According to the Bundesrat, it now seems probable that the law proposing cuts in its promotion cannot come into power as planned. It was said that mainly East German Federal States and those controlled by Social Democrats (SPD) voted for the petition. With this, the EEG-Novelle (New Renewable Energy Law), due to come into effect on July 1, has been stopped for the immediate future. However, the German Government is expecting that they would be able to have retroactive validity.
Responding to the decision, Karl-Heinz Remmers, CEO of Solarpraxis said: The German Bundesrat upper house of parliament, for the time being, has stopped the legislative procedure of the proposed changes of the EEG affecting photovoltaics. However, those in the market should not by any means reckon with a delaying of the date of validity or cuts that are in fact smaller. This is because the decision does not have any binding effect.
He continued: Important to stress is that this stop is only aimed at bringing about a reduction of the planned cuts from 11-16 percent to ten percent. It is also explicitly not to attain, for example, remunerations for arable land or the setting of new time scales for the changes.
In the legislative procedure of the EEG, the Bundestag (German Parliament) has the right to pass a law without consulting the upper house of parliament, the Bundesrat. With the convening of the committee of mediation, the Bundestag and Bundesrat will have to discuss the specific scale of cuts again. However, the Bundestag can also simply decide to retain the cuts already decided and push them through, as the Bundesrats approval does not have to be granted for a law to be passed.
As such the law can come into power exactly as planned. The proposed cuts as of July 1 are also able to have retroactive validity. In this case, legal action against the law would also have no chance as the measure has been adequately publicized. Due to the multiple legislative delays experienced by the current German Government and the brutal expectations of success upon it, such a holding course has to be expected. For this reason, speculations about the law coming into power at a later date are purely games of chance. A party wishing to profit from the rates of remuneration, exceptions aside, are certainly advised to set their PV installation running by the end of June."
Mr Remmers concluded: Further dates in the procedure are expected to be determined in the next week. However a speedy beginning of the procedure of mediation can be expected. In the case of a rapid decision by the committee of mediation, the law could be presented again at the next meeting of the Bundesrat on July 9. This means that the law (with or without changes) could have passed through the Bundesrat by then.
In the mediation committee, sixteen representatives of the Bundestag (German Parliament) and the Bundesrat will together search for a compromise. After this, the Federal Assembly has to again deal with the promotion of solar energy. A meeting will first be able to take place in July due to schedule commitments.
However, it is not compulsory for the Bundesrat to grant approval for a law to be realized. This means that the Bundestag may be able to set its already proposed bill into law again by means of an absolute majority.
In April, the Bundesrat was already giving voice to its support for cuts of reduced severity. It suggested the promotion of solar energy should be reduced by a maximum of ten percent. However, the Christian Democrat (Union) and Liberal (FDP) majority had seen the Bundestag approve a reduction of the photovoltaic feed-in tariff as of July 1. This amounted to sixteen percent for roof installations and between eleven and fifteen percent for open space installations. In addition, the planned prohibition of solar parks on arable land is heavily contested.