Electricity markets

Unlocking the grid

Jörg-Rainer Zimmermann, 17 Dec 16
Storage technology, decentralised expansion of renewables and regional price signals can help reduce the need for new power lines – without slowing the pace of the energy transition.

The European Commission is seeking to shape the European electricity market into a supranational domain transcending all borders. Germany’s geographical position means its transmission grid would play a key role in such a scenario. However, efforts to expand the transmission system have struggled to get off the ground – even though studies by the semi-public energy agency Dena have long predicted that massive grid expansion measures would be needed to accommodate the output of renewable energy plants and bring it to consumers. Recent studies have called Dena’s predictions into question, however, as experts increasingly proclaim storage technology as the key to flexibly regulating a system with a very high share of solar, wind and co. One thing remains undisputed: as the Federal Ministry for Economic Affairs has been saying for some time, EU-wide electricity trading is on the rise. Germany, as a gateway between the western and eastern European electricity markets, is taking on an increasingly prominent role in the process. In future, “significantly more cross-border electricity trading” will take place in Germany than elsewhere, according to the ministry.

However, plans for new power lines are often met with resistance in the country. A major obstacle is posed by approval procedures, in which popular opinion plays a prominent part. By 30 June this year, of the 22 projects specified in the Power Grid Expansion Act (EnLAG), with a total length of around 1,800 km, approval had been granted for some 850 km – an achievement nevertheless hailed as a success by the economics ministry. In the words of state secretary for energy Rainer Baake of the Greens, “While the number of projects actually completed remains too low at 650 km, approval has been granted for around 850 km, or roughly 50 percent of the EnLAG projects. This is an important milestone.” In light of the acceptance issues surrounding new pylons and power lines, the Federal Government has already decided to favour underground cables for direct current. However, this technology is substantially more expensive than overhead power lines, with implications for end consumers’ electricity bills. Nevertheless, Baake has announced his intention to ramp up grid expansion, citing cost as a decisive factor: “Grid expansion remains the most cost-effective flexibility option for a successful energy transition. Without it, we will be forced to resort to expensive curtailment of renewables. Accordingly, the federal states and project developers must treat the EnLAG plans as a top priority.”

Ultimately though, given the slow pace at which these efforts are progressing, Germany’s Renewable Energy Sources Act (EEG) has had the effect of putting the cart before the horse. Plans for the definition of grid bottlenecks will mean that in areas of the country where grid expansion is lagging, construction of new wind turbines will be limited by quotas.

This is an abridged version of the article “Unlocking the grid” – the full text is available in new energy issue 5/2016.

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