Smart Grid

February 25, 2013

Energy Storage is Germane to Germany's New PV Solar Subsidy

“Keeping the home fires burning” has become one of the top priorities worldwide today, as nations from India to the United States continue to contend with high-profile electricity outages caused by inadequate infrastructure, as well as storm-related damage.

Even Germany, known for its advanced power policies, is worried about the intermittent nature of its renewable, grid-tied power capacity.

In fact, last November, VIK, the association that represents the interests of German industrial and commercial energy consumers, warned that although the nation can export its renewable energy at times of peak renewable production and low demand, it faces paying high prices to ensure its own load is reliable at peak times.

"Although Germany still remains a net exporter of electricity through its expensive renewables, it would be very misleading to evaluate this outcome as a success in itself," VIK Director General Annete Loske stated. Loske called for further emphasis on network expansion, storage technologies and load management capabilities, as Germany continues its energy transition.

Now, Environment Minister Peter Altmaier has proposed a subsidy that, effective May 1, 2013, would finance up to 30 percent of the costs of new battery storage systems that add to the back-up capacity of grid-tied solar power generation.

Under the new law, storage systems would be limited to a maximum of 30 kilowatts (kW) and would have a domestic content mandate—meaning they would have to be manufactured in Germany.

To pay the full, remaining costs of each battery system, the German state bank, KfW, has developed a program that would comprise low-interest loans from its funds and a repayment bonus from Nuclear Safety (BMU) funds. BMU is currently making the final decision on the release of the grant component and the program's launch date.

Thereafter, KfW and BMU will provide detailed information on the program’s conditions.

In the long run, the program—which currently is on hold, according to industry sources— is designed to incentivize the development solar power batteries that can be installed and connected in houses at the same time as solar panels. Assuming this incentive program were successful, a free-standing house could save up to 60 percent on electricity, according to estimates by the scientific think tank, the Fraunhofer Institute in Würzburg, Germany – while stored power can be used later or offloaded into the national energy grid.

Germany Trade & Invest, the Berlin-based economic development agency of the Federal Republic of Germany, supports the new legislation.  “The policy has progressed well, and the increase of fluctuating renewable capacities is now causing the need for storage and smart grid expansion,” said Tobias Rothacher, senior manager, Renewable Energies, at the agency.

 “Such batteries not only make customers more independent from the energy price fluctuations, but the technological advances bring Germany closer to immunity from the energy and fuel merry-go-round,” continued Rothacher. There’s also the benefit of produced power being stored rather than being jettisoned expensively –offering further savings to plant operators.”

That new policy will feature high on the agenda when Germany Trade & Invest attends the Batteries Japan 2013 convention, as well as at the Fuel Cell Expo, both in Tokyo this week. 

Edited by Braden Becker