Faced with the challenge of energy shortages, Germany has once again stepped up its support for photovoltaics.
Germany's Federal Network Agency said it will hold an additional tender for 1.5GW of solar development in order to boost the country's sluggish growth rate in the solar sector, with participants having until 15 January next year to submit project development proposals.
According to the announcement, the size of proposed projects should not exceed 100MW. proposed solar projects that win government incentives must be completed within nine months after receiving a feed-in tariff.
The upcoming tender is also known as the "crisis tender" as it is being held in response to the energy crisis that is prevailing in Germany as a result of the conflicts in Russia and Ukraine.
In April 2022, Germany unveiled its 'Easter Package', a plan to increase the share of renewable energy in the energy mix to 80% by 2030 and 100% by 2035.
The newly elected German coalition government is committed to accelerating the decarbonisation of Germany's electricity sector while reducing energy imports. Over the next decade, Germany will accelerate PV development, aiming to reach 215GW of installed solar capacity by 2030, adding 22GW per year.
For Chinese PV companies, most mainstream PV companies are actively exploring the European market, and with Germany already having more than a third of the EU's installed solar capacity, the country's proactive policies will undoubtedly benefit the country's PV market for further growth.
The challenge of under-subscription of projects
Despite wanting to push for rights, the German government's new tender initiative has also attracted some criticism. The German solar association 'BSW-Solar' said that the timeframes offered by German institutions for completing the construction of solar projects were too short and unrealistic. He also said that there were land restrictions that did not allow solar projects to be completed in time and that these needed to be relaxed.
The German Solar Energy Association says that many German federal states have not yet opened up arable and grassland land located in poor areas of Germany, which is preventing the development of solar electricity projects. As a result, potential development sites for solar power plants for developers are limited.
The Federal Network Agency was unsuccessful in allocating all the planned capacity mentioned in the previous solar tender. In the last tender allocation, the Federal Network Agency was only able to allocate 700 MW out of the 1,126 MW planned for the beginning of this year.
The wind tenders have also been under-subscribed in the past few years. Only the planned capacity for the past few months has been fully auctioned off. Solar power tenders are mainly over-subscribed. Last month, the under-subscription of the solar tender came into focus, raising questions about investor interest.
Carsten Körnig, head of the BSW, said that the current "site restrictions" would lead to a slowdown in solar expansion due to strict restrictions on the allocation of land for the construction of solar power plants at state level.
He added that the current framework "is outdated and is curbing the expansion of solar energy and the lights may go out in Germany." He argued that the current tender conditions should be examined, otherwise, "future solar tenders may often be under-subscribed."