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Tailwind for the energy transition? The new German Onshore Wind Energy Act

16.02.2023 7 Reading Time

klimaVest: Redakteurin Annemarie Fountoukas
Annemarie Fountoukas

The German Onshore Wind Energy Act is in force and is already being criticised

With the German Onshore Wind Energy Act (Wind-an-Land-Gesetz: WaLG), which entered into force on 1 February 2023, the German Federal government is pursuing an ambitious goal. It is intended to provide tailwind for the expansion of wind energy in Germany. This is also urgently necessary, because the current pace is simply too slow. Several ministries are outperforming each other with sustained ambition here. According to the German Renewable Energy Act (EEG), 71 gigawatts (GW) of onshore wind energy is to be installed in Germany by 2030. In its long-term scenarios, the Federal Ministry of Economics Affairs would like to have 80 GW on the grid by then, while the German Environment Agency is aiming for an ambitious 105 GW. 

It’s about nothing less than a trend reversal

In order to at least comply with the German Renewable Energies Act, between 1,500 and 2,000 wind turbines would have to be built per year. The reality is quite different: since 2020, this figure has been less than 500 per year. Considering that 895 wind farms were built nationwide in 2014 and 699 in the following year, a step backwards clearly has to be postulated. The main reasons for the slowdown are, on the one hand, the insufficient designation of land by the Federal states and, on the other hand, its actual usability for onshore wind energy.  

Will the turnaround succeed with the German Onshore Wind Energy Act?

With the WaLG, the German Federal government wants to cut the Gordian knot.  By 2027, all the regional states must have allocated 1.4 percent of the federal territory to wind energy. By 2032, the target is 2.0 percent. Solo efforts at regional state level are also to be prevented by a new concept for the state liberalisation clause for minimum distance regulations under national law. In accordance with WaLG, the Federal Nature Conservation Act enshrines uniform standards for species conservation assessments, which on the one hand are intended to ensure a high level of protection of endangered species and, on the other hand, to ensure accelerated approval procedures.  Nevertheless, the law is being criticised from all quarters – for different motives.

Tug-of-war between the government and the regional state

Everyone now wants independence from Russian gas. But that’s where the similarities come to an end. Bavaria, which heralded a tentative turnaround with 14 new and eight approved wind turbines in the previous year, felt restricted in its municipal planning sovereignty even in June 2022. In addition, Bavaria’s Minister for Construction, Christian Bernreiter, continued to denounce the lack of noise protection and questioned citizens’ acceptance.  After all, the brakes had successfully been put on the 10H distance rule between 2017 and 2021. If the distance between a wind turbine and a residential building must be ten times the height of a wind turbine, there will be no space for the expansion of wind energy. Nowadays, there is a willingness to compromise on this point as well. But it seems that it is difficult to change the way we think. 

Project developers lack consistency

Juwi, an established project developer in the field of renewable energies, considers the WaLG in its current form to be a paper tiger. The company wants more speed in the designation of suitable areas by the federal states and harder consequences if deadlines are missed.  The manufacturing industry is also struggling with completely different problems. While fixed prices were agreed in contracts for wind turbines, increased material costs due to disrupted supply chains are creating enormous cost pressure. The competition from China and Denmark, however, is not sleeping and is securing its share of the cake at favourable costs. Nordex has now taken down the sails in Rostock and discontinued blade production. 

The industry is facing a restart

With the German Wind on Land Act (Wind-an-Land-Gesetz; WaLG), the German federal government aims to prevent the German wind power industry from experiencing a similar collapse to the German solar industry. According to a press release from the German Wind Energy Association, confidence once again prevails.  There were cheers all round thanks to the record tender target of around 13 GW of wind energy on land. There is also huge potential in the preference for repowering – the renewal of outdated power plants. It still remains to be seen whether the wind industry will turn into an economic engine.  

The WaLG may not be perfect, but it creates framework conditions that should increase the pace of expansion and take into account the needs of a wide range of stakeholders. One thing is for sure, the WaLG is in the interests of investors. It is no coincidence that klimaVest has now been able to exceed the one billion euro fund volume mark and, thanks to investors, has a forecast return of between 3.5 and 4.5 percent.

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