Renewable Energy and the EEG

Renewables in Germany in brief

Renewables are the core of Germany's energy transition. The Renewable Energy Sources Act (Erneuerbare-Energien-Gesetz, EEG) sets the target of at least 80% renewable energy in gross electricity consumption by 2030 (§ 1(2) EEG) and expansion paths of 115 GW of onshore wind and 215 GW of solar capacity by 2030 (§ 4 EEG). The Offshore Wind Act (WindSeeG) aims for at least 30 GW offshore by 2030.

Renewable installations are by law in the overriding public interest and serve public safety (§ 2 EEG), which gives them priority in permitting decisions. Support is granted through market premiums determined in tenders run by the Federal Network Agency (Bundesnetzagentur), or through statutory payments for smaller plants.

The system is in transition. The Federal Government's EEG 2027 bill would replace fixed feed-in tariffs for new plants with direct marketing and introduce contracts for difference for plants from 100 kW, while keeping the 80% target. According to the Bundestag, the bill (printed paper 21/7867) received its first reading on 24 September 2026 and was the subject of a committee hearing in October 2026; as of the latest parliamentary sources we reviewed, it had not been adopted.

Developers, investors and lenders must therefore plan under the current EEG while preparing for the new regime. This page explains support, tenders, grid connection, permitting, PPAs, repowering and project M&A for renewables. For the wider framework, see our energy and infrastructure overview.

Support for renewables under the EEG

Under the current EEG, most new plants sell their electricity on the market through a direct marketer and receive a market premium on top, calculated as the difference between the "value to be applied" (anzulegender Wert) and the monthly or annual market value. For larger plants, the value to be applied is determined in tenders run by the Federal Network Agency, which identifies the successful bidders and their award values (§ 22(1) EEG). For onshore wind, the payment claim generally exists only while an award is effective (§ 22(2) EEG). Smaller plants, especially rooftop solar systems, receive statutory payments, including feed-in tariffs for small installations.

During periods of negative spot market prices, the value to be applied falls to zero (§ 51(1) EEG), subject to exceptions for small installations. This rule, together with the growing number of negative price hours, has made storage, flexible operation and hybrid projects more attractive. Plants must be directly marketed and remotely controllable above certain sizes, and operators of onshore wind and ground-mounted solar plants may offer affected municipalities up to 0.2 cents per kilowatt hour (§ 6 EEG), a payment that has become standard practice to secure local support.

The EEG 2027 reform

The Government's EEG 2027 bill marks a system change. According to the Bundestag's summary, it would abolish fixed feed-in tariffs for new plants and require direct marketing, introduce two-sided contracts for difference with a refinancing contribution on excess revenues for plants from 100 kW, and adjust tender volumes for 2027 to 2032.

Small solar systems under 25 kW would receive fixed payments only until the end of 2028 and for three years. The changes are designed to comply with EU electricity market design rules, which require two-way contracts for difference for new direct price support, and the reform needs EU state aid approval. See our insight on EEG reform plans for 2027.

Tenders and grid connection

The Federal Network Agency holds tenders for onshore wind, ground-mounted and rooftop solar, innovation tenders combining technologies and biomass on fixed dates each year. Bidders must meet material requirements, for example an immission control permit for onshore wind, and provide security; awards expire if the plant is not commissioned within the realisation period, and penalties may apply.

Bid strategy depends on maximum bid values set by the Federal Network Agency, the expected competition and the project's cost structure. Because awards are tied to the specific project and permit, changes to turbine type or location after the award need to be checked against the tender rules, and transfers of awards to other projects are restricted. Offshore wind sites are tendered under the WindSeeG either as centrally pre-surveyed sites or as sites that are not centrally pre-surveyed. See our insight on offshore wind tenders.

Grid operators must connect renewable plants without delay and with priority at the technically and economically most suitable connection point (§ 8(1) EEG). In practice, capacity constraints have become a major obstacle. Flexible connection agreements allow faster connection in exchange for limits on feed-in, and the grid connection package adopted by the cabinet together with the EEG bill would change how scarce capacity is allocated. Developers should secure a grid connection commitment early and align it with tender and financing timelines, because a delayed connection can cause a tender award to lapse or trigger penalties. See our insight on grid connection reform.

Biomass, hydropower and green hydrogen

The EEG also supports biomass, biomethane, hydropower, geothermal energy and electricity from green hydrogen. Biomass plants increasingly operate flexibly, producing electricity when prices are high, and existing plants depend on follow-up tenders as their original support periods expire. Tenders for plants producing electricity from green hydrogen form part of the strategy to build dispatchable renewable capacity. Each technology has its own tender rules, maximum values and sustainability requirements, so developers should check the specific provisions rather than rely on the general rules for wind and solar.

Permits for renewables projects

Onshore wind turbines above 50 metres require an immission control permit. Each federal state must designate a statutory share of its territory for onshore wind by 31 December 2027 and 31 December 2032 (§ 3 WindBG). In designated wind energy areas, no environmental impact assessment and no species protection assessment under § 44(1) of the Federal Nature Conservation Act is required, but mitigation measures or payments apply (§ 6 WindBG).

Objections and actions by third parties against onshore wind turbines above 50 metres have no suspensive effect (§ 63 BImSchG), and repowering is assessed only for its additional adverse effects compared with the existing turbines (§ 16b BImSchG). See our insight on onshore wind permitting.

Ground-mounted solar projects usually require a binding land-use plan, except where they are privileged in the outer area, for example along motorways and major railway lines or as agri-photovoltaics connected to a farm (§ 35(1) nos. 8 and 9 of the Building Code). Rooftop systems are generally permit-free but may raise building law, fire safety and monument protection questions, and several federal states now require solar installations on new commercial buildings or car parks. Biomass plants require immission control permits and must comply with sustainability requirements. The overriding public interest in § 2 EEG applies across technologies and has strengthened projects in court. See our insight on solar and agri-PV projects.

Storage, hybrid projects and curtailment

Co-locating battery storage with wind or solar plants has become common, because storage can shift output away from negative price hours and reduce curtailment. Energy storage facilities are themselves in the overriding public interest (§ 11c EnWG), and the EEG contains rules on innovation tenders and on storing renewable electricity without losing support, which must be applied carefully to avoid jeopardising payment claims. Grid operators may curtail renewable plants to manage congestion under redispatch rules, generally against compensation; the EEG 2027 bill would partly waive compensation in overloaded grid areas, which makes curtailment risk a growing issue in financial models.

Local participation and citizens' energy

Local acceptance is a practical condition for renewables projects. Apart from voluntary municipal payments under § 6 EEG, several federal states have adopted participation laws requiring developers to offer municipalities or residents a financial stake or other benefits. Citizens' energy companies benefit from exemptions from the tender requirement for onshore wind up to a certain size (§ 22(2) no. 3 EEG). Developers should map the applicable state rules early, because they affect project economics and timing.

PPAs and merchant renewables

Corporate power purchase agreements (PPAs) have become a key route to market for plants that do not receive or do not rely solely on EEG support. Germany has no specific PPA statute; PPAs are long-term supply contracts or financial hedges governed by general civil law and energy regulation. Guarantees of origin are issued by the Federal Environment Agency only for electricity for which no EEG payment is claimed (§ 79 EEG), and renewable electricity may not be sold in several forms at the same time (§ 80 EEG). Virtual PPAs are usually financial derivatives and may trigger reporting and other duties under financial regulation.

The most negotiated points are price structure (fixed, indexed or floor and cap), volume risk (pay-as-produced or baseload), the treatment of negative prices and curtailment, credit support, change in law, and termination. With the EEG 2027 reform pending, change-in-law clauses that address contracts for difference and refinancing contributions are especially important. See our insight on corporate PPAs in Germany.

Financing renewables

Renewables projects in Germany are typically financed through non-recourse or limited-recourse project finance at the level of the project company. Lenders require secured land rights, a final permit no longer subject to challenge or at least robust legal opinions on challenge risk, a grid connection commitment, and a revenue model based on EEG market premiums, contracts for difference or PPAs. Security packages include share pledges, assignments of receivables under PPAs, direct marketing and EEG payment claims, and step-in rights under construction and service contracts. Change-in-law and curtailment risk are increasingly reflected in debt sizing.

Repowering and project M&A for renewables

Many German onshore wind farms were built in the early 2000s and are reaching the end of their support period or technical life. Owners must decide whether to continue operating on a merchant basis or under a PPA, to repower, or to decommission and restore the site as required by the permit and the land leases. Repowering, replacing older turbines with fewer, more powerful ones, benefits from simplified permitting under § 16b BImSchG and often from existing land rights and grid connections, but requires new tender awards and careful review of the existing leases, which may not cover larger turbines or longer terms.

Renewables projects change hands at every stage: as project rights before permits, as ready-to-build projects, at commercial operation and as operating portfolios. Transactions are usually share deals of the project company.

Due diligence covers land rights and easements, permits and their conditions, objections and litigation, grid connection, tender awards and payment entitlements, turbine or module supply and service agreements, PPAs and financing. Purchase agreements allocate permitting and development risks through milestone payments and conditions, and sellers of operating assets often give warranties on availability, energy yield data and compliance with permit conditions such as shutdown times for bats and birds. Investors from outside the EU should check whether investment screening applies. See our insight on renewable energy project M&A.

Illustration: a hypothetical investor acquires a portfolio of ready-to-build solar parks with tender awards under the current EEG. Because the awards have realisation deadlines, the purchase agreement links part of the price to commissioning on time, and the investor negotiates a PPA for part of the output with an industrial buyer, including a change-in-law clause addressing the planned shift to contracts for difference for future projects.

How TRW & Co helps

We advise developers, investors, utilities, industrial buyers and lenders on renewables in Germany. We secure land rights and easements, manage permitting and defend permits in court, advise on EEG and WindSeeG tenders, grid connection and payment entitlements, and draft and negotiate EPC, turbine and module supply, O&M and PPA agreements.

We act on project and portfolio acquisitions and disposals, repowering and financing, and monitor the EEG 2027 reform for our clients' projects, assessing how the transition from market premiums to contracts for difference affects business plans, PPAs and financing. We also advise municipalities and utilities on participation models and local energy projects. To discuss a project, please contact us. This page is general information and not legal advice.