The energy transition

The energy transition means moving away from nuclear and fossil fuels towards a sustainable energy supply through the use of renewable energies. It is one of the central social challenges and of the present time and of the coming decades. The future is not only be about clean generation of electricity, but about holistic „green“ resource and whole environmentally friendly supply system without the obsolete conventional power plants.

The expansion of renewables is advancing inexorably.

Electricity generation from wind and sun in Germany recently reached the 40 percent mark – and the trend is rising. However, the rapidly increasing proportions of intermittent renewable energy generation and the increasing decentralization of the energy supply are a gigantic challenge for the entire energy system.

How much energy is supplied at what point in time will more than ever depend on the forces of nature. Nevertheless, a stable and reliable energy supply must be guaranteed at all times.

„100 percent electricity from renewable sources of energy is achievable and is necessary. This requires a system change away from coal and nuclear energy towards energy efficiency and the renewables. A switch from coal and nuclear to a complete supply from renewable energies is feasible.“ ¹

¹BUND, German Federal Government, August 27, 2010: “Statement on the issue of energy storage within the framework of the integration of electricity from renewable sources into the grid”

Generation – Consumption. Source: Bundesverband Energiespeicher eV (BVES)

The rapid integration of wind and solar power is encouraging, but massive technical problems of grid stabilization and immense costs in connection with the highly volatile supplied quantities are increasing. Electricity is generally consumed the moment it is generated. If generated too much or too little, there will be noticeable energy surpluse or shortage.

The flexibility of the energy system and the use of energy storage systems help to decouple generation from consumption in terms of time. In order to achieve the climate goals, energy storage becomes the crucial factor, its strategic importance rising worldwide. In the European Strategic Energy Technology Plan (SET), energy storage is considered to be a long-term indispensable technology in order to achieve the EU 2050 goals for security of energy supply and climate protection.

The energy transition is not possible without energy storage, leading experts agree on this claim. Energy is not always available in the amount needed, thus, storage technologies have two main tasks to be integrated into the power grid with a large share of electricity from renewable sources.

It must be able to respond rapidly in order to compensate for fluctuations and ensure grid stability,
It should store electricity in such way that power is available over a longer period of time.

Why is that so?

THE POWER GRID NEEDS A CONSTANT FREQUENCY OF 50 HERTZ. SINCE RENEWABLES ARE INTERMITTENT AND DEPEND ON THE WEATHER SITUATION, VOLTAGE AND FREQUENCY FLUCTUATIONS INFLUENCE THE ENTIRE ELECTRIC GRID. THESE FLUCTUATIONS MUST BE COMPENSATED IN FRACTIONS OF A SECOND SO THAT THE VOLTAGE AND FREQUENCY CAN ALWAYS BE MAINTAINED.

According to the German Federal Power Grid Agency, at the moment it is possible to cover additional energy storage need for not more than 1,000 MWh. Demand for capacities, however, is much higher.

The most mature technology is pumped hydro storage (PHS), they are being used successfully for decades. The disadvantages pumped hydro are the low total capacity and the limited scaling possibility. With all their benefits, PHS plants require special conditions: a natural height – e.g. hill or mountain of few hundred to more than two thousand meters – with the possibility of building two sufficiently large basins at a reasonable cost. These conditions are very rare, and the energy transition can therefore not be expedited with PHS.

Battery storage systems may seem feasible in the short term. The costs per megawatt hour (MWh) of installed capacity may be low at the moment, before demand for electric car batteries rises. Nevertheless, the very limited lifespan and the loss of performance, even for a limited number of charging cycles, are their main problem. Accordingly, repeated investment should be expected over decades of operation. Furthermore, grid-scale battery will have an immense environmental impact of both repeated production and deployment of such large batteries, as well as their disposal – an issue which is far from being solved. In terms of an environmentally friendly energy supply, batteries as grid-scale energy storage are highly controversial.

Financial aspects

Wind turbines and solar systems deliver highly volatile amounts of electricity over days, weeks and months. The contribution of wind energy in particular fluctuates considerably from day to day making supply hardly predictable. For example, on several days in January and September 2017, as well as in summer 2018, wind turbines had practically nothing to the supply to the grid despite forecasts, whereas stormy weather in October 2017 caused wind power production in Germany to rise to a record.

Once there is such an overproduction, renewable generation systems are artificially switched off by the transmission system operators (TSO), because this surplus of electricity cannot be used and puts power grid stability at risk. If this excess power cannot be fed into the grid, for example when network capacity is at its limit or there is a risk of overload, the generating facility is entitled to compensation according to the 2009 renewables law “EEG 2009”. In simple terms, only in Germany taxpayers and households in past years payed billions of euros for dumped surplus of renewable energy, in amount of dozens of millions of megawatt hours.

FAZ LOMBORG:

„MACROECONOMIC MODELS INDICATE THAT THE ECONOMIC LOSS FROM RENEWABLES COULD BE MUCH GREATER THAN SIMPLY THEIR ADDITIONAL COSTS, AS INCREASED PRODUCTION COSTS WEAKEN ALL OTHER INDUSTRIES SUFFOCATE DEVELOPMENT. THE AVERAGE OF ALL RENOWNED MODELS INDICATES THAT CURRENT CLIMATE POLICY WILL CAUSE ANNUAL COST TO GERMANY OF 43 BILLION EUROS UP TO 2020.“ ²

²Björn Lomborg: “Germany’s failed climate policy”. In: “Der Moralische Imperativ” Ed .: Reinhard Müller: The best contributions from FAZ and Sunday newspaper; FAZ eBook 46, Frankfurter Allgemeine Zeitung 2016

The energy transition works as long as the weather is right – quite expensive for everyone, but it does. But if neither the sun is shining, nor the wind blowing, it’s over: coal and nuclear power plants have to step in to stabilize the system and provide electricity. These conventional power plants are not feasible since the integration of renewable generation and are also being heavily subsidized as so called “capacity mechanisms” (plan “B” or reserve power generation) with billions of euros annually, again at the expense of the consumers.

In order for the intermittent renewable energy sources to provide stable supply of electricity and balance the grid in any kind of weather, and save billions of unnecessary costs, it must be stored. If the EU and Germany want to get rid of fossil-fuel and nuclear power plants to a significant extent, appropriate energy storage systems are needed to facilitate the energy transition.

The European Association for Storage of Energy (EASE) quantifies the need for storage capacity of up to 5,500,000 MWh in 2050 compared to the 300,000 MWh required today within the European Union.

Bloomberg New Energy Finance sees a “six-fold doubling” of the market volume for energy storage and estimates the market already by 2030 at 103 billion US dollars.

GERMAN TRANSMISSION SYSTEM OPERATOR ENBW:

„ENERGY STORAGE CAN BALANCE IRREGULAR ELECTRICITY GENERATION FROM RENEWABLE ENERGY SOURCES“

BY 2035, 55 TO 60 PERCENT OF ALL ELECTRICITY GENERATION IN GERMANY SHOULD COME FROM RENEWABLE SOURCES. IN 2015 IT WAS ALREADY 30 PERCENT. MOST OF THE GREEN ELECTRICITY WILL BE GENERATED BY WIND ENERGY AND SOLAR SYSTEMS, AS IT IS TODAY. HOWEVER, THEY DO NOT SUPPLY ELECTRICITY INTO THE GRID CONSTANTLY AND IN RELEVANT AMOUNT. SOMETIMES THE WIND IS STRONG, SOMETIMES IT’S NOT. THE SUN ALSO DONATES VARYING AMOUNTS OF LIGHT FOR GENERATING ELECTRICITY FROM PHOTOVOLTAICS – DEPENDING ON THE WEATHER AND THE SEASON. THE NATURAL OFFER IS NOT BASED ON CURRENT NEEDS. THE PRODUCTION CAN BE HIGHER OR LOWER THAN THE QUANTITY THAT IS CURRENTLY USED. THEREFORE, WE NEED INTERMEDIATE STORAGE.

ENERGY STORAGE CAN COMPENSATE THIS IRREGULAR ELECTRICITY GENERATION FROM RENEWABLE ENERGIES. IT EVEN MUST DO IT, BECAUSE WITHOUT STORAGE, THE GRID IS IN TROUBLE. ELECTRICITY STORAGE BALANCES GENERATION AGAINST CONSUMPTION. FOR EXAMPLE, YOU STORE WIND ENERGY WHEN THE GENERATION IS ABOVE DEMAND. IF THE NEED EXCEEDS GENERATION, ELECTRICITY IS WITHDRAWN FROM THE STORAGE.

Source: ENBW

The energy transition

Why is that so?

Financial aspects

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