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Lower costs, more certainty. In future, renewables will have to stand on their own two feet and increasingly compete on the market on their own. To make this work, a new funding scheme for electricity from renewables will be introduced as of 2017, replacing fixed feed-in tariffs with competitive auctions.

An initial three rounds of auctions for ground-mounted PV installations were held last year. On 11 April this year, Germany's national regulator, the Federal Network Agency, published the results of the fourth round of auctions.

Competition up, prices down

State Secretary Baake commented: "The fourth round of auctions for ground-mounted PV installations has reinforced the message that the auctioning system is working. Once again, there was keen competition. The overall volume of the projects for which bids were submitted was 540 MW, several times as much as the 125 MW for which the auction was held. And once again, the price level was lower than in the preceding round. The price granted was 7.41 cents/kWh. This is an impressive result. Within just 12 months, prices have dropped from 9.2 in the first round, to 8.5, to 8.0, to now reach an average 7.41 cents/kWh. This shows that there is major potential for reductions in price. This is good news, not least for electricity users and for electricity prices."

Just like in the previous rounds, the level of participation in the fourth round of the auctions was high, with a total of 108 bids submitted, of which 92 met the eligibility criteria.

Maintaining stakeholder diversity

Our aim is to maintain the high level of stakeholder diversity as the old system used to promote the expansion of renewables is replaced with a new one based on auctions. For this reason, several proposals to this effect have been included in the 2016 revision of the Renewable Energy Sources Act. Small-scale installations with a volume of up to one megawatt are to be exempt from the auctioning system. Local citizens' energy initiatives are to be given facilitated access to the auctions for wind power. Unlike other players, which are usually also larger, they will be allowed to submit their bid even before their wind turbine has been authorised. The financial requirements will also be less strict than for other players. Furthermore, small players, particularly local citizens' energy initiatives, are to be given advice and support especially targeted to their needs, which will help them make the transition to the new system.