Germany aims to boost the solar and wind industries

To boost the manufacturing of wind turbines and solar panels in Germany, the German government plans to acquire shares in renewable energy companies and help wind turbine and solar panel producers.

Germany had had a developing – but promising – industrial landscape of solar panel and wind turbine manufacturers. Nevertheless, as domestic financial assistance ran dry, so did the sector.

After Russia launched a full-scale war against Ukraine which led to the abrupt cutoff of cheap Russian gas imports, domestic production capability is again becoming a priority.

The German government now has a three-step strategy following a public consultation from April 2022 to February 2023.

“We need to enhance production capacity for renewable energies and power grids in Germany and Europe,” stated Germany’s Economy and Climate Action Minister Robert Habeck.

First, he wants to assist businesses in investing in and operating sustainable manufacturing plants. The official mentioned special electricity pricing for industry and financial assistance for running expenses that are now in violation of EU standards. Countries such as China, for example, provide low-cost electricity to industry for €0.07 per kilowatt-hour.

Furthermore, the government intends to establish a “transformation fund” to purchase shares in renewable energy businesses.

Second, the government intends to “temporarily” de-risk onshore wind and electrical grid development. For example, a wind park developer who cannot sell his electricity due to a lack of grid capacity may be paid through a new tool.

Finally, Habeck intends to expand a new wave of EU-approved innovative funding programs known as Important Projects of Common European Interest, including solar. Now, Berlin seeks support from Spain, which first proposed the idea.

Recent indications that China was considering limiting solar PV exports only reinforced the industry’s position.

“In ten years, Germany wants to triple the photovoltaic share of electricity supply from roughly 10% to around 30%,” said Jörg Ebel, president of the solar industry lobbying organisation BSW.

To protect “this aim, which has no alternatives,” and given solar PV’s “systemic relevance,” Germany should “not solely rely on buying” solar panels, according to the lobbyist.

Habeck expects the German initiative to “complement” the EU’s Green Deal Industrial Strategy, unveiled earlier this month by the European Commission. Nevertheless, another potential stumbling block exists the liberal FDP party, which controls the finance ministry as part of Berlin’s three-party government coalition.