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Published on October 8th, 2012 | by Nicholas Brown

22

German Baseload Power Cheaper than French 12 Months Running

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October 8th, 2012 by  

 
The EEX (European Energy Exchange) recent report on September’s trading results showed that both peak-load and baseload day-ahead electricity prices in Germany and Austria are lower than that of Switzerland and France.

solar panels germany

Solar panels in Germany by Q-Cells

The EEX press release does mention that electricity prices converge (meet each other) 75% of the time. However, during periods of low power demand, the prices differences mentioned above come about. These low-demand periods are usually at night and on weekends. (Low demand and high supply causes electricity prices to drop in this kind of market.)

The average price difference in September was 4%. “The drop over the past 12 months in Germany has indeed been quite dramatic at around 18% – from 5.264 cents per kilowatt-hour in September 2011 to the current 4.467 cents last month.”

In other words, as Germany’s renewable energy has boomed, its electricity prices have dropped relative to those of its nuclear-heavy neighbors.
 

 
This news is especially important due to the fact that nuclear power, which provides about 75% of France’s electricity, is often touted as a particularly inexpensive source of baseload power (if it is from old nuclear power plants). But, that doesn’t seem to be the case here.

Also, renewable energy opponents repeatedly voice their concern about the cost impact of low-emissions power sources scaring away “industry.” Odd. The cost impact seems to be a beneficial one here.

Industry pays rates on the power exchange, which are determined by the most expensive electricity generators that need to be ramped up to meet demand. Over the past year, in particular, the tremendous growth of PV power plant usage in Germany, which increases peak power production considerably, has offset the demand for more expensive peak power, thereby bringing down spot market electricity prices.

Renewable energy growth has been tremendous in Germany, which has been pursuing it aggressively. As a matter of fact, solar power is much cheaper in Germany, largely due to the economies of scale they have achieved from to their large-scale adoption of it, and from lower “soft costs” and limited subsidies.

Source: Renewables International

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About the Author

writes on CleanTechnica, Gas2, Kleef&Co, and Green Building Elements. He has a keen interest in physics-intensive topics such as electricity generation, refrigeration and air conditioning technology, energy storage, and geography. His website is: Kompulsa.com.



  • archaios pteryx

    http://www.energy.eu/ (as official a source as they come) will show you, beyond any doubt, that Germany’s household electricity is about €0.26/kWhr vs. €0.14 in France. Industrial electricity in Germany is at €0.11/kWhr, vs. €0.078 in France. That, in simple arithmetic, says that German electricity is almost DOUBLE that of France. French base-load power sources are mostly nuclear. Germany has brown coal, black coal and nuclear. Coal may be cheaper than nukes. German successfully used solar pv for summer peak loads and has a lot of wind power but that increases its electicity costs towards consumer backlash levels

    • http://zacharyshahan.com/ Zachary Shahan

      This is a straw man. There are other reasons for the price of electricity being high. Please, let’s keep this discussion honest!

      • archaios pteryx

        how about asking the Germans? Of course (base load) coal may in some cases be cheaper than (base load) nuclear. That does not change the fact that EITHER are a lot cheaper than pv or wind. The key is what does pv and what does wind substitute. The quite Green Fraunhofer Institute said it clearly: “:PVs managed to substitute gas”. I see also some coal substitution on Fraunhofer’s exhibits, they are picture perfect and all in favor of PVs as peak power especially in the summer. Wind did not appear, nor is anyone claiming any feats. Without massive and inexpensive water storage, wind is a rather random nuisance (to neighboring countries’ grid. Ignore me. Look at the German (and French) figures. They are readily available and crystal clear (and Germany is not exactly anti-Green! Why is there such fear of plain facts (especially when they are not against your “cause”)

        • Bob_Wallace

          1. Coal is not cheaper than anything. Coal pollution causes massive public health problems and treating those illnesses costs money.

          2. You cannot make a valid comparison between the price of electricity from a nuclear plants built when costs were lower and now paid off with new wind/solar generation. That makes no sense and is totally invalid.

          New nuclear is more expensive than new solar and very much more expensive than new wind.

          Please quit posting crap.

          • archaios pteryx

            There is something called “accounting”. It has generally accepted rules re costs. Coal’s pollution aspects are known and regulated and such regulations have “costs”. Other, hidden costs, suspected cost, are not “costs” and including them in income statements would be fraudulent. But you imply they should be included in decision making. I have no doubt that a 2000 MW nuke’s capital costs are higher than 2000 MW of either solar, or pv, or even coal. But 2000 nuclear MW comes with a 95%+ availability, a 40+ year lifespan, and provides dispatchable power, while solar or wind are of the order of 25% availability, about 20 yr lifespan, and do not provide dispatchable power. No electricity would be 100% cheaper than any alternative. Quasi random electricity is of limited value, that’s all. Regarding my posting “crap”, you are the moderator, you define “crap”. I am only giving you my point of view as an informed ratepayer. I regret that you think of it as “crap”.

          • Bob_Wallace

            Give me a break!

            In no way or fashion does the coal industry pay a dime for the 13,000+ Americans they kill each year with their pollution and the thousands upon thousands that they make ill.

            You think we should simply turn a blind eye to the almost $1 billion we pay in tax dollars and health insurance premiums because of coal pollution? What kind of screwball thinking is that?

            Those dollars spent on treating illnesses causes by coal pollution go into the debt column. The lost productivity due to worker and worker family illness go into the debt column.

            Nuclear is not dispatchable. It cannot be turned on and off quickly. Some nuclear is partially load-following, it can be ramped up and down over a number of hours, but nuclear cannot be used to deal with rapid changed in supply/demand.

            Hydro, gas turbines, and battery/flywheel/pump-up storage are dispatchable.

            And the 24/365 95% availability of nuclear is not exactly a godsend. We built between 20 and 25 GWs of storage because nuclear has to keep running when demand is down and we need somewhere to put that unneeded supply.

          • archaios pteryx

            Indeed, the Industrial Revolution and economic growth have been deadly. Still, daily power demand curves are what they are. They are the needs of about 300 million people and about $15 trillion of US GDP. The power demand curves necessitate (or permit) base load power and peak power. It pays, and is good environmental and business practice to manage peak loads, as they tend to be more expensive than base. Or we can tweak the needs of 300 million people and go through contortions to have another power model. Fine, too. The question remains: who pays for this and who decides?

          • http://zacharyshahan.com/ Zachary Shahan

            this is yet another deceitful distraction. the cost of not changing is greater than the cost of changing, and will mostly hit poorer people and nations. if you haven’t seen the studies on that basic starting point, your whole line of argument is going to be off.

          • Bob_Wallace

            The power demand curves are tweak-able. We are discovering more and more ways to shift loads. That’s not going to solve all our energy problems but it will help.

            We have to get fossil fuels off our grid, starting with coal.

            The great thing is, all our renewable energy sources are cheaper than coal. All of them. And wind + storage is cheaper than coal.

            So no one pays. Everyone saves.

            Who decides? The American people decide. We elect our government and we eventually get the government to do what we want done even though we have to push long and hard on some issues. The majority of Americans want something done to reduce the problems of climate change.

          • http://zacharyshahan.com/ Zachary Shahan

            I’m sorry, but if you keep posting nonsense, you’re going to be shown the door. There’s no way you can actually think coal pays for all its pollution costs. In the US alone, for one year, a Harvard Medical School study found that coal costs us $500 billion a year not included in its price. http://cleantechnica.com/2011/02/17/cost-of-coal-500-billion-year-in-u-s-harvard-study-finds/
            If that cost were internalized, it would be completely out in the cold.
            Yes, the grid is shifting from a baseload-based one to a more responsive and cost-effective one. There’s nothing wrong about that. That’s good. But major transitions come with challenges. I’ve seen E.ON & RWE’s statements. They’re working to protect their profits. They’re not interested in a distributed generation network. No surprise there. But the future is clear, whether you want to deny it and fight it or not.

          • archaios pteryx

            The threat of the door is only used by scared people, feel free to use it. There are MANY kinds of hidden costs. The known risks of coal, or nuclear, are costs (some are NOT hidden). The risks of not enough electricity, poverty, and child mortality are other hidden costs. The only reason hidden costs are not accounted for is because of their subjective, and possibly fraudulent, nature (hence something called “GAAP” — look it up).
            Of course Eon and RWE look after their profits, isn’t everyone?. But when their gas generation becomes unprofitable, as it has, as a result of intermittent power, it will be taken off-line. That will leave wind and solar with just cheap coal and nuclear. Now, if you legislate against the rule that chooses low variable cost electricity on the grid, that is fine too. But on what basis DO you choose? Not variable cost? Perhaps total cost? That would be very much against your case. Perhaps you legislate against anything that does not suit you. That is fine too, but not necessarily in what I would consider public interest. So we go to “what IS public interest?”.
            On a very practical matter, the 2012 German Electricity Generation statistics show a VERY clear image: Solar has, on average, displaced gas and even some coal; wind has also been a contributor, albeit more sporadic. The VERY clear image also says that (a) that has increased electricity prices enough to necessitate political backtracking in Germany, and (b) CO2 emissions are now higher (assuming one cares about them, which I assume you do). That is the result of two simple reasons: (i) less gas — gas is what has been reducing emissions, and (ii) reduced efficiency of the conventional dirty plants that you hate. And YOUR solution is?” Do not flip the switch when the wind isn’t blowing or the sun isn’t shining”. That is fine, too, the question, sir, is WHO decides on that matter?

          • http://zacharyshahan.com/ Zachary Shahan

            Ha, hilarious, no, I’m not scared — I just got tired of spending my day trying to inform people who have no interest in learning, and leaving completely false comments on our site is a disservice to readers and humanity — not what we’re in the business of.

            And I’m sorry to say, your comment includes about 5 pieces of complete disinformation and deceit that I have no inclination to waste my time on today. I don’t assume you have any interest in learning, based on our conversations to date, so please find another site to irritate. :D

          • Mercky Waters

            Zack, you are responding with a straw man. No one said the cost of coal includes externalities. Neither does the cost of nuclear, hydropower, solar, or wind but the externalities are still there. Archaeopteryx is using data and logic, you respond with accusations of deceit and threats to use administrative priveledge to squelch dissent. So, are you an educator or a propagandist? Which do you admire? You can engage using facts and data or you can just be you own little Rupert Murdock.

        • http://zacharyshahan.com/ Zachary Shahan

          You’re posting arguments that belong in a different era. Wind and solar integrate into the grid well up to quite a high penetration level. To call them a nuisance is incorrect and either 1) ignorant or 2) dishonest. If you want to try to brainwash someone, I recommend doing so on some generic website where people don’t know anything about the energy system.

          Regarding “the Germans,” we’ve got one on our team, and I’ve read the commentary of and talked to many others. I do every day — I follow the sites of several Germans.

          Regarding solar being primarily peak power: yes, that’s not being argued and is certainly not anything surprising. As penetration levels increase, however, it will cut into the baseload power, with wind, natural gas, and other options filling in around it.

          • archaios pteryx

            solar has already cut into daytime base baseload power in Germany, including coal fired plants; you may think that is a good development; is it? What it does is to add operational inefficiencies and financial risk to such conventional plants, I suggest your German colleague translate to you E.on’s and RWE’s comments on the matter. The executive summary is “zu viel Ökostrom und fallende Preise”. I would also ask him to translate to you Altmeier’s recent tariff cutbacks to prevent consumer backlash. Or look at
            http://www.spiegel.de/international/germany/problems-prompt-germany-to-rethink-energy-revolution-a-852815.html . Or try http://www.xe.com/news/2013/01/30/3177021.htm?c=1&t , it quotes Verbund’s CEO. Dimes against dollars that conventional power will also be asking for subsidies in the near future to avoid blackouts. “Fallende Preise” already results in disinvestment. Germany is able “export” unwanted peak power (at a loss to ratepayers) to neighbors. Others such as the US may not. I doubt that the Mexicans need unscheduled peak power when the suns shines or the wind blows in Texas. When and if power storage is economically and practically feasible in the GW range, that of course will not be a problem.

          • Bob_Wallace

            Screw “conventional” power. Drive those nasty coal plants out of business. That will speed up the transition to a clean grid.

            When utilities realize that coal is loosing money for them they’ll start working harder to install storage.

  • http://www.facebook.com/petiteplanete Craig Morris

    Why is Clean Technica reprinting so many of my articles from http://www.renewablesinternational.net? Did you get our permission to do this?

    • http://cleantechnica.com/ Zachary Shahan

      Hey Craig, just got your emailed and replied. Think we’re linking/crediting appropriately, but will carry on the discussion via email and make any changes desired.

      Clearly, we like the great work you’re doing and are just working to spread the good word much further. If I’m not mistaken, I think we’ve got the same overall goals in mind.

  • CoBaja

    Comment construire un panneau de chauffage solaire a partir de canettes d’aluminium:

    http://solar.freeonplate.com/fr/panneau_solaire.htm

    Thierry

  • yazriel

    Well, if there are massive additions of power (solar and wind) which are then dumped on the exchange (merit order etc) then OBVIOUSLY the whole sale price will fall

    Of course, the end consumer bill will go up significantly due to FIT

    Are there any studies that show that *overall* average electricity price has gone down (e.g. because peak plants are no longer needed)

    • Bob_Wallace

      I would imagine that at this point in time it’s less about closing down “expensive” plants than avoiding building new, expensive plants.

      Germany is closing down its nuclear plants which are old and paid off, therefore generate cheap electricity. That’s not going to make electricity cheaper (but Germans are willing to pay a bit more in order to get rid of nuclear).

      Germany is building some new, more efficient coal plants. They are also closing down older, less efficient plants. The net change will be a decrease in the amount of electricity from coal. But because the new plants will not be paid off that will likely bump prices up a bit.

      Without wind and solar Germany would probably have had to build even more new coal plants, so I expect some money was saved there.

    • Bob_Wallace

      You can look here and see Texas wholesale prices go below $0.00/MWh when the wind blows hard.

      http://www.ercot.com/content/cdr/html/20111014_real_time_spp

      Some of that negative is due to the 2.2 cents/kWh PTC, but add that back in and you’ve still got some very cheap prices compared to other parts of the day.

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