German government presents plan to halt ‘ongoing crisis’ for onshore wind

Germany’s Federal Ministry of Economics said in a plan released this week that the responsibility for strengthening the country’s onshore wind industry lies jointly with the federal and state governments, and stressed the need to strengthen acceptance of onshore wind farms within local communities and accelerate approval procedures for projects.

Some of the measures include introducing a central licensing authority per stage to manage wind farm applications, limitations on the time in which to appeal projects and a 1,000-metre distance regulation from residential homes. The measures constitute an important step towards strengthening the onshore wind sector, thereby helping Germany generate 65 percent of its electricity from renewable sources, a target the country has set out to achieve by 2030, the ministry said.

However, in a statement, BWE criticised the 1,000-metre distance regulation, and while it praised elements of the plan, it said some of the measures cancel each other out. Nevertheless, it maintained the “situation can be sustainably improved” if the measures are implemented swiftly.

There have also been problems arising from the shift to a tender process for projects, according to Michael Ebner, head of infrastructure at asset manager KGAL, which reached a €750 million close on its fourth renewable energy fund this week.

“We have a huge problem in permitting projects,” he told Infrastructure Investor. “Also, those which have participated in a tender process were not built. They were successful but the tariffs were too low and were not bankable.  We are not investing in German onshore wind right now because there are only a few projects to invest in and so pricing is too high.”

In a report released last month, Commerzbank said that only 287MW of onshore wind had been commissioned in Germany in the first half of 2019, an 82 percent year-on-year decrease.

“Permits are increasingly delayed due to a large number of applications and an increasing number of appeals and legal complaints,” Commerzbank stated. “As a result, German turbine manufacturers, their suppliers as well as project developers are increasingly facing economic pressure.”

Tailwinds for Morgan Stanley

Despite the problems suffered by the sector, one major project developer, PNE, has still maintained the interest of Morgan Stanley Infrastructure Partners. On Thursday, the pair signed a takeover agreement, which will see Morgan Stanley pay €4 per share for the Frankfurt-listed company, valuing PNE at €300 million.

The move follows an earlier bid from Morgan Stanley, investing through its third infrastructure fund in August, when it tabled an offer between €3.50 and €3.80 per share. The firm’s offer, still subject to a shareholder vote, would de-list the company that launched its IPO in 1998.

PNE said in its half-yearly report in August that while international markets remain its focus, it continues to build out a planned 200MW onshore wind portfolio in Germany and has 71.3MW under construction to complement the 95.7MW already built, with additional projects at the approval stage.