Geothermal energy

The geothermal market in Germany is steadily growing thanks to a favorable environment: Under the Renewable Energy Sources Act, payments for geothermal power are guaranteed over the long term. These feed-in tariffs support the aim of using renewable energies to generate a total of 30 percent of all power produced in Germany by 2020. Experts at the German Geothermal Union believe that, over the medium term, geothermal heat may become Germany's most important heating source.

A small number of projects have already been implemented and a large number begun, giving Germany clear approval procedures and its first practical experience of geothermal power plants. This makes Germany an attractive market and means further projects are likely: According to a market study by GeoThermal Engineering, the next five years will probably see 300,000 meters of drilling, the equivalent of around 75 drill holes. HOCHTIEF operates in this segment through Süddeutsche Geothermieprojekte and is currently carrying out the drilling for the company's second geothermal power plant. Here too, the availability of finance will have a decisive influence.

Legal and economic factors in Germany

Change in the law governing the awarding of public-private partnership contracts

In December 2008, the German Bundestag decided to revise the section of the Act against Restraints on Competition that governs the awarding of contracts. This will be extended to include a provision specifically requiring public-private partnership contracts to be subdivided into lots, by dividing the whole into parts and by splitting contracts based on product or service categories. Companies carrying out public-sector work as private-sector contractors will have to subdivide into lots all subcontracts which they award to third parties. The impact on future award procedures in the PPP sector cannot yet be reliably determined.