vortrag heiko staubitz
TRANSCRIPT
| wwwgtaicom
Germany as a Business Location
Heiko Staubitz
Senior Manager Renewable Energies
Germany Trade amp Invest
09022012
wwwgtaicom
Germany Trade amp Invest is the foreign trade and inward investment promotion
agency of the Federal Republic of Germany
The agency is promoted by the Federal Ministry of Economics and Technology
and the Federal Government Commissioner for the New Federal States in
accordance with a German Parliament resolution
Germany Trade amp Investhellip
supports export-oriented companies based in Germany with comprehensive foreign market information
promotes Germany as a high-performance business and technology location in order to attract investors who createsecure jobs in Germany
Provides consultancy services to foreign investors in terms of their business settlement plans and the necessary project management support in Germany
An additional special focal point of activity lies in promoting the economic development of the new federal states including Berlin
The Agency
9 February 2012 Germany Trade amp Invest 2
wwwgtaicom
Macroeconomic analyses and forecasts
Country and industry analyses (over
125 countries)
International projects and tenders
Foreign economic and tax law
Customs information and tariffs
Practical business tips
Business contacts and addresses
Areas of Activity
The Agency
Companies Abroad
(Foreign Investors)
Germany Trade amp Invest
Companies in Germany
(ExportersInvestors)
Identification of attractive markets and
companies
Economic framework in Germany
Site-specific information
Industry-specific information
Direct contact with potential investors
abroad
Investor consultancy services
Project management support
Fo
reig
n C
ou
ntr
y a
nd
Market
In
form
ati
on
In
form
ati
on
ab
ou
t G
erm
an
y
Co
nsu
ltan
cy
9 February 2012 3
wwwgtaicom
Germany Trade amp Invest works in close cooperation with the 120 German
Chambers of Commerce Abroad (AHKs) in 80 countries across the globe
Germany Trade amp Invest cooperates with all foreign trade promotion partners in
Germany - and in particular with trade associations and chambers of commerce
The economic development agencies of the federal states are Germany Trade amp
Invests partners within the investor settlement process in Germany
Partners
The Agency
9 February 2012 Germany Trade amp Invest 4
wwwgtaicom
Main Objectives
The New Energy Concept (2010)
Energy efficiency measures
Increase in energy productiveness 21 pa
Reduction of energy consumption -50 (2050 vs 2008)
Reduction of electricity consumption -25 (2050 vs 2008)
Renovation rate 2 pa
Reduction of energy for transportation -40 (2050 vs 2005)
Climate protection measures 2020 2050
CO2 cuts vs 1990 -40 -80
Renewable share ofhellip 2020 2050
Total energy consumption 18 60
Electricity consumption 35 80
Heat generation 14 60
09022012 5
wwwgtaicom
Faster expansion of renewable energies
Integration of renewable energies into the overall energy system eg through a
market premium
Central component wind energy
Increase energy RampD levels - up to euro05 bn will be made available
Expansion of electricity and smart grids as well as increasing the level of energy
storage capacity
Restructuring the fossil power plant park towards more flexible power stations
(eg gas plants as responsive power to intermittent renewable energies)
Increase energy efficiency (particularly in buildings)
Cost efficiency and efficient procurement
European initiatives for energy efficiency
Measures for implementing the new energy policy after the decision
taken on the gradual phase-out of nuclear power by 2022
09022012 6
Source httpwwwbmudeenergiewendebeschluesse_und_massnahmendoc47892php
The Federal Energy Concept
wwwgtaicom
Network Expansion
Source Dena 2010 BDEW 2011
09022012 7
Expansion requirements for the transmission and distribution grid
Grid expansion of 3600km is required by 2020
Baseline scenario with overhead lines as most cost-effective option
0946 bn euroa
Transmission grid
For the medium-voltage power grid (500000km) expansions of 11
to 28 are foreseen
For the low-voltage power grid (11m km) an expansion of 13 to
22 is anticipated
Investment needs
euro 10-27 bn
Distribution grid
wwwgtaicom
Based on the amendment of the Federal Law on the Energy Industry (EnWG)
and the enacting of the Network Expansion Acceleration Act (NABEG)
competences for the extension of the high-voltage grid have been transferred to
the Federal Network Agency
Four major steps were developed
Appraisal and determination of the conditions for the network extension
Based on the Network Agencyrsquos scenarios the Transmission System
Operators (TSO) calculate the extension requirements
Federal advisory planning for finding adequate route corridors
Plan approval procedure for the exact route
Source Federal Network Agency 2012
Network Expansion
09022012 8
The Federal Network Agencyrsquos competences
wwwgtaicom
Intelligent Grids and Metering - EnWG
09022012 9
Source EnWG 2011 Cronos smart utility consulting gmbh 2011
In 2011 the German Federal Law on the Energy Industry (EnWG) was
supplemented by specifications for metering elements eg smart meters
smart meter installations and requirements (sect 21b sect 21d sect 21e sect 21 f sect
21i)
Smart meters are obligatory for new constructions and complete
refurbishments consumer loads of over 6000 kWhYear and plant
operators under the renewable energy act (EEG) and in accordance with the
cogeneration act (KWKG) of over 7 KW (sect 21c para 1 and 2 EnWG)
Expected smart meter roll-put in Germany
2015 ndash 10 of grid accesses with smart meters
2020 ndash already 60
Smart meter legal amendment and roll-out in Germany
wwwgtaicom
Source Own draft according to Frost amp Sullivan 2011
09022012 10
Expected Smart Meter Roll-Out in Germany
The market is expected to grow substantially with overall CAGR of 717 from
2010-2017
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Revenues (euro Mio) 1 3 12 17 23 33 162 409 499 721 731
Units 001 002 01 014 02 03 15 4 52 82 9
0
1
2
3
4
5
6
7
8
9
10
0
100
200
300
400
500
600
700
800
Un
its (
millio
n)
Reven
ue (
euro m
illio
n)
Revenues (euro Mio)
Units
Smart meter market unit and revenue forecast Germany
wwwgtaicom
Direct marketing of power from renewable energy create new
business opportunities in Germany
Note not exhaustive Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
Sonne Wind amp Waumlrme 172011
The Optional Market Premium
09022012 11
Incentives
Scheme
Sellers of renewable energy electricity can decide on a monthly basis to either feed the electricity into the grid and receive the feed-in tariff remuneration or participate in direct selling in the electricity market and receive an amount equal to the difference between a reference value based on the average electricity price and the feed-in tariff An additional management premium is paid to cover cost of forecasting and feed-in management
Requirements
Requirements for direct marketing
Access to the electricity market
Recognized trading participant in the European Energy Exchange
Next day feed-in volume forecast and real-time load measurement of RE-installation
Opportunities
Challenges and opportunities exist in Technologies and services to forecast feed-in volume and feed-in management Energy storage options and smart grids Virtual linking different power plant technologies New business models for electricity trading services and utilities
wwwgtaicom
Operators of renewable energy facilities have two options for remuneration
1) Feed-in tariff remuneration or 2) Direct sale under the direct marketing scheme
To improve market and system integration incentives for direct selling
of power from renewable energy have been established
Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
09022012 12
The Optional Market Premium
wwwgtaicom
Source Own draft according to BDEW 2012
Implementation of the Market Premium in 012012
09022012 13
20
43
20
0
90
40
100
10
0
20
40
60
80
100
120
Controllable RE Wind Onshore Wind Offshore PV
Registrations at TNOs for direct marketing (MPM) in 012012 (Dec 21st
2011)
Fraunhofer ISI (Appraisal of market
premium share for 2012 from 012011)
Forecast and actual direct marketing (MPM)
The ldquoOwn-Consumption Bonusldquo Principle
Wattage
Time of day
0h 3h 6h 9h 12h 15h 18h 21h 24h
Feed-in tariff 2874 to 2624 euroctkWh1
ldquoOwn Consumption Bonusldquo 1543 to 986 euroctkWh2
PLUS cost savings
Energy from grid Costs ~ 22 euroctkWh3
Funding through feed-in tariff system AND cost savings on grid energy
Rooftop systems le 500kWp may generate income of gt 37 euroctkWh in 2011
500 kWp max PV Energy
Energy Demand
ldquoIn-houseldquo consumption of PV Energy
Notes 1) Subject to size of system according to feed-in tariff classification | 2) Applicable only for rooftop systems le 500kWp installed between July 2010 and December 2011
3) Subject to electricity retail price of respective utility company Source German parliament resolution from July 2010
09022012 | wwwgtaicom 14
wwwgtaicom
But Almost no possibility of developing new pumped storage capacity
Use of new storage technologies combined with smart grid solutions
will be a necessity
Expected Investment of euro 25-30 billion in storage capacity until 2030
Ambitious growth targets for RE what does this mean for energy storage
Source BCG analysis (Electricity Storage March 2010) ZSW 2010 Bundestag 2010
Renewable Energies in Germany
09022012 15
RE-share Required compensation
capacity (GW) TWh of energy
required
Today 17 16-17 22
2015 na (30) ca 22 30
2020 35 ca 26 37
2025 gt35 ca 28 39
wwwgtaicom
Balancing Power
09022012 16
Easy market entry for smaller players in the balancing power sector
Primary control reserve (PCR)
Secondary control reserve (SCR)
Tertiary control reserve (TCR)
Time for activation 30 s 5 min 15 min
Availability Up to 15 min 15 min to 1hr Minimum of 15 min
Required min bids by regulator 1) 5 MW 10 MW 15 MW
Required min bids by regulator since April 13
1 MW 5 MW 5 MW (10 MW)
Tendering period monthly
daily Tendering period since
April 13 weekly
Focus on new technologies
Flexiblecontrollable plants battery storage systems renewable energy systems at direct marketing
Today for energy storage and balancing power only hydro-pump and gas power
Plants attending at the balancing power market in Germany
Legislative framework has been changed to open the market for innovative storage
technologies
IRR subject to the technology used and the control reserve segment
targeted
Source BMU 2011
wwwgtaicom
Balancing Power
Source 50 Hertz
09022012 17
Price development of TCR 2006 ndash 2010 in euro MW d
0 euro
200 euro
400 euro
600 euro
800 euro
1000 euro
1200 euro
1400 euro
1600 euro
1800 euro
2000 euro
2200 euro
positive Minutenreserve
negative Minutenreserve
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Germany Trade amp Invest is the foreign trade and inward investment promotion
agency of the Federal Republic of Germany
The agency is promoted by the Federal Ministry of Economics and Technology
and the Federal Government Commissioner for the New Federal States in
accordance with a German Parliament resolution
Germany Trade amp Investhellip
supports export-oriented companies based in Germany with comprehensive foreign market information
promotes Germany as a high-performance business and technology location in order to attract investors who createsecure jobs in Germany
Provides consultancy services to foreign investors in terms of their business settlement plans and the necessary project management support in Germany
An additional special focal point of activity lies in promoting the economic development of the new federal states including Berlin
The Agency
9 February 2012 Germany Trade amp Invest 2
wwwgtaicom
Macroeconomic analyses and forecasts
Country and industry analyses (over
125 countries)
International projects and tenders
Foreign economic and tax law
Customs information and tariffs
Practical business tips
Business contacts and addresses
Areas of Activity
The Agency
Companies Abroad
(Foreign Investors)
Germany Trade amp Invest
Companies in Germany
(ExportersInvestors)
Identification of attractive markets and
companies
Economic framework in Germany
Site-specific information
Industry-specific information
Direct contact with potential investors
abroad
Investor consultancy services
Project management support
Fo
reig
n C
ou
ntr
y a
nd
Market
In
form
ati
on
In
form
ati
on
ab
ou
t G
erm
an
y
Co
nsu
ltan
cy
9 February 2012 3
wwwgtaicom
Germany Trade amp Invest works in close cooperation with the 120 German
Chambers of Commerce Abroad (AHKs) in 80 countries across the globe
Germany Trade amp Invest cooperates with all foreign trade promotion partners in
Germany - and in particular with trade associations and chambers of commerce
The economic development agencies of the federal states are Germany Trade amp
Invests partners within the investor settlement process in Germany
Partners
The Agency
9 February 2012 Germany Trade amp Invest 4
wwwgtaicom
Main Objectives
The New Energy Concept (2010)
Energy efficiency measures
Increase in energy productiveness 21 pa
Reduction of energy consumption -50 (2050 vs 2008)
Reduction of electricity consumption -25 (2050 vs 2008)
Renovation rate 2 pa
Reduction of energy for transportation -40 (2050 vs 2005)
Climate protection measures 2020 2050
CO2 cuts vs 1990 -40 -80
Renewable share ofhellip 2020 2050
Total energy consumption 18 60
Electricity consumption 35 80
Heat generation 14 60
09022012 5
wwwgtaicom
Faster expansion of renewable energies
Integration of renewable energies into the overall energy system eg through a
market premium
Central component wind energy
Increase energy RampD levels - up to euro05 bn will be made available
Expansion of electricity and smart grids as well as increasing the level of energy
storage capacity
Restructuring the fossil power plant park towards more flexible power stations
(eg gas plants as responsive power to intermittent renewable energies)
Increase energy efficiency (particularly in buildings)
Cost efficiency and efficient procurement
European initiatives for energy efficiency
Measures for implementing the new energy policy after the decision
taken on the gradual phase-out of nuclear power by 2022
09022012 6
Source httpwwwbmudeenergiewendebeschluesse_und_massnahmendoc47892php
The Federal Energy Concept
wwwgtaicom
Network Expansion
Source Dena 2010 BDEW 2011
09022012 7
Expansion requirements for the transmission and distribution grid
Grid expansion of 3600km is required by 2020
Baseline scenario with overhead lines as most cost-effective option
0946 bn euroa
Transmission grid
For the medium-voltage power grid (500000km) expansions of 11
to 28 are foreseen
For the low-voltage power grid (11m km) an expansion of 13 to
22 is anticipated
Investment needs
euro 10-27 bn
Distribution grid
wwwgtaicom
Based on the amendment of the Federal Law on the Energy Industry (EnWG)
and the enacting of the Network Expansion Acceleration Act (NABEG)
competences for the extension of the high-voltage grid have been transferred to
the Federal Network Agency
Four major steps were developed
Appraisal and determination of the conditions for the network extension
Based on the Network Agencyrsquos scenarios the Transmission System
Operators (TSO) calculate the extension requirements
Federal advisory planning for finding adequate route corridors
Plan approval procedure for the exact route
Source Federal Network Agency 2012
Network Expansion
09022012 8
The Federal Network Agencyrsquos competences
wwwgtaicom
Intelligent Grids and Metering - EnWG
09022012 9
Source EnWG 2011 Cronos smart utility consulting gmbh 2011
In 2011 the German Federal Law on the Energy Industry (EnWG) was
supplemented by specifications for metering elements eg smart meters
smart meter installations and requirements (sect 21b sect 21d sect 21e sect 21 f sect
21i)
Smart meters are obligatory for new constructions and complete
refurbishments consumer loads of over 6000 kWhYear and plant
operators under the renewable energy act (EEG) and in accordance with the
cogeneration act (KWKG) of over 7 KW (sect 21c para 1 and 2 EnWG)
Expected smart meter roll-put in Germany
2015 ndash 10 of grid accesses with smart meters
2020 ndash already 60
Smart meter legal amendment and roll-out in Germany
wwwgtaicom
Source Own draft according to Frost amp Sullivan 2011
09022012 10
Expected Smart Meter Roll-Out in Germany
The market is expected to grow substantially with overall CAGR of 717 from
2010-2017
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Revenues (euro Mio) 1 3 12 17 23 33 162 409 499 721 731
Units 001 002 01 014 02 03 15 4 52 82 9
0
1
2
3
4
5
6
7
8
9
10
0
100
200
300
400
500
600
700
800
Un
its (
millio
n)
Reven
ue (
euro m
illio
n)
Revenues (euro Mio)
Units
Smart meter market unit and revenue forecast Germany
wwwgtaicom
Direct marketing of power from renewable energy create new
business opportunities in Germany
Note not exhaustive Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
Sonne Wind amp Waumlrme 172011
The Optional Market Premium
09022012 11
Incentives
Scheme
Sellers of renewable energy electricity can decide on a monthly basis to either feed the electricity into the grid and receive the feed-in tariff remuneration or participate in direct selling in the electricity market and receive an amount equal to the difference between a reference value based on the average electricity price and the feed-in tariff An additional management premium is paid to cover cost of forecasting and feed-in management
Requirements
Requirements for direct marketing
Access to the electricity market
Recognized trading participant in the European Energy Exchange
Next day feed-in volume forecast and real-time load measurement of RE-installation
Opportunities
Challenges and opportunities exist in Technologies and services to forecast feed-in volume and feed-in management Energy storage options and smart grids Virtual linking different power plant technologies New business models for electricity trading services and utilities
wwwgtaicom
Operators of renewable energy facilities have two options for remuneration
1) Feed-in tariff remuneration or 2) Direct sale under the direct marketing scheme
To improve market and system integration incentives for direct selling
of power from renewable energy have been established
Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
09022012 12
The Optional Market Premium
wwwgtaicom
Source Own draft according to BDEW 2012
Implementation of the Market Premium in 012012
09022012 13
20
43
20
0
90
40
100
10
0
20
40
60
80
100
120
Controllable RE Wind Onshore Wind Offshore PV
Registrations at TNOs for direct marketing (MPM) in 012012 (Dec 21st
2011)
Fraunhofer ISI (Appraisal of market
premium share for 2012 from 012011)
Forecast and actual direct marketing (MPM)
The ldquoOwn-Consumption Bonusldquo Principle
Wattage
Time of day
0h 3h 6h 9h 12h 15h 18h 21h 24h
Feed-in tariff 2874 to 2624 euroctkWh1
ldquoOwn Consumption Bonusldquo 1543 to 986 euroctkWh2
PLUS cost savings
Energy from grid Costs ~ 22 euroctkWh3
Funding through feed-in tariff system AND cost savings on grid energy
Rooftop systems le 500kWp may generate income of gt 37 euroctkWh in 2011
500 kWp max PV Energy
Energy Demand
ldquoIn-houseldquo consumption of PV Energy
Notes 1) Subject to size of system according to feed-in tariff classification | 2) Applicable only for rooftop systems le 500kWp installed between July 2010 and December 2011
3) Subject to electricity retail price of respective utility company Source German parliament resolution from July 2010
09022012 | wwwgtaicom 14
wwwgtaicom
But Almost no possibility of developing new pumped storage capacity
Use of new storage technologies combined with smart grid solutions
will be a necessity
Expected Investment of euro 25-30 billion in storage capacity until 2030
Ambitious growth targets for RE what does this mean for energy storage
Source BCG analysis (Electricity Storage March 2010) ZSW 2010 Bundestag 2010
Renewable Energies in Germany
09022012 15
RE-share Required compensation
capacity (GW) TWh of energy
required
Today 17 16-17 22
2015 na (30) ca 22 30
2020 35 ca 26 37
2025 gt35 ca 28 39
wwwgtaicom
Balancing Power
09022012 16
Easy market entry for smaller players in the balancing power sector
Primary control reserve (PCR)
Secondary control reserve (SCR)
Tertiary control reserve (TCR)
Time for activation 30 s 5 min 15 min
Availability Up to 15 min 15 min to 1hr Minimum of 15 min
Required min bids by regulator 1) 5 MW 10 MW 15 MW
Required min bids by regulator since April 13
1 MW 5 MW 5 MW (10 MW)
Tendering period monthly
daily Tendering period since
April 13 weekly
Focus on new technologies
Flexiblecontrollable plants battery storage systems renewable energy systems at direct marketing
Today for energy storage and balancing power only hydro-pump and gas power
Plants attending at the balancing power market in Germany
Legislative framework has been changed to open the market for innovative storage
technologies
IRR subject to the technology used and the control reserve segment
targeted
Source BMU 2011
wwwgtaicom
Balancing Power
Source 50 Hertz
09022012 17
Price development of TCR 2006 ndash 2010 in euro MW d
0 euro
200 euro
400 euro
600 euro
800 euro
1000 euro
1200 euro
1400 euro
1600 euro
1800 euro
2000 euro
2200 euro
positive Minutenreserve
negative Minutenreserve
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Macroeconomic analyses and forecasts
Country and industry analyses (over
125 countries)
International projects and tenders
Foreign economic and tax law
Customs information and tariffs
Practical business tips
Business contacts and addresses
Areas of Activity
The Agency
Companies Abroad
(Foreign Investors)
Germany Trade amp Invest
Companies in Germany
(ExportersInvestors)
Identification of attractive markets and
companies
Economic framework in Germany
Site-specific information
Industry-specific information
Direct contact with potential investors
abroad
Investor consultancy services
Project management support
Fo
reig
n C
ou
ntr
y a
nd
Market
In
form
ati
on
In
form
ati
on
ab
ou
t G
erm
an
y
Co
nsu
ltan
cy
9 February 2012 3
wwwgtaicom
Germany Trade amp Invest works in close cooperation with the 120 German
Chambers of Commerce Abroad (AHKs) in 80 countries across the globe
Germany Trade amp Invest cooperates with all foreign trade promotion partners in
Germany - and in particular with trade associations and chambers of commerce
The economic development agencies of the federal states are Germany Trade amp
Invests partners within the investor settlement process in Germany
Partners
The Agency
9 February 2012 Germany Trade amp Invest 4
wwwgtaicom
Main Objectives
The New Energy Concept (2010)
Energy efficiency measures
Increase in energy productiveness 21 pa
Reduction of energy consumption -50 (2050 vs 2008)
Reduction of electricity consumption -25 (2050 vs 2008)
Renovation rate 2 pa
Reduction of energy for transportation -40 (2050 vs 2005)
Climate protection measures 2020 2050
CO2 cuts vs 1990 -40 -80
Renewable share ofhellip 2020 2050
Total energy consumption 18 60
Electricity consumption 35 80
Heat generation 14 60
09022012 5
wwwgtaicom
Faster expansion of renewable energies
Integration of renewable energies into the overall energy system eg through a
market premium
Central component wind energy
Increase energy RampD levels - up to euro05 bn will be made available
Expansion of electricity and smart grids as well as increasing the level of energy
storage capacity
Restructuring the fossil power plant park towards more flexible power stations
(eg gas plants as responsive power to intermittent renewable energies)
Increase energy efficiency (particularly in buildings)
Cost efficiency and efficient procurement
European initiatives for energy efficiency
Measures for implementing the new energy policy after the decision
taken on the gradual phase-out of nuclear power by 2022
09022012 6
Source httpwwwbmudeenergiewendebeschluesse_und_massnahmendoc47892php
The Federal Energy Concept
wwwgtaicom
Network Expansion
Source Dena 2010 BDEW 2011
09022012 7
Expansion requirements for the transmission and distribution grid
Grid expansion of 3600km is required by 2020
Baseline scenario with overhead lines as most cost-effective option
0946 bn euroa
Transmission grid
For the medium-voltage power grid (500000km) expansions of 11
to 28 are foreseen
For the low-voltage power grid (11m km) an expansion of 13 to
22 is anticipated
Investment needs
euro 10-27 bn
Distribution grid
wwwgtaicom
Based on the amendment of the Federal Law on the Energy Industry (EnWG)
and the enacting of the Network Expansion Acceleration Act (NABEG)
competences for the extension of the high-voltage grid have been transferred to
the Federal Network Agency
Four major steps were developed
Appraisal and determination of the conditions for the network extension
Based on the Network Agencyrsquos scenarios the Transmission System
Operators (TSO) calculate the extension requirements
Federal advisory planning for finding adequate route corridors
Plan approval procedure for the exact route
Source Federal Network Agency 2012
Network Expansion
09022012 8
The Federal Network Agencyrsquos competences
wwwgtaicom
Intelligent Grids and Metering - EnWG
09022012 9
Source EnWG 2011 Cronos smart utility consulting gmbh 2011
In 2011 the German Federal Law on the Energy Industry (EnWG) was
supplemented by specifications for metering elements eg smart meters
smart meter installations and requirements (sect 21b sect 21d sect 21e sect 21 f sect
21i)
Smart meters are obligatory for new constructions and complete
refurbishments consumer loads of over 6000 kWhYear and plant
operators under the renewable energy act (EEG) and in accordance with the
cogeneration act (KWKG) of over 7 KW (sect 21c para 1 and 2 EnWG)
Expected smart meter roll-put in Germany
2015 ndash 10 of grid accesses with smart meters
2020 ndash already 60
Smart meter legal amendment and roll-out in Germany
wwwgtaicom
Source Own draft according to Frost amp Sullivan 2011
09022012 10
Expected Smart Meter Roll-Out in Germany
The market is expected to grow substantially with overall CAGR of 717 from
2010-2017
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Revenues (euro Mio) 1 3 12 17 23 33 162 409 499 721 731
Units 001 002 01 014 02 03 15 4 52 82 9
0
1
2
3
4
5
6
7
8
9
10
0
100
200
300
400
500
600
700
800
Un
its (
millio
n)
Reven
ue (
euro m
illio
n)
Revenues (euro Mio)
Units
Smart meter market unit and revenue forecast Germany
wwwgtaicom
Direct marketing of power from renewable energy create new
business opportunities in Germany
Note not exhaustive Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
Sonne Wind amp Waumlrme 172011
The Optional Market Premium
09022012 11
Incentives
Scheme
Sellers of renewable energy electricity can decide on a monthly basis to either feed the electricity into the grid and receive the feed-in tariff remuneration or participate in direct selling in the electricity market and receive an amount equal to the difference between a reference value based on the average electricity price and the feed-in tariff An additional management premium is paid to cover cost of forecasting and feed-in management
Requirements
Requirements for direct marketing
Access to the electricity market
Recognized trading participant in the European Energy Exchange
Next day feed-in volume forecast and real-time load measurement of RE-installation
Opportunities
Challenges and opportunities exist in Technologies and services to forecast feed-in volume and feed-in management Energy storage options and smart grids Virtual linking different power plant technologies New business models for electricity trading services and utilities
wwwgtaicom
Operators of renewable energy facilities have two options for remuneration
1) Feed-in tariff remuneration or 2) Direct sale under the direct marketing scheme
To improve market and system integration incentives for direct selling
of power from renewable energy have been established
Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
09022012 12
The Optional Market Premium
wwwgtaicom
Source Own draft according to BDEW 2012
Implementation of the Market Premium in 012012
09022012 13
20
43
20
0
90
40
100
10
0
20
40
60
80
100
120
Controllable RE Wind Onshore Wind Offshore PV
Registrations at TNOs for direct marketing (MPM) in 012012 (Dec 21st
2011)
Fraunhofer ISI (Appraisal of market
premium share for 2012 from 012011)
Forecast and actual direct marketing (MPM)
The ldquoOwn-Consumption Bonusldquo Principle
Wattage
Time of day
0h 3h 6h 9h 12h 15h 18h 21h 24h
Feed-in tariff 2874 to 2624 euroctkWh1
ldquoOwn Consumption Bonusldquo 1543 to 986 euroctkWh2
PLUS cost savings
Energy from grid Costs ~ 22 euroctkWh3
Funding through feed-in tariff system AND cost savings on grid energy
Rooftop systems le 500kWp may generate income of gt 37 euroctkWh in 2011
500 kWp max PV Energy
Energy Demand
ldquoIn-houseldquo consumption of PV Energy
Notes 1) Subject to size of system according to feed-in tariff classification | 2) Applicable only for rooftop systems le 500kWp installed between July 2010 and December 2011
3) Subject to electricity retail price of respective utility company Source German parliament resolution from July 2010
09022012 | wwwgtaicom 14
wwwgtaicom
But Almost no possibility of developing new pumped storage capacity
Use of new storage technologies combined with smart grid solutions
will be a necessity
Expected Investment of euro 25-30 billion in storage capacity until 2030
Ambitious growth targets for RE what does this mean for energy storage
Source BCG analysis (Electricity Storage March 2010) ZSW 2010 Bundestag 2010
Renewable Energies in Germany
09022012 15
RE-share Required compensation
capacity (GW) TWh of energy
required
Today 17 16-17 22
2015 na (30) ca 22 30
2020 35 ca 26 37
2025 gt35 ca 28 39
wwwgtaicom
Balancing Power
09022012 16
Easy market entry for smaller players in the balancing power sector
Primary control reserve (PCR)
Secondary control reserve (SCR)
Tertiary control reserve (TCR)
Time for activation 30 s 5 min 15 min
Availability Up to 15 min 15 min to 1hr Minimum of 15 min
Required min bids by regulator 1) 5 MW 10 MW 15 MW
Required min bids by regulator since April 13
1 MW 5 MW 5 MW (10 MW)
Tendering period monthly
daily Tendering period since
April 13 weekly
Focus on new technologies
Flexiblecontrollable plants battery storage systems renewable energy systems at direct marketing
Today for energy storage and balancing power only hydro-pump and gas power
Plants attending at the balancing power market in Germany
Legislative framework has been changed to open the market for innovative storage
technologies
IRR subject to the technology used and the control reserve segment
targeted
Source BMU 2011
wwwgtaicom
Balancing Power
Source 50 Hertz
09022012 17
Price development of TCR 2006 ndash 2010 in euro MW d
0 euro
200 euro
400 euro
600 euro
800 euro
1000 euro
1200 euro
1400 euro
1600 euro
1800 euro
2000 euro
2200 euro
positive Minutenreserve
negative Minutenreserve
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Germany Trade amp Invest works in close cooperation with the 120 German
Chambers of Commerce Abroad (AHKs) in 80 countries across the globe
Germany Trade amp Invest cooperates with all foreign trade promotion partners in
Germany - and in particular with trade associations and chambers of commerce
The economic development agencies of the federal states are Germany Trade amp
Invests partners within the investor settlement process in Germany
Partners
The Agency
9 February 2012 Germany Trade amp Invest 4
wwwgtaicom
Main Objectives
The New Energy Concept (2010)
Energy efficiency measures
Increase in energy productiveness 21 pa
Reduction of energy consumption -50 (2050 vs 2008)
Reduction of electricity consumption -25 (2050 vs 2008)
Renovation rate 2 pa
Reduction of energy for transportation -40 (2050 vs 2005)
Climate protection measures 2020 2050
CO2 cuts vs 1990 -40 -80
Renewable share ofhellip 2020 2050
Total energy consumption 18 60
Electricity consumption 35 80
Heat generation 14 60
09022012 5
wwwgtaicom
Faster expansion of renewable energies
Integration of renewable energies into the overall energy system eg through a
market premium
Central component wind energy
Increase energy RampD levels - up to euro05 bn will be made available
Expansion of electricity and smart grids as well as increasing the level of energy
storage capacity
Restructuring the fossil power plant park towards more flexible power stations
(eg gas plants as responsive power to intermittent renewable energies)
Increase energy efficiency (particularly in buildings)
Cost efficiency and efficient procurement
European initiatives for energy efficiency
Measures for implementing the new energy policy after the decision
taken on the gradual phase-out of nuclear power by 2022
09022012 6
Source httpwwwbmudeenergiewendebeschluesse_und_massnahmendoc47892php
The Federal Energy Concept
wwwgtaicom
Network Expansion
Source Dena 2010 BDEW 2011
09022012 7
Expansion requirements for the transmission and distribution grid
Grid expansion of 3600km is required by 2020
Baseline scenario with overhead lines as most cost-effective option
0946 bn euroa
Transmission grid
For the medium-voltage power grid (500000km) expansions of 11
to 28 are foreseen
For the low-voltage power grid (11m km) an expansion of 13 to
22 is anticipated
Investment needs
euro 10-27 bn
Distribution grid
wwwgtaicom
Based on the amendment of the Federal Law on the Energy Industry (EnWG)
and the enacting of the Network Expansion Acceleration Act (NABEG)
competences for the extension of the high-voltage grid have been transferred to
the Federal Network Agency
Four major steps were developed
Appraisal and determination of the conditions for the network extension
Based on the Network Agencyrsquos scenarios the Transmission System
Operators (TSO) calculate the extension requirements
Federal advisory planning for finding adequate route corridors
Plan approval procedure for the exact route
Source Federal Network Agency 2012
Network Expansion
09022012 8
The Federal Network Agencyrsquos competences
wwwgtaicom
Intelligent Grids and Metering - EnWG
09022012 9
Source EnWG 2011 Cronos smart utility consulting gmbh 2011
In 2011 the German Federal Law on the Energy Industry (EnWG) was
supplemented by specifications for metering elements eg smart meters
smart meter installations and requirements (sect 21b sect 21d sect 21e sect 21 f sect
21i)
Smart meters are obligatory for new constructions and complete
refurbishments consumer loads of over 6000 kWhYear and plant
operators under the renewable energy act (EEG) and in accordance with the
cogeneration act (KWKG) of over 7 KW (sect 21c para 1 and 2 EnWG)
Expected smart meter roll-put in Germany
2015 ndash 10 of grid accesses with smart meters
2020 ndash already 60
Smart meter legal amendment and roll-out in Germany
wwwgtaicom
Source Own draft according to Frost amp Sullivan 2011
09022012 10
Expected Smart Meter Roll-Out in Germany
The market is expected to grow substantially with overall CAGR of 717 from
2010-2017
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Revenues (euro Mio) 1 3 12 17 23 33 162 409 499 721 731
Units 001 002 01 014 02 03 15 4 52 82 9
0
1
2
3
4
5
6
7
8
9
10
0
100
200
300
400
500
600
700
800
Un
its (
millio
n)
Reven
ue (
euro m
illio
n)
Revenues (euro Mio)
Units
Smart meter market unit and revenue forecast Germany
wwwgtaicom
Direct marketing of power from renewable energy create new
business opportunities in Germany
Note not exhaustive Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
Sonne Wind amp Waumlrme 172011
The Optional Market Premium
09022012 11
Incentives
Scheme
Sellers of renewable energy electricity can decide on a monthly basis to either feed the electricity into the grid and receive the feed-in tariff remuneration or participate in direct selling in the electricity market and receive an amount equal to the difference between a reference value based on the average electricity price and the feed-in tariff An additional management premium is paid to cover cost of forecasting and feed-in management
Requirements
Requirements for direct marketing
Access to the electricity market
Recognized trading participant in the European Energy Exchange
Next day feed-in volume forecast and real-time load measurement of RE-installation
Opportunities
Challenges and opportunities exist in Technologies and services to forecast feed-in volume and feed-in management Energy storage options and smart grids Virtual linking different power plant technologies New business models for electricity trading services and utilities
wwwgtaicom
Operators of renewable energy facilities have two options for remuneration
1) Feed-in tariff remuneration or 2) Direct sale under the direct marketing scheme
To improve market and system integration incentives for direct selling
of power from renewable energy have been established
Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
09022012 12
The Optional Market Premium
wwwgtaicom
Source Own draft according to BDEW 2012
Implementation of the Market Premium in 012012
09022012 13
20
43
20
0
90
40
100
10
0
20
40
60
80
100
120
Controllable RE Wind Onshore Wind Offshore PV
Registrations at TNOs for direct marketing (MPM) in 012012 (Dec 21st
2011)
Fraunhofer ISI (Appraisal of market
premium share for 2012 from 012011)
Forecast and actual direct marketing (MPM)
The ldquoOwn-Consumption Bonusldquo Principle
Wattage
Time of day
0h 3h 6h 9h 12h 15h 18h 21h 24h
Feed-in tariff 2874 to 2624 euroctkWh1
ldquoOwn Consumption Bonusldquo 1543 to 986 euroctkWh2
PLUS cost savings
Energy from grid Costs ~ 22 euroctkWh3
Funding through feed-in tariff system AND cost savings on grid energy
Rooftop systems le 500kWp may generate income of gt 37 euroctkWh in 2011
500 kWp max PV Energy
Energy Demand
ldquoIn-houseldquo consumption of PV Energy
Notes 1) Subject to size of system according to feed-in tariff classification | 2) Applicable only for rooftop systems le 500kWp installed between July 2010 and December 2011
3) Subject to electricity retail price of respective utility company Source German parliament resolution from July 2010
09022012 | wwwgtaicom 14
wwwgtaicom
But Almost no possibility of developing new pumped storage capacity
Use of new storage technologies combined with smart grid solutions
will be a necessity
Expected Investment of euro 25-30 billion in storage capacity until 2030
Ambitious growth targets for RE what does this mean for energy storage
Source BCG analysis (Electricity Storage March 2010) ZSW 2010 Bundestag 2010
Renewable Energies in Germany
09022012 15
RE-share Required compensation
capacity (GW) TWh of energy
required
Today 17 16-17 22
2015 na (30) ca 22 30
2020 35 ca 26 37
2025 gt35 ca 28 39
wwwgtaicom
Balancing Power
09022012 16
Easy market entry for smaller players in the balancing power sector
Primary control reserve (PCR)
Secondary control reserve (SCR)
Tertiary control reserve (TCR)
Time for activation 30 s 5 min 15 min
Availability Up to 15 min 15 min to 1hr Minimum of 15 min
Required min bids by regulator 1) 5 MW 10 MW 15 MW
Required min bids by regulator since April 13
1 MW 5 MW 5 MW (10 MW)
Tendering period monthly
daily Tendering period since
April 13 weekly
Focus on new technologies
Flexiblecontrollable plants battery storage systems renewable energy systems at direct marketing
Today for energy storage and balancing power only hydro-pump and gas power
Plants attending at the balancing power market in Germany
Legislative framework has been changed to open the market for innovative storage
technologies
IRR subject to the technology used and the control reserve segment
targeted
Source BMU 2011
wwwgtaicom
Balancing Power
Source 50 Hertz
09022012 17
Price development of TCR 2006 ndash 2010 in euro MW d
0 euro
200 euro
400 euro
600 euro
800 euro
1000 euro
1200 euro
1400 euro
1600 euro
1800 euro
2000 euro
2200 euro
positive Minutenreserve
negative Minutenreserve
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Main Objectives
The New Energy Concept (2010)
Energy efficiency measures
Increase in energy productiveness 21 pa
Reduction of energy consumption -50 (2050 vs 2008)
Reduction of electricity consumption -25 (2050 vs 2008)
Renovation rate 2 pa
Reduction of energy for transportation -40 (2050 vs 2005)
Climate protection measures 2020 2050
CO2 cuts vs 1990 -40 -80
Renewable share ofhellip 2020 2050
Total energy consumption 18 60
Electricity consumption 35 80
Heat generation 14 60
09022012 5
wwwgtaicom
Faster expansion of renewable energies
Integration of renewable energies into the overall energy system eg through a
market premium
Central component wind energy
Increase energy RampD levels - up to euro05 bn will be made available
Expansion of electricity and smart grids as well as increasing the level of energy
storage capacity
Restructuring the fossil power plant park towards more flexible power stations
(eg gas plants as responsive power to intermittent renewable energies)
Increase energy efficiency (particularly in buildings)
Cost efficiency and efficient procurement
European initiatives for energy efficiency
Measures for implementing the new energy policy after the decision
taken on the gradual phase-out of nuclear power by 2022
09022012 6
Source httpwwwbmudeenergiewendebeschluesse_und_massnahmendoc47892php
The Federal Energy Concept
wwwgtaicom
Network Expansion
Source Dena 2010 BDEW 2011
09022012 7
Expansion requirements for the transmission and distribution grid
Grid expansion of 3600km is required by 2020
Baseline scenario with overhead lines as most cost-effective option
0946 bn euroa
Transmission grid
For the medium-voltage power grid (500000km) expansions of 11
to 28 are foreseen
For the low-voltage power grid (11m km) an expansion of 13 to
22 is anticipated
Investment needs
euro 10-27 bn
Distribution grid
wwwgtaicom
Based on the amendment of the Federal Law on the Energy Industry (EnWG)
and the enacting of the Network Expansion Acceleration Act (NABEG)
competences for the extension of the high-voltage grid have been transferred to
the Federal Network Agency
Four major steps were developed
Appraisal and determination of the conditions for the network extension
Based on the Network Agencyrsquos scenarios the Transmission System
Operators (TSO) calculate the extension requirements
Federal advisory planning for finding adequate route corridors
Plan approval procedure for the exact route
Source Federal Network Agency 2012
Network Expansion
09022012 8
The Federal Network Agencyrsquos competences
wwwgtaicom
Intelligent Grids and Metering - EnWG
09022012 9
Source EnWG 2011 Cronos smart utility consulting gmbh 2011
In 2011 the German Federal Law on the Energy Industry (EnWG) was
supplemented by specifications for metering elements eg smart meters
smart meter installations and requirements (sect 21b sect 21d sect 21e sect 21 f sect
21i)
Smart meters are obligatory for new constructions and complete
refurbishments consumer loads of over 6000 kWhYear and plant
operators under the renewable energy act (EEG) and in accordance with the
cogeneration act (KWKG) of over 7 KW (sect 21c para 1 and 2 EnWG)
Expected smart meter roll-put in Germany
2015 ndash 10 of grid accesses with smart meters
2020 ndash already 60
Smart meter legal amendment and roll-out in Germany
wwwgtaicom
Source Own draft according to Frost amp Sullivan 2011
09022012 10
Expected Smart Meter Roll-Out in Germany
The market is expected to grow substantially with overall CAGR of 717 from
2010-2017
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Revenues (euro Mio) 1 3 12 17 23 33 162 409 499 721 731
Units 001 002 01 014 02 03 15 4 52 82 9
0
1
2
3
4
5
6
7
8
9
10
0
100
200
300
400
500
600
700
800
Un
its (
millio
n)
Reven
ue (
euro m
illio
n)
Revenues (euro Mio)
Units
Smart meter market unit and revenue forecast Germany
wwwgtaicom
Direct marketing of power from renewable energy create new
business opportunities in Germany
Note not exhaustive Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
Sonne Wind amp Waumlrme 172011
The Optional Market Premium
09022012 11
Incentives
Scheme
Sellers of renewable energy electricity can decide on a monthly basis to either feed the electricity into the grid and receive the feed-in tariff remuneration or participate in direct selling in the electricity market and receive an amount equal to the difference between a reference value based on the average electricity price and the feed-in tariff An additional management premium is paid to cover cost of forecasting and feed-in management
Requirements
Requirements for direct marketing
Access to the electricity market
Recognized trading participant in the European Energy Exchange
Next day feed-in volume forecast and real-time load measurement of RE-installation
Opportunities
Challenges and opportunities exist in Technologies and services to forecast feed-in volume and feed-in management Energy storage options and smart grids Virtual linking different power plant technologies New business models for electricity trading services and utilities
wwwgtaicom
Operators of renewable energy facilities have two options for remuneration
1) Feed-in tariff remuneration or 2) Direct sale under the direct marketing scheme
To improve market and system integration incentives for direct selling
of power from renewable energy have been established
Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
09022012 12
The Optional Market Premium
wwwgtaicom
Source Own draft according to BDEW 2012
Implementation of the Market Premium in 012012
09022012 13
20
43
20
0
90
40
100
10
0
20
40
60
80
100
120
Controllable RE Wind Onshore Wind Offshore PV
Registrations at TNOs for direct marketing (MPM) in 012012 (Dec 21st
2011)
Fraunhofer ISI (Appraisal of market
premium share for 2012 from 012011)
Forecast and actual direct marketing (MPM)
The ldquoOwn-Consumption Bonusldquo Principle
Wattage
Time of day
0h 3h 6h 9h 12h 15h 18h 21h 24h
Feed-in tariff 2874 to 2624 euroctkWh1
ldquoOwn Consumption Bonusldquo 1543 to 986 euroctkWh2
PLUS cost savings
Energy from grid Costs ~ 22 euroctkWh3
Funding through feed-in tariff system AND cost savings on grid energy
Rooftop systems le 500kWp may generate income of gt 37 euroctkWh in 2011
500 kWp max PV Energy
Energy Demand
ldquoIn-houseldquo consumption of PV Energy
Notes 1) Subject to size of system according to feed-in tariff classification | 2) Applicable only for rooftop systems le 500kWp installed between July 2010 and December 2011
3) Subject to electricity retail price of respective utility company Source German parliament resolution from July 2010
09022012 | wwwgtaicom 14
wwwgtaicom
But Almost no possibility of developing new pumped storage capacity
Use of new storage technologies combined with smart grid solutions
will be a necessity
Expected Investment of euro 25-30 billion in storage capacity until 2030
Ambitious growth targets for RE what does this mean for energy storage
Source BCG analysis (Electricity Storage March 2010) ZSW 2010 Bundestag 2010
Renewable Energies in Germany
09022012 15
RE-share Required compensation
capacity (GW) TWh of energy
required
Today 17 16-17 22
2015 na (30) ca 22 30
2020 35 ca 26 37
2025 gt35 ca 28 39
wwwgtaicom
Balancing Power
09022012 16
Easy market entry for smaller players in the balancing power sector
Primary control reserve (PCR)
Secondary control reserve (SCR)
Tertiary control reserve (TCR)
Time for activation 30 s 5 min 15 min
Availability Up to 15 min 15 min to 1hr Minimum of 15 min
Required min bids by regulator 1) 5 MW 10 MW 15 MW
Required min bids by regulator since April 13
1 MW 5 MW 5 MW (10 MW)
Tendering period monthly
daily Tendering period since
April 13 weekly
Focus on new technologies
Flexiblecontrollable plants battery storage systems renewable energy systems at direct marketing
Today for energy storage and balancing power only hydro-pump and gas power
Plants attending at the balancing power market in Germany
Legislative framework has been changed to open the market for innovative storage
technologies
IRR subject to the technology used and the control reserve segment
targeted
Source BMU 2011
wwwgtaicom
Balancing Power
Source 50 Hertz
09022012 17
Price development of TCR 2006 ndash 2010 in euro MW d
0 euro
200 euro
400 euro
600 euro
800 euro
1000 euro
1200 euro
1400 euro
1600 euro
1800 euro
2000 euro
2200 euro
positive Minutenreserve
negative Minutenreserve
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Faster expansion of renewable energies
Integration of renewable energies into the overall energy system eg through a
market premium
Central component wind energy
Increase energy RampD levels - up to euro05 bn will be made available
Expansion of electricity and smart grids as well as increasing the level of energy
storage capacity
Restructuring the fossil power plant park towards more flexible power stations
(eg gas plants as responsive power to intermittent renewable energies)
Increase energy efficiency (particularly in buildings)
Cost efficiency and efficient procurement
European initiatives for energy efficiency
Measures for implementing the new energy policy after the decision
taken on the gradual phase-out of nuclear power by 2022
09022012 6
Source httpwwwbmudeenergiewendebeschluesse_und_massnahmendoc47892php
The Federal Energy Concept
wwwgtaicom
Network Expansion
Source Dena 2010 BDEW 2011
09022012 7
Expansion requirements for the transmission and distribution grid
Grid expansion of 3600km is required by 2020
Baseline scenario with overhead lines as most cost-effective option
0946 bn euroa
Transmission grid
For the medium-voltage power grid (500000km) expansions of 11
to 28 are foreseen
For the low-voltage power grid (11m km) an expansion of 13 to
22 is anticipated
Investment needs
euro 10-27 bn
Distribution grid
wwwgtaicom
Based on the amendment of the Federal Law on the Energy Industry (EnWG)
and the enacting of the Network Expansion Acceleration Act (NABEG)
competences for the extension of the high-voltage grid have been transferred to
the Federal Network Agency
Four major steps were developed
Appraisal and determination of the conditions for the network extension
Based on the Network Agencyrsquos scenarios the Transmission System
Operators (TSO) calculate the extension requirements
Federal advisory planning for finding adequate route corridors
Plan approval procedure for the exact route
Source Federal Network Agency 2012
Network Expansion
09022012 8
The Federal Network Agencyrsquos competences
wwwgtaicom
Intelligent Grids and Metering - EnWG
09022012 9
Source EnWG 2011 Cronos smart utility consulting gmbh 2011
In 2011 the German Federal Law on the Energy Industry (EnWG) was
supplemented by specifications for metering elements eg smart meters
smart meter installations and requirements (sect 21b sect 21d sect 21e sect 21 f sect
21i)
Smart meters are obligatory for new constructions and complete
refurbishments consumer loads of over 6000 kWhYear and plant
operators under the renewable energy act (EEG) and in accordance with the
cogeneration act (KWKG) of over 7 KW (sect 21c para 1 and 2 EnWG)
Expected smart meter roll-put in Germany
2015 ndash 10 of grid accesses with smart meters
2020 ndash already 60
Smart meter legal amendment and roll-out in Germany
wwwgtaicom
Source Own draft according to Frost amp Sullivan 2011
09022012 10
Expected Smart Meter Roll-Out in Germany
The market is expected to grow substantially with overall CAGR of 717 from
2010-2017
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Revenues (euro Mio) 1 3 12 17 23 33 162 409 499 721 731
Units 001 002 01 014 02 03 15 4 52 82 9
0
1
2
3
4
5
6
7
8
9
10
0
100
200
300
400
500
600
700
800
Un
its (
millio
n)
Reven
ue (
euro m
illio
n)
Revenues (euro Mio)
Units
Smart meter market unit and revenue forecast Germany
wwwgtaicom
Direct marketing of power from renewable energy create new
business opportunities in Germany
Note not exhaustive Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
Sonne Wind amp Waumlrme 172011
The Optional Market Premium
09022012 11
Incentives
Scheme
Sellers of renewable energy electricity can decide on a monthly basis to either feed the electricity into the grid and receive the feed-in tariff remuneration or participate in direct selling in the electricity market and receive an amount equal to the difference between a reference value based on the average electricity price and the feed-in tariff An additional management premium is paid to cover cost of forecasting and feed-in management
Requirements
Requirements for direct marketing
Access to the electricity market
Recognized trading participant in the European Energy Exchange
Next day feed-in volume forecast and real-time load measurement of RE-installation
Opportunities
Challenges and opportunities exist in Technologies and services to forecast feed-in volume and feed-in management Energy storage options and smart grids Virtual linking different power plant technologies New business models for electricity trading services and utilities
wwwgtaicom
Operators of renewable energy facilities have two options for remuneration
1) Feed-in tariff remuneration or 2) Direct sale under the direct marketing scheme
To improve market and system integration incentives for direct selling
of power from renewable energy have been established
Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
09022012 12
The Optional Market Premium
wwwgtaicom
Source Own draft according to BDEW 2012
Implementation of the Market Premium in 012012
09022012 13
20
43
20
0
90
40
100
10
0
20
40
60
80
100
120
Controllable RE Wind Onshore Wind Offshore PV
Registrations at TNOs for direct marketing (MPM) in 012012 (Dec 21st
2011)
Fraunhofer ISI (Appraisal of market
premium share for 2012 from 012011)
Forecast and actual direct marketing (MPM)
The ldquoOwn-Consumption Bonusldquo Principle
Wattage
Time of day
0h 3h 6h 9h 12h 15h 18h 21h 24h
Feed-in tariff 2874 to 2624 euroctkWh1
ldquoOwn Consumption Bonusldquo 1543 to 986 euroctkWh2
PLUS cost savings
Energy from grid Costs ~ 22 euroctkWh3
Funding through feed-in tariff system AND cost savings on grid energy
Rooftop systems le 500kWp may generate income of gt 37 euroctkWh in 2011
500 kWp max PV Energy
Energy Demand
ldquoIn-houseldquo consumption of PV Energy
Notes 1) Subject to size of system according to feed-in tariff classification | 2) Applicable only for rooftop systems le 500kWp installed between July 2010 and December 2011
3) Subject to electricity retail price of respective utility company Source German parliament resolution from July 2010
09022012 | wwwgtaicom 14
wwwgtaicom
But Almost no possibility of developing new pumped storage capacity
Use of new storage technologies combined with smart grid solutions
will be a necessity
Expected Investment of euro 25-30 billion in storage capacity until 2030
Ambitious growth targets for RE what does this mean for energy storage
Source BCG analysis (Electricity Storage March 2010) ZSW 2010 Bundestag 2010
Renewable Energies in Germany
09022012 15
RE-share Required compensation
capacity (GW) TWh of energy
required
Today 17 16-17 22
2015 na (30) ca 22 30
2020 35 ca 26 37
2025 gt35 ca 28 39
wwwgtaicom
Balancing Power
09022012 16
Easy market entry for smaller players in the balancing power sector
Primary control reserve (PCR)
Secondary control reserve (SCR)
Tertiary control reserve (TCR)
Time for activation 30 s 5 min 15 min
Availability Up to 15 min 15 min to 1hr Minimum of 15 min
Required min bids by regulator 1) 5 MW 10 MW 15 MW
Required min bids by regulator since April 13
1 MW 5 MW 5 MW (10 MW)
Tendering period monthly
daily Tendering period since
April 13 weekly
Focus on new technologies
Flexiblecontrollable plants battery storage systems renewable energy systems at direct marketing
Today for energy storage and balancing power only hydro-pump and gas power
Plants attending at the balancing power market in Germany
Legislative framework has been changed to open the market for innovative storage
technologies
IRR subject to the technology used and the control reserve segment
targeted
Source BMU 2011
wwwgtaicom
Balancing Power
Source 50 Hertz
09022012 17
Price development of TCR 2006 ndash 2010 in euro MW d
0 euro
200 euro
400 euro
600 euro
800 euro
1000 euro
1200 euro
1400 euro
1600 euro
1800 euro
2000 euro
2200 euro
positive Minutenreserve
negative Minutenreserve
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Network Expansion
Source Dena 2010 BDEW 2011
09022012 7
Expansion requirements for the transmission and distribution grid
Grid expansion of 3600km is required by 2020
Baseline scenario with overhead lines as most cost-effective option
0946 bn euroa
Transmission grid
For the medium-voltage power grid (500000km) expansions of 11
to 28 are foreseen
For the low-voltage power grid (11m km) an expansion of 13 to
22 is anticipated
Investment needs
euro 10-27 bn
Distribution grid
wwwgtaicom
Based on the amendment of the Federal Law on the Energy Industry (EnWG)
and the enacting of the Network Expansion Acceleration Act (NABEG)
competences for the extension of the high-voltage grid have been transferred to
the Federal Network Agency
Four major steps were developed
Appraisal and determination of the conditions for the network extension
Based on the Network Agencyrsquos scenarios the Transmission System
Operators (TSO) calculate the extension requirements
Federal advisory planning for finding adequate route corridors
Plan approval procedure for the exact route
Source Federal Network Agency 2012
Network Expansion
09022012 8
The Federal Network Agencyrsquos competences
wwwgtaicom
Intelligent Grids and Metering - EnWG
09022012 9
Source EnWG 2011 Cronos smart utility consulting gmbh 2011
In 2011 the German Federal Law on the Energy Industry (EnWG) was
supplemented by specifications for metering elements eg smart meters
smart meter installations and requirements (sect 21b sect 21d sect 21e sect 21 f sect
21i)
Smart meters are obligatory for new constructions and complete
refurbishments consumer loads of over 6000 kWhYear and plant
operators under the renewable energy act (EEG) and in accordance with the
cogeneration act (KWKG) of over 7 KW (sect 21c para 1 and 2 EnWG)
Expected smart meter roll-put in Germany
2015 ndash 10 of grid accesses with smart meters
2020 ndash already 60
Smart meter legal amendment and roll-out in Germany
wwwgtaicom
Source Own draft according to Frost amp Sullivan 2011
09022012 10
Expected Smart Meter Roll-Out in Germany
The market is expected to grow substantially with overall CAGR of 717 from
2010-2017
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Revenues (euro Mio) 1 3 12 17 23 33 162 409 499 721 731
Units 001 002 01 014 02 03 15 4 52 82 9
0
1
2
3
4
5
6
7
8
9
10
0
100
200
300
400
500
600
700
800
Un
its (
millio
n)
Reven
ue (
euro m
illio
n)
Revenues (euro Mio)
Units
Smart meter market unit and revenue forecast Germany
wwwgtaicom
Direct marketing of power from renewable energy create new
business opportunities in Germany
Note not exhaustive Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
Sonne Wind amp Waumlrme 172011
The Optional Market Premium
09022012 11
Incentives
Scheme
Sellers of renewable energy electricity can decide on a monthly basis to either feed the electricity into the grid and receive the feed-in tariff remuneration or participate in direct selling in the electricity market and receive an amount equal to the difference between a reference value based on the average electricity price and the feed-in tariff An additional management premium is paid to cover cost of forecasting and feed-in management
Requirements
Requirements for direct marketing
Access to the electricity market
Recognized trading participant in the European Energy Exchange
Next day feed-in volume forecast and real-time load measurement of RE-installation
Opportunities
Challenges and opportunities exist in Technologies and services to forecast feed-in volume and feed-in management Energy storage options and smart grids Virtual linking different power plant technologies New business models for electricity trading services and utilities
wwwgtaicom
Operators of renewable energy facilities have two options for remuneration
1) Feed-in tariff remuneration or 2) Direct sale under the direct marketing scheme
To improve market and system integration incentives for direct selling
of power from renewable energy have been established
Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
09022012 12
The Optional Market Premium
wwwgtaicom
Source Own draft according to BDEW 2012
Implementation of the Market Premium in 012012
09022012 13
20
43
20
0
90
40
100
10
0
20
40
60
80
100
120
Controllable RE Wind Onshore Wind Offshore PV
Registrations at TNOs for direct marketing (MPM) in 012012 (Dec 21st
2011)
Fraunhofer ISI (Appraisal of market
premium share for 2012 from 012011)
Forecast and actual direct marketing (MPM)
The ldquoOwn-Consumption Bonusldquo Principle
Wattage
Time of day
0h 3h 6h 9h 12h 15h 18h 21h 24h
Feed-in tariff 2874 to 2624 euroctkWh1
ldquoOwn Consumption Bonusldquo 1543 to 986 euroctkWh2
PLUS cost savings
Energy from grid Costs ~ 22 euroctkWh3
Funding through feed-in tariff system AND cost savings on grid energy
Rooftop systems le 500kWp may generate income of gt 37 euroctkWh in 2011
500 kWp max PV Energy
Energy Demand
ldquoIn-houseldquo consumption of PV Energy
Notes 1) Subject to size of system according to feed-in tariff classification | 2) Applicable only for rooftop systems le 500kWp installed between July 2010 and December 2011
3) Subject to electricity retail price of respective utility company Source German parliament resolution from July 2010
09022012 | wwwgtaicom 14
wwwgtaicom
But Almost no possibility of developing new pumped storage capacity
Use of new storage technologies combined with smart grid solutions
will be a necessity
Expected Investment of euro 25-30 billion in storage capacity until 2030
Ambitious growth targets for RE what does this mean for energy storage
Source BCG analysis (Electricity Storage March 2010) ZSW 2010 Bundestag 2010
Renewable Energies in Germany
09022012 15
RE-share Required compensation
capacity (GW) TWh of energy
required
Today 17 16-17 22
2015 na (30) ca 22 30
2020 35 ca 26 37
2025 gt35 ca 28 39
wwwgtaicom
Balancing Power
09022012 16
Easy market entry for smaller players in the balancing power sector
Primary control reserve (PCR)
Secondary control reserve (SCR)
Tertiary control reserve (TCR)
Time for activation 30 s 5 min 15 min
Availability Up to 15 min 15 min to 1hr Minimum of 15 min
Required min bids by regulator 1) 5 MW 10 MW 15 MW
Required min bids by regulator since April 13
1 MW 5 MW 5 MW (10 MW)
Tendering period monthly
daily Tendering period since
April 13 weekly
Focus on new technologies
Flexiblecontrollable plants battery storage systems renewable energy systems at direct marketing
Today for energy storage and balancing power only hydro-pump and gas power
Plants attending at the balancing power market in Germany
Legislative framework has been changed to open the market for innovative storage
technologies
IRR subject to the technology used and the control reserve segment
targeted
Source BMU 2011
wwwgtaicom
Balancing Power
Source 50 Hertz
09022012 17
Price development of TCR 2006 ndash 2010 in euro MW d
0 euro
200 euro
400 euro
600 euro
800 euro
1000 euro
1200 euro
1400 euro
1600 euro
1800 euro
2000 euro
2200 euro
positive Minutenreserve
negative Minutenreserve
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Based on the amendment of the Federal Law on the Energy Industry (EnWG)
and the enacting of the Network Expansion Acceleration Act (NABEG)
competences for the extension of the high-voltage grid have been transferred to
the Federal Network Agency
Four major steps were developed
Appraisal and determination of the conditions for the network extension
Based on the Network Agencyrsquos scenarios the Transmission System
Operators (TSO) calculate the extension requirements
Federal advisory planning for finding adequate route corridors
Plan approval procedure for the exact route
Source Federal Network Agency 2012
Network Expansion
09022012 8
The Federal Network Agencyrsquos competences
wwwgtaicom
Intelligent Grids and Metering - EnWG
09022012 9
Source EnWG 2011 Cronos smart utility consulting gmbh 2011
In 2011 the German Federal Law on the Energy Industry (EnWG) was
supplemented by specifications for metering elements eg smart meters
smart meter installations and requirements (sect 21b sect 21d sect 21e sect 21 f sect
21i)
Smart meters are obligatory for new constructions and complete
refurbishments consumer loads of over 6000 kWhYear and plant
operators under the renewable energy act (EEG) and in accordance with the
cogeneration act (KWKG) of over 7 KW (sect 21c para 1 and 2 EnWG)
Expected smart meter roll-put in Germany
2015 ndash 10 of grid accesses with smart meters
2020 ndash already 60
Smart meter legal amendment and roll-out in Germany
wwwgtaicom
Source Own draft according to Frost amp Sullivan 2011
09022012 10
Expected Smart Meter Roll-Out in Germany
The market is expected to grow substantially with overall CAGR of 717 from
2010-2017
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Revenues (euro Mio) 1 3 12 17 23 33 162 409 499 721 731
Units 001 002 01 014 02 03 15 4 52 82 9
0
1
2
3
4
5
6
7
8
9
10
0
100
200
300
400
500
600
700
800
Un
its (
millio
n)
Reven
ue (
euro m
illio
n)
Revenues (euro Mio)
Units
Smart meter market unit and revenue forecast Germany
wwwgtaicom
Direct marketing of power from renewable energy create new
business opportunities in Germany
Note not exhaustive Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
Sonne Wind amp Waumlrme 172011
The Optional Market Premium
09022012 11
Incentives
Scheme
Sellers of renewable energy electricity can decide on a monthly basis to either feed the electricity into the grid and receive the feed-in tariff remuneration or participate in direct selling in the electricity market and receive an amount equal to the difference between a reference value based on the average electricity price and the feed-in tariff An additional management premium is paid to cover cost of forecasting and feed-in management
Requirements
Requirements for direct marketing
Access to the electricity market
Recognized trading participant in the European Energy Exchange
Next day feed-in volume forecast and real-time load measurement of RE-installation
Opportunities
Challenges and opportunities exist in Technologies and services to forecast feed-in volume and feed-in management Energy storage options and smart grids Virtual linking different power plant technologies New business models for electricity trading services and utilities
wwwgtaicom
Operators of renewable energy facilities have two options for remuneration
1) Feed-in tariff remuneration or 2) Direct sale under the direct marketing scheme
To improve market and system integration incentives for direct selling
of power from renewable energy have been established
Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
09022012 12
The Optional Market Premium
wwwgtaicom
Source Own draft according to BDEW 2012
Implementation of the Market Premium in 012012
09022012 13
20
43
20
0
90
40
100
10
0
20
40
60
80
100
120
Controllable RE Wind Onshore Wind Offshore PV
Registrations at TNOs for direct marketing (MPM) in 012012 (Dec 21st
2011)
Fraunhofer ISI (Appraisal of market
premium share for 2012 from 012011)
Forecast and actual direct marketing (MPM)
The ldquoOwn-Consumption Bonusldquo Principle
Wattage
Time of day
0h 3h 6h 9h 12h 15h 18h 21h 24h
Feed-in tariff 2874 to 2624 euroctkWh1
ldquoOwn Consumption Bonusldquo 1543 to 986 euroctkWh2
PLUS cost savings
Energy from grid Costs ~ 22 euroctkWh3
Funding through feed-in tariff system AND cost savings on grid energy
Rooftop systems le 500kWp may generate income of gt 37 euroctkWh in 2011
500 kWp max PV Energy
Energy Demand
ldquoIn-houseldquo consumption of PV Energy
Notes 1) Subject to size of system according to feed-in tariff classification | 2) Applicable only for rooftop systems le 500kWp installed between July 2010 and December 2011
3) Subject to electricity retail price of respective utility company Source German parliament resolution from July 2010
09022012 | wwwgtaicom 14
wwwgtaicom
But Almost no possibility of developing new pumped storage capacity
Use of new storage technologies combined with smart grid solutions
will be a necessity
Expected Investment of euro 25-30 billion in storage capacity until 2030
Ambitious growth targets for RE what does this mean for energy storage
Source BCG analysis (Electricity Storage March 2010) ZSW 2010 Bundestag 2010
Renewable Energies in Germany
09022012 15
RE-share Required compensation
capacity (GW) TWh of energy
required
Today 17 16-17 22
2015 na (30) ca 22 30
2020 35 ca 26 37
2025 gt35 ca 28 39
wwwgtaicom
Balancing Power
09022012 16
Easy market entry for smaller players in the balancing power sector
Primary control reserve (PCR)
Secondary control reserve (SCR)
Tertiary control reserve (TCR)
Time for activation 30 s 5 min 15 min
Availability Up to 15 min 15 min to 1hr Minimum of 15 min
Required min bids by regulator 1) 5 MW 10 MW 15 MW
Required min bids by regulator since April 13
1 MW 5 MW 5 MW (10 MW)
Tendering period monthly
daily Tendering period since
April 13 weekly
Focus on new technologies
Flexiblecontrollable plants battery storage systems renewable energy systems at direct marketing
Today for energy storage and balancing power only hydro-pump and gas power
Plants attending at the balancing power market in Germany
Legislative framework has been changed to open the market for innovative storage
technologies
IRR subject to the technology used and the control reserve segment
targeted
Source BMU 2011
wwwgtaicom
Balancing Power
Source 50 Hertz
09022012 17
Price development of TCR 2006 ndash 2010 in euro MW d
0 euro
200 euro
400 euro
600 euro
800 euro
1000 euro
1200 euro
1400 euro
1600 euro
1800 euro
2000 euro
2200 euro
positive Minutenreserve
negative Minutenreserve
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Intelligent Grids and Metering - EnWG
09022012 9
Source EnWG 2011 Cronos smart utility consulting gmbh 2011
In 2011 the German Federal Law on the Energy Industry (EnWG) was
supplemented by specifications for metering elements eg smart meters
smart meter installations and requirements (sect 21b sect 21d sect 21e sect 21 f sect
21i)
Smart meters are obligatory for new constructions and complete
refurbishments consumer loads of over 6000 kWhYear and plant
operators under the renewable energy act (EEG) and in accordance with the
cogeneration act (KWKG) of over 7 KW (sect 21c para 1 and 2 EnWG)
Expected smart meter roll-put in Germany
2015 ndash 10 of grid accesses with smart meters
2020 ndash already 60
Smart meter legal amendment and roll-out in Germany
wwwgtaicom
Source Own draft according to Frost amp Sullivan 2011
09022012 10
Expected Smart Meter Roll-Out in Germany
The market is expected to grow substantially with overall CAGR of 717 from
2010-2017
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Revenues (euro Mio) 1 3 12 17 23 33 162 409 499 721 731
Units 001 002 01 014 02 03 15 4 52 82 9
0
1
2
3
4
5
6
7
8
9
10
0
100
200
300
400
500
600
700
800
Un
its (
millio
n)
Reven
ue (
euro m
illio
n)
Revenues (euro Mio)
Units
Smart meter market unit and revenue forecast Germany
wwwgtaicom
Direct marketing of power from renewable energy create new
business opportunities in Germany
Note not exhaustive Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
Sonne Wind amp Waumlrme 172011
The Optional Market Premium
09022012 11
Incentives
Scheme
Sellers of renewable energy electricity can decide on a monthly basis to either feed the electricity into the grid and receive the feed-in tariff remuneration or participate in direct selling in the electricity market and receive an amount equal to the difference between a reference value based on the average electricity price and the feed-in tariff An additional management premium is paid to cover cost of forecasting and feed-in management
Requirements
Requirements for direct marketing
Access to the electricity market
Recognized trading participant in the European Energy Exchange
Next day feed-in volume forecast and real-time load measurement of RE-installation
Opportunities
Challenges and opportunities exist in Technologies and services to forecast feed-in volume and feed-in management Energy storage options and smart grids Virtual linking different power plant technologies New business models for electricity trading services and utilities
wwwgtaicom
Operators of renewable energy facilities have two options for remuneration
1) Feed-in tariff remuneration or 2) Direct sale under the direct marketing scheme
To improve market and system integration incentives for direct selling
of power from renewable energy have been established
Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
09022012 12
The Optional Market Premium
wwwgtaicom
Source Own draft according to BDEW 2012
Implementation of the Market Premium in 012012
09022012 13
20
43
20
0
90
40
100
10
0
20
40
60
80
100
120
Controllable RE Wind Onshore Wind Offshore PV
Registrations at TNOs for direct marketing (MPM) in 012012 (Dec 21st
2011)
Fraunhofer ISI (Appraisal of market
premium share for 2012 from 012011)
Forecast and actual direct marketing (MPM)
The ldquoOwn-Consumption Bonusldquo Principle
Wattage
Time of day
0h 3h 6h 9h 12h 15h 18h 21h 24h
Feed-in tariff 2874 to 2624 euroctkWh1
ldquoOwn Consumption Bonusldquo 1543 to 986 euroctkWh2
PLUS cost savings
Energy from grid Costs ~ 22 euroctkWh3
Funding through feed-in tariff system AND cost savings on grid energy
Rooftop systems le 500kWp may generate income of gt 37 euroctkWh in 2011
500 kWp max PV Energy
Energy Demand
ldquoIn-houseldquo consumption of PV Energy
Notes 1) Subject to size of system according to feed-in tariff classification | 2) Applicable only for rooftop systems le 500kWp installed between July 2010 and December 2011
3) Subject to electricity retail price of respective utility company Source German parliament resolution from July 2010
09022012 | wwwgtaicom 14
wwwgtaicom
But Almost no possibility of developing new pumped storage capacity
Use of new storage technologies combined with smart grid solutions
will be a necessity
Expected Investment of euro 25-30 billion in storage capacity until 2030
Ambitious growth targets for RE what does this mean for energy storage
Source BCG analysis (Electricity Storage March 2010) ZSW 2010 Bundestag 2010
Renewable Energies in Germany
09022012 15
RE-share Required compensation
capacity (GW) TWh of energy
required
Today 17 16-17 22
2015 na (30) ca 22 30
2020 35 ca 26 37
2025 gt35 ca 28 39
wwwgtaicom
Balancing Power
09022012 16
Easy market entry for smaller players in the balancing power sector
Primary control reserve (PCR)
Secondary control reserve (SCR)
Tertiary control reserve (TCR)
Time for activation 30 s 5 min 15 min
Availability Up to 15 min 15 min to 1hr Minimum of 15 min
Required min bids by regulator 1) 5 MW 10 MW 15 MW
Required min bids by regulator since April 13
1 MW 5 MW 5 MW (10 MW)
Tendering period monthly
daily Tendering period since
April 13 weekly
Focus on new technologies
Flexiblecontrollable plants battery storage systems renewable energy systems at direct marketing
Today for energy storage and balancing power only hydro-pump and gas power
Plants attending at the balancing power market in Germany
Legislative framework has been changed to open the market for innovative storage
technologies
IRR subject to the technology used and the control reserve segment
targeted
Source BMU 2011
wwwgtaicom
Balancing Power
Source 50 Hertz
09022012 17
Price development of TCR 2006 ndash 2010 in euro MW d
0 euro
200 euro
400 euro
600 euro
800 euro
1000 euro
1200 euro
1400 euro
1600 euro
1800 euro
2000 euro
2200 euro
positive Minutenreserve
negative Minutenreserve
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Source Own draft according to Frost amp Sullivan 2011
09022012 10
Expected Smart Meter Roll-Out in Germany
The market is expected to grow substantially with overall CAGR of 717 from
2010-2017
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Revenues (euro Mio) 1 3 12 17 23 33 162 409 499 721 731
Units 001 002 01 014 02 03 15 4 52 82 9
0
1
2
3
4
5
6
7
8
9
10
0
100
200
300
400
500
600
700
800
Un
its (
millio
n)
Reven
ue (
euro m
illio
n)
Revenues (euro Mio)
Units
Smart meter market unit and revenue forecast Germany
wwwgtaicom
Direct marketing of power from renewable energy create new
business opportunities in Germany
Note not exhaustive Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
Sonne Wind amp Waumlrme 172011
The Optional Market Premium
09022012 11
Incentives
Scheme
Sellers of renewable energy electricity can decide on a monthly basis to either feed the electricity into the grid and receive the feed-in tariff remuneration or participate in direct selling in the electricity market and receive an amount equal to the difference between a reference value based on the average electricity price and the feed-in tariff An additional management premium is paid to cover cost of forecasting and feed-in management
Requirements
Requirements for direct marketing
Access to the electricity market
Recognized trading participant in the European Energy Exchange
Next day feed-in volume forecast and real-time load measurement of RE-installation
Opportunities
Challenges and opportunities exist in Technologies and services to forecast feed-in volume and feed-in management Energy storage options and smart grids Virtual linking different power plant technologies New business models for electricity trading services and utilities
wwwgtaicom
Operators of renewable energy facilities have two options for remuneration
1) Feed-in tariff remuneration or 2) Direct sale under the direct marketing scheme
To improve market and system integration incentives for direct selling
of power from renewable energy have been established
Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
09022012 12
The Optional Market Premium
wwwgtaicom
Source Own draft according to BDEW 2012
Implementation of the Market Premium in 012012
09022012 13
20
43
20
0
90
40
100
10
0
20
40
60
80
100
120
Controllable RE Wind Onshore Wind Offshore PV
Registrations at TNOs for direct marketing (MPM) in 012012 (Dec 21st
2011)
Fraunhofer ISI (Appraisal of market
premium share for 2012 from 012011)
Forecast and actual direct marketing (MPM)
The ldquoOwn-Consumption Bonusldquo Principle
Wattage
Time of day
0h 3h 6h 9h 12h 15h 18h 21h 24h
Feed-in tariff 2874 to 2624 euroctkWh1
ldquoOwn Consumption Bonusldquo 1543 to 986 euroctkWh2
PLUS cost savings
Energy from grid Costs ~ 22 euroctkWh3
Funding through feed-in tariff system AND cost savings on grid energy
Rooftop systems le 500kWp may generate income of gt 37 euroctkWh in 2011
500 kWp max PV Energy
Energy Demand
ldquoIn-houseldquo consumption of PV Energy
Notes 1) Subject to size of system according to feed-in tariff classification | 2) Applicable only for rooftop systems le 500kWp installed between July 2010 and December 2011
3) Subject to electricity retail price of respective utility company Source German parliament resolution from July 2010
09022012 | wwwgtaicom 14
wwwgtaicom
But Almost no possibility of developing new pumped storage capacity
Use of new storage technologies combined with smart grid solutions
will be a necessity
Expected Investment of euro 25-30 billion in storage capacity until 2030
Ambitious growth targets for RE what does this mean for energy storage
Source BCG analysis (Electricity Storage March 2010) ZSW 2010 Bundestag 2010
Renewable Energies in Germany
09022012 15
RE-share Required compensation
capacity (GW) TWh of energy
required
Today 17 16-17 22
2015 na (30) ca 22 30
2020 35 ca 26 37
2025 gt35 ca 28 39
wwwgtaicom
Balancing Power
09022012 16
Easy market entry for smaller players in the balancing power sector
Primary control reserve (PCR)
Secondary control reserve (SCR)
Tertiary control reserve (TCR)
Time for activation 30 s 5 min 15 min
Availability Up to 15 min 15 min to 1hr Minimum of 15 min
Required min bids by regulator 1) 5 MW 10 MW 15 MW
Required min bids by regulator since April 13
1 MW 5 MW 5 MW (10 MW)
Tendering period monthly
daily Tendering period since
April 13 weekly
Focus on new technologies
Flexiblecontrollable plants battery storage systems renewable energy systems at direct marketing
Today for energy storage and balancing power only hydro-pump and gas power
Plants attending at the balancing power market in Germany
Legislative framework has been changed to open the market for innovative storage
technologies
IRR subject to the technology used and the control reserve segment
targeted
Source BMU 2011
wwwgtaicom
Balancing Power
Source 50 Hertz
09022012 17
Price development of TCR 2006 ndash 2010 in euro MW d
0 euro
200 euro
400 euro
600 euro
800 euro
1000 euro
1200 euro
1400 euro
1600 euro
1800 euro
2000 euro
2200 euro
positive Minutenreserve
negative Minutenreserve
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Direct marketing of power from renewable energy create new
business opportunities in Germany
Note not exhaustive Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
Sonne Wind amp Waumlrme 172011
The Optional Market Premium
09022012 11
Incentives
Scheme
Sellers of renewable energy electricity can decide on a monthly basis to either feed the electricity into the grid and receive the feed-in tariff remuneration or participate in direct selling in the electricity market and receive an amount equal to the difference between a reference value based on the average electricity price and the feed-in tariff An additional management premium is paid to cover cost of forecasting and feed-in management
Requirements
Requirements for direct marketing
Access to the electricity market
Recognized trading participant in the European Energy Exchange
Next day feed-in volume forecast and real-time load measurement of RE-installation
Opportunities
Challenges and opportunities exist in Technologies and services to forecast feed-in volume and feed-in management Energy storage options and smart grids Virtual linking different power plant technologies New business models for electricity trading services and utilities
wwwgtaicom
Operators of renewable energy facilities have two options for remuneration
1) Feed-in tariff remuneration or 2) Direct sale under the direct marketing scheme
To improve market and system integration incentives for direct selling
of power from renewable energy have been established
Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
09022012 12
The Optional Market Premium
wwwgtaicom
Source Own draft according to BDEW 2012
Implementation of the Market Premium in 012012
09022012 13
20
43
20
0
90
40
100
10
0
20
40
60
80
100
120
Controllable RE Wind Onshore Wind Offshore PV
Registrations at TNOs for direct marketing (MPM) in 012012 (Dec 21st
2011)
Fraunhofer ISI (Appraisal of market
premium share for 2012 from 012011)
Forecast and actual direct marketing (MPM)
The ldquoOwn-Consumption Bonusldquo Principle
Wattage
Time of day
0h 3h 6h 9h 12h 15h 18h 21h 24h
Feed-in tariff 2874 to 2624 euroctkWh1
ldquoOwn Consumption Bonusldquo 1543 to 986 euroctkWh2
PLUS cost savings
Energy from grid Costs ~ 22 euroctkWh3
Funding through feed-in tariff system AND cost savings on grid energy
Rooftop systems le 500kWp may generate income of gt 37 euroctkWh in 2011
500 kWp max PV Energy
Energy Demand
ldquoIn-houseldquo consumption of PV Energy
Notes 1) Subject to size of system according to feed-in tariff classification | 2) Applicable only for rooftop systems le 500kWp installed between July 2010 and December 2011
3) Subject to electricity retail price of respective utility company Source German parliament resolution from July 2010
09022012 | wwwgtaicom 14
wwwgtaicom
But Almost no possibility of developing new pumped storage capacity
Use of new storage technologies combined with smart grid solutions
will be a necessity
Expected Investment of euro 25-30 billion in storage capacity until 2030
Ambitious growth targets for RE what does this mean for energy storage
Source BCG analysis (Electricity Storage March 2010) ZSW 2010 Bundestag 2010
Renewable Energies in Germany
09022012 15
RE-share Required compensation
capacity (GW) TWh of energy
required
Today 17 16-17 22
2015 na (30) ca 22 30
2020 35 ca 26 37
2025 gt35 ca 28 39
wwwgtaicom
Balancing Power
09022012 16
Easy market entry for smaller players in the balancing power sector
Primary control reserve (PCR)
Secondary control reserve (SCR)
Tertiary control reserve (TCR)
Time for activation 30 s 5 min 15 min
Availability Up to 15 min 15 min to 1hr Minimum of 15 min
Required min bids by regulator 1) 5 MW 10 MW 15 MW
Required min bids by regulator since April 13
1 MW 5 MW 5 MW (10 MW)
Tendering period monthly
daily Tendering period since
April 13 weekly
Focus on new technologies
Flexiblecontrollable plants battery storage systems renewable energy systems at direct marketing
Today for energy storage and balancing power only hydro-pump and gas power
Plants attending at the balancing power market in Germany
Legislative framework has been changed to open the market for innovative storage
technologies
IRR subject to the technology used and the control reserve segment
targeted
Source BMU 2011
wwwgtaicom
Balancing Power
Source 50 Hertz
09022012 17
Price development of TCR 2006 ndash 2010 in euro MW d
0 euro
200 euro
400 euro
600 euro
800 euro
1000 euro
1200 euro
1400 euro
1600 euro
1800 euro
2000 euro
2200 euro
positive Minutenreserve
negative Minutenreserve
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Operators of renewable energy facilities have two options for remuneration
1) Feed-in tariff remuneration or 2) Direct sale under the direct marketing scheme
To improve market and system integration incentives for direct selling
of power from renewable energy have been established
Source Renewable Energies Sources Act (EEG) 2012 Federal Ministry for the Environment Nature Conservation and Nuclear Safety 2011
09022012 12
The Optional Market Premium
wwwgtaicom
Source Own draft according to BDEW 2012
Implementation of the Market Premium in 012012
09022012 13
20
43
20
0
90
40
100
10
0
20
40
60
80
100
120
Controllable RE Wind Onshore Wind Offshore PV
Registrations at TNOs for direct marketing (MPM) in 012012 (Dec 21st
2011)
Fraunhofer ISI (Appraisal of market
premium share for 2012 from 012011)
Forecast and actual direct marketing (MPM)
The ldquoOwn-Consumption Bonusldquo Principle
Wattage
Time of day
0h 3h 6h 9h 12h 15h 18h 21h 24h
Feed-in tariff 2874 to 2624 euroctkWh1
ldquoOwn Consumption Bonusldquo 1543 to 986 euroctkWh2
PLUS cost savings
Energy from grid Costs ~ 22 euroctkWh3
Funding through feed-in tariff system AND cost savings on grid energy
Rooftop systems le 500kWp may generate income of gt 37 euroctkWh in 2011
500 kWp max PV Energy
Energy Demand
ldquoIn-houseldquo consumption of PV Energy
Notes 1) Subject to size of system according to feed-in tariff classification | 2) Applicable only for rooftop systems le 500kWp installed between July 2010 and December 2011
3) Subject to electricity retail price of respective utility company Source German parliament resolution from July 2010
09022012 | wwwgtaicom 14
wwwgtaicom
But Almost no possibility of developing new pumped storage capacity
Use of new storage technologies combined with smart grid solutions
will be a necessity
Expected Investment of euro 25-30 billion in storage capacity until 2030
Ambitious growth targets for RE what does this mean for energy storage
Source BCG analysis (Electricity Storage March 2010) ZSW 2010 Bundestag 2010
Renewable Energies in Germany
09022012 15
RE-share Required compensation
capacity (GW) TWh of energy
required
Today 17 16-17 22
2015 na (30) ca 22 30
2020 35 ca 26 37
2025 gt35 ca 28 39
wwwgtaicom
Balancing Power
09022012 16
Easy market entry for smaller players in the balancing power sector
Primary control reserve (PCR)
Secondary control reserve (SCR)
Tertiary control reserve (TCR)
Time for activation 30 s 5 min 15 min
Availability Up to 15 min 15 min to 1hr Minimum of 15 min
Required min bids by regulator 1) 5 MW 10 MW 15 MW
Required min bids by regulator since April 13
1 MW 5 MW 5 MW (10 MW)
Tendering period monthly
daily Tendering period since
April 13 weekly
Focus on new technologies
Flexiblecontrollable plants battery storage systems renewable energy systems at direct marketing
Today for energy storage and balancing power only hydro-pump and gas power
Plants attending at the balancing power market in Germany
Legislative framework has been changed to open the market for innovative storage
technologies
IRR subject to the technology used and the control reserve segment
targeted
Source BMU 2011
wwwgtaicom
Balancing Power
Source 50 Hertz
09022012 17
Price development of TCR 2006 ndash 2010 in euro MW d
0 euro
200 euro
400 euro
600 euro
800 euro
1000 euro
1200 euro
1400 euro
1600 euro
1800 euro
2000 euro
2200 euro
positive Minutenreserve
negative Minutenreserve
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Source Own draft according to BDEW 2012
Implementation of the Market Premium in 012012
09022012 13
20
43
20
0
90
40
100
10
0
20
40
60
80
100
120
Controllable RE Wind Onshore Wind Offshore PV
Registrations at TNOs for direct marketing (MPM) in 012012 (Dec 21st
2011)
Fraunhofer ISI (Appraisal of market
premium share for 2012 from 012011)
Forecast and actual direct marketing (MPM)
The ldquoOwn-Consumption Bonusldquo Principle
Wattage
Time of day
0h 3h 6h 9h 12h 15h 18h 21h 24h
Feed-in tariff 2874 to 2624 euroctkWh1
ldquoOwn Consumption Bonusldquo 1543 to 986 euroctkWh2
PLUS cost savings
Energy from grid Costs ~ 22 euroctkWh3
Funding through feed-in tariff system AND cost savings on grid energy
Rooftop systems le 500kWp may generate income of gt 37 euroctkWh in 2011
500 kWp max PV Energy
Energy Demand
ldquoIn-houseldquo consumption of PV Energy
Notes 1) Subject to size of system according to feed-in tariff classification | 2) Applicable only for rooftop systems le 500kWp installed between July 2010 and December 2011
3) Subject to electricity retail price of respective utility company Source German parliament resolution from July 2010
09022012 | wwwgtaicom 14
wwwgtaicom
But Almost no possibility of developing new pumped storage capacity
Use of new storage technologies combined with smart grid solutions
will be a necessity
Expected Investment of euro 25-30 billion in storage capacity until 2030
Ambitious growth targets for RE what does this mean for energy storage
Source BCG analysis (Electricity Storage March 2010) ZSW 2010 Bundestag 2010
Renewable Energies in Germany
09022012 15
RE-share Required compensation
capacity (GW) TWh of energy
required
Today 17 16-17 22
2015 na (30) ca 22 30
2020 35 ca 26 37
2025 gt35 ca 28 39
wwwgtaicom
Balancing Power
09022012 16
Easy market entry for smaller players in the balancing power sector
Primary control reserve (PCR)
Secondary control reserve (SCR)
Tertiary control reserve (TCR)
Time for activation 30 s 5 min 15 min
Availability Up to 15 min 15 min to 1hr Minimum of 15 min
Required min bids by regulator 1) 5 MW 10 MW 15 MW
Required min bids by regulator since April 13
1 MW 5 MW 5 MW (10 MW)
Tendering period monthly
daily Tendering period since
April 13 weekly
Focus on new technologies
Flexiblecontrollable plants battery storage systems renewable energy systems at direct marketing
Today for energy storage and balancing power only hydro-pump and gas power
Plants attending at the balancing power market in Germany
Legislative framework has been changed to open the market for innovative storage
technologies
IRR subject to the technology used and the control reserve segment
targeted
Source BMU 2011
wwwgtaicom
Balancing Power
Source 50 Hertz
09022012 17
Price development of TCR 2006 ndash 2010 in euro MW d
0 euro
200 euro
400 euro
600 euro
800 euro
1000 euro
1200 euro
1400 euro
1600 euro
1800 euro
2000 euro
2200 euro
positive Minutenreserve
negative Minutenreserve
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
The ldquoOwn-Consumption Bonusldquo Principle
Wattage
Time of day
0h 3h 6h 9h 12h 15h 18h 21h 24h
Feed-in tariff 2874 to 2624 euroctkWh1
ldquoOwn Consumption Bonusldquo 1543 to 986 euroctkWh2
PLUS cost savings
Energy from grid Costs ~ 22 euroctkWh3
Funding through feed-in tariff system AND cost savings on grid energy
Rooftop systems le 500kWp may generate income of gt 37 euroctkWh in 2011
500 kWp max PV Energy
Energy Demand
ldquoIn-houseldquo consumption of PV Energy
Notes 1) Subject to size of system according to feed-in tariff classification | 2) Applicable only for rooftop systems le 500kWp installed between July 2010 and December 2011
3) Subject to electricity retail price of respective utility company Source German parliament resolution from July 2010
09022012 | wwwgtaicom 14
wwwgtaicom
But Almost no possibility of developing new pumped storage capacity
Use of new storage technologies combined with smart grid solutions
will be a necessity
Expected Investment of euro 25-30 billion in storage capacity until 2030
Ambitious growth targets for RE what does this mean for energy storage
Source BCG analysis (Electricity Storage March 2010) ZSW 2010 Bundestag 2010
Renewable Energies in Germany
09022012 15
RE-share Required compensation
capacity (GW) TWh of energy
required
Today 17 16-17 22
2015 na (30) ca 22 30
2020 35 ca 26 37
2025 gt35 ca 28 39
wwwgtaicom
Balancing Power
09022012 16
Easy market entry for smaller players in the balancing power sector
Primary control reserve (PCR)
Secondary control reserve (SCR)
Tertiary control reserve (TCR)
Time for activation 30 s 5 min 15 min
Availability Up to 15 min 15 min to 1hr Minimum of 15 min
Required min bids by regulator 1) 5 MW 10 MW 15 MW
Required min bids by regulator since April 13
1 MW 5 MW 5 MW (10 MW)
Tendering period monthly
daily Tendering period since
April 13 weekly
Focus on new technologies
Flexiblecontrollable plants battery storage systems renewable energy systems at direct marketing
Today for energy storage and balancing power only hydro-pump and gas power
Plants attending at the balancing power market in Germany
Legislative framework has been changed to open the market for innovative storage
technologies
IRR subject to the technology used and the control reserve segment
targeted
Source BMU 2011
wwwgtaicom
Balancing Power
Source 50 Hertz
09022012 17
Price development of TCR 2006 ndash 2010 in euro MW d
0 euro
200 euro
400 euro
600 euro
800 euro
1000 euro
1200 euro
1400 euro
1600 euro
1800 euro
2000 euro
2200 euro
positive Minutenreserve
negative Minutenreserve
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
But Almost no possibility of developing new pumped storage capacity
Use of new storage technologies combined with smart grid solutions
will be a necessity
Expected Investment of euro 25-30 billion in storage capacity until 2030
Ambitious growth targets for RE what does this mean for energy storage
Source BCG analysis (Electricity Storage March 2010) ZSW 2010 Bundestag 2010
Renewable Energies in Germany
09022012 15
RE-share Required compensation
capacity (GW) TWh of energy
required
Today 17 16-17 22
2015 na (30) ca 22 30
2020 35 ca 26 37
2025 gt35 ca 28 39
wwwgtaicom
Balancing Power
09022012 16
Easy market entry for smaller players in the balancing power sector
Primary control reserve (PCR)
Secondary control reserve (SCR)
Tertiary control reserve (TCR)
Time for activation 30 s 5 min 15 min
Availability Up to 15 min 15 min to 1hr Minimum of 15 min
Required min bids by regulator 1) 5 MW 10 MW 15 MW
Required min bids by regulator since April 13
1 MW 5 MW 5 MW (10 MW)
Tendering period monthly
daily Tendering period since
April 13 weekly
Focus on new technologies
Flexiblecontrollable plants battery storage systems renewable energy systems at direct marketing
Today for energy storage and balancing power only hydro-pump and gas power
Plants attending at the balancing power market in Germany
Legislative framework has been changed to open the market for innovative storage
technologies
IRR subject to the technology used and the control reserve segment
targeted
Source BMU 2011
wwwgtaicom
Balancing Power
Source 50 Hertz
09022012 17
Price development of TCR 2006 ndash 2010 in euro MW d
0 euro
200 euro
400 euro
600 euro
800 euro
1000 euro
1200 euro
1400 euro
1600 euro
1800 euro
2000 euro
2200 euro
positive Minutenreserve
negative Minutenreserve
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Balancing Power
09022012 16
Easy market entry for smaller players in the balancing power sector
Primary control reserve (PCR)
Secondary control reserve (SCR)
Tertiary control reserve (TCR)
Time for activation 30 s 5 min 15 min
Availability Up to 15 min 15 min to 1hr Minimum of 15 min
Required min bids by regulator 1) 5 MW 10 MW 15 MW
Required min bids by regulator since April 13
1 MW 5 MW 5 MW (10 MW)
Tendering period monthly
daily Tendering period since
April 13 weekly
Focus on new technologies
Flexiblecontrollable plants battery storage systems renewable energy systems at direct marketing
Today for energy storage and balancing power only hydro-pump and gas power
Plants attending at the balancing power market in Germany
Legislative framework has been changed to open the market for innovative storage
technologies
IRR subject to the technology used and the control reserve segment
targeted
Source BMU 2011
wwwgtaicom
Balancing Power
Source 50 Hertz
09022012 17
Price development of TCR 2006 ndash 2010 in euro MW d
0 euro
200 euro
400 euro
600 euro
800 euro
1000 euro
1200 euro
1400 euro
1600 euro
1800 euro
2000 euro
2200 euro
positive Minutenreserve
negative Minutenreserve
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Balancing Power
Source 50 Hertz
09022012 17
Price development of TCR 2006 ndash 2010 in euro MW d
0 euro
200 euro
400 euro
600 euro
800 euro
1000 euro
1200 euro
1400 euro
1600 euro
1800 euro
2000 euro
2200 euro
positive Minutenreserve
negative Minutenreserve
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Prequalified providers of different kind of balancing power
Source regelenergieleistungnet 2011
Potential Large-scale Storage Partners
09022012 18
Provider Location
Primary Capacity Reserve (PCR)
Secondary Capacity Reserve (SCR)
Tertiary Capacity Reserve (TCR)
1 ArcelorMittal Eisenhuumlttenstadt GmbH Eisenhuumlttenstadt x
2 BalancePower GmbH Hannover x
3 CURRENTA GmbH amp Co OHG Leverkusen x
4 EON Energy Trading SE Duumlsseldorf x x x
5 EON Westfalen Weser Energie-Service GmbH Herford x x
6 EnBW Kraftwerke AG Karlsruhe x x x
7 envia Mitteldeutsche Energie AG Chemnitz x
8 Evonik Power Saar GmbH Saarbruumlcken x x
9 Evonik Steag GmbH Essen x
10 GDF SUEZ Energie Deutschland AG Berlin x x
11 Infracor GmbH Marl x
12 Kraftwerke Mainz Wiesbaden AG Mainz x
13 Lechwerke AG Augsburg x
14 Mark-E AG Hagen x
15 MVV Energie AG Mannheim x
16 RWE Innogy GmbH Essen x
17 RWE Supply amp Trading GmbH Essen x x x
18 Stadtwerke Duumlsseldorf AG Duumlsseldorf x
19 Stadtwerke Hannover AG Hannover x
20 Stadtwerke Muumlnchen GmbH Muumlnchen x x x
21 Stadtwerke Rosenheim GmbH amp Co KG Rosenheim x
22 Statkraft Markets GmbH Duumlsseldorf x x x
23 swb Erzeugung GmbH amp Co KG Bremen x
24 ThyssenKrupp Steel AG Duisburg x
25 Trianel GmbH Aachen x x
26 Vattenfall Europe Generation AG Berlin x x x
27 VSE AG Saarbruumlcken x
28 VW Kraftwerk GmbH Wolfsburg x
29 Xstrata Zink GmbH Nordenham x
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
Source Federal Gazette BMU BMWi BMBF
RampD Incentives
Funding Initiative Energy Storage ndash growing awareness for stationary storage technologies
Type of funding
Grant recipient
Supported technologies
and systems
Non-repayable cash grants
Eligible projects can be funded by up to 50
subject to applicability
Electric material thermal storage technologies
superordinated systems for management
communication IT
Industrial companies in collaboration
with research institutions and universities
The Initiative Energy Storage supports collaborative RampD projects with funding of EUR 200 million for the period 2011-2014 The program is focused on the development of storage technologies for electricity heat and other energy sources
Subsequent to the objective of increasing renewable energy supply and building up smart grids in Germany the necessity of balancing power receives more attention
Requirements
A registered business domicile in Germany
The utilization of the research results must be in
Germany
Application procedure
First stage application until July 8 2011
[project proposal]
Second application round probably in 2012
09022012
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
09022012 | wwwgtaicom 20
Germany Trade amp Invest closely supports the project team throughout the investment decision-making process
Example Milestones of a manufacturing project
The Role of Germany Trade amp Invest
European location analysis (long list)
Detailed site evaluation
Initial site visits
Re-evaluation of site analysis
(short list)
In-depth site visit (LOIs)
European incentives
comparison
Detailed incentives
assessment
Incentive calculation
Approval of incentives
Incentives application
Negotiation of
incentives (LOI)
Meeting with financing partners
Negotiation of
Conditions (Term Sheet)
Building and Environ- mental permit
Discussion about
infrastructure upgrades
Detailed site matrix
(plot analysis)
Meeting with engineering companies
Start of construction
Utility prices and reliability comparison
LOIs for utility supply
Discussion of utility
requirements
Site Decision MoU
Advice on financial structure
Financial agreement
Site Selection
Incentives
Financing
Utilities
Engineering
Months (est)
0 2 4 6 8 T
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Two headquarters in Germany - 46 locations worldwide
The Agency
9 February 2012
Chicago New York San Francisco Toronto Washington
Buenos Aires Mexico City Santiago de Chile Sao Paulo
Athens Brussels Helsinki London Madrid Milan Paris Stockholm
Dubai Istanbul
Johannesburg Cairo Nairobi Tunis
Belgrade Budapest Bucharest Kiev Moscow Prague Warsaw Zagreb
Bangkok Beijing Hanoi Hong Kong Jakarta Kuala Lumpur Mumbai New Delhi Seoul Shanghai Taipeh Tokyo
Sydney
Tel Aviv
Berlin Bonn
Germany Trade amp Invest 21
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
09022012 | wwwgtaicom 22
Germany Trade amp Invest
Foreign Trade and Inward Investment Promotion Agency
Germany Trade amp Invest
copy 2011 Germany Trade amp Invest All information provided by Germany Trade amp Invest has been put together with the utmost care However we assume no liability for the accuracy of the information provided
Contact
Germany Trade and Invest GmbH Mr Heiko Staubitz Senior Manager Renewable Energies Friedrichstraszlige 60 10117 Berlin Germany T +49 30 200 099-226 F +49 30 200 099-111 HeikoStaubitzgtaicom wwwgtaicom
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
The EUrsquos new geographic center is in Germany providing rapid amp easy
access to all European markets
Source Eurostat 2010
Note EU-27rsquos center 42 km east of FrankfurtMain in Meerholz Hessen Estimates
First-Class Infrastructure
09022012 23
State-of-the-art transportation infrastructure and logistics capabilities to serve all European markets
From Germany most of Europe can be reached by air in just 3 hours and by road in 24 hours (flight truck and rail distances from Berlin in hours)
24 h
3 h
15 h
Rome
12 h London
Moscow
48 h
24 h
Warsaw
Prague
Berlin
Vienna Budapest
Brussels
Madrid
Riga
Helsinki
Athens
Copenhagen
Paris
Stockholm
EU member states
Non-EU member states
2009 EU-27 Germany
Population (millions) 500 82
GDP (in EUR bn) 11806 2407
GDP Growth (YoY) -42 -50
Inflation 10 02
Unemployment 89 75
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Germany offers one of the most competitive tax systems among the big
industrialized countries
1National German average Lower overall tax rates in certain areas are possible eg only 2283 in certain municipalities 2Top corporate income taxation rate incl local taxes lower starting rates or other special tax rates available Example USA progressive rate for the federal corporate income tax from 15 to 35 3 A surcharge of 5 is levied on taxable income exceeds INR 1 mio
Source Federal Ministry of Finance (BMF) GTAI
Company Taxation
9 February 2012
Average Corporate Tax Burden ( 2012 in )
24
39622
3955
34432
33992
3140
3000
30002
30003
29831
2600
25502
2283
20622
1900
1900
1900
000 500 1000 1500 2000 2500 3000 3500 4000 4500
USA (New York)
Japan
France
Belgium
Italy
Canada (Ontario)
Spain
India
Germany (average)
UK
Netherlands
Germany (minimum)
Hungary
Czech Rep
Poland
Slovak Rep
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
German Exports (2009 in EUR bn)
Germany is the focal point for goods and services in Europe
Source Federal Statistical Office Germany 2010
Global Player
09022012 25
32 UK
France
Italy
Poland
Czech Republic
Russia
Japan
China
11
36
USA 54
Total German Exports to the World EUR 808 bn
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Power balance 2008
New power structure in 2030 will lead to bottlenecks in Germany
--
++ Offshore wind parks
Conventional power plants
Nuclear power plant closures
Bottleneck
The Smart Grid Market Overview
Power balance 2030
09022012 26
++
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
More than 1000 market participants are active in the fully liberalized
German electricity market
Source wwweneteu BMWi 2010
Smart Grid
27 27
Companies operate transmission grids (and
grids in the lower voltage level)
Mainly owners of power plants with capacity
of more than 100 MW
Total 1000 market participants
Mainly municipal utilities (Stadtwerke)
App 100 small private companies
150 new market participants
4 Interconnected Companies
866 Operators of Distribution Grids
09022012
German Transmission Grid
(2010)
German Distribution Grid
(2010)
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
German industry electricity prices are slightly above the European
average
Source Eurostat 2011
Note Prices incl taxes without VAT
International Comparison
The German Electricity Market
Electricity Prices for Industry (2010
EUR ctkWh 500-2000 MWh)
Electricity Prices for Industry (2010
EUR ctkWh 20000-70000 MWh)
28 09022012
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
The Federal Network Agency has now communicated the level of the so-called ldquoqualityrdquo element (Q element) to the electricity distribution system operators participating in the regular incentive regulation procedure during the first regulatory period bull The Q element level depends on the reliability of the relevant system bull System operators whose network has had good quality levels relative to
other system operators over the past few years will have an amount added to the revenue cap for the years 2012 and 2013
bull System operators whose networks have comparatively poor quality levels
will however have amounts deducted
A Case for Medium and Low voltage (New)
Storage in the LV and MV Distributed PV
Source Bundesnetzagentur November 2011
The German network authority launches quality regulation for electricity distribution systems
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Balancing power as early market
Different Market Types
30
Source BCS Allmerus Gtai 2010
Calculations based on estimated storage prices 2015-2020 ndash further price decrease improve profitability of all cases
Application Type Application Type
Central
MixedBoth
Decentralized
Pro
fita
bility o
f busin
ess c
ase
Difficult Easy Feasibility of Implementation
Central conv stabilization
4a
3
1
4b
8
5
7
6
2
Island
Storage
Black Start
Services
Price
Arbitrage
Residential
Storage
Decent Stab
(mid-load)
Balancing
Power
Ind Peak
shaving
TampD deferral
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011
wwwgtaicom
Focus on RampD and pilot programs German Industry invests up to EUR 17 bn in RampD
Focus on establishing the market for vehicles and infrastructure
Focus on implementing stable business models
Market Preparation
2014 Market
Run-up 2017
Mass Market
2020
The German Government Program 2011
Germany to become e-mobility lead market and lead provider
Source BMWi BMVBS BMU BMBF 2011
E-Mobility in Germany
31
Goal 1 million EVs on German roads by 2020 and 6 million EVs by 2030
Means EUR 500 m RampD funds until 2011 - additional EUR 1 bn until 2013
Planned Incentives (extract)
Special parking spots for EVacutes
Admission to restricted streets and areas
Use of bus and special lanes
Diverse tax incentives
RampD Projects Lighthouses Showcases
All aspects of e-mobility to be covered
Introduction to broad public
8 model regions for e-mobility
6 model regions ldquoe-energyrdquo on smart grids
7 model regions ldquoICT for Electric Mobilityrdquo
01062011