffs under the FIT, 2009.
Technology Min Max Degressio Remarks (depends on…)
(Cts/ (Cts/ n
kWh) kWh)
hydropower 3.50 12.67 1% plant size, age
Methane from dumps, 4.16 11.00 1.5% Plant size, fuel
sewage, mines
Biomass 2.5 13? 1% Plant size, fuel, CHP,
technology, feed-in
geothermal 10.5 18 1% Plant size, technology,
CHP
Wind power: onshore (5) (10.4) 1% Location, technical
offshore 3.5 15.50 5% compliance, repowering
Solar photovoltaics 31.94 48.01 8 – 10 % Plant size, building
integration
BMU, 2008

17. Feed-in Tariffs are not just tariffs:
• German Feed-in Law (EEG) is
– Purchase price guarantee
– Grid access guarantee
– Purchase obligation, priority for feed-in
• Grid operator buys at predefined rates;
• National equitization fund
• Every power customer pays
• Law is reviewed every four years
• Federal law
• Annual degression incentivizes early action

18. Advantages of Feed-in Tariffs: Simple, stable, fair,
effective.
• Industry needs a long-term perspective for large investment
and capacity decisions.
• Operators need clear price signals,
• non-discriminatory grid access,
• reward for early action,
• minimal transaction costs.
• All of these factors reduce the total cost of deploying
renewables through lower risk and lower transaction costs,
and maximize deployment activity.

19. Advantages of Feed-in Tariffs:
Simple, stable, fair, effective (II).
• Germany has overachieved her renewable energy targets.
– In 2000, the target for 2010 was 12.5%.
– This target was actually reached in 2007 with 14.7%.
• Costs for systems in Germany are lower than in other
jurisdictions.

20. FIT regimes save cost.
Böll 2008

21. Costs and Benefits

22. RE costs as share of power price

23. Expected development of the monthly EEG-costs per
average household (3500 kWh/year).
Euro 2005/month
Source: BMU 2006

24. Future costs of wind power.
Low-cost wind power
As of 2015, prices for power from
conventionally-fuelled power plants will surpass
those for wind energy.
New power-plant construction and rising
procurement costs will determine conventional
power prices.

25. CO2 avoidance through renewable energy, 2007.
Total CO2 avoidance via the use of renewable energy sources
in Germany, 2007
Electricity 23.1 million t 34.2 million t 19.5 million t 2.1
million t
78.9
million t
Heat 21.9 million t 0.9 million t Total: approx.117 million t CO2
23.3 from this approx. 57 million t CO2
million t through the EEG
0.5 million t
Fuels 15.0 million t
15.0
million t
0 10 20 30 40 50 60 70 80 90
CO2-avoidance [million tonnes]
Hydropower Wind energy Biomass Photovoltaics Geothermal energy Solar thermal energy Biofuels
Source: BMU-Brochure: quot;Renew able energy sources in figures – national and international developmentquot;, Internet Update, KI III 1; Version: 15.12.2008; provisional figures
Source: BMU 2008

26. Income from building renewable energy in
Germany, 2007.
Turnover from the Construction of Renewable Energy Powered
Installations in Germany, 2007
Total: approx. € 11 billion
Solar thermal
EUR 755 mill.
Photovoltaics (6.9 %) 1)
Geothermal energy
EUR 4,675 mill.
EUR 680 mill.
(42.7 %)
(6.2 %)
Wind energy
EUR 2,228 mill.
(20.8 %)
Hydropower
EUR 70 mill.
Biomass heat Biomass (0.6 %)
EUR 1,440 mill. electricity
(13.2 %) EUR 1,050 mill. (9.6 %)
1)
Large plants and heat pumps
Source: BMU-Brochure: quot;Renew able energy sources in figures – national and international developmentquot;, Internet Update, KI III 1; Version: 15.12.2008; provisional figures
Source: BMU 2008

27. Income from renewable energy installations in
Germany, 2007.
Turnover from the Operation of Renewable Energy Powered Installations
in Germany, 2007
Total: approx. € 14.5 billion
Biofuels
EUR 3,810 mill.
Biomass heat 1) (26.2 %)
EUR 1,880 mill.
(12.9 %)
Photovoltaics
EUR 1,600 mill.
Biomass electricity (11.0 %)
EUR 2,520 mill.
(17.4 %) Geothermal energy
EUR 0.05 mill.
(< 0.1 %)
Hydropower
EUR 1,200 mill. Wind energy
(8.3 %) EUR 3,510 mill.
(24.2 %)
1)
Only fuels used exclusively to supply heat
Source: BMU-Brochure: quot;Renew able energy sources in figures – national and international developmentquot;, Internet Update KI III 1; Version: 15.12.2008; provisional figures
Source: BMU 2008

28. Total income from renewable energy in Germany,
2007.
Total Turnover from Renewable Energy Sources
in Germany, 2007
Total: approx. € 25.5 billion
Wind energy
Geothermal
EUR 5,790 mill.
energy 1) (22.7 %)
EUR 680 mill.
(2.7 %)
Hydropower
EUR 1,270 mill.
(5.0 %)
Solar energy 2)
EUR 7,030 mill.
(27.6 %)
Biomass
EUR 10,700 mill.
(42.0 %)
1)
Large plants and heat pumps
2)
Photovoltaics and solar thermal energy;
Source: BMU-Brochure: quot;Renew able energy sources in figures – national and international developmentquot;, Internet Update, KI III 1; Version: 15.12.2008; provisional figures
Source: BMU 2008

29. Wind energy suppliers in Germany, 2007.
Share of providers of wind energy installations in newly installed
capacity in Germany up to end of 2007
Gesamt: 1,667 MW
Siemens Wind Power
Vestas 3.5 %
24.1 %
Other
1.0 %
REpower Systems
10.9 %
Enercon
50.3 %
Gamesa
2.6 %
Fuhrländer Nordex
2.7 % 4.8 %
Source: Molly, J.P.: Status der Windenergienutzung-Stand 31.12.2007; Deutsches Windenergie-Institut (DEWI)
Source: BMU 2008

30. Total jobs in renewable energy in Germany,
2005 - 2008.
Source: BMU 2009

31. The solar industry in Germany.
• Since 2003, the turnover of the German PV industry has
multiplied by a factor of 10 (total €5.5 bn)
• Of this, 37.6 % were exported.
• Over 40,000 jobs were created in solar factories and
installation businesses.
• Until 2010, the solar industry association BSW
expects around 54,000 jobs, in 2020 maybe twice as many.
• Preconditions: stable home market, investments into
research.
BSW Präsentation Marktentwicklung

32. The solar industry
in Germany (II).
BSW Präsentation Marktentwicklung

33. Farm revenues.
BSW Präsentation Marktentwicklung

34. Sweetwater, TX
•Nolan County, Texas had 20% of
the population living in poverty in
2004.
•Now 1,100 of the 15,000 residents
have jobs directly related to wind
energy.
•Sweetwater area is steadily
growing again for the first time in
decades.
•Nolan County‘s property tax base
has expanded from $500 m in 1999
to $2.4 bn in 2008.
Source: windpowerworks.org 2009

35. Manufacturing of utility scale wind turbine
components in the US in 2008.
•13,000 direct new jobs, nearly $2 bn in investment
•Towers, components, gearboxes, housings, turbines, blades, materials,
lifts… Source AWEA Annual Statistics 2008

36. Iowa School Districts
• Each school that operates a
turbine saves or generates
between $3,500 and $560,000
annually.
• Wind power presents a unique
educational opportunity.
• Forest City Community School
District’s turbine annually
produces about 60 percent of the
district’s electricity consumption.
This clean, locally grown power
has allowed the district to reduce Wind energy became an issue
its carbon dioxide emissions by of local pride in each of these
657 tons and sulfur dioxide school districts.
emissions by 2.9 tons annually.
Source: Iowa Policy Project 2007

37. Danish wind cooperatives
85% or all wind power capacity is owned by individual or local cooperatives.
Source: Böll 2009

39. What helps develop community wind schemes?
Source: windustry 2007

40. Conclusion
• Germany has very ambitious climate change objectives, and
implements the policies to put them into a reality.
• Energy efficiency and renewable energies will be among the
main vehicles.
• The policies implemented are having multiple benefits:
– increased energy security
– decreased GHG emissions,
– Creation of an industry of global significance,
– Jobs and national income.
• Among the social and economic benefits of the FIT is
increased resilience against the current global downturn.

41. Thank you for your attention.
Christine Wörlen, Ph.D.
Am Weinhang 8 | 10965 Berlin | Germany
fon +49 - (0)30 - 7809 787-0
fax +49 - (0)721 - 1513 323 46
mobil +49 - (0)1522 - 1971 234
mail woerlen@arepo-consult.com