Solar power self-consumption after the support period: Will it pay off in a cross-sector perspective?

Transcription

1 Solar power self-consumption after the support period: Will it pay off in a cross-sector perspective? Working Paper with Lars G. Ehrlich (HWWI) and André Wolf (HWWI) Jonas Klamka ForschungsKollegSiegen (FoKoS) der Universität Siegen und Hamburgisches WeltWirtschaftsInstitut (HWWI) klamka@hwwi.org Jonas Klamka 1

2 Large number of small-scale PV systems scattered across Germany Nearly 70 % of Germanys roof-top PV systems have a capacity less than 10 kwp. This corresponds to a share of 18 % of the total installed capacity. (Source: ZSW, 2014 and BNetzA, 2014) Technical lifetime support period Most solar module manufacturers provide a technical guarantee of 25 years or even longer and show relatively low efficiency losses. (Source: cf. Fraunhofer ISE, 2015) Support period = 20 years Technical lifetime > 20 years Jonas Klamka 2

3 share in % Market value of PV power is below-average Due to the natural correlation of all PV plants (sunshine hours), the market value of PV power is below-average. A higher penetration of PV power will further strengthen this trend. Sluggish decarbonization of Germanys residential heating sector The private heating sector shows a comparatively low share of renewable energies in Germany. In 2015 renewable energies accounted for only 13 % of final energy consumption for heating and cooling, whereas the share of gross electricity consumption exceeded 31 %. (Source: BMWi AGEE-Stat, 2016) Share of renewable energies in final energy consumption Electricity Heating and cooling Jonas Klamka 3

4 The private heating market in Germany Private heat generation in Germany is still primarily dominated by fossil fuels: 22.5 % oil and 47.9 % natural gas. (Source: Destatis, 2016) The German Federal Government has set itself targets to reach a secure, ecological and affordable energy supply in the heating and cooling sector: - Increase in energy-efficient modernization of buildings - Reduction of final energy demand (-20 % until 2020 for space heating purposes in the building stock) - A share of 14 % renewable energy in final energy demand for heating until A share of 18 % (60 %) renewable energy in gross final consumption of energy until 2020 (2050) Sector coupling is an issue that receives growing attention in the political realm. Renewable electricity becomes the most important source of energy. Technologies that replace as many fossil fuels as possible with a small amount of electricity are favoured. Sector coupling makes the electricity system more flexible. (BMWi, 2016) Jonas Klamka 4

5 Profiles of PV production and heat demand Due to its natural properties PV generation and heat demand are not well seasonally synchronized. Nevertheless, there is some potential for PV in covering a part of private heat demand. Jonas Klamka 5

6 Uncertainty regarding future policy framework > 100 kwp: PV systems with a capacity of more than 100 kwp are obliged to participate in direct marketing. Feed-in tariffs are slowly abandoned as the major policy instrument and replaced by auctions. These PV systems are steadily pushed closer to markets. This trend will likely persist in the future. < 100 kwp: Small PV systems are not obliged to participate in direct marketing. Feed-in remuneration will continue to decline. The share of self-consumption will continue to increase in the future. However, until now there is no policy framework regarding previously supported PV systems (> 20 yr.). According to the German Federal Ministry of Economic Affairs and Energy (BMWi), changes to legal requirements are not planned concerning the time after the support period. According to 5 Nr. 1 EEG 2014 / 3 Nr. 1 EEG 2017 priority dispatch for electricity from renewables is maintained after the end of the support period. Jonas Klamka 6

7 What could an owner of a small-scale PV system do after the end of the support period? 1. Dismantle or decommission the system (depends on the scrap value ). 2. Sell the electricity (direct marketers, regional/local ). 3. Maximize self-consumption. Jonas Klamka 7

8 What could an owner of a small-scale PV system do after the end of the support period? 1. Dismantle or decommission the system (depends on the scrap value ). 2. Sell the electricity (direct marketers, regional/local ). 3. Maximize self-consumption. Jonas Klamka 8

9 What could an owner of a small-scale PV system do after the end of the support period? However, due to the different patterns of PV production and household consumption, a large part of the electricity must be stored intraday. At the moment, there are two main storage options for private households: battery systems and hot water thermal storages. Jonas Klamka 9

10 What could an owner of a small-scale PV system do after the end of the support period? A comparison is made in terms of a household s electricity and heating costs under cost-minimizing operation of each of four systems against the option of dismantling the system and conventionally meeting heat and electricity demand. Jonas Klamka 10

11 Simulation-approach and data used: Heat demand: Electricity demand: PV generation: Profile for energy demand for heating purposes. The standard heat load profile method (BGW, 2006) is used to generate the energy demand for space heating and domestic hot water in an average single family house in Southern Germany. We use artificial load profiles published by the German Association of Energy and Water Industries (BDEW). We model hourly PV power generation in line with established methods (e.g. Lang et al., 2016; Duffie and Beckman, 2013; Hellman et al. 2014). P t PV = G t β, φ, δ t, γ, ω n A η t η r, κ TC, G t PR South orientation (35 ). 5 kwp system. Performance ratio 70 %. Data: Test Reference Year (TRY) dataset from German Meteorological Service (DWD). Data records of selected meteorological measurands for each hour of one year. Long term averages for 15 representative regions. Jonas Klamka 11

12 Optimization problem of the household: PV generation Clear hierarchy of PV power utilization. Meet electricity and heat demand at lowest costs. Direct electricity utilization Battery storage Thermal storage Driven by difference in prices (in euro cents). Domestic electricity price: Natural gas price: 6.80 EPEX base price: 3.78 (Average prices in 2014) Hierarchy depends on the system setup. Feed into the grid Jonas Klamka 12

13 (Primarily) results: Table 1: Level of self-sufficiency, share of self-used PV generation and share of feed-in.* System Self-sufficiency power in % Self-sufficiency heat in % Used PV gen. in % System 1 (PV) System 2 (PV + Bat.) System 3 (PV + Therm.) System 4 (PV + Bat. + Therm.) * PV generation = 4517 kwh/a, power demand = 5283 kwh/a, heat demand = kwh Grid feed-in in % of PV gen. Table 2: Simulated energy costs under the different systems for the base case scenario. System Annual electricity costs in Euro/year Annual heating costs in Euro/year Annual total costs in Euro/year Reference System 1 (PV) System 2 (PV + Bat.) System 3 (PV + Therm.) System 4 (PV + Bat. + Therm.) Jonas Klamka 13

14 Discussion of the (primarily) results: Cost savings potential compared to conventional procurement: Biggest potential with thermal and battery storage; total 925 Euro. But, savings are mainly driven by direct utilization of PV generation (629 Euro). Additional savings through storage applications are in the range of Euro. Consequently, savings are focused on electricity costs (correlation of production and consumption). Annual savings of heating costs are less than 130 Euro. For owners of a PV system with thermal storage, the additional acquisition of battery storage provides comparatively small economic benefit and vice versa. Policy makers should thoroughly check the regulatory framework for small-scale PV systems. What is the aim of the German Federal Government? Jonas Klamka 14

15 Drawbacks, open questions and possible improvements: Results are strongly influenced by the used load profiles. In reality these are mainly driven by socioeconomic parameters like employment status, children and so on. By choosing an hourly resolution we might overestimate the potential benefits. PV generation and electricity demand may occur in the same hour but not necessarily in the very same moment. Uncertainty about fossil fuel and electricity price development. (Possible) next steps: Consider a higher temporal resolution in our simulation approach. Split heat demand profile into one profile for space heating and one profile for domestic hot water. Consider new charges. E.g. on fossil fuels or self-consumption Consider different tariff structures. E.g. charging maximum peak, high basic charge BUT, without loosing universality. Jonas Klamka 15

16 Thank you very much. Questions and suggestions? Contact: Jonas Klamka Jonas Klamka 16