German electricity supply security to stay very high even with coal exit – economy ministry
Electricity supply security in Germany is set to stay very high by international standards even as the country begins to phase out coal-fired power generation, the Federal Ministry for Economic Affairs and Energy (BMWi) said in a monitoring report. "The report shows that electricity consumers in Germany can continue to be supplied reliably with electricity even as we continue to restructure our energy supply,” said Minister for Economic Affairs and Energy Peter Altmaier in a press release. An expert opinion, on which the government report is based, notes that energy supply is adequately ensured “in all scenarios examined here up to 2030 (including a scenario with a reduction in the capacity of coal-fired power plants on the market to achieve the climate protection targets in Germany for 2030).”
Concerns about the security of supply have ranked very high among German industry and many politicians throughout the country’s transition away from nuclear and now coal-fired power generation to a system largely based on fluctuating renewable energy sources. So far, Germany has one of the highest levels of supply security internationally. The commission put in charge with drafting a plan to exit coal said in its proposal that “Germany’s energy supply is secure and will remain so”.
Although the monitoring report's message itself may come across as predictable, “it sets a central standard for security of supply that could have far-reaching implications for the electricity industry”, writes Jakob Schlandt, editor in chief of the energy and climate newsletter Tagesspiegel Background. The report alters the basic definition of supply security and how this is calculated. Before, Germany’s maximum consumption was simply compared with its guaranteed output. Now, threshold values based on a complex, stochastic analysis of the German electricity market, which is integrated in the European market, are used to determine the security of electricity supply, explained Schlandt. Such a probability-based approach is already in practice in other European countries such as France.
In the monitoring report, “permanent full coverage is abandoned”, too, writes Schlandt. Instead, it is prescribed that power generation should be able to cover the load with a probability of 99.94 percent. The reasoning, according to Schlandt, is that “if you aim below that, the damage caused by power failures becomes excessive. If you aim above that, the costs for the power system are too high”. This, however, does not mean that consumers will only receive internet 99.94 percent of the time. Such potential power shortages would only affect a small number of households at best at a time and translate to an average of “five to ten minutes” of disconnection per consumer per year. In comparison, interruptions in power supply due to technical difficulties in the power grids have amounted to 12 to 15 minutes per year since 2009.
In response to the monitoring report, Germany’s Association of Local Utilities (VKU) called the probability-based approach “insufficient” in light of the challenges that a coming coal phase-out could present, suggesting to “add a risk-oriented approach in the form of a stress test that also simulates exceptional situations.” Legally defining the phase-out of coal in Germany without putting such a risk-oriented monitoring of supply security into place “would be like walking on a tightrope without a safety net”, said chief executive Katherina Reiche.
German Association of Energy and Water Industries BDEW called the report’s reliance on European electricity imports “too risky”. “We should not rely on always being able to import electricity from other EU countries at certain times of high electricity demand,” said chairman of BDEW’S executive board Stefan Kapferer. Kapferer also highlighted the need for new gas-based generation capacity, energy storage, combined heat and power generation, and accelerating the expansion of the energy grid. VDMA Power Systems, a part of the German Engineering Federation, also pointed to combined heat and power generation and the modernization of electricity grids. “In the medium term, however, the market model must allow investments in storage facilities and flexible generation facilities, because a stable electricity supply is a decisive location factor for an industrial country like Germany,” according to managing director Matthias Zelinger.
