July 5 (Bloomberg) -- Chancellor Angela Merkel’s government unveiled a program aimed at getting voters to invest in building new power lines and transformers that seeks to turn opponents of the “smart power grid” construction project into stakeholders.
Merkel’s Citizen’s Dividend program targets cash to fund the 10 billion euro ($12.9 billion) grid. When complete, the network will transport power from off-shore wind farms and new fossil-fuel power plants in northern Germany to consumers and industry in the south. Private investors may co-finance as much as 15 percent of the total costs with returns of “up to 5 percent,” the government said today in Berlin.
“Speeding up construction of the grid is urgent if Germany is to achieve its ambitious energy targets,” the Economy and Environment Ministries said in a joint statement on their websites. Offering co-investment to ordinary Germans “can raise the degree of acceptance” of the project that entails building 2,700 kilometers (1,680 miles) of new power lines and renewing another 2,800 kilometers of cable.
With national elections on Sept. 22, Merkel’s project may serve a dual purpose of winning over voters who oppose the building of the grid in their neighborhoods and deflecting opposition-party criticism which alleges that she’s bungling the nation’s shift to renewables. Local residents in states like Thuringia oppose power lines due to be built through a mountain forest.
Building the grid, that will be operated by Tennet TSO GmbH, TransnetBW GmbH, 50Hertz GmbH and Amprion GmbH, has been delayed amid squabbles with the government over liability in financing construction. On June 6, the upper house of parliament that represents the states and is dominated by opposition Social Democratic and Greens parties agreed to give up control over power lines built in their regions in order to speed up construction.
Merkel’s energy shift program requires a grid with built-in storage capacity as Germany ramps up the share of renewable energy sources in power generation to 35 percent by 2020 from 23 percent last year. Germany will close all its nuclear power plants by 2022.
The government is mainly targeting German investors and groups living close to the new power lines, according to the statement. A minimum investment of 1,000 euros is envisaged with the four grid operators gaining the right to set investment packages and buy stakes back from investors.
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