Germany’s energy feed-in act forces power companies to buy up green electricity from wind and solar producers at exhorbitant prices and guarantees the green energy producers fat profits.
Windparks are paid even power that doesn’t get delivered. (Photo by: Philip May. GNU-Lizenz für freie Dokumentation,)
But what happens when the sun shines and the wind blows too much, and the power companies don’t need the power?
Answer: the power companies ask the green producers to stop production. But now comes the hitch: If the power companies don’t need the power, German law still requires the power companies to pay green producers for the energy that they would have produced had they not been asked to shut down. Therefore solar panel and windfarm operators get money whether they produce or not. No risks!
One example, according to leading German daily Bild here, is a windfarm operated by Green Party activist Reinhard Christiansen (58). The “Bürgerwindpark” (People’s Windpark), which was built 12 years ago for €8.5 million, at times produces more energy than E.ON power company actually needs, and thus often gets asked to shut down. However, E.ON must pay for the ungenerated power.
The result? Consumers have to pay for the electricity that never gets delivered, let alone consumed! So far Christiansen has hauled in 2.5 million euros ($3 million) for “phantom electric power”.
Bild quotes Christiansen:
We can sell a lot more power than what the power company is able to accept.“
The ‘People’s Windpark’ pulled in 2.5 million euros for compensation for power that could have been generated but could not be used because of a lack of grid capacity.”
Bild writes that this is no isolated incident and that Germany’s Feed-In Act has led to a flurry of bizarre incidences where millions get paid out for “phantom electric power”.
In 2010, 10.2 million euros were paid out, and the trend is exploding upwards. Bild quotes a confidential internal government document:
For a midsize windpark, amounts in the neighborhood of well over 100 million euros can be reached quickly.“
In the end the crazy thing is that it’s again the consumers who wind up paying for power that never gets used.”
In Germany, it is not uncommon for the mayor and city officials to get in on the profiteering, often pushing windfarm projects through against the stiff resistance of local citizens. It’s a business fraught with corruption and shady deals. Welcome to Germany’s Energiewende (energy transformation) where a few are laughing their way to the bank, and the rest are being taken to the cleaners.