The German federal government has abandoned negotiations with the country’s state governments over measures to introduce a "brake on electricity prices". The breakdown in talks means that uncertainty about German policy on renewable energy incentives will continue until after federal elections in September.
An initiative to rein in consumer electricity prices by restricting the amount households pay to support renewable generation was presented in February by Germany's federal environment and economy ministers. It introduced entirely-unexpected uncertainty about the financial viability of German offshore wind projects, including those already in operation and/or having secured project finance.
Germany’s 16 states are opposed to the federal proposal and the two sides had been due to meet at the end of this month. The state governments hold a majority in Germany’s upper parliamentary house and could block or postpone any new renewables legislation proposed by the federal government.
"There will almost certainly be no revision of the renewable energy law before the federal elections in September 2013, so the legislation will remain as it is into next year," said Hans-Josef Fell, energy spokesman for opposition Greens Party yesterday.