BMI View: We expect non-hydropower renewables capacity growth to slow down over the coming five years as a result of the introduction of competitive capa city auctions from January 2017 - with the German government looking to reduce costs and calibrate growth in new intermittent power supply to support grid integration . Over the longer term, reduced cost and integration of intermittent wind and solar power will become a supportive factor for Germany ' s renewables sector, supporting our positive long-term outlook for the segment .
|f = BMI forecast. Source: EIA, National Sources, BMI|
|Generation, Non-Hydropower Renewables, TWh||175.983||182.076||188.066||193.944||200.389||206.561||213.617|
|Generation, Non-Hydropower Renewables, % y-o-y||17.042||3.463||3.290||3.126||3.323||3.080||3.416|
|Capacity, Non-Hydroelectric Renewables, MW||93,178.4||98,129.3||102,868.4||107,083.8||111,035.4||115,129.0||119,552.1|
|Capacity, Non-Hydroelectric Renewables, % y-o-y||8.0||5.3||4.8||4.1||3.7||3.7||3.8|
Latest Updates And Structural Trends
Germany will introduce competitive auctions in the renewables sector from January 2017, as the EEG 2017 was passed through the German parliament in July 2016. The new mechanism will be introduced on the back of a series of solar power pilot auctions over 2015, that are meant to help the government better calibrate the new system. The amount of capacity awarded in auctions will be capped in order to ensure that new capacity can be integrated into the grid system without jeopardising the stability of the power supply. While this will slow growth over the short-to-medium term, we believe it will be a strong positive for the sector over the longer term, as costs decrease and new technologies that can support renewables integration increase their penetration in the power market (like automated demand-response measures and battery storage).
We expect the German non-hydropower renewables capacity to grow by an annual average of 3.8% between start-2017 and end-2025, as the government aims to curb growth from that of historic levels to a more a sustainable level. Given the maturity of the sector, this growth rate still means that the segment will add more than 39.5GW over the next decade.
Germany became the first country in the world to release a 2050 carbon emission reduction plan - when the German cabinet released the long-term plan for climate action at COP22 in Marrakech on November 14 2016. The new plan sets out targets to reduce greenhouse gas emissions (GHG) on a sector basis by 2030 from 1990 levels, with (i) the energy sector targeting 61-62% reduction (II) buildings 66-67% (III) transport 40-42% (IV) industry 49-51% (V) agriculture 31-34% and (VI) other 87%.
We expect wind power to outperform solar power and biomass power over our 10-year forecast period. This will be the result of more ambitious capacity allocation for the wind power sector under the EEG2017, in addition to project developers that are awarded permits by end-2016 under the feed-in-tariff scheme being able to develop these projects up to 2018. The slowdown of biomass capacity growth will be particularly pronounced as concerns about feedstock sustainability have prompted the government to allocate limited capacity in auctions between 2017 and 2022.
The Germany Renewables Report researched at source contains BMI Research's assessment of the current renewables market in Germany. The report also contains historical data together with forecasts to end-2018 covering electricity generation (TWh) and electricity capacity (MW).
The renewables sectors covered in the report include Wind, Solar, Geothermal, Tidal and Wave, and Biomass (See Table of Contents for exact coverage). The report also features details on government green energy agendas and funding opportunities, as well as presenting a detailed list of key renewables projects currently being planned or undertaken in Germany, their capacity, the timeframe of construction and their current status.
The report discusses the various energy policies currently in force, including targets, subsidies and the relevant infrastructure developments or limitations which might impact on renewables growth, analysing the potential effects of regulatory changes in conjunction with the background macroeconomic outlook. Finally, there is a general overview of the competitive landscape in Germany, together with a detailed summary of the main utilities and manufacturers present and their business operations.
BMI's Germany Renewables Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with unique independent forecasts and competitive intelligence on the Germany renewables industry.
- Benchmark BMI's independent renewables industry forecasts for Germany to test other views - a key input for successful budgeting and planning in the renewables market.
- Target business opportunities and risks in the Germany renewables sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in the country.
BMI Industry View
Summary of BMI's key industry forecasts, views and trend analysis covering the renewables market in Germany, regulatory changes, major investments and projects and significant multinational and national company developments.
Industry SWOT Analysis
Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the renewables sector and within the broader political, economic and business environment.
BMI Industry Forecasts
Historic data series (2010-2012) and forecasts to end-2018 for electricity generation (TWh) and electricity generating capacity (MW) for each individual renewables sector present in the country.
These in turn are broken down into:
Electricity Generation: Overall capacity (TWh), growth % change year-on-year, KWh per capita, % of Total Non-Hydropower renewables generation, % of total electricity generation.
Electricity Capacity: Overall capacity (MW), growth % change year-on-year, % of non-hydroelectric renewables capacity and % of total capacity.
These forecasts are in turn supported by explicit assumptions, in conjunction with analysis of the key risks to the main forecast.
Business Environment Rankings
BMI's Renewables Business Environment Rankings provide fully comparable Risk-Reward Rankings aimed at investors in the regional renewables market.
The rankings methodology makes sophisticated use of various industry, economic and demographic data point.