"We support the government's intention to switch the electricity supply almost completely to renewable energies as early as 2035 and consider the increased and stabilized expansion targets for offshore wind energy as well as the additional demand for the production of 'green' hydrogen as an essential step for a successful energy transition," said WAB Managing Director Heike Winkler. "And we welcome the draft's prioritisation of offshore wind development in the North Sea and Baltic Sea as being in the overriding public interest and serving public safety."
Offshore wind energy has been delivering high electricity yields for years and has reduced its costs enormously. In order not to counteract this development, the market design should enable a sustainable economic development of the necessary supply industry. This would enable the value chain to continue the expansion at sea in a sustainable manner, to use the reliability and system efficiency of the power plants at sea and to leverage value creation potentials. The development of the maritime industries and the market ramp-up of the hydrogen economy are also of great importance in this regard.
The cost-cutting character of the auction models envisaged in the draft law poses a major challenge for a sustainable development of the supplier industry, as it is not flanked by a "sector deal", industrial planning, or other local content requirements as in many other countries. However, there are market participants in Europe who benefit from such rules in their home markets. The Sector Deal in the UK was recently followed by Poland and France with their own Local Content Agreements, which provide for a quota of up to 50 per cent for the value-added share of domestic companies.
"Fair international competitive conditions are needed to enable sustainable development of the supplier industry in the face of high cost-cutting pressure. We have been drawing attention to the fact that dialogue is needed to eliminate inequalities for a very long time," said the WAB e.V. Managing Director.
From the perspective of the experienced and innovative German supplier industry, these rules distort a free market in Europe and worldwide. To compensate for this imbalance, qualitative tendering criteria, which play a role alongside price in the allocation of areas in the North and Baltic Seas, are suitable instruments - in addition to long-term predictability of the expansion pipeline. This is the only way to continue to ensure cost-efficient expansion and to implement the targets for 2030 and beyond.
"The current development of the domestic offshore wind industry has been heavily burdened by political decisions in Germany in recent years and now needs a tailwind to be able to support the new political goals in the best possible way," demands Heike Winkler. "Our urgent recommendation is to implement qualitative tender criteria in order to strengthen or not to further weaken domestic value creation, resilience and probability of realisation in the context of the offshore wind expansion targets".
"In terms of sustainable development of the supply chain, we see qualitative criteria as sustainability criteria that can counteract the 'race to the bottom' effect," added the WAB e.V. Managing Director.
Ideal examples include the assessment of the contribution of a planned project to local economic development and the involvement of SMEs, as already provided for in the regulation on "other energy production", or the criterion of the carbon footprint in the product life cycle of parts of this technology as proposed by us. Both tendering models should therefore provide for at least a preliminary project description to be able to assess the quality criteria.
The rules for repowering should also allow older offshore wind farms to upgrade to more modern technology to enable the highest possible energy yield in a limited space.
There is currently no regulatory framework for "green" hydrogen. This makes immediate investment decisions difficult. For a rapid market ramp-up, the systematics of the H2Global programme for the import of "green" hydrogen should also be applied for a "sprinter programme" in Germany. The necessary means for a fast market ramp-up by means of a centrally pre-investigated CfD framework should be urgently considered, as we have already asked for together with other stakeholders in the appeal "H2Global4Europe".
There is currently no regulatory framework for "green" hydrogen. This makes immediate investment decisions difficult. For a rapid market ramp-up, the systematics of the H2Global programme for the import of "green" hydrogen should also be applied for a "sprinter programme" in Germany. The necessary means for a fast market ramp-up by means of a centrally pre-screened CfD framework should be urgently considered, as we have already demanded together with other stakeholders in the appeal "H2Global4Europe".
"The infrastructure needed to achieve the expansion targets goes far beyond power lines and hydrogen-capable gas pipelines," said Heike Winkler. "The availability, further development and modernisation of port and shipyard locations takes on strategic importance and links climate protection with value creation and employment." In addition, bottlenecks in special ships and crews for construction and operation should be urgently resolved. These include transport and installation vessels, cable laying and repair vessels as well as inspection and maintenance vessels. In addition, there is no longer a specialised offshore wind installation company based in Germany. KfW or other financing instruments can make an important contribution here, if they are available in good time and with sufficient flexibility.
Link to the WAB statement on the draft WindSeeG amendment (in German): bit.ly/WindSeeG-RefE
About WAB e.V.:
Bremerhaven-based WAB is the nationwide contact partner for the offshore wind industry in Germany and the leading business network for onshore wind energy in the north-west region. The association fosters the production of "green" hydrogen from wind energy. It comprises some 250 smaller and larger businesses as well as institutes from all sectors of the wind industry, the maritime industry as well as research. www.wab.net
Contact:
Hans-Dieter Sohn | Senior Communications and Marketing Manager WAB e.V. | +49 173 2382802 | hans.sohn @ wab.net
