New Ministerial Draft for Combined Heat and Power Act (KWKG) 2016: First Key Elements

A revised ministerial draft on the planned amendment of the Combined Heat and Power Act (KWKG 2016) is currently being discussed. The draft has not yet been officially released, but some key elements are already being discussed. Reportedly, the draft will provide for a phasing-out of the coal-fired combined heat and power (CHP), a change in the CHP expansion target and an increase of the CHP support for electricity from CHP plants. The previous support for electricity from CHP which is not fed into the grid for the general supply shall be dropped, with a few exceptions. In addition, mandatory direct marketing of electricity from CHP plants with more than 100 kilowatts shall be introduced.

1. Phasing-out of the coal-fired CHP

As already announced in the White Paper of the Federal Government, the surcharge for gas-fired CHP plants, which replace coal-fired CHP plants, shall be increased. New CHP plants using coal as fuel shall in future no longer be eligible. Also the modernization of coal-fired thermal power stations shall no longer be funded by the KWKG 2016.

2. Increase of the CHP surcharges

Electricity from CHP plants which is fed into a grid for the general supply shall get more support. The following figures are being reported

  • 8 ct/kWh for capacity up to 50 kW,
  • 5 ct/kWh for capacity over 50 kW up to 250 kW
  • 4 ct/kWh for capacity from 250 kW up to 2.000 kW
  • 1 ct/kWh for capacity above 2.000 kW

In contrast, electricity from CHP plants which is not fed into a grid for the general supply shall basically no longer receive CHP support. Exceptions to this rule shall apply only apply to CHP plants with lower power capacity (up to 50 kW) as well as CHP plants which are used in current cost-intensive companies. Compared with the KWKG 2012, CHP plants with a lower capacity would no longer benefit in the future from the possibility of a plant modernization.

3. Mandatory direct marketing

As a novelty, the principle of a mandatory direct marketing shall be introduced for electricity from CHP plants with a power capacity over 100 kW. So far CHP plant operators (with a power capacity up to 2.000 kW) only had to offer their electricity to the grid operator in order to receive the CHP Index (usual price), the charges for decentralized feed (avoided network charges) and the CHP surcharge. According to the proposals for the KWKG amendment, direct marketing shall become a precondition for obtaining the CHP support and the avoided network charges.

4. Grandfathering for gas-fired CHP

To prevent laying off highly efficient plants, existing gas-fired CHP plants in the general supply which are funded neither by the EEG nor currently receive CHP support shall continue to receive limited support until the end of 2019. After successful registration, highly efficient gas-fired CHP plants which are basically designed for the supply of end-users and have a power capacity of over 10.000 kW shall obtain temporary support of 1.5 cents/kWh.

5. Abolition of special rules for fuel cells

On the basis of the KWKG 2012, fuel cells benefit from special rules, e.g. maintaining maximum support for a period of 10 years. In the future, fuel cells shall be treated like any other CHP plants.

Source: Energie & Management, BHKW-Infozentrum

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