Do we need a binding “sustainable energy production and allocation plan” in Europe? – Considerations on the further development of sustainable energy law

Do we need a binding “sustainable energy production and allocation plan” in Europe?– Considerations on the further development of sustainable energy law using the example of Germany

Prof. Dr. Wolfgang Köck, 12th IUCN Colloquium 2014, June 30th – July 5th 2014Tarragona,Spain

Do we need a binding “sustainable energy production and allocation plan” in Europe?

– Considerations on the further development of sustainable energy law using the example of Germany

Page 2

Overview

A. Challenges of Germany’s Energy Transition

B. The Asymmetry of the legal governance of electricity transmission and electricity generation

C. The need for a binding electricity generation plan in Germany

D. Conclusion and Outlook to the EU



▪ Ambitious renewable energy targets: RE share in electricity• at present (2012): 22,9%; until 2020 at least 35%; until 2030 at least 50%• until 2040 at least 65%; until 2050 at least 80%

▪ RE-promotion in Germany*: effective, but for now not in good coordination with the development of electricity grids and the requirements of the security of electricity supply

▪ system integration of RE (I): net development → new transmission lines and grids needed (2,700 km new construction; 2,900 km repowering) → growing NIMBY-problems and new debates on EMF – different concepts in EU)

▪ system integration of RE (II): priority for RE leads to „missing money“-effects for conventional power plants with impacts on security of electricity supply

▪ decision for nuclear phaseout: impacts on security of electricity supply

* Renewable Energy Sources Act (EEG): Obligations for grid system operations: giving priority to connect installations generating electricity

from RE sources to the grid system; giving priority to transmit and distribute the entire available quantity of electricity from RE sources; paying feed-in tariffs to installation operators for a period of 20 years


B. The Asymmetry of the legal governance of electricity transmission

and electricity generation

Silde: G. Hermes

Scenario frame

• Forecast (10 years) generation, supply, consumption• Transmission operators have to submit a draft annually • Permission by the Federal Network Agency

Net development plan

• Measures for optimizating, increasing and extending the network (horizon: 10 years)

• Transmission operators have to submit a draft annually• „Permission“ by FNetworkA after modifications when required

Federal demand plan

(Bundesbedarfsplan)• demand plan by federal law (status of confirmation)• Verification of demand by federal legislator

Federal plan for trans-mission line corridors

(Bundesfachplanung)

• Designation of (spatially acceptable) corridors by the Federal Network Agency with participation of spatial planning institutions on state level

Authorisation (project)Authorisation (project)

PlanfeststellungPlanfeststellung• Authorisation decision by FNA for federal state

crossed / cross-border transmission line projects

1. Transmission grids: cooperative demand planning under executive/political control

B. The Asymmetry of the legal governance of electricity transmission

and electricity generation

Market model:

2. Electricity generation: market model with incentive elements (EEG)

Obligation by the German Energy Act up to now only appellative:

- Free access to the market of electricity generation- Freedom of choice in investment decisions

- Competition between producers (from network regulation)

- No specific regulation on generation market

- General legal requirements (competition, spat. planning, env. regul.)

Within the framework of this law energy supply companies are obligated to supply as laid down in § 1 EnWG. (§ 2 I EnWG)

Investment incentives for renewable energy sources (EEG):

- Obligation to connect, purchase and to transfer - Obligation to pay feed in tariff; minimum rates are set by law - Complex fine-tuning by rates of feed in tariff for deifferent RE sources

- Priority feed-in of RE


Slide: G. Hermes

demand-oriented electricity grid planning and grid provision

“Free“ investment decision (type of electricity production and location)

C. The need for a binding electricity generation plan in Germany – four reasons

1. Safe-guarding the security of electricity supply

2. Recognizing the interdependence of net development planning and the structure of electricity generation

3. Governmental influence on electricity consumption and on substantialpreconditions for investments in electricity generation plants

4. The unsufficient scope of the existing legal instruments


2011/2012:

1. Safe-Guarding the security of electricity supply

Medium-term (2016 – 2022):

- „stress test“ for all nuclear power plants: Federal Network Agency: electricity generation capacity is just in short supply

-Prediction: giving up of conventional power plants (according to the consequences of the merit order principle (2012 bis 2014) -under constant market conditions some conventional power plants will be economically unviable

- Most of the existing conventional power plants originates from times before „liberalisation“ of electricity markets in the EU

- „Missing Money Problem“: prices on „energy-only“-market (merit order principle) is not sufficient to cover the costs of all needed power plants

€/MWh

MW

Merit order (energy only market)


Slide: G. Hermes, Uni Frankfurt

2. Interdependence between net development and electricity generation structure

Should Renewables get priority for 100%?

Demand for electricity (potentials of strengthening energy efficiency) ?

windenergy offshore (north) oder

windenergy onshore (possibly south) ?

Conventional electricity generation capacity and locations?

Development of photovoltaics ?


a) Nuclear phaseout and general conditions for conventional power plants

• phasing out period for the existing nuclear power plants

• Emissions trade for conventional power plants

3. Governmental influence on electricity consumption and on substantialpreconditions for investments in electricity generation plants

b) General conditions for Renewable Energies – Feed in tariffs – caps

c) General conditions for electricity demand– f.e. Energy Saving Act (Energieeinsparungsgesetz)

d) Designation of land for electricity generation – Spatial Planning (state and regional level)– Spatial Planning (local level: „zoning“)

Government

and administration are

major players!!


4. The unsufficient scope of the existing instruments

• The targets of the energy program of the federal government: in present too undefined for giving orientation for the grid development planning

• The promotion of Renewables by the Renewable Energy Sources Act (EEG): characterized by permanent adaptation in a formal parlamentarian legislation procedure without any formal preliminary planning procedures;

• Competences according to §§ 13 ff. German Energy Act (Energiewirtschaftsgesetz, EnWG): an instrument for crisis situations, not for permanent coordination

• Contract out new electricity generation capacities (§ 53 EnWG): needs preliminary planning

C. The need for a binding electricity generation plan in Germany5. Intermediate result

Electricity generation planning makes sense and is necessary

• for ensuring the security of electricity supply,

• for strengthening the predictions for net development planning

• for the coordination and the application of different instruments in energy law, in renewable energy law, in spatial planning law, and in environmental law

• for decisionmaking in the field of contract out new electricity capacities

• for the preparation of amendments of the EEG

D. Conclusion

• The energy transition needs more not less planning

• Energy (generation) planning is necessary to improve net development planning as well as to safe-guard security of supply

• Energy generation planning should be a mix of political and administrative planning

• Energy generation planning will only be possible in close cooperation at federal and states level; this requires appropriate procedures and principles

Outlook to the EU

• experiences of Germany`s energy transition leads to some conclusions for the further EU-policy in the energy sector:

− EU is on it`s way to an european energy transition (especially RE-targets) and shouldn`t underestimate the problems during the transition phase

− EU targets for RE share leads to numerous effects on energy policy of Member States (transmission lines; locations for RE sites; policy for safe-guarding energy supply: capacity mechanisms)

− new cooperations between the MS in energy policy is needed: EU should establish obligations for the coordinaton of national energy policies by planning instruments (based on EU competences for energy (Art. 194 II TFEU) and for trans-european networks (Art. 172, 171 II TFEU) (this includes more than just net development planning and more than just decision making by operators and experts)

Leipzig, 2013-06-*****

Thank you very much for your attention!

Prof. Dr. Wolfgang KöckHead of Department of Environmental and Planning Law

Helmholtz Centre for Environmental Research([email protected])

further informations about the department: http://www.ufz.de/export/data/1/53080_UFZ_UPRBrochure_2013_EN.

pdf

Proposal for establishing an energy generation plan for Germany based on: Georg Hermes, Planungsrechtliche Sicherung einer Energiebedarfsplanung, Zeitschrift für Umweltrecht 25 (2014), 259-269

http://www.zur.nomos.de/fileadmin/zur/doc/Aufsatz_ZUR_14_05.pdf

Baedeker Travel Guide:

Germany – Discovering Renewable Energy

Additional slides

D. Profile of requirements for an electricity generation planaccording to Georg Hermes (Zeitschrift für Umweltrecht 25 (2014), 259)

• Safe-guarding security of electricity supply between market and plan: contract out capacity markets (solution close to the market); process of contract out needs preliminary planning (plan is a pre-condition, not an alternative to capacity markets)

• Between professional prediction and democratic legitimacy: prediction overstrains professional expertise, because numerous premise are not independent from political decision making (Energy Policy) – therefore: decision of federal government is needed

• Between interests on security of investment and flexibility: plan needs permanent adaptation to better knowledge but investment needs protection of trust

• Between the federal level and the states: federal electricity generation plan as a

binding requirement for spatial designations on the state and the regional level; participation of states as a procedural step within the planning procedure

• Between political planning (programs) and sectoral location oriented demand

planning: federal energy generation plan need elements of political planning (f.e. targets, premise, … and demand planning (f.e. capacities; locations)

V. Fazit

Slide: Hermes,Uni Frankfurt/M

Energy targets of the federal government

Annual update Scenarioframe

Net Development Plan Generation Development Plan

allignment

Federal demand plan energy (Bundesbedarfsplan Energie)

Capacity mechanisms

EEG-fine-tuning

Designation (Spatial Planning)

Federal Government

Parliament

Federal Network Agency

States

Federal Network Agency

Documents

Do we need a binding “sustainable energy production and allocation plan” in Europe? – Considerations on the further development of sustainable energy law