Breaking News

Tweet TWEET

Germany Plans Reunification-Style Speed to Build Grids for Cleaner Energy

Germany may accelerate power-line projects to transmit more renewable energy to consumers after Japan’s nuclear disaster rattled voters in Europe’s biggest electricity market.

The Economy Ministry is preparing to use fast-track powers last exercised in 1990 when a newly united Germany had to build transportation infrastructure as fast as possible to replace crumbling roads in the east and improve connections in the country, according to a ministry document obtained by Bloomberg News. Control over power grids would be taken by Chancellor Angela Merkel’s government from states and local councils.

“The scale of the challenge is comparable with infrastructure needs after reunification,” according to the document, an outline for a draft to be presented to the cabinet in two days. Power storage sites will be exempted from paying grid fees for 20 years rather than the current 10.

Merkel last week froze a plan to extend the lives of nuclear stations after explosions at Japan’s Fukushima plant reignited German concerns over reactor safety. Her party lost votes in a state election yesterday. While Germany wants to help replace reactors with wind parks off the northern coast, building power lines to transmit power to industrial energy users in the south can be slowed by local approval processes.

The country needs to construct at least 3,400 kilometers (2,100 miles) of power lines, according to the German Energy Agency, a think tank owned by Allianz SE, Deutsche Bank AG, DZ Bank AG, KfW Group and the German government.

Health Concerns

That may cost 9.7 billion euros ($13.7 billion) using currently employed technology or as much as 29 billion euros if transmission companies must lay cables underground because of opposition to overhead lines by local people on health concern, the researcher known as Dena said in a study in November.

The chancellor’s coalition also will establish a legal framework for the construction of transnational power lines to help meet a European Union goal of integrating the electricity market in the region, according to the document.

Germany’s largest power generators, E.ON AG (EOAN), RWE AG (RWE), EnBW Energie Baden-Wuerttemberg AG (EBK) and Vattenfall AB, were ordered by state and federal governments last week to halt reactors in the country for three-month safety checks at the seven oldest nuclear plants.

That move “definitely increased” the risk to the country’s power grid, especially in the north, Johannes Teyssen, chief executive officer of Dusseldorf-based E.ON, said. E.ON, RWE and EnBW switched off five reactors last week, four of which were in central or southern Germany.

Nuclear Extension

Merkel last year agreed to extend the life of Germany’s nuclear reactors in return for receiving 15 billion euros from their owners to help build the grids. The plan also commits the four main utilities to pay a nuclear tax from this year through 2016 of 2.3 billion euros annually.

Another 5 billion euros was earmarked for offshore wind parks. The steps cumulatively aim to speed Germany’s target of generating 80 percent of energy from renewable means by 2050.

Germany has low-, medium- and high-voltage power grids. The high-voltage networks that transmit power over long distances are operated by RWE, EnBW, TenneT Holding BV and Elia System Operator SA.

To contact the reporters on this story: Brian Parkin in Berlin at bparkin@bloomberg.net; Nicholas Comfort in Frankfurt at ncomfort1@bloomberg.net

To contact the editors responsible for this story: Will Kennedy at wkennedy3@bloomberg.net; James Hertling at jhertling@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.