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WFG welcomes planned increase for geothermal feed-in-tariff in Germany

Hekla Energy drilling rig at Mauerstetten, Germany (source: Iceland Drilling)
Alexander Richter 6 May 2011

German Geothermal Business Forum ("Wirtschaftsforum Geothermie", WFG) welcomes the ambition of the German Federal Environment Ministry, to raise the feed-in tariff for geothermal energy by up to $3/ MWh ($3 cents/ kWh), within the framework of the amendment of the Renewable Sources Act (EEG).

In a release today, the German Geothermal Business Forum (“Wirtschaftsforum Geothermie”, WFG) welcomes the ambition of the Federal Environment Ministry, to raise the feed-in tariff for geothermal energy, within the framework of the amendment of the Renewable Sources Act (EEG). As several German daily newspapers announced in the last few days, the Federal Environment Ministry suggests in the draft to the EEG study report, to integrate the existing incentives into the base compensation, and to raise that amount by about 2 Cent per kWh. In spite of the significant increase in the compensation provided by the EEG contribution for electrical energy from geothermal, power customers should have no concerns as geothermal projects have long lead times, due to intensive exploration requirements, and different licences which have to be applied for.

Regarding the amendments suggested by the Federal Environment Ministry, Dr. Erwin Knapek, President of the WFG, comments, “The suggested changes provide for the enormous potential of geothermal energy in Germany. This is a step in the right direction. However, for a genuine step-change development of base-load geothermal energy, and thus for reaching the target of a meaningful energy transition in Germany, further amendments are necessary.” The Wirtschaftsforum Geothermie and the GtV-Bundesverband Geothermie published in April a proposition for the faster development of geothermal energy and, a suggestion for the enhancement of the Renewable Sources Act in a common paper.

In preparation for the study report, the WFG and the Institut für Energiewirtschaft und Rationelle Energieanwendung (IER) of Stuttgart University evaluated, for the Federal Environment Ministry the electrical production costs based on geothermal plants in operation and business plans of projects under construction, to demonstrate their potential. This created for the ministry a realistic picture of the actual conditions of geothermal energy utilization in Germany. Nevertheless, the advantages of geothermal energy are obvious – climate friendly, renewable, sustainable and crisis resistant are only some of the attributes characterizing geothermal energy.

The amendment of the EEG and the consequences for geothermal energy is one of the subjects at the 7th International Geothermal Conference in Freiburg from May, 10th to 12th 2011. Among others Cornelia Viertl from the Federal Environment Ministry and the WFG President Dr. Erwin Knapek, present the study report and the findings from its preparation.”

Source: Release via e-mail