{"id":8474,"date":"2014-10-19T09:00:01","date_gmt":"2014-10-19T14:00:01","guid":{"rendered":"http:\/\/blogs.edf.org\/energyexchange\/?p=8474"},"modified":"2015-12-21T12:43:16","modified_gmt":"2015-12-21T18:43:16","slug":"germanys-energiewende-proves-electricity-can-be-clean-and-reliable","status":"publish","type":"post","link":"https:\/\/blogs.edf.org\/energyexchange\/2014\/10\/19\/germanys-energiewende-proves-electricity-can-be-clean-and-reliable\/","title":{"rendered":"Germany’s Energiewende Proves Electricity can be Clean and Reliable"},"content":{"rendered":"

\"electric-power-273644_640\"<\/a>Since 2004, the year of the first major revision of Germany\u2019s Renewable Energy Act (EEG), the country has added<\/a> at least 35 gigawatts (GW) of solar and 35 GW of wind to its electric grid \u2013 enough to offset<\/a> upwards of 35 coal plants. What\u2019s more impressive is during the first half of 2014, close to 29 percent of Germany\u2019s electricity<\/a> came from renewable sources. For perspective, America\u2019s renewables percentage<\/a>, at about 14 percent, was half of Germany\u2019s during this timeframe.<\/p>\n

Meanwhile, the country has improved its status as a grid reliability leader, causing the Heinrich B\u00f6ll Foundation\u2019s Energy Transition<\/i> blog<\/a> to conclude, \u201cClearly, installing the equivalent of 100 percent of peak demand as wind and solar capacity does not bring down the grid.\u201d\u00a0 Renewables International<\/i><\/a> further asserts, \u201cRenewables have not yet reached a penetration level that has detrimentally impacted grid reliability.\u201d<\/p>\n

This success runs contrary to the predictions of Energiewende\u2019s critics, who have sounded the alarms about investing in \u201ctoo much\u201d renewable energy. Some of these concerns are more valid than others, but the truth is, most of these claims are blown out of proportion, fixable with solutions that are not overly complex, and\/or based on no empirical data.<\/p>\n

How did Germany do it?<\/b><\/p>\n

The System Average Interruption Duration Index (SAIDI) measures the average interruption time per electricity customer, and it is the foremost metric used internationally for assessing electric grid reliability.\u00a0 This past August, Germany\u2019s Network Agency announced that the country\u2019s SAIDI value dropped from 15.91 minutes in 2012 to 15.32 minutes in 2013.<\/p>\n

This improvement is especially impressive considering Germany\u2019s 2012 SAIDI score was the third best in Europe<\/a> and less than a tenth of the value of 244, the most recent statistic from the United States<\/a> (see graphics below).<\/p>\n

 <\/p>\n

\"min<\/a><\/p>\n

 <\/p>\n

The indicator that most strongly correlates with grid reliability, and could explain why Germany outperforms the United States, is the level of undergrounding of low-voltage (LV) and medium-voltage (MV) cables. As the name suggests, underground electricity wires are buried and sheltered from inclement weather and thus more reliable than aboveground electricity transmission. Over 70 percent of both LV and MV cables<\/a> are underground in Germany (see figure below).<\/p>\n

 <\/p>\n

\"clustering<\/a><\/p>\n

 <\/p>\n

By contrast, 2012 survey results<\/a> from the Edison Electric Institute indicate that underground cables only serve about 39 percent of homes in the United States (see below).<\/p>\n

 <\/p>\n

\"undergrounding<\/a><\/p>\n

 <\/p>\n

Critics are not always right<\/b><\/p>\n

Despite this success, the Institute for Energy Research asserted<\/a> just last month that \u201cthe outcome [of the Energiewende] for Germans will be a higher potential for blackouts\u201d due to an increased number of grid intervention events. From 2010 to 2012, grid intervention events increased fourfold in Germany. Similarly, Nature Publishing Group<\/a> claims,<\/p>\n

“The rapid rise in wind and solar power has created a nightmare scenario for grid operators, who face surges when the wind blows and the sun shines, and shortages when they don\u2019t.\u00a0 In 2011, more than 200,000 blackouts exceeding three minutes were reported \u2013 and experts warn of a growing risk of major power failures.\u201d<\/p>\n

But this criticism is shortsighted. SAIDI specifically measures blackouts exceeding three minutes, and since 2006 Germany\u2019s solar and wind capacity have increased by 70 GW while its SAIDI has improved from 21.53 to 15.32.\u00a0 Furthermore, as argued by Craig Morris for the Heinrich B\u00f6ll Foundation\u2019s Energy Transition<\/i> blog<\/a>, all \u2018grid intervention\u2019 events mean is that \u201cinstead of merely sitting there looking at screens, the engineers now have to press buttons\u201d; as a result, there is a \u201cslightly<\/i>\u201d higher likelihood of human error.<\/p>\n

The most valid concern<\/b><\/p>\n

Of all the criticisms against Energiewende\u2019s reliability success, the issue of cost is the most valid. As it turns out, upgrading the electric grid to a state-of-the-art, 21st<\/sup> century machine is pretty expensive, and that cost is mostly borne by utilities.<\/p>\n

Too rapid an increase in generation from renewables is financially weakening German utilities, which make only a fraction of the revenue dispatching renewable power as from conventional sources. The value of Europe\u2019s top 20 utilities has fallen from \u20ac1 trillion (USD $1.3 trillion) in 2008 to \u20ac500 billion (USD $630 billion) in 2013. According to The Economist<\/a>, European grid upgrades by 2020 are expected to cost up to \u20ac1 trillion, and \u201ccompanies worth \u20ac500 billion cannot finance anything like that amount\u2026 In their current state, utilities cannot finance Europe\u2019s hoped-for clean energy system.\u201d<\/p>\n

Thus, crippling these utilities is potentially problematic for reliability because it lowers the potential for investment in the modernized grid. This concern, however, has yet to erode Germany\u2019s electric grid reliability in practice.[Tweet “Data supports conclusion Germany\u2019s grid reliability during Energiewende has been an unequivocal success so far http:\/\/ow.ly\/D35o2 “]<\/p>\n

Solutions exist<\/b><\/p>\n

According to the Heinrich B\u00f6ll Foundation<\/a>, \u201ceven the strongest proponents of Energiewende agree that Germany needs to reform its energy system to accommodate the next influx of renewable energies.\u201d<\/p>\n

However, solutions exist to this problem that are not revolutionary. For example, a shift away from the \u201cenergy-only\u201d market, in which utilities are only<\/i> paid to produce and deliver energy, to one that is more profitable for utilities as renewables take over the generation mix. Potential structures include \u201ccapacity\u201d and \u201ccapabilities\u201d markets.<\/p>\n

In a capacity market, utilities are not compensated for the energy they produce, but instead for what they have on reserve for immediate use when faced with reliability challenges. But this model does not give preference to any particular energy source. A capabilities market, however, attempts to prioritize power generation that guarantees low CO2 emissions. Natural gas-fired plants, energy storage, demand response<\/a>, and renewable energy resources are just a few examples of the reliability measures that might be prioritized over a coal-fired \u201cpeaker\u201d plant when trying to meet the demands of a strained electric grid.<\/p>\n

The highest quality data supports the conclusion Germany\u2019s grid reliability during Energiewende has been an unequivocal success so far. Opponents levy negative commentaries on this subject, and there is certainly still room for improvement regarding energy markets, but there is no doubt the German experience, as an international model, proves a clean<\/i> grid can also be a reliable one.<\/p>\n

This is the third blog post in\u00a0a six-part series on <\/i>Energiewende, which will describe best practices gleaned from the German experience and examine their U.S. applicability.\u00a0Topics will include the Economics<\/a>,\u00a0Politics<\/a>, Governance<\/a>, Implementation<\/a>, and\u00a0Reliability<\/a> of <\/em>Energiewende.<\/em><\/i><\/p>\n","protected":false},"excerpt":{"rendered":"

Since 2004, the year of the first major revision of Germany\u2019s Renewable Energy Act (EEG), the country has added at least 35 gigawatts (GW) of solar and 35 GW of wind to its electric grid \u2013 enough to offset upwards of 35 coal plants. 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