Winds of change push German power grid to brink | Business| Economy and finance news from a German perspective | DW | 11.03.2020
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Winds of change push German power grid to brink

As Berlin steps up its switch to renewable energy, consumers of electricity — i.e., German taxpayers — are footing the bill. The problem is grid infrastructure that can't keep pace with the new sources coming online.

Sabine, the fierce storm that hit Europe in February, led to huge overproduction of wind energy in Germany, with domestic wind plants temporarily supplying a staggering 44 gigawatts (GW) of electricity to the national power grid — two-thirds of total national electricity consumption. This is a level not planned for another decade at the earliest as Berlin steps up its noncarbon energy plans. "A feed-in record!" as the Wind Energy Association hailed it. But not all are happy with this success.

"Due to the strong wind associated with the storms, the wind turbines, which are mainly concentrated in the north of Germany, produced a lot more electricity than could be consumed at the same time," Sebastian Kreth, of the chemicals company VCI in Frankfurt, told DW. 

Under Germany's renewable energy law, which is designed to help support green power, wind turbine operators also receive compensation for every kilowatt-hour of electricity not produced if wind power surpasses peak grid capacity. Added to this, power grid operators must accept and distribute electricity from renewable sources even when there's no demand for it.

The price of electricity can therefore turn negative, meaning that grid operators have to sell at a loss or pass the costs on to customers. It is estimated that so-called grid stabilizing measures due to excess wind power supply in 2020 could cost consumers a total of €4 billion ($4.5 billion) in extra bills for electricity that is sold at a negative price or even never produced.

Hurricane Dorian Luftbild (picture-alliance/NOAA)

German wind plants supplied 44 gigawatts (GW) of electricity to the national power grid at one point in February

In 2017, consumers paid €1.51 billion extra for grid stabilization, compared with €1.44 billion in 2018. And the German Federal Network Agency has calculated that the expenditure for the first three quarters of 2019 alone was €950 million.

"We can't afford this madness in the long run," said Bernd Westphal, the economic policy spokesman for the Social Democrats (SPD) in parliament.

During the storm Sabine, Germany's four regional transmission system operators (TSOs) halted production of a combined 210 gigawatt-hours (GWh) of wind power in the two most affected areas because of oversupply. The largest amount with 160 GWh was stopped in the Tennet network in the northwest, while network operator 50Hertz in the northeast stopped 50 GWh. 

Grid locked

Moreover, due to the lack of transmission network capacity, conventional plants in southern Germany, where much of the country's industries are based, had to continue burning their dirty fuels despite an excess of wind power in the north.

The crux of the problem is the slow rate of network expansion. Over 7,000 kilometers (4,500 miles) of new high-voltage power lines are needed for the  transition to a fully functioning national distribution network. Only 1,800 kilometers have been approved and only 1,100 kilometers were actually built to date.

"Since there is still a large lack of transmission network capacities in order to better distribute the electricity, such problems are inevitable. They can only be amended when there is progress in the expansion of the electrical grid. In other words, we need more capacity especially in the high-voltage transmission lines," says Kreth. 

Kreth argues substantial storage capacities must also be built up in the medium to long term in order to intercept production peaks when there is oversupply in renewables, and to release them back into the grid at different times. "For the chemical industry, which makes up  one tenth of German electricity consumption, it is essential that Germany can keep up the security of electricity supply it enjoys today," he says.

Windkraft und Vögel (picture-alliance/M. Woike)

Long administrative and permitting procedures as well as local opposition to new trajectories are the main reason for delay

Christoph Zipf from the Brussels-based Wind Europe lobby group recalls the German government's pledge to promote faster grid expansion and talk to local residents who bloc it; just to add that the connections "are not active yet." 

"Long administrative and permitting procedures as well as local opposition to new trajectories are the main reason for delay," he told DW.

In the meantime, he laments, wind energy is fed into the grid and under uncertain conditions, meaning that the wind energy produced can exceed the level the current grid can manage. "Wind turbines are much more flexible in the way they can be steered by the operators than coal fired power plants or even nuclear plants," he says.

Who is to blame?

At the moment, there is a debate if surplus wind and solar electricity or that coming from coal-fired power plants is to be blamed for the rising number of grid interventions. 

Hubertus Bardt, director of the Cologne Institute for Economic Research, blames renewables and said operators must be forced to produce power more flexibly. "At the moment there's not enough incentive for the operators of wind turbines and solar plants to adjust their power output in line with demand," he told the German business daily Handelsblatt.

But Felix Matthes, an energy analyst at the Institute for Applied Ecology, believes fossil-fuel power plants are to blame. "Germany's power plant fleet doesn't fit the energy revolution," he argues. "It's too sluggish. It makes quick reaction to spikes in power demand impossible even though that's what's urgently needed these days." 

Watch video 02:48

Wind turbines draw mixed response in Germany

Choices

Alex Robertson, a senior official at European turbine builder Vestas, still believes that despite the current problems Germany leads the global energy transition with its renewables policies , also known as Energiewende. Through decades of strong national support of renewable energies, Germany had grown a vibrant wind energy industry employing over 15,000 people and making it an attractive country for investment from companies looking for low-carbon energy supply, he told DW.

"But the home market is currently in a crisis. The 80% reduction in annual onshore wind turbine installations in just two years has already resulted in bankruptcy of one turbine manufacturer and thousands of lost jobs," he says, and adds: "The government needs to decide if it wants to fight for the competitiveness of Germany and the support of the climate change movement, or give in to nimbyism and the small anti-wind club in parliament."

And Marco Lange from the Gamesa Renewable Energy subsidiary of Siemens stresses that the German market is still in a "historically unique" position due to its vast number of small local project developers. He warns, however, that this advantage is increasingly offset by the "economic disincentive" of governbment policies that in recent months has led to "significant undersigning of the auctions" for wind power installations.

"Even after winning an auction there is still big uncertainty whether projects will be successfully and quickly set up," he told DW, with the effects becoming ever more clearer. "We see already an ongoing decline of companies being active in the wind industry."

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