Germany is considered a world leader in wind energy deployment, with electricity production from wind having gone up more than eightfold—from 670 to more than 5500 GWh—between 1993 and 1999. In 1999, Germany had more than 4000 MW installed capacity. The prices also declined substantially over this period, indicating a learning rate of approximately 8%, and it is estimated that for each deutschemark (DM) spent by the government in subsidizing learning, market actors provided 2.1 DM. Furthermore, the manufacturing base for wind energy technologies, including indigenous firms as well as joint ventures, continues to expand in Germany.
A number of different actors and policies operating in tandem contributed to this success story. In 1989, when the federal government initiated a ‘‘100-MW Wind Programme,’’ there was nearly a complete absence of a market for wind turbines. Wind plant operators could receive money from this program as well as utilities for power delivered to the grid. Investment subsidies were also provided by this program, and the Lander (states) offered additional grants.
In 1991, the federal government also promulgated the EFL, which obliged grid operators to purchase electricity produced from renewable at agreed and fixed prices and, thus, provided a stable market for investors. In the same year, the government also enlarged the 100-MW program to a 250-MW program. During the early 1990s, the government also increased its support for wind power R&D, with the budget for the 1992–1996 period being more than double that for the 1987–1991 period.
In addition, many German regions or municipalities established targets intended to promote renewable energy, including wind energy and use, and often provided financial support, including investment subsidies, to implement these renewable energy policies.
Many German financial institutions also provided low-interest loans for renewable energy projects. Between 1990 and 1997, a total of 3.48 billion DM (1.78 billion euros) was disbursed for wind energy projects. Energy tax laws that allowed the offsetting of investments in wind farms made this an attractive option for individuals.
Administrative support was provided for wind energy projects in the forms of planning guidance and land use directives that helped to assuage local concerns about these projects. At the same time, developers also often held public meetings in local communities to share information about, and raise interest in, schemes. Finally, the high level of environmental awareness as well as interest in renewables among the citizenry contributed significantly to the public support for wind energy deployment.
