State aid: Commission approves auction scheme for electricity from renewable sources in Germany

On the 20 December 2016, the European Commission found amendments to the German renewable energy scheme, published in june 2016, to be in line with EU state aid rules. This would promote the steady deployment of renewable energy whilst maintaining competition in the German energy market.

Germany demonstrated that specific auctions for each technology would ensure a more cost-efficient result than a bidding process in which all or several technologies compete, in view of the specific conditions present in the German electricity market. In particular, Germany shew that there are grid instability and integration issues present within the German electricity market. In line with the Guidelines, Germany is therefore entitled to organise specific auctions for each technology.
At the same time, Germany committed to test alternative designs in which auctions would incorporate grid integration costs or tender for a specific electricity quality