Aggregated Costs of the German Energiewende How to improve Cost Effectiveness

Transcription

1 1 Aggregated Costs of the German Energiewende How to improve Cost Effectiveness Prof. Dr. Georg Erdmann TU Berlin; Chair Energy Systems Founder of Prognoseforum GmbH Member of the Federal Commission Energie der Zukunft IAEE International Conference, New York 16 June 2014

2 German Energy Concept 2050 [as of September 2010] 2 Political target Base year Greenhouse gas emissions % % Primary energy consumption % -50% Final Energy productivity % 2.1% p.a. Electricity consumption % -25% CHP electricity share % Heat demand of building stock % -20% Primary energy in building stock % Modernization rate of buildings 1% 2% p.a. Final energy in transportation % -40% Number of electric vehicles mio REN share in energy consumption Nuclear phase-out until : 21,5 TW ,6 TW 18% 8,5 TW 60% REN electricity share % 80%

3 Target function of Energy Policy 3 How to determine the indicators the weights of these three targets? Costs pricewürdigkeit of energy services Environment Umweltverträglichkeit (without GHG) Supply security

4 Renewable Electricity in Germany [Source AGEB] Renewable electricity generation [TWh/a] Biomass PV Wind Hydro

5 5 Merit Order of the German Power Plant Portfolio 2010 Marginal cost [Euro/MWh] Load (wo wind and PV) 50 0 Hydro, Biomass, CHP Nuclear Lignite Hard coal CCGT Electric load Hard coal Gas 93 GW

6 6 Merit Order of the German Power Plants with Wind and PV Portfolio 2010 Marginal cost [Euro/MWh] Load (wo wind and PV) 50 0 Hydro, Biomass, CHP Lignite Hard coal CCGT Hard coal Gas Electric load 93 GW

7 7 Costs of Renewable Electricity Generation [Own forecast calculated from Eckpunktepapier of 22 January 2014] 30'000 Costs of renewable electricity [mio Euro] 25'000 20'000 15'000 Net payments for renewable electricity (~18 bn Euro in 2014) 10'000 5'000 TSO- Market value of direct sold Revenues renewable electricity from EEX

8 8 German Electricity Bill to Final Users [Source: Independent Expert Group Energy of the Future ] Total expenditures of industrial, commercial and residential customers [without VAT; Billion Euros]

9 Renewable Electricity Levy [Germany; calculated from Eckpunktepapier of 22 January 2014] 9 0,08 0,06 0,04 Renewable electricity levy [Euro/kWh] Before amendment in 2014 Government ambition with amendment in ,02 0,

10 Levy on Adjusted Final Electricity Consumption 10 Payments for REN support minus REN market value Regular final electricity consumption Adjusted final electricity consumption equal to total final electricity consumption minus Share of electricity consumption of energy intensive industries which is exempted from the levy Own generation which is partly exempted from the levy

11 11 Adjusted Final Electricity Consumption [Germany; calculated from Eckpunktepapier of 22 January 2014] 500'000 Adjusted electricity consumption [GWh] 400' ' ' '

12 Problems of the Present REN Support 12 Increasing overall costs (not including the costs of the required efficiency investment expenditures) while greenhouse gas emissions increase No investments into power generation without additional state aid (capacity market in spite of overcapacities) Present renewable electricity levy implies various distribution effects of relevant size Leads to increasing complexity of state interventions Electricity business becomes lobbying business

13 Renewable Electricity Support Schemes 13 Price control Volume control Obligation of grid operators (or ISO) to purchase all offered renewable electricity at legally defined (and technology specific) fixed feed-in payments Legally defined and technology specific market premium (on top of the market price) but the renewable generators must sell the electricity Obligation of retailers to hold a minimum number of Renewable Electricity Certificates (register of installations must exist) Dominant model but challenged by the EU Commission New dominant German scheme after 2014 How to address the problem of intermittency?

14 Intermittent Nature of Wind Power 14 20,000 16,000 Wind power generation [MW] Amprion EnBW 50Hertz Transmission Transpower 12,000 8,000 No capacity contribution Gradient 8,000 MW/h 4,

15 Renewable Electricity Support Schemes 15 Price control Volume control Obligation of grid operators (or ISO) to purchase all offered renewable electricity at legally defined (and technology specific) fixed feed-in payments Legally defined and technology specific market premium (on top of the market price) but the renewable generators must sell the electricity Obligation of retailers to hold a minimum number of Renewable Electricity Certificates (register of installations must exist) Renewable investment tenders (define the additional capacity and select the investor that asks for the lowest market premium) Obligation of retailers to physically acquire a minimum amount of renewable electricity (as percentage of electricity sales to final customers) Dominant model but challenged by the EU Commission New dominant German scheme after 2014 How to address the problem of intermittency? How to avoid the misuse of market power? Do all 800 retailers have the capacity to comply?

16 Proposed Market Integration Premium 16 Market integration premium to retailers [Euro/MWh] Retailer s share of intermittent electricity [%]

17 17 Technology Specific Market Premiums [Example based on Prices and Costs of 2014] Average prices / costs [Euro/MWh] 120 PV Biogas 100 Wind Day-ahead Price New GT 20 0

18 18 Ordered Day-ahead Price Level Necessary for Financing new GT Day-ahead price [Euro/MWh] Euro/MWh at 500 h/a Euro/MWh at 1000 h/a Euro/MWh at 1500 h/a Euro/MWh at 2000 h/a Euro/MWh Hours

19 19 Contribution of Remaining Power Plants in the Electricity Supply Scenario for Load [GW] Ordered load duration Contribution of conventional power plants Ordered residual load without biogas / bio-methane

20 Why this could be a solution? 20 Freedom instead of state control Physical market integration of intermittent renewable generators Incentive for increasing flexibility (storages, demand response, ) Creating a fair competition on the generation side without oversubsidizing Creating an incentive to reach the renewable targets How to make this solution politically feasible? European Court of Justice: freedom of trade (Warenverkehrsfreiheit)

21 21 Thank you Tel: +49 (030) Fax: +49 (030)