Green Power

Source: JOIN IEA/IRENA Policy and Measures Database
Last updated: 9 July 2012
The operators of renewable energy plants not operating under the German Feed-In Scheme, the EEG, have the opportunity to sell the electricity generated in their plants at a premium on the market. This "green electricity" entered the market as a new product which could be purchased instead of electricity generated in conventional plants. Most utilities and electricity suppliers offer a choice between tariffs to their customers. The choice to purchase green electricity, may even be differentiated between the different sources of renewable energy (e.g. 100% hydropower). Such programmes do not necessarily lead to the installment of new capacity (This is due to the fact that electricity from existing renewable energy plants will have to first enter the market). Once feasible conditions are established, new capacity is installed. The dissemination of such offers into the German market can be split in two phases surrounding the liberalisation of the electricity market in 1998; the first prior to liberalisation and the second after. In the initial phase, prior to the liberalisation, utilities commercialised green power supplies by requesting green tariffs. Electricity was sold with a surcharge the utility used to build up funds which were used for installing new renewable energy capacity, mainly photovoltaic systems. The utility could pass the financial burden on to electricity customers. After the deregulation of the market, independent electricity suppliers also started to market green power. In 2000, 132 different companies offered green electricity. The market share, however, was less than 1% of the total power supply. Several certification schemes exist to ensure independent monitoring and control of the electricity?s origin. Moreover, some of these certification schemes also monitor whether the funds are invested in new plants. Although not being a governmental programme, the state has supported green power in two ways: before liberalisation, regulatory authorities accepted extra costs caused by green tariffs and after the market liberalisation, state agencies began to purchase green power.