Energy & Infrastructure

Amendments to the Offshore Wind Energy Act (WindSeeG) – postponed bidding dates, extended limitation of the time of operation

ENERGY NEWS #3/2017   Summary  
  • The Offshore Wind Energy Act (Windenergie-auf-See-Gesetz – WindSeeG) has been affected in the same way as the Renewable Energy Sources Act 2017 (EEG 2017) (see Gleiss Lutz Energy News #2/2017). Even before it entered into force on 1 January 2017, it had already been amended for the first time in the wake of the most recent amendment to the KWKG (Act of 22 December 2016, Federal Law Gazette I, p. 3106).
  • The two bidding dates for “existing projects” were each pushed back by one month to 1 April 2017 and 1 April 2018, respectively. The limitation period of the time of operation was also changed; it was lengthened from 20 years to 25 years.

 

Amendment of the bidding procedure rules for existing Projects

1. Point of departure

The WindSeeG regulates the bidding procedure for the competitive calculation of the market premium under EEG 2017 for offshore wind turbines, as well as the planning, licensing, construction, commissioning and operation of offshore wind farms and offshore grid connections for the period from 2021 on.

For “existing projects”, i.e. offshore wind farm projects at a very advanced stage of development within the meaning of section 26(2) WindSeeG, special conditions for bidding procedures apply (sections 26 to 38 WindSeeG). For example, there will be a special bidding date in 2017 and in 2018 with an auction volume of 1,550 MW per bidding round (section 27WindSeeG).

2. Key changes

Instead of the bidding dates 1 March 2017 and 1 March 2018 that had been originally stipulated for existing projects, section 26(1) WindSeeG new version now sets 1 April 2017 and 1 April 2018 as the bidding dates. The reason for the postponement lies in the other amendments to theWindSeeG and is supposed to give the affected parties more time to adjust to them.

Another amendment was made to section 37WindSeeG, which regulates the legal consequences of awards. Already pursuant to the former section 37(1) no. 1 WindSeeG, the Federal Network Agency (Bundesnetzagentur) could determine the time as of which the awarded project had a claim to the market premium, in derogation of section 25 sent. 3 EEG 2017. It has now been clarified what criteria it must take into account in this regard. With its decision, the Federal Network Agency must ensure that the claim for the market premium begins in the years 2021 to 2023 for wind turbines with an installed capacity of at most 1,700 MW and in the years 2021 to 2024 for wind turbines with an installed capacity of at most 2,400 MW. This is meant to underscore the significance of the quantity structure defined in section 27(4) WindSeeG.

Change in the limitation of the time of Operation

1. Point of departure

A planning permission or a planning consent for an offshore wind farm is issued only for a limited period. However, this period can be extended if the area development plan (Flächenentwicklungsplan) does not provide for subsequent use immediately thereafter. Under the original version of the WindSeeG, the length of the limited period was determined by the duration of the claim for the market premium pursuant to EEG 2017 (section 48(7) sent.2 WindSeeG, old version). Pursuant to section 25 sent. 1 EEG 2017, the duration of the claim is 20 years.

2. Key changes

The duration of the claim is no longer linked to the claim for the market premium. Instead, section 48(7) WindSeeG, new version, now provides that a planning permission or a planning consent is issued for a limited term of 25 years. This does not change the duration of the claim for the market premium, which will still be granted for a period of (only) 20 years.

The extension of the limited term to 25 years is supposed to take into account the fact that technically, offshore wind turbines are generally constructed for an operating period of 25 years. Moreover, it is the hope of the legislator that the longer operating period will mean that electricity production in offshore wind turbines will be less costly, leading to lower bids for these turbines in the bidding procedures.

The extended limitation period has led to editorial changes in sections 24(2), 37(2), 66(2) WindSeeG and in section 17d(5) Energy Industry Act (EnWG).

Gleiss Lutz commentary

The extension of the limited operating period to 25 years from the previous 20 years is to be welcomed. For one thing, it was the obvious thing to do, if only due to the fact that even the permits issued under the former regulatory framework, i.e. the Offshore Installations Ordinance (Seeanlagenverordnung – SeeAnlV), which lapsed at the end of 2016, have a limited term of 25 years. Ultimately, then, the present administrative practice has merely been continued and codified.

Irrespective of this, it is also proper to link the limitation to the technical useful life of the installations. Otherwise, electricity production potential that is technically available would remain unused. Since the financial support under EEG 2017 is still limited to 20 years, this will not result in any additional costs that would burden the electricity consumer by way of the EEG surcharge. To what extent it will be economically possible to operate the offshore wind turbines even without the EEG support cannot yet be foreseen with certainty at present. However, with the statutory amendment it is now possible that the operators will make their plans on the basis of a 25-year operation and calculate their bids accordingly.

Citation: Dannecker/Kerth, Amendments to the OffshoreWind Energy Act (WindSeeG) – postponed bidding dates, extended limitation of the time of operation (Neuerungen im WindSeeG – verschobene Gebotstermine, verlängerte Befristung der
Betriebsdauer), Gleiss Lutz Energy News #3/2017 of 17 January 2017

 

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