RWE, in conjunction with Commerzbank, plans to create a ‘Green Mittelstand Fund’ to give medium-sized industrial companies in Germany access to green electricity generated by offshore wind plants. The two companies have signed a Memorandum of Understanding to this effect.
The new fund will offer these companies for the first time the opportunity to secure green electricity through long-term power purchase agreements (PPAs). Up to now, it has mainly been large industrial customers who have been able to sign such long-term PPAs with large-scale green electricity projects.
Medium-sized companies are offered two options as part of this fund: On the one hand, they can participate directly in the planned offshore wind farm with equity. On the other hand, they can secure long-term green electricity via a PPA and thus achieve their decarbonisation targets. Or these options can be combined.
The first planned wind farm is to have an installed capacity of around 1 GW. The companies want to apply for a seabed licence for the wind farm within the framework of future tenders, in accordance with the planned amendment to the German Wind Energy at Sea act. These auctions are expected to take place in 2023. RWE plans to hold 51 % of the shares in the wind farm, the remaining 49 % are to be offered to interested medium-sized companies by Commerzbank via the new fund. RWE will develop, build and operate the wind farm.
The company will commit to making the power generated available to medium-sized companies. Commerzbank, on its part, plans to make green electricity directly available to its customers from the German ‘Mittelstand’, that is, medium-sized companies. This is to take place via individual financing and credit solutions for the equity investments of medium-sized companies in the offshore wind farm. The concept offers the possibility to purchase green electricity from the wind farm via PPAs starting with a tranche corresponding to a capacity of 5 MW, ie tailored to the electricity needs of medium-sized companies.
Amending the Act
The German Wind Energy at Sea Act is to be amended to help enable the country to be climate neutral by 2045, which will require the generation of enormous amounts of green electricity The amendment will therefore provide expansion targets to be increased and seabed opportunities for offshore wind to be brought forward to at least 70 GW by 2045. In order to take advantage of industrial policy-related opportunities and render Germany an attractive location for investment in renewable energies, speed is required, as well as a clear focus on supporting the economy in switching to climate-friendly production. To this end, the majority of green electricity from offshore wind must find its way into industry and the medium-sized enterprises of the German ‘Mittelstand’.