Financing Opportunities for BIPV. How is Germany financing BIPV?

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1 Financing Opportunities for BIPV How is Germany financing BIPV? Workshop 2 Building Integrated PV Symposium April 2013, Toronto Astrid Schneider, Berlin Solar Architecture Design, Research & Communication

2 Costs of BIPV per kwp Ca Movable glassglass modules Ca Custom sized insulation glazing Ca Custom sized laminates Ca Roof-integrated standard modules Ca Roof top mounted standard modules Astrid Schneider - Solar Architecture Source: Astrid Schneider Solar Architecture 2

3 German Success Story Financing PV: Based on two main elements: 1)Feed in tariff for renewable electricity: the Renewable electricity law = EEG in April 2000 State guaranteed access to feed solar electricity into the public grid (public grid = utility grids) Price level of the tariff to be high enough to allow economic installation of PV-plants distributing the higher price to all electricity consumed in Germany Differentiation of tariffs according to renewable technology 20 years of state guaranteed payment of feed in tariff Astrid Schneider - astrid.s@debitel.net - Germany 3

4 German Success Story Financing PV: 2) State owned business development bank KfW Offering state subsidized (for example 1,3%) long term loans (up to 20 years) with long term fixed interest rates for PV and BIPV projects as well as for other renewable energy systems, energy efficiency and the construction or renovation of energy efficient buildings (and many other program lines) In 2011 the KfW had an overall credit volume of 77.8 Billion EUR, 50.9 Billion EUR for projects in Germany 18.4 Billion EUR in 2011 Loan Volume of KfW bank for environment and climate protection credit programs Astrid Schneider - astrid.s@debitel.net - Germany 4

5 Example for feed in tariff based financing This project was finished in December 2007 all numbers relate to this time Astrid Schneider - Solar Architecture Arnold Dransfeld Architect / Astrid Schneider Solar design

6 School Building in Prenzlau The solar roofs of this newly erected school building were paid and invested by a private company named ENERTRAG AG, which normally invests in wind power plants. Astrid Schneider - Solar Architecture Source: Astrid Schneider Solar design

7 School Building in Prenzlau Arnold Dransfeld Architect of the building / Astrid Schneider Solar design Astrid Schneider - Solar Architecture

8 BIPV roof for a new school building Investor PV-roof Investor building Arnold Dransfeld Architect / Astrid Schneider Solar consultant 25.5 kwp steel roof with amorphous silicon Costs: building structure -> normal investor and PV-system (25,5 kw thin film modules) -> energy system investor or PV-system (65,8 kw mono crystalline) Financing of PV system by feed-in tariff - solar electricity is sold to utility Astrid Schneider - Solar Architecture

9 BIPV-Roof for a new school building Energy balance: Summer holidays in times of highest Production: No problem due to feeding of produced electricity to the public grid 25.5 kw installed on 480 m2 roof area Ca. 920 kwh/kwp electricity generation 23,223 kwh Solar electricity per year 49 cent/kwh price for sold electricity from utility (feed in tariff 2007!!!) Earnings: 11,279 /year earning / investment 130,000 System produces at least as much electricity as the school will consume per year Astrid Schneider - Solar Architecture Source Astrid Schneider 9

10 BIPV-Roof for a new school building Saved costs due to PV as roofing: The cumulated cash flow shows: The feed-in tariff must be stable and guaranteed for 20 years, otherwise it is not possible to finance the PV roof The solar roof costs nearly half as much as the building itself A separate investment scheme / business is made up with investing in PVpower plant - it is not easy for house owners to bear the risks Not easy to separate ownership of BIPV-plant as it in connected to the building Astrid Schneider - Solar Architecture / m2 on 460 m2 -> 9.200,- EUR -> 360 EUR / kwp with thin film Source Astrid Schneider 10

11 BIPV-Roof for a new school building The School Roof produces more electricity than the school consumes Astrid Schneider - Solar Architecture Source Astrid Schneider 11

12 PV Installations: ca. 7.5 GW / Year in Installed Capacity of PV-Systems and produced energy in Germany In the years we had about 7500 MW installations of Solar Plants every year this resulted in a very rapid rise in overall PV-Power as a share of the overall electricity system in Germany. We went from 1% in 2009 to 5% now. Source: German Ministry for Environment - BMU / AGEE-Stat, Astrid Schneider - astrid.s@debitel.net - Germany

13 PV produces 5% of Germany s Electricity Renewable electricity produced in Germany from Photo- Voltaic 4.7% Biomass 6.9% Wind 7.7% Water 3.6% In 2012 Germany had 32,643 MW installed capacity of photovoltaic power plants, which produced 28,000 GWh of solar electricity 4.7% of German electricity demand (all renewables share is 22.9% in 2012) Source: German Ministry for Environment - BMU / AGEE-Stat, Astrid Schneider - astrid.s@debitel.net - Germany

14 : PV produces at noon 24% Electricity Photovoltaic 15.9 GW Wind 5.2 GW Others 46.2 GW (including water power, biomass etc.) Sum: 67.3 GW Solar power is acting as a game changer in Germany s electricity system and markets. Gas power stations, which were used to provide noon time high consumption are made workless from spring to harvest. Stock market electricity prices are strongly falling in Germany from about 8 Cent per kwh in 2008 to about 3.5 Cent per kwh actually in spring Source: EEX - Transparency Platform of German Grid Operators provided by European Energy Exchange AG (operates electricity stock exchange) Astrid Schneider - astrid.s@debitel.net - Germany

15 Renewable Electricity Generation in Germany [TWh] StrEG 1. Januar 1991 gesamter Strom aus EE Einspeisung vergÿteter Strom nach StrEG Einspeisung vergÿteter Strom nach EEG VergŸtung 1,0 1,3 1,6 2,3 2,8 3,7 4,8 6,8 7,9 EEG 1. April ,4 18, * 3,5 25,0 neues EEG 1. August ,5 38,5 44,0 51,5 67,0 72, [Mio. EUR] StrEG: Stromeinspeisungsgesetz; EEG: Erneuerbare-Energien-Gesetz Quelle: BMU Publikation "Erneuerbare Energien in Zahlen Ğ nationale und internationale Entwicklung", KI III; Stand: Juni 2009; Angaben vorlšufig In 2008 about 72 TWh of renewable electricity is produced in Germany. The feed in tariff payment is about 9000 million EUR per year Source: German Environmental Ministry (BMU / AG-EE-Stat) Development of Renewable Energy in Germany June 2009 Astrid Schneider - astrid.s@debitel.net - Germany 15

16 Forcast Renewable Power Production Growth In TWh of Power Generation Photovoltaic Wind offshore Wind onshore Biomass 0 The actual forecast of the grid operators sees the share of renewable power plants, which are paid by the feed in tariff rising strongly a near doubling between 2011 and 2017 Astrid Schneider Solar Architecture - Germany Source: EEG-Mittelfristprognose: Entwicklungen 2013 bis 2017 (Trend-Szenario) 16

17 Forcast Payments of feed in tariff to operators In thousand Million EUR Photovoltaic Wind offshore Wind onshore Biomass Due to price reductions of renewable power the feed in tariff payments are not rising as strongly as the produced power. In 2014 the feed in tariff paid per kwh by electricity consumers is calculated to be about 5 Cent ( ) on top of each kwh purchased from the public grid. Source: EEG-Mittelfristprognose: Entwicklungen 2013 bis 2017 (Trend-Szenario) Astrid Schneider - astrid.s@debitel.net - Germany

18 Actual Situation of German Feed in Tariff: The feed in tariff was since 2000 accomplished by: Strong state policy commitment Legal guarantee of feed in system Long term stability to allow investment planning Clear and strong legal framework to secure investment Actual situation: Discussion of high feed in tariff payments by consumers (ca. 5 -Cent per kwh) Policy challenges / upcoming changes in feed in tariffs Discussion of strong module imports from China and price pressures due to imports of cheep Chinese Solar modules Falling feed in tariffs stimulated by cheep mass production No chance for extra tariffs for BIPV which would be needed to make more sophisticated / special module production economic Astrid Schneider - astrid.s@debitel.net - Germany 18

19 PV Feed in Tariff s January - April 2013: Monthly degression of feed in tariff by 2.2% in first quarter 2013 New Feed in Tariff since summer 2012: PV-plants between 10 kwp and 1 MW are only getting 90% of electricity paid with feed in tariff Every 3 month the degression is reviewed and might be more or less than 1% according to last installation numbers 20 years of state guaranteed payment of feed in tariff Astrid Schneider - astrid.s@debitel.net - Germany 19

20 Changing Situation for Financing of BIPV New aspects are coming foreward: - grid power costs 24 -Cent / kwh for private consumers including taxes, grid costs, production costs, distribution and marketing, margins, etc. - feed in tariff is only about 15 -Cent / kwh Source: Picture: Prof. Dr. Volker Quaschning Astrid Schneider Solar Architecture - Germany

21 Changing Situation for Financing of BIPV Self Consumption by private or commercial producers: Direct consumption of self produced solar power as beeing cheaper than power from the grid Adding a battery to the solar home system to make maximum use of self produced solar power electric vehicle loading Power to heat: produce hot water demand with solar electricity in combination with heat pump Supporting heating systems directly or via heat pump with electric power by solar plant and hot water storage Astrid Schneider - astrid.s@debitel.net - Germany 21

22 Using BIPV for different purposes: Direct self consumption - Sales to grid direct sales to neighbours producing heat battery storage - Due to higher prices for electricity from the grid than for self produced solar electricity new markets are opening and will make PV-installations independent from state rules and subsidies. However utilities are planning to get hold in this and to implement tariffs for supplying safety to consumers who don t any more want any climate endangering electricity production but who might need safety of supplies while 100% self supply systems are not economic Source: Prof. Volker Quaschning Astrid Schneider Solar Architecture - Germany 22

23 Will PV substitute Solar Thermal Systems? Photovoltaic systems are more easily to be introduced into existing houses and their heating / hot water infrastructure. They can be added in different quantities easily. Heat production equipment is cheap. Mass production of PV reduces costs quickly. Source: Prof. Volker Quaschning Astrid Schneider Solar Architecture - Germany 23

24 Using BIPV for Power Car - Heat Research house in Berlin: all energy demand shall be fulfilled by the photovoltaic plant Source: Pictures obove: BMVBS - Picture right: Webcam-picture (Quelle: BMVBS) Astrid Schneider - astrid.s@debitel.net - Germany 24

25 Changing Situation for Financing of BIPV Utilities discuss with politics how to stop piracy self suppliers not paying for grid stability, new grids, storages, reserve load, etc. but supplying themselves, cutting earnings for utilities heavily - Astrid Schneider - astrid.s@debitel.net - Germany 25

26 Latest Trends for BIPV-use Preparing for the age of 100% renewable energy and materials: Power to smart grid Power to heat Power to gas Power to chemicals? Astrid Schneider - astrid.s@debitel.net - Germany 26

27 Thanks for your attention! Astrid Schneider Solar Architecture Berlin Astrid Schneider Solar Architecture Pestalozzistr. 12 D Berlin

28 Please quote with correct copyright remarks: Astrid Schneider - Solar Architecture, Berlin In Case of the wish for publication or other economic use please contact: astrid.s@debitel.net Astrid Schneider Solar Architecture Pestalozzistr. 12 D Berlin Germany