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How Germany Manages Big Swings in Its Renewable Generation
The Electricity Journal 29 (2016) 89–91
Contents lists available at ScienceDirect
The Electricity Journal journal homepage: www.elsevier.com/locate/electr
Electricity Currents: A Survey of Current Industry News and Developments
Electricity Currents is compiled from the monthly newsletter EEnergy Informer, edited and published by Fereidoon P. Sioshansi, who may be reached at [email protected] or via the letter’s Web site at www.eenergyinformer.com
How Germany Manages Big Swings in Its Renewable Generation By end of 2015, Germany had nearly 100 GW of renewable capacity, consisting of roughly 45 GW of wind, 40 GW of solar PVs, 9 GW of biomass, and 5.6 GW of hydro. Renewables now represent 50% of total installed capacity and account for nearly 30% of generation – both records for a major industrial economy the size of Germany. German demand rarely exceeds 80 GW, which means that installed solar and wind capacity alone already exceeds peak demand. And given the known variability of renewables, how does Germany manage to keep the lights on and the grid reliable? First, the German grid is strong. Outages are measured in rare minutes per year, not in hours as in parts of the U.S. This is due to interconnections with neighboring countries, which facilitates export of excess energy – or imports, as the case may be. A second and rather unexpected reason is the flexible operation of coal and nuclear power plants. The country’s remaining nuclear power plants are able to reduce their output by up to 20% for several hours if renewable generation is running high. For example, on May 8, 2016, the nuclear base was able to reduce output by 1 GW. The flexibility of coal was even higher, at 6 GW, roughly 10% of peak demand that day. Hydro and gas power plants also contribute, but to a lesser extent. In addition, the ancillary power market in Germany operates faster and with more players. Moreover, investments in system control software and weather forecasting tools help ride out the variations in renewable generation.
According to Hans Bludszuweit, a researcher at the CIRCE Foundation in Zaragoza, Spain, wind generation is highest during the winter months while solar generation peaks in summer. On many days when demand is high relative to renewable generation, the network can balance things. Take March 30, 2015, a Monday, when renewable generation was around 47 GW with 82 GW of demand peaking around 2 p.m. The day before, Sunday, peak demand was merely 61 GW. The question is, how does Germany deal with excess generation from solar and wind, especially when demand is low, which happens more frequently as the renewable proportion continues to rise? The main answer is the flexibility of bulk generation, together with Germany’s strong interconnections with its neighbors, which allows the excess generation to be exported. However, as the proportion of renewables continues to grow, it is obvious that more storage capacity will be needed. As it happened, wholesale spot prices went negative for eight hours, necessitating the export of all nuclear and some coal generation on May 8 (see figure). At noon, the renewable share was 89%. Although network stability is an important issue, there is an increasing concern how to avoid curtailment of renewable generation. The simple answer is to sell the energy to someone else. But if neighbors also produce excess power, grid congestion is difficult to avoid. This leads to the idea of a European super-grid, more storage, and more flexible demand. So the question is not whether better interconnections, more storage and more transmission is needed, but how much of each.
90
Electricity Currents / The Electricity Journal 29 (2016) 89–91
http://dx.doi.org/10.1016/j.tej.2016.06.009
Guess What? Energy Transition Is Well Under Way in China, India While smallish countries like Denmark, Norway, and Austria, already clean and exceedingly green, make headlines by moving away from fossil fuels and towards a more sustainable energy future, they won’t make much of a dent in emissions on a global scale, even if they succeed. Energy and carbon’s future will be decided in the large and growing economies of China, India, Indonesia, Pakistan, Nigeria and, to a lesser extent, the U.S., Russia, Germany, Japan and the UK. These countries account for the lion’s share of global emissions and what they do or don’t will determine the outcome of the agreement signed at the UN in April 2016. The conventional wisdom is that change in the energy sector takes place at a glacial speed, meaning observers shouldn’t hold their breath for any dramatic developments any time soon. That is also what the incumbents in coal, oil, gas, and the auto industry want to hear, namely, that the status quo will prevail once delegates leave the signing ceremonies and the photo ops. There is at least sporadic evidence, though, that things could change rather fast this time around once the mindset is changed – and proponents of this view point to the Paris accord as the turning point in changing minds. Meanwhile, evidence emerging from China, while piecemeal, is encouraging. It shows that change is already underway and at a remarkable pace. And there also is highly encouraging news emanating from India. China first. To start with, China’s economy is no longer growing at double digits. Moreover, as its economy shifts from export-focused heavy manufacturing to serving the growing domestic market and towards services, its demand for electricity is expected to drop – to just 3% in 2016, a remarkable decline compared to the double-digit growth rates of the past. Even more amazing is that China’s central planners have been shifting the electricity generation mix towards cleaner and less polluting resources focusing on renewables and nuclear rather than coal. China achieved not one but two global renewable records in 2015: installing 32.5 GW of wind and 18 GW of solar in a single year, dwarfing the U.S., Germany, and other front-runners. It is an understatement to say that China is reshaping the global
energy economy and leading the transition to a lowercarbon future. The data coming from China’s National Bureau of Statistics, not always the most transparent or up-to-date source, nevertheless convey the rapid transition of China away from coal and towards lower-carbon resources, exemplified by a stunning 74% increase in grid-connected solar-generation capacity in 2015. Additionally, China installed 15 GW of hydroelectricity and 6 GW of nuclear capacity last year, both zero-emission resources. Declining consumption and the transition towards renewables has resulted in another environmental bonus: Declining coal consumption and imports. China’s coal imports dropped 30% last year, adding to the woes of Australian, Indonesian, South African, Colombian, and American coal exporters, all of whom are competing in a saturated market with declining growth prospects. As for India, it is behind China in its transformation, but under Prime Minister Modi it is also making efforts to invest in renewables on a massive scale. Together, ‘‘Chindia’s’’ moves will account for over half of global emissions, and both are transforming the global energy market faster than anyone could have imagined only a few years ago. With the slowing demand growth and the flood of new renewables and nuclear, China’s thermal generation declined 2.7% in 2015 – a trend that is expected to gradually reduce the share of thermal generation in the electricity mix from 73% in 2015 to 63% projected by 2020. That is rapid transformation for a massive economy, and a growing and developing one at that. This is truly amazing. Moreover, the statistics indicates that thermal plant utilization rates are beginning to decline – a common phenomenon across Europe and the U.S. – as the percentage of renewables rises. The culmination of these developments show up in China’s coal consumption – roughly half of global consumption of coal – which declined 4% in 2015. Tim Buckley of the Institute for Energy Economics and Financial Analysis (IEEFA), which studies China’s energy transition away from fossil fuels, points out that China is planning to install an additional 22 GW of wind, 18 GW of solar, 16 GW of hydro, and 6 GW of nuclear in 2016. Little by little – or actually, a lot by a lot – it adds up. Declining demand growth plus 62 GW of zero-carbon capacity should meet China’s electricity needs. Coal consumption and imports are projected to continue their gradual decline as will thermal plants’ utilization rates. For the skeptics who say the energy transition will take decades, China provides a counterexample. And if China can succeed in adjusting its energy mix in record time, anyone can. http://dx.doi.org/10.1016/j.tej.2016.06.010
Refugee Camps: A Model For Decentralized Energy? Refugees are on their way to Europe, escaping civil war and suppression. The European Union not only is trying to resettle them but helping to establish refugee camps in
Contents lists available at ScienceDirect
The Electricity Journal journal homepage: www.elsevier.com/locate/electr
Electricity Currents: A Survey of Current Industry News and Developments
Electricity Currents is compiled from the monthly newsletter EEnergy Informer, edited and published by Fereidoon P. Sioshansi, who may be reached at [email protected] or via the letter’s Web site at www.eenergyinformer.com
How Germany Manages Big Swings in Its Renewable Generation By end of 2015, Germany had nearly 100 GW of renewable capacity, consisting of roughly 45 GW of wind, 40 GW of solar PVs, 9 GW of biomass, and 5.6 GW of hydro. Renewables now represent 50% of total installed capacity and account for nearly 30% of generation – both records for a major industrial economy the size of Germany. German demand rarely exceeds 80 GW, which means that installed solar and wind capacity alone already exceeds peak demand. And given the known variability of renewables, how does Germany manage to keep the lights on and the grid reliable? First, the German grid is strong. Outages are measured in rare minutes per year, not in hours as in parts of the U.S. This is due to interconnections with neighboring countries, which facilitates export of excess energy – or imports, as the case may be. A second and rather unexpected reason is the flexible operation of coal and nuclear power plants. The country’s remaining nuclear power plants are able to reduce their output by up to 20% for several hours if renewable generation is running high. For example, on May 8, 2016, the nuclear base was able to reduce output by 1 GW. The flexibility of coal was even higher, at 6 GW, roughly 10% of peak demand that day. Hydro and gas power plants also contribute, but to a lesser extent. In addition, the ancillary power market in Germany operates faster and with more players. Moreover, investments in system control software and weather forecasting tools help ride out the variations in renewable generation.
According to Hans Bludszuweit, a researcher at the CIRCE Foundation in Zaragoza, Spain, wind generation is highest during the winter months while solar generation peaks in summer. On many days when demand is high relative to renewable generation, the network can balance things. Take March 30, 2015, a Monday, when renewable generation was around 47 GW with 82 GW of demand peaking around 2 p.m. The day before, Sunday, peak demand was merely 61 GW. The question is, how does Germany deal with excess generation from solar and wind, especially when demand is low, which happens more frequently as the renewable proportion continues to rise? The main answer is the flexibility of bulk generation, together with Germany’s strong interconnections with its neighbors, which allows the excess generation to be exported. However, as the proportion of renewables continues to grow, it is obvious that more storage capacity will be needed. As it happened, wholesale spot prices went negative for eight hours, necessitating the export of all nuclear and some coal generation on May 8 (see figure). At noon, the renewable share was 89%. Although network stability is an important issue, there is an increasing concern how to avoid curtailment of renewable generation. The simple answer is to sell the energy to someone else. But if neighbors also produce excess power, grid congestion is difficult to avoid. This leads to the idea of a European super-grid, more storage, and more flexible demand. So the question is not whether better interconnections, more storage and more transmission is needed, but how much of each.
90
Electricity Currents / The Electricity Journal 29 (2016) 89–91
http://dx.doi.org/10.1016/j.tej.2016.06.009
Guess What? Energy Transition Is Well Under Way in China, India While smallish countries like Denmark, Norway, and Austria, already clean and exceedingly green, make headlines by moving away from fossil fuels and towards a more sustainable energy future, they won’t make much of a dent in emissions on a global scale, even if they succeed. Energy and carbon’s future will be decided in the large and growing economies of China, India, Indonesia, Pakistan, Nigeria and, to a lesser extent, the U.S., Russia, Germany, Japan and the UK. These countries account for the lion’s share of global emissions and what they do or don’t will determine the outcome of the agreement signed at the UN in April 2016. The conventional wisdom is that change in the energy sector takes place at a glacial speed, meaning observers shouldn’t hold their breath for any dramatic developments any time soon. That is also what the incumbents in coal, oil, gas, and the auto industry want to hear, namely, that the status quo will prevail once delegates leave the signing ceremonies and the photo ops. There is at least sporadic evidence, though, that things could change rather fast this time around once the mindset is changed – and proponents of this view point to the Paris accord as the turning point in changing minds. Meanwhile, evidence emerging from China, while piecemeal, is encouraging. It shows that change is already underway and at a remarkable pace. And there also is highly encouraging news emanating from India. China first. To start with, China’s economy is no longer growing at double digits. Moreover, as its economy shifts from export-focused heavy manufacturing to serving the growing domestic market and towards services, its demand for electricity is expected to drop – to just 3% in 2016, a remarkable decline compared to the double-digit growth rates of the past. Even more amazing is that China’s central planners have been shifting the electricity generation mix towards cleaner and less polluting resources focusing on renewables and nuclear rather than coal. China achieved not one but two global renewable records in 2015: installing 32.5 GW of wind and 18 GW of solar in a single year, dwarfing the U.S., Germany, and other front-runners. It is an understatement to say that China is reshaping the global
energy economy and leading the transition to a lowercarbon future. The data coming from China’s National Bureau of Statistics, not always the most transparent or up-to-date source, nevertheless convey the rapid transition of China away from coal and towards lower-carbon resources, exemplified by a stunning 74% increase in grid-connected solar-generation capacity in 2015. Additionally, China installed 15 GW of hydroelectricity and 6 GW of nuclear capacity last year, both zero-emission resources. Declining consumption and the transition towards renewables has resulted in another environmental bonus: Declining coal consumption and imports. China’s coal imports dropped 30% last year, adding to the woes of Australian, Indonesian, South African, Colombian, and American coal exporters, all of whom are competing in a saturated market with declining growth prospects. As for India, it is behind China in its transformation, but under Prime Minister Modi it is also making efforts to invest in renewables on a massive scale. Together, ‘‘Chindia’s’’ moves will account for over half of global emissions, and both are transforming the global energy market faster than anyone could have imagined only a few years ago. With the slowing demand growth and the flood of new renewables and nuclear, China’s thermal generation declined 2.7% in 2015 – a trend that is expected to gradually reduce the share of thermal generation in the electricity mix from 73% in 2015 to 63% projected by 2020. That is rapid transformation for a massive economy, and a growing and developing one at that. This is truly amazing. Moreover, the statistics indicates that thermal plant utilization rates are beginning to decline – a common phenomenon across Europe and the U.S. – as the percentage of renewables rises. The culmination of these developments show up in China’s coal consumption – roughly half of global consumption of coal – which declined 4% in 2015. Tim Buckley of the Institute for Energy Economics and Financial Analysis (IEEFA), which studies China’s energy transition away from fossil fuels, points out that China is planning to install an additional 22 GW of wind, 18 GW of solar, 16 GW of hydro, and 6 GW of nuclear in 2016. Little by little – or actually, a lot by a lot – it adds up. Declining demand growth plus 62 GW of zero-carbon capacity should meet China’s electricity needs. Coal consumption and imports are projected to continue their gradual decline as will thermal plants’ utilization rates. For the skeptics who say the energy transition will take decades, China provides a counterexample. And if China can succeed in adjusting its energy mix in record time, anyone can. http://dx.doi.org/10.1016/j.tej.2016.06.010
Refugee Camps: A Model For Decentralized Energy? Refugees are on their way to Europe, escaping civil war and suppression. The European Union not only is trying to resettle them but helping to establish refugee camps in