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EEG 2.0: Proposal for Last Minute Changes to EEG 2014 Reform Bills

To meet concerns by the EU Commission, the ruling conservative CDU/CSU parties and their Social Democrat allies (SPD) agreed to amend the EEG 2.0 bills. The revised proposals also merges the currently separate bills amending the Renewable Energy Sources Act (EEG) and EEG special equalisation scheme, which provides for a reductions of the renewables surcharge (EEG surcharge) for energy-intensive companies and railroad operators.

The 204-page proposal comes as input for the Bundestag’s Economic Affairs and Energy Committee, very shortly before Parliament is due to hear the second and final third reading of the bills this coming Friday, June 27th, and vote on the matter. Long-time Parliament member Renate Künast, chairman of the Committee on Legal Affairs of Parliament, was quoted by the magazine Der Spiegel [1] complaining about the legislative procedure.

Below we will summarize what upon first review appear to be the main amendments. If readers wish to compare, please use the following links to the original EEG reform bill [2] and the bill amending the special equalisation scheme (for our blog post on the matter, please click here [3]; the original bill can be accessed here [4]).

1. EEG Surcharge for Imported Renewable Power

Recently voiced concerns by the European Commission that levying the EEG surcharge on imported renewable power might violate Articles 30 and 110 TFEU led to the introduction of a new section on tendering that will also allow tenders from other European countries. According to a new Section 2 para. 6 of the proposed EEG 2014, future tenders to establish the scope of financial support under the EEG that shall be carried out by 2017 at the latest shall be open to power from European countries, covering at least 5% of newly installed capacity. The system will be subject to  certain further restrictions, in particular the principle of reciprocity.

2. Own Consumption of Power by Operators

As reported yesterday, the Commission raised concerns over the provisions regulating a partial exemption of own consumption of power by operators of power plants from the renewables surcharge (EEG surcharge).

According to revised proposal, the following shall apply regarding this important matter for German industry:

 3. Special Equalisation Scheme

Concerning the other highly important topic for German industry, the revised proposal suggests to

4. Support under the EEG for the Various Sources of Renewable Energy

Changes affect

5. Market Integration of Renewables

It is the officially declared intention of the EEG 2.0 or EEG 2014 to reduce EEG-related costs by subjecting renewables to market conditions to a greater degree by making direct marketing mandatory.

The latest proposal contains the following changes compared with the former version of the EEG 2014:

6. Underground Power Cables

Various other minor changes are proposed, among them an amendment of the Federal Requirement Plan for Transmission Networks [7], according to which underground power cables may be permitted parallel to existing high and extra-high voltage overhead cables on a case to case basis for the pilot projects listed in the law.

7. Further Steps

The majority of the Bundestag’s Committee for Economic Affairs and Energy has agreed with the proposed latest changes as introduced by the CDU/CSU and the SPD parliamentary groups.  The Bundestag is scheduled to vote on the amended proposal on Friday. The debate is scheduled to start at 9:00 CEST and planned to last for 1:10 hours [8]. The vote of the Bundesrat is expected for 11 July 2014. Entry into force shall be 1 August 2014.

It remains to be seen to what extent all pending European law issues will really be resolved with the EEG 2.0 revision. The European Court of Justice’s upcoming decisions in the Ålands Vindkraft case (C-573/12), [9] the Essent Belgium case (C-204/12) [10] or the pending EEG state aid law cases [11]on the EEG 2012 exemptions may require further adjustment depending on the Commissions and the  court’s findings on the application of the Treaty principle of the free movement of goods and its state aid rules on renewable energy support schemes and its exemptions.

Sources: Bundestag [12], Recommendations and Report Economic Affairs and Energy Committee [13]

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