Merkel’s Coalition Finally Endorses Green Power Plan

(Bloomberg) -- Germany's ruling coalition sealed a long-awaited plan to boost auctions of wind and solar power, brushing aside the political turmoil that's dogged the alliance since the summer and making good on election promises.

Coalition lawmakers agreed on Wednesday to auction a total of 8 gigawatts of wind and solar power from 2019 to 2021, redeeming a pledge they made in February, according to a statement released by the Christian Democrat and Christian Social Union caucuses.

The capacity adds to regular power auctions and is “aimed to speed achievement of a 65 percent share for clean power in the nation's energy mix by 2030,” the parties said. Next year, the government will draw up a new package of auction plans for the period 2021 to 2030, they said.

Squabbling in the three-party coalition over the terms of a plan to expand renewables focused on how to alleviate voters' unease about the rising cost of electricity and green energy subsidies. Another factor was an unexpected gain in the price developers offered for electricity from wind farms in recent auctions.

Spreading wind farms is “decisive for us,” said the statement from the CDU and CSU lawmakers. The Social Democrats make up the third party in the coalition, which is led by Chancellor Angela Merkel.

In a bid to reduce the costs to power consumers of supporting clean power, the Bnetza power regulator will hold pilot auctions that incorporate exclusion of compensation to park owners for the so-called “redispatch” of wind power in congested grid conditions and when wholesale power prices are negative, according to the agreement.

According to the coalition's policy blueprint from the spring, the government also plans to auction additional amounts of offshore wind. The proposal was excluded from Wednesday's accord.

The time table for the additional wind and solar tenders is:

• 1 gigawatt each for onshore wind power and solar in 2019
• 1.4 gigawatts each for wind, solar in 2020
• 1.6 gigawatts for each in 2021

To contact the reporter on this story: Brian Parkin in Berlin at bparkin@bloomberg.net

To contact the editors responsible for this story: Reed Landberg at landberg@bloomberg.net, Andrew Reierson

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