Minister of Energy Expresses Preference for Domestic Producers in Energy Sector - Energy Minister to Advocate for Domestic Producers in the EU
In the pursuit of decarbonization, Germany is accelerating its energy transition, aiming to achieve greenhouse gas neutrality by 2045 and reduce emissions by 65% compared to 1990 levels by 2030. Expansion of renewable energies, including wind, solar, and energy storage, is a core lever for reaching these ambitious climate goals. However, the question of preferring European manufacturers in public tenders for these projects is nuanced, shaped by both national and EU legislation.
Germany's focus on renewable energy projects is primarily guided by meeting targets, ensuring price competitiveness, and integrating projects into the grid. The European Union's public procurement rules generally prohibit discrimination based on the nationality of the supplier in tenders for energy storage, wind power, and solar projects. This aim is to foster a competitive internal market and prevent favoring domestic or European manufacturers over non-EU ones.
Recent developments in the sector show that funding and project selection are based on technical, economic, and environmental criteria, not on the origin of the manufacturer. For instance, Germany's recent nationwide funding call for zero-emission buses does not explicitly favour European manufacturers, with projects being evaluated on expected CO₂ savings, fleet electrification ratios, and financial need.
Energy Minister Armin Willingmann (SPD) has suggested an incentive system for preferring European manufacturers due to global market distortions. He continues to advocate for a preference for European manufacturers in tenders for energy storage, solar, and wind power. However, the implementation of such a system in Germany is subject to the constraints of EU state aid rules.
The demand for batteries and electricity continues to increase, and the energy transition in Germany will likely require more large-scale battery storage plants, as demand for storage solutions grows with the increasing use of renewable energy. By the end of 2024, around 1.8 million home storage systems and almost half of the 3.8 million photovoltaic systems in the home segment will be equipped with a battery storage system.
Experts, such as Simon Schandert, co-founder of Tesvolt, emphasise the importance of Europe having its own battery storage production in the current geopolitical situation. Willingmann visited battery storage manufacturer Tesvolt in Lutherstadt Wittenberg, expressing the need for more attention to be paid to the origin of storage, wind power, or solar installations in future tenders or funding programs.
Saxony-Anhalt's Economics Minister hopes that the planned reform of the Renewable Energy Act (EEG) will include funding for energy storage. Energy storage plays a crucial role in the energy transition to balance fluctuations in renewable energies, with almost 60 percent renewable energy in Germany's electricity production last year.
The revised Renewable Energy Directive (RED III), adopted in 2023, sets a minimum renewable energy target of 42.5% by 2030 but does not introduce explicit preferences for European manufacturers in tenders or procurement. The directive emphasises open and competitive markets.
In conclusion, no explicit preference for European manufacturers in tenders for wind, solar, or energy storage in Germany is mandated by law. The EU procurement law prohibits discrimination based on the origin of goods and services, promoting a competitive internal market. The energy transition will not succeed without storage, and the debate over preferring European manufacturers in tenders is an ongoing discussion in the pursuit of a sustainable and secure energy future.
- Germany's energy transition prioritizes technically, economically, and environmentally sound projects for renewable energy, with the EU's public procurement rules generally promoting a competitive internal market by prohibiting discrimination based on the origin of the supplier.
- The debate over preferring European manufacturers in tenders for wind, solar, or energy storage in Germany, as suggested by Energy Minister Armin Willingmann, is an ongoing discussion due to the need for more attention to the origin of storage, wind power, or solar installations in future tenders or funding programs, particularly in the context of the current geopolitical situation and the increasing demand for batteries and electricity.
