The Legal Frame for the Use of Offshore Wind Energy in Germany
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1 The Legal Frame for the Use of Offshore Wind Energy in Germany Which kind of legal frame is needed in the Baltic States? 3 rd seminar on EIA for offshore wind farms vis-à-vis Natura2000 and other land uses Riga, Lettland 15./16. April 2009 RA in Dr. Ursula Prall
2 I. The status of offshore wind farms in Germany 1. Situation and history of the development Objective in MW electric power to be installed by 2030, using a step by step-approach: : preparation phase : at least 500 MW : to MW : to MW Things went differently legal framework was not ready to cope with project developers activity: Relevant ordinance supplied only the essential requirements for occasional structures project developing was free from constrictions situation speaks for itself BSH started developing a high standard of concretising and closing gaps in legislation designed for single, not hundreds of structures environmental standards were developed in cooperation with authorities competent for nature protection; sensitive areas were identified and research on the effects on the maritime environment started methods for risk analyses were developed and harmonised.
3 I. The status of offshore wind farms in Germany (North Sea/BSH) 3
4 I. The status of offshore wind farms in Germany (Baltic Sea/BSH) 4
5 I. The status of offshore wind farms in Germany 2. Why are there not yet any offshore wind farms built in Germany? Conditions Unlike other European countries, offshore wind farms are planned in distances of often more than 100km from the shore, in water depths of 20 to 40m. These conditions are more demanding than in UK or Denmark. Scarcity of components Because of these difficult conditions, installation and operation is more cost intensive which means that 5MW turbines shall be used. Such turbines are still in the prototype status, and most other components are scarce as well (situation improves only now). Insufficient incentive Until the beginning of 2009, the incentive was too low; installation and operation would not have been profitable. This has been substantially improved. No licensed grid connections Only were few offshore wind farms have a licensed grid connection (which is not yet built). 5
6 I. The status of offshore wind farms in Germany 3. Conclusions The use of offshore wind energy in Germany is not yet a story of success. But there is reason to hope that this will change in the very near future, and preparation has certainly been thorough. The length of the preparation process shows how much more is to be done than was reckoned with in the earlier stages. It makes sense to consider these experiences. Not all experiences, conclusions and achievements are applicable everywhere else. They cannot be transferred to another situation without examination of their applicability. 6
7 II. Why should an offshore wind farm be built? 1. Expensive projects binding EU targets Expensive projects 80 turbines with an electric power of 5MW cost more than 1 billion Euros. This does not include grid connection. Using a new technology in a rough environment with difficult operation and maintenance conditions is risky. Binding EU targets on the use of RES by 2020 Latvia: 40% (2005: 32.6%) Estonia: 25% (2005: 18%) Lithunia: 23% (2005: 15%) Consequence: It is necessary to make the use of RES happen. 7
8 II. Why should an offshore wind farm be built? 2. Options for action Feed-in tariffs: fixed, above-market price for each generated kwh incentive for potential operators obligation for transmission/distribution system operator Quota system: obligation of using a fixed quantity of RES obligation for either system operator, consumer, or producer to transmit, use or produce a minimum quantity of RES electricity price is subject to the market No harmonised promotion system on EU level 8
9 II. Why should an offshore wind farm be built? 3. How is it done in Germany? a) Feed-in tariffs (1) Erneuerbare Energien-Gesetz (EEG; Renewable Energy Sources Act) EEG entered into force in 1990 and was very substantially amended every four years (last version entered into force on Januar 1 st 2009), adjusting, inter alia, the objective and feed-in tariffs. Objectives provide for sustainable development of energy supply reduce economic costs of energy supply by internalising external costs promote the development of relevant technologies spare fossil energy resources 30% of all electriciy shall be RES based by 2020 and shall continue to increase afterwards (EEG 2004: 12.5% until 2010 and 20% in 2020) Instruments guaranteed grid acces and guaranteed transmission; obligation of grid extension guaranteed above-market price for twenty years price differs from source to source, in accordance with technological status. difference to market price can be passed on to consumers 9
10 II. Why should an offshore wind farm be built? 3. How is it done in Germany? a) Feed-in tariffs (2) Feed-in tariffs for offshore wind energy 15 Ct/kWh for the first twelve years if an offshore wind turbine starts operating before 2016 ( incentive for accelerating realisation) 13 Ct/kWh for the first twelve years if a turbine starts operating in 2016 or later 3.5 Ct/kWh for another eight years ( high tariff in the beginning is more important than a middling one over a longer period) 15 or 13 Ct/kWh for an additional 1.7 months for each additional meter of water depth starting at 20m 13 or 15 Ct/kW for an additional 0.5 month for each additional mile of distance from the shore, starting at 12 nm ( no incentive, but compensation for difficult conditions and extra costs for installation and operation & maintenance) no fixed, above-market price for wind farms situated in a Natura2000-area ( negative incentive) if a wind farm starts operating in 2015 or later, a degression of 5% of the relevant tariff applies ( incentive for acceleration, but also aligning costs to developments) 10
11 II. Why should an offshore wind farm be built? 3. How is it done in Germany? b) Grid connection to be supplied by TSO Until end of 2006 grid connection was the responsibility of each wind farm project developer/operator additional investment of 25% - 40%, depending on distance more environmental impact by numerous sea cables less cost-efficiency Since end of 2006 responsibility of transmission system operators costs can be passed on to consumer bundling of cables: less environmental impact and more cost-efficiency (2009) problematic move ( VI.) 11
12 II. Why should an offshore wind farm be built? 4. Conclusions feed-in tariffs are a highly successful instrument for promoting the use of RES, by establishing a reliable incentive. The system has been copied in many other countries; it is widely held to be the best instrument. quota systems might make sense if it is necessary to initialise the use of RES. As an incentive, it is not as reliable as a feed-in tariff. studies show that electricity prices tend to rise more if a quota system is used. political question, not a legal one. 12
13 III. Where should an offshore wind farm be built? 1. Conflicting interests Other interests navigation marine environment/nature conservation fishery air traffic military landscape/tourism existing structures (cables; pipelines) sand and gravel excavation EU legal frame Habitat Directive 1992/43/EEC Bird Directive 1979/409/EEC EIA Directive 1985/337/EEC SEA Directive 2001/42/EC (all as amended) 13
14 III. Where should an offshore wind farm be built? 2. Options for action Decision in each single case location is choice of the applicant, the competent authority has to decide in each single case without any additional guidance as to the suitability of the location Identification of no-go-areas finding areas that should by all means be kept free of structures, such as Natura2000-areas or areas with dense traffic Identification of "go-areas" finding areas that are particularly suitable because of little potential for conflicts Comprehensive spatial planning prepare comprehensive spatial planning and balancing all interests 14
15 III. Where should an offshore wind farm be built? 3. How is it done in Germany? (1) no formal provisions traffic routes were known but not formalised sensitive areas were half-known but not affirmed and not formally protected structures and excavation areas were known locations were intensively discussed between applicant and BSH and projects were limited to 80 WTG, so gross errors were mostly avoided September 2005: Nature conservation areas areas that should be part of Natura2000 were notified to Brussels, covering some 30% of the German EEZ ( applicability of Art. 6 Habitat Dir.) negative incentive (no fixed tariff) started working guidance as to where not to plan an offshore wind farm was in place December 2005: Areas particularly suitable for offshore wind farms three areas particularly suitable were identified (little traffic, no major environmental conflicts less investigations necessary guidance as to where to plan an offshore wind farm with less expenditure 15
16 III. Where should an offshore wind farm be built? 3. How is it done in Germany? (2) 2005/2008: Spatial planning In 2005, BSH started working on a comprehensive spatial planning for the German EEZ (12nm-zone: responsibility of Länder), draft was announced three (!) years later priority areas for traffic were to be established priority areas for offshore wind farms were to be established, outside such areas an offshore wind farm would not be permissible. room for approximately MW hardly any room for new projects reflected the planning situation in 2005, not in 2008 effective steerage of land use in respect to offshore wind farms - but offshore wind farm industry pointed out that it would effectively cut off the development which aims at MW 2009: fundamental changes to the draft, i.e. priority areas for offshore wind farms but the possibility of having projects licensed outside these areas remains 16
17 Spatial planning in the North Sea (draft by BSH) 17
18 Spatial Planning in the Baltic Sea (draft by BSH) 18
19 III. Where should an offshore wind farm be built? 4. Conclusions Best: Have spatial planning in place before projects are developed, in order to effectively steer the use of space. Everybody would profit if the different interests are considered early, fairly and thoroughly Each country must decide whether this is "worthwhile" or whether another option might suffice, which would depend on quality and quantity of conflicting uses. Second best: Have areas identified with little potential for conflict, i.e. not forcing, but inducing project developers to use those areas Third best (minimum): Identify no-go areas in respect to nature conservation and traffic Worst: Force the competent authority to make its decisions with an instrument designed for a few cases, with no possibility of denying a project because it does not fit into an overall structure of land use. 19
20 IV. Under what circumstances should an offshore wind farm be licensed? 1. Defining scope and requirements of licensing Striking a balance When defining licensing requirements, many issues need to be considered: the need to use RES the applicants rights and interests many different interests that need to be protected. It is necessary to find requirements that strike a balance between all these aspects. EU legal frame Habitat Directive 1992/43/EEC Bird Directive 1979/409/EEC EIA Directive 1985/337/EEC (all as amended) 20
21 IV. Under what circumstances should an offshore wind farm be licensed? 2. Options for action General considerations Should the approval be discretionary or non-discretionary? Should the regimes in EEZ and 12nm-zone differ (UNCLOS needs to be taken into account in the EEZ)? what should be the scope of the permit, which elements of the project should be covered? only the wind farm? also grid connection? onshore part of cable? Licensing requirements Should all potentially conflicting interests be protected? Or should only some be protected and others left out of the decision making process? Should the technical details be already part of the licensing process or should these matters be left to the execution stage? 21
22 IV. Under what circumstances should an offshore wind farm be licensed? 3. How is it done in Germany? a) General considerations Non-discretionary administrative act If none of the reasons for refusing the project are fulfilled, the project has to be licensed. Differentiation between EEZ and 12nm-zone different competent authority slightly different procedures slightly different requirements Scope of permit/eez one permit for wind farm, transformer station, inner park cable connection one permit for cable/eez-part another permit for cable/12nm-zone part again another permit for land many different authorities involved (matter of federalism) Scope of permit/12nm-zone Although typically split into several steps, the permit would cover everything 22
23 IV. Under what circumstances should an offshore wind farm be licensed? 3. How is it done in Germany? b) Licensing requirements (EEZ) - Overview Overview of requirements A wind farm has to be approved, provided that it does not impair the safety and efficiency of navigation, it is not detrimental to the marine environment, if it does not impair other public interests (added in 2008), if it does not contradict spatial planning (added in 2008), and if such effects cannot be either prevented or compensated by collateral clauses. BSH Standards concretising requirements harmonisation of methods for risk analyses Standard Environmental Investigation Concept Standard Design of Offshore Wind Farms Standard Geological Site Investigation planned: Standard on safety/emergency management; health & safety 23
24 IV. Under what circumstances should an offshore wind farm be licensed? 3. How is it done in Germany? b) Licensing requirements (EEZ) - safety of navigation (1) No more "freedom of navigation" Offshore wind farms are obstacles to navigation. UNCLOS forbids artificial structures at a location where they would intervene with the use of important, internationally recognised shipping routes outside such shipping routes, no such provision exists. wind farms need to be placed were they cause the least negative impact on navigation. Efficiency of navigation relevant mostly in respect to economic aspects (detours cause more fuel consumption also, more attention might have to be paid by the officers if all superfluous impediments are avoided, a negative impact has to be put up with. 24
25 IV. Under what circumstances should an offshore wind farm be licensed? 3. How is it done in Germany? b) Licensing requirements (EEZ) - safety of navigation (2) Threat to safety of navigation: Collisions It is crucial that collisions between a vessel and an offshore wind farm are avoided, since it might lead to casualities (ferries involved?), contamination of the environment (hazardous substances, such as oil or chemicals involved?) great damage to turbine and vessel. Safety measures marking of turbines, radar/ais "collision friendly foundations" surveillance of the area positioning of safety vessels with significant towing capacity inside a wind farm (in one case only) 25
26 IV. Under what circumstances should an offshore wind farm be licensed? 3. How is it done in Germany? b) Licensing requirements (EEZ) - safety of navigation (3) Defining an acceptable risk (abstract general rule) Which probability of a collision is acceptable? decision considering legal and political aspects must be made by the competent authority (or on a higher level) obviously, it is not up to a project developer, because most protected interests are not at his disposition Germany: one collision in hundred years is an acceptable risk Risk analysis (each individual case ) What probability of a collision exists at that particular location? analysis of the traffic situation probabilistic risk assessment, covering different scenarios Additional measures Risk mitigation measures consent of Waterways and Shipping Directorates safety zones (in accordance with UNCLOS) 26
27 IV. Under what circumstances should an offshore wind farm be licensed? 3. How is it done in Germany? b) Licensing requirements (EEZ) - marine environment Purpose of an EIA Collect facts on the environment of the proposed project and evaluate the probable effects and consequences on the environment: which species are affected? what kind of habitat? which other interests (landscape, climate, people, etc.; Art. 3 EIA Dir.) cumulative effects how slight/middling/severe are any effects? No decision-making guidance by EIA Directive EIA Dir. does not give any guidance as to how to decide, but all aspects need to be considered third parties are involved, so all aspects/pros and cons should be on the table ways of optimising the project can be identified Strict limits to decision making by Habitat Directive and Bird Directive Art. 6 and 12 Habitat Directive, Art. 4, 5, 9 Bird Directive ECJ juristdiction 27
28 IV. Under what circumstances should an offshore wind farm be licensed? 3. How is it done in Germany? b) Licensing requirements (EEZ) - other public interests landscape important to people living near the coast and in respect to tourism. Experiences show that communities can be reconciled mitigation measures and information about the project are important very much a matter of attitude Military use It is usually difficult to say whether the issue is concerned because of confidentiality. Early discussions with the relevant bodies might help. Fishing industry Increasing concern because a lot of space might be used - compensations? Existing structures It is no technical problem to cross other cables/pipelines, but fairly expensive. 28
29 IV. Under what circumstances should an offshore wind farm be licensed? 3. How is it done in Germany? b) Licensing requirements (EEZ) - technical aspects Geotechnical investigations Partly before, partly after licensing geophysical and geotechnical site investigations have to be carried out: geophysical site investigation (SSS) (100%) before licensing geotechnical site investigation (bore holes) for 10% of all locations before licensing rest of geotechnical site investigation after licensing and before construction (relevant for manufacturing foundations; each one has to be specific) BSH Standard; investigations to be certified by an independent expert Details of construction Partly before, partly after licensing the detailed technical features of each foundation, turbine and the transformer station must be decided: all materials and details must be suitable for offshore conditions all installation methods must be suitable for offshore conditions installation logistics must be planned to perfection BSH Standard; all materials, details and logistics need to be certified by an independent expert 29
30 IV. Under what circumstances should an offshore wind farm be licensed? 3. How is it done in Germany? b) Licensing requirements (EEZ) - collateral clauses "Cradle to grave" Numerous collateral clauses cover installation, operation and decommissioning of an offshore wind farm, ensuring that the requirements of licensing are continuously met. They concern, inter alia: safety during the construction phase state of the art geotechnical study state of the art methods in the construction prior to start of construction presentation of a safety concept covering emergencies installation of lights, radar, AIS use of environmentally friendly materials and non-glare paint foundation design minimising collision impact noise reduction during construction and operation environmental monitoring during operation limitation of the permit for 25 years (possibility of prolongation if requirements are still met) decommissioning it was substantially underestimated how demanding these conditions would be! 30
31 IV. Under what circumstances should an offshore wind farm be licensed? 4. Conclusions General considerations It makes more sense to differentiate between onshore and offshore wind farms than to differentiate between windfarms situated within the territory of a state and those situated within the EEZ. a license should preferably cover all elements, i.e. wind farm and grid connection. It reduces the risk of delay, and everybody knows what one is dealing with from the beginning. Licensing requirements Navigation: Whilst some detriments to efficiency must be put up with, safety may not suffer. Environment: EU legal frame must be observed, which should cover all necessary aspects Other public interests: A balance between the use of offshore wind energy and other interests must be reached. Existing uses might have to suffer some restrictions, in the interest of climate protection. Anxieties about "sunset pollution" might be met with less lights, less height. Whether these interests need to be preconditions for licensing depends on their relevance in each single country. 31
32 IV. Under what circumstances should an offshore wind farm be licensed? 4. Conclusions Licensing requirements (cont.) All BSH Standards have been extremely helpful. After a critical look in respect to applicability and extent, they should provide a very good guidelines for others as well. Collateral clauses are a crucial part of each permission and should cover all aspects, making sure that the licensing requirements are constantly met. Existing permissions might be a guideline. Technical details should be dealt with at a later stage, not as a precondition for licensing. Otherwise, money might be spent on a project which might not be licensed. 32
33 V. Competent authorities and proceedings 1. Establishing formalities Competent authority For each administrative act, a competent authority must be assigned: "formal" competence but also competence in the sense of expertise/necessary knowledge to make an informed decision Proceedings which steps are to be taken? which documents etc. need to be submitted, and at what stage? who is to be involved? EU legal frame EIA Directive 85/337/EEC prescribes certain steps that need to be observed. 33
34 V. Competent authorities and proceedings 2. Options for action Competent authority one for those projects within the EEZ, another one for projects within the 12nmzone? Or one for all offshore wind farms? Proceedings (integrating provisions by EIA Directive) EIA can be integrated in the proceedings or it could be an extra procedure. The following elements must be covered (Art. 5 and 6 EIA Directive): other concerned authorities must be involved public shall be informed of the project and certain information must be made available public must be given early and effective opportunity of participation reasonable time frames shall be provided for this participation other Member States may have to be included. There are no specific forms prescribed for the participation of these groups and bodies. 34
35 V. Competent authorities and proceedings 3. How is it done in Germany? (1) Competent authority Competent authority for projects within the EEZ is the Federal Maritime and Hydrographic Agency (Bundesamt für Seeschifffahrt und Hydrographie - BSH) competent authority for projects within the 12nm-zone are appointed by Länder Proceedings Both the "before licensing stage" as well as the "execution stage" shall be presented, because many of the important details happen after licensing. Before licensing upon receival, BSH checks completeness (basic information: location, probable environment, size, time frame of realisation,...) first round of participation is initiated: other authorities are informed and asked for comments after evaluation of these first comments, more - also private - stakeholders are involved in a second participation round and are given an opportunity to comment 35
36 V. Competent authorities and proceedings 3. How is it done in Germany? (2) Before licensing (cont.) first public discussion (application conference/scoping): the project is presented and conflicting interests and uses are discussed. As a consequence, the scope of investigation is prescribed. objective: defining the scope of investigation by identifying potential conflicts. phase of investigation (environmental impact study, risk analysis, basic technical designs). third round of participation: all resulting documents are passed on to the public and other authorities/bodies for inspection and comment. second public discussion of these documents objective: identification of actual conflicts and - if possible - finding solutions review of all points and - if all requirements are met - granting of approval (parallel: granting of approval by Waterways and Shipping Directorates, if safety standards are met). time frame: between two and five years (two if everyone is really fast and a lot of work was done in advance) 36
37 V. Competent authorities and proceedings 3. How is it done in Germany? (3) Execution of a permit A lot of questions are unsolved at the point of licensing, because the requirements (in Germany) only say that the wind farm as a whole does not constitute a danger to the protected subjects. Many technical details concerning constructional safety are still open: geotechnical investigations need to be carried out for each location even the last screw needs to be certified for offshore use installation logistics need to be thought through. environmental monitoring concept noise reduction methods emergency management concept operation and maintenance concept... realisation process is very demanding and should not be underestimated. But: the nearer to the shore and the shallower the water, the easier experience should help a lot 37
38 V. Competent authorities and proceedings 4. Conclusions Competent authority Considering how complex a matter it is, it might make sense to appoint one authority which would deal with all applications. Otherwise, expertise would need to be built up in more places than necessary. Proceedings EU legal frame needs to be observed (EIA Directive) The proceedings might seem to be very long winded, but they constitute an excellent method of discussing problems and finding solutions/compromises. The more people/stakeholders involved, the better the chance of agreement and support. The decision should not be rushed (it should certainly not be artificially prolonged, though). 38
39 VI. Where would the electricity go? 1. "No life without arteries" offshore onshore planning and licensing difficult routes (sensitive areas, crossing of streets, rivers, train lines etc.) should be avoided, if at all possible contracts with land owners need to be concluded onshore transmission/distribution grid sufficient capacity to transmit the electricity to where it is in demand? need for extension of power lines or nodes, new transformer stations? will some grid capacity be available in the future, because another power plant might be shut down, etc.? 39
40 VI. Where would the electricity go? 2. Options for action offshore onshore who shall build the grid connection - TSO, wind farm operator, state? who shall pay - operator or consumer/tax payer? onshore transmission/distribution grid if more capacity is needed, is the legal frame work in place or are adjustments necessary? when would the capacity be needed - when should planning and building of new powerlines be underway? should it be underground cables or power lines above ground? 40
41 VI. Where would the electricity go? 3. How is it done in Germany? a) Grid connection offshore onshore Responsibility The TSOs are responsible for connecting all wind farms that start being built until the end of 2015 to the onshore transmission grid the connection must be in place at the same time the wind farm is ready to start operation Costs of grid connection costs can be passed on to the electricity consumers Advantages more cost efficient because of bundling less environmental impact because of bundling incentive for project developers since they do not need to invest acceleration of project realisation because of limited responsibility Disadvantage one sometimes gets the impression that TSOs simply don't care about their legal responsibility. 41
42 VI. Where would the electricity go? 3. How is it done in Germany? b) Capacity of the onshore (transmission) grid Problem In Germany, wind electricity is mostly generated in the north but needed in the south or the middle. Its use/percentage is constantly increasing The grid needs to be restructured, in order to cope with decentralised electricity generation. Identification of extra capacity needed From , a comprehensive technical study was done. Conclusion: 850 km of high voltage power lines (in specified locations) are needed for integrating wind power (on- and offshore) until Another technical study is under way, examining another time horizon Legislation on accelerating the building of power lines under way Overhead power lines are very contentious, which is why - at the moment - some legislation is under way to speed up licensing and realisation. It is discussed to install more underground cables, but there is little chance that more than very few stretches will be built as cables; it is argued that cables are too expensive. 42
43 VI. Where would the electricity go? 4. Conclusions Offshore onshore It must be made sure that the grid connection is ready at the same time the wind farm is ready to operate. If someone else than the wind farm operator is responsible for grid connection, it must be ascertained that he is willing to do his job, that there is absolutely no loop-hole and that it is done in time. Capacity of onshore grid If there are doubts about the capacity of the onshore grid, early action should be taken to investigate the matter and - if necessary - amend the situation. Grid connection/grid capacity is vital! 43
44 VII. What else is needed? Components Where to the turbines, foundations and transformer stations come from? where the jack-up platforms and other installation equipment (vessels for cable laying)? Infrastructure Can the turbines etc. be stored at the quay side? onshore grid connection? Operation and maintenance are operation and maintenance concepts in place? Emergency management What shall be done if a vessel comes dangerously close to a wind farm is out of control? Who is in command? Is some sort of surveillance of the area already in place - what needs to be added? What is to be done if a collision occurs - what strategies? 44
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