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Germany’s green energy

By Dave Elliott

Renewables have continued to grow in Germany, providing around 23% of total electrical generation from around 32GW of wind and 32GW of PV solar, most of this  being locally owned capacity, including  projects run by a growing number of local energy co-ops. And it works well: in bitterly cold March last year, the wind and PV were supplying about half of total electricity at one point:

Spurred on by successes like that, German Environment Minister Peter Altmaier claimed that, ‘the growth in renewables and the decline in power consumption have already fully bridged the gap opened by the shutdowns of the eight nuclear reactors in 2011.’

The next stage of the ‘Energiewende’ energy transition is even more ambitious, aiming to cut overall energy demand by 50% (electricity by 25%) and get at least 80% of electricity from renewables by 2050, at a cost put by one minister  at up to €1 trillion, depending on Feed In Tariff (FiT) levels. The €1 trillion figure was quickly challenged as not being meaningful: it didn’t take account of savings from reduction in use of fossil fuels and other benefits. In any case, most of the existing power plants would need to be replaced by then anyway, so large amounts of money would have to be spent whichever way Germany went. Even so, projected increases in the FiT levels were a source of political  conflict. The FiTs currently put around €0.053/kWh on consumers bills and as wind and especially PV have got cheaper, the cost pass through for individual projects to consumer is less, with FiT price degression kicking in.  But with the number of projects likely to rise, the net cost will grow, although planned FiT increases seem likely to be frozen for two years, and may be limited to 2.5% a year after that. Maybe that will be enough.

In a generally supportive review, the International Energy Agency said that, to make the energy transition work, the government must ‘manage the cost of future renewable capacity via costeffective marketbased approaches; monitor costs and ensure their fair and equitable allocation across all customer groups; ensure that the largescale transmission and distribution developments necessary are put in place in an efficient and timely manner; assess the extent to which the present market arrangements attract  investment in new flexible gasfired generation and costeffective electricity storage; and develop policies that convey a clear understanding of the medium term role of gas.’ IEA praised Germany’s ambitious drive towards Energy Efficiency, a current IEA focus

On the ground, the big issue is system integration. Most of the wind capacity is in the North most of the load in the South, and the grid cant easily cope at peak periods.  So a new €10 bn supergrid network is planned, along three corridors from North to South, with 1000 MW, 660 km HVDC lines:

Given the local variability of wind and solar, that would also help with grid balancing. So too will the various wind-to-gas projects, converting surplus wind-derived electricity into hydrogen by electrolysis, and then converting that into methane gas, using captured CO2. (See my earlier wind-to-gas post). So can an integrated network with fast acting smart grid management; for an update on the latest Combined Power Plant test,  see the english (US!) video

There is certainly a lot to learn from Germany and a lot of optimism, especially about PV and FITs. See and http://

However, it’s not all good news. With nuclear closing and fossil gas plants facing competition from wind and PV for peak supply, some gas plants are becoming uneconomic and are closing down. That may be good in emission terms, but they are needed, at least for a while, to backup variable renewables. Worse still, Germany is opening over 5GW of (long pre-planned) new coal plants. They will replace old inefficient ones, and some of the next new ones are ultra-supercritical plants designed to ramp up and down at 30 MW/minute and 500 MW within 15 minutes. So, like natural gas fired turbines, they can help to balance variable renewables. But, although German coal is cheaper than imported gas, its dirtier, and without CCS, emissions will go up-they already have slightly, despite the reduced demand and rising renewables. German carbon dioxide emissions rose 1.6% in 2012, in part due to cold weather, which led to more use of natural gas for heating homes, but, although the use of coal for electricity generation went up, the increase in wind and solar power reduced the overall need for gas. World Nuclear New grumpily said ‘The effect of the nuclear shutdown was not obvious in the figures thanks to the ramp-up of renewables, which offset the burning of fossil fuels’.

Longer term, the optimistic expectation is that as energy efficiency measures bite and more renewables are added, emissions will fall. Moreover, as new grid balancing smart and supergrid technologies and energy storage system are deployed, the need for fossil backup will fall. A report from Agora Energiewende, a joint initiative of the Mercator Foundation and the European Climate Foundation, looks at the programme up to 2030. It says that ‘Base-Load’ power plants would disappear altogether, and natural gas and coal plant would only operate part-time: With a 40% share of power coming from renewable energy, only 10 to 25 GW conventional capacity operating between 6000 to 8000 hours per year will still be needed’, i.e. not often, so low efficiency high cost open cycle gas turbines are fine.  In their scenario, Combined Heat and Power (CHP) also provides an input, supplying 25% of electricity by 2020. The report argues that since the marginal (operating) costs of renewables will always be low (no fuel costs!), an extra market mechanism needs to be introduced to support investment in new capacity e.g. for balancing, otherwise it would not be profitable:

Clearly this is all very technology-and policy- dependent and there are plenty of naysayers. For a dour take on it see: And this:

So what’s the prognosis? Certainly some of the ideas may be costly. But for example, given that surplus wind (and PV) electricity would be dumped otherwise, the power-to-gas idea may not prove as expensive as it first might seem and, as renewables expand, money will be saved by not having to import fossil gas. Crucially, capital and generation cost are falling. German energy expert Frank Peter says the cost of electricity from renewable energy is now comparable to that from fossil fuels, although he notes there are regional differences. ‘Wind energy in the north of Germany is the cheapest technique for producing electricity, costing less than six euro cents per kilowatt hour in the long term. For each of the technologies the review period is always 40 years. In the same region, electricity from a new coal-fired power station costs over eight euro cents, and from a very efficient gas turbine power station and a large solar power station just over nine euro cents per kilowatt hour. In the south of Germany there are different environmental conditions – more sun, but less wind. Electricity from large solar farms is a lot cheaper there, costing around 7.5 cents/kWh in the long term, while wind energy is more expensive, costing on average nine euro cents per kilowatt hour. It’s fair to say that looking at the situation today, energy from renewable technologies costs a similar amount to traditional, conventional technologies’

So, given that renewables are likey to get cheaper, while conventional sources will get more expensive, Germany may be on to a winner.

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