Innovation tenders should stimulate technological innovation

On September 1, it should have been ready. But for the time being, there is little innovation in the tenders for renewable energies. Associations and investors of EEG plants recently reacted with disappointment and criticism to the first draft of a regulation on the so-called innovation tenders in the EEG. The idea behind these calls for tenders: to pave the way for new technologies without the costs going through the roof. What must be taken into account so that a mechanism in the EEG can achieve this goal?

Cost issues also determine the acceptance of energy system transformation

A period of grace for renewable energies is only available for small systems: Since the amendment of the Renewable Energy Sources Act (EEG) in 2017, the level of remuneration for electricity from large renewable energy generation plants is no longer fixed by the state, but is determined by means of tenders. Instead of installing unlimited wind turbines or biogas plants on the basis of a predetermined commission, operators of green electricity generation plants have since been given an incentive to plan their plants more specifically and to calculate them as cheaply as possible. The legislator wants to take an additional step: So-called innovation tenders are to be used to test how technology and marketing of green power generation could be better integrated into the overall system in the future. The goal: to use efficient technology according to demand.

The Energy Collection Act therefore provides for the testing of new pricing mechanisms and tendering procedures. The plan was to put out to tender 250 megawatts in innovation tenders this year, 400 megawatts in 2020 and 500 megawatts in 2021. These quantities would be deducted from the regular tender quantities for onshore wind turbines and solar plants.

If you want to understand why the tender design is such an explosive and controversial aspect in the already complex world of renewables, you just have to pay close attention to the news from the energy world these days. Headlines were made (once again) by the regulation of wind turbines - and thus indirectly by the question of acceptance and costs for the conversion of the energy system. In particularly windy winters, more green electricity was often produced than the power grids could handle - namely around 3.3 billion kilowatt hours. Enough electricity to supply over a million households for a year. A real waste, then. However, as is well known, new cables unfortunately cannot be laid so quickly and easily. Stopping the expansion of renewables as an alternative is also not up for discussion. It is therefore necessary to look for innovative solutions for the expansion of renewables, that, in the long term, will slow down the costs of energy system transformation.

Using green power instead of regulating

Innovative technologies include, for example, PV modules which, unlike those currently available on the market, can be used on house walls or on industrial plants. Another innovation is to combine wind and solar power plants – such combined power plants could generate more electricity than a wind turbine or a solar plant in "solo" operation. A broader use of so-called Power2X technologies would also be conceivable. This refers to the storage of regeneratively generated electricity in the form of gas produced by electrolysis. The possibilities are manifold. However, the legislative framework for such innovations is still lacking. Innovation tenders could pave the way for these same innovations. True to the meaning of the word (Latin: innovare = to renew), the focus must be on trying something new! The focus here should be on using or storing electricity generated from renewable sources in order to avoid having to regulate it in the future.

From innogy's point of view, innovation tenders offer in any case good chances to initiate technological developments and to adapt the tender design to new challenges. However, the legislator should not try to solve too many problems at once. In order to ensure effective competition in tenders, properties must be comparable.

innogy therefore advocates to first define consistent and measurable goals and to focus on technological innovations. Such solutions, successfully tested in small-scale innovation tenders, could later be transferred to the main tenders.

Develop ideas for better land use

In view of the current tense situation in the expansion of renewables, innovations should be driven primarily in the technological field: Since land for the construction of RE plants is becoming increasingly scarce, the legislator should provide incentives for the efficient use of this land. In concrete terms, this means taking up as little space as possible to achieve high electricity yields. What this means in concrete terms is illustrated by a few examples.

Wind turbines that, due to their design, deliver a higher specific yield and therefore require less space than comparable plants are generally more expensive. However, it would be conceivable to take this into account in calls for tenders, according to the (admittedly highly simplified) formula: less space required for the same performance = higher funding.

Another example of an innovation that cannot yet compete economically with an existing technology: flexible and ultra-light solar cells. They could be installed on the facades of buildings or industrial plants, for example. Currently, such cells are more expensive than conventional PV modules. In contrast to open space PV systems, for example, no additional space is required. Open-space PV systems, which are built in such a way that areas below the modules can continue to be used for agricultural purposes, should also be used more in future. Thus, innovations would indeed be the focus of the innovation tenders.

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