EEG Medium Term Forecast: Likely EEG Surcharge in 2015 Between 5.85 and 6.86 ct/kWh

The four German transmission system operators (TSOs) have published their forecasts for the 2015 EEG surcharge range and the 5-year medium term (Mittelfristprognose). They expect the renewables surcharge or EEG surcharge for 2015 to range between 5.85 to 6,86 ct/kWh, i.e. 0.35 ct/kWh less respectively 0.66 ct/kWh more  than the recently announced EEG surcharge of 6.24 ct/kWh for 2014.

With the EEG surcharge (EEG-Umlage, also called EEG reallocation charge), consumers pay for the difference between the fixed feed-in tariffs paid pursuant to the Renewable Energy Sources Act (EEG) for renewable energy fed into the grids and the sale of the renewable energy at the EPEX Spot power exchange by the TSOs. The complex system of the sale of the renewable energy by the TSOs and their compensation is laid down in AusglMechV and the corresponding AusglMechAV.

Section 3 paras. 3 and 4 AusglMechAV stipulate that until 15 November of each year the TSOs have to publish the forecast for the EEG reallocation charge for the year after next as well as a 5 year medium term forecast. They inter alia have to provide information concerning the predicted development of the installed capacity, full load hours, the annual amount of electricity fed into the grid and feed-in tariffs paid to installation operators.

The forecasts were again made based on expert opinions by independent energy consulting agencies on behalf of the TSOs. Last year, the November forecast significantly underestimated the need to adjust the EEG surcharge, giving a range of 4.89 and 5.74 ct/kWh for 2014, which did not suffice as the actual EEG surcharge of 6.24 ct/kWh (plus 19% VAT) for 2014, announced in October 2013, shows. Of course, the opinions cannot forecast what changes the new German government will come up with.

For the lower end of the EEG surcharge, i.e. 5.85 ct/kWh, the TSOs calculate with EEG-related costs of EUR 23,310,127,522.22 and a revenue from the sale of renewable energy of EUR 2,438,379,606.80, resulting in a deficit of EUR 20,871, 747,915.42 on the EEG surcharge balancing account. Due to possible errors in the forecast, the TSOs are entitled to add a cash reserve of a maximum of 10% of the deficit. The cash reserve for 2015 in the lower range was set at EUR 2,081,039,559.01. From the resulting amount the TSOs deducted EUR 902,881,121.39, at which they estimate the EEG balancing account to stand at 30 September 2014. All in all one arrives at EUR 22,049,906,353.05 which are passed on the all those consumers, who are not entitled to an EEG surcharge reduction.

Regarding the upper end of the EEG surcharge, i.e. 6.86 ct/kWh, the TSOs calculate with EEG-related costs of EUR 26,496,822,637.19 and a revenue from the sale of renewable energy of EUR 2,378,772,335.45, resulting in a deficit of EUR 24,118,050,301,74. The cash reserve for 2015 in the upper range was set at EUR 2,401,293,570.50. From the resulting amount the TSOs deducted EUR 902,881,121.39, at which they estimate the EEG balancing account to stand at 30 September 2014. All in all one arrives at EUR 25,616,462,750.86 which are passed on the all those consumers, who are not entitled to an EEG surcharge reduction.

In their medium-term forecast the TSOs lowered the forecast for the overall development of the installed capacity for the years 2014 to 2017 compared with last year’s forecast. For 2018 they expect an overall installed capacity of renewable energy sources of 111,378 MW. Solar power, onshore wind power and offshore wind power are believed to account for 52,851 MW respectively 43,415 MW respectively 6,298 MW. In last year’s medium term prognosis up to 2017, the TSOs still predicted an installed solar capacity of 54,838 MW by 2017 and onshore wind power capacity of 38,747 MW and offshore wind power capacity of 7,853 MW.

Regarding full load hours adjustments were also make for the years 2014 to 2017. For 2018 the TSOs assume 4,198 full load hours for hydro power, 3,422 for landfill, sewage treatment and mine gases, 6,009 for biomass, 4,117 for geothermal power, 1,828 for onshore wind power, 4,258 for offshore wind power and 955 for solar power.

For the period of 2014 to 2017 TSOs also lowered their assumption regarding the total amount of electricity from renewable sources fed into the grids. For 2018 they assume a total of 200,584 GWh, which are broken down to 6,547 GWh provided by hydro power, 1,579 GWh by landfill, sewage treatment and mine gases, 39,710 GWh by biomass, 333 GWh by geothermal power, 77,638 GWh by onshore wind power, 26,487 GWh by offshore wind power and 48,291 GWh by solar power. A total of 143,284 GWh will be directly marketed pursuant to the different direct marketing possibilities laid down in Section 33b paras. 1 to 3 EEG, the TSOs believe. To encourage direct marketing, certain premiums are granted by the EEG (cf. Sections 33g to 33i EEG). According to the TSOs, feed-in tariff payments as well as the other aforementioned costs pursuant to the EEG will lead to costs of EUR 26,017 million in 2018.

Source: EEG-KWK.net

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