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The Growing Absurdities Of The German Energiewende

Christoph Eisenring, Neue Zürcher Zeitung

In Bavaria, two gas-fired power plants of the latest generation stand around as investment ruins. Nevertheless, one of the operators wants to build a third one at the same location. This can only be understood against the background of the misguided German Energiewende.

At the beginning of the year, the number of successful reports on renewable energies in Germany is increasing: The Agora Energiewende think tank writes that their 35% share of electricity production is the same as that of electricity from coal-fired power plants for the first time. By 2030, the German government even wants to increase the share of renewables to 65%. However, people often forget to mention that the availability of electricity varies greatly, depending on whether it is produced with sun and wind or from conventional sources. The large-scale use of storage facilities for renewables is also a long way off. There is therefore no getting around keeping a conventional power plant park in the back of one’s hand at all times, which can take over in times of “dark lulls” such as when there is little sun and wind.

Expensive interventions in the power grid

In the Bavarian town of Irsching near Ingolstadt, electricity producer Uniper and its partners have commissioned two state-of-the-art gas-fired power plants as of 2010. Nevertheless, the bill did not add up: The glut of subsidised eco-electricity put pressure on stock market prices. And a higher price for CO2 emissions had been expected, which would have given gas-fired power plants advantages over coal-fired power plants. The two units cannot be operated profitably. To do this, the CO2 price in emissions trading would have to rise to over €40 per tonne, which is currently half as high. However, the German Electricity Grid Agency demands that the two blocks be kept in reserve. Although the two gas-fired power plants are investment ruins, Uniper is now building a third gas-fired power plant at the same location. Has the company learned nothing?

No, this time it might even be a good deal. Uniper was awarded the construction contract in an auction by the electricity network operator Tennet. The power plant with a capacity of 300 megawatts is to produce “not for the market”, but only in emergency situations to stabilize the grid. And for this emergency service, Uniper receives a remuneration that makes the construction worthwhile. Tennet can ultimately pass the costs on to consumers. The power plant will be available from October 2022. This is no coincidence: the last nuclear power plants in Germany will be shut down that year, but security of supply must continue to be guaranteed. Now, however, the strongly fluctuating wind power is generated especially in the north. In order to transport it to the south, where the industrial heart of Germany beats, new power lines are needed. But the Minister of Economic Affairs, Peter Altmaier, admitted a few months ago that the construction of this line was “catastrophically behind schedule”. Of the planned 7670 kilometers of power lines, only 950 kilometers are in operation.

Consumers pay twice

The number of interventions in the grid has increased due to the volatile feed-in of renewable energies and the lack of transport possibilities. This also includes regulating wind turbines when the grid is overloaded. In 2017, these measures already cost €1.4 billion. Consumers have to pay for these expenses via their electricity bills. These grid charges are now higher than the levies for green electricity. German consumers therefore pay one of the highest electricity prices in Europe.

In addition to Uniper, the Nürnberg utility N-Ergie also has a 25.2% stake in one of the two existing gas power plants in Irsching. Its boss, Josef Hasler, is now sharply critical of the implementation of the energy turnaround. He points out that all three power plants ultimately served grid stability. It is even so that the again planned power station comes only as last to the course. However, the two existing units are only connected to the grid a few hours a year. This could lead to the absurd situation that the new power plant will never be used, he says. However, while the new unit will now be fully compensated, the two existing units will only be remunerated for the few hours during which they are in operation. The same task is thus compensated quite differently in Hasler’s judgment. The annual loss for the block, in which N-Ergie is involved, amounts to a two-digit million amount.

It would therefore be better to shut it down today than tomorrow. But the power plants had been “forcibly shut down” and should not be shut down. Hasler complains that consumers, who are burdened with rising grid charges, are ultimately the victims of the misguided energy policy. In Irsching, three large gas-fired power plants, which are rarely in use, will be in operation in a few years’ time. The consumers thus paid twice, namely for the massive expansion of the electricity transmission grids and the construction of new power plants, the N-Ergie boss points out. This will certainly not contribute to the acceptance of the energy system transformation.

Full story (in German)