21.09.2018 | Less security of supply in Europe

Power plants: Capacities are dropping

An analysis by the Federal Association for Energy and Water Management indicates: In the next decade, Germany will no longer be able to rely solely on electricity imports from Europe. The remaining over-capacities for ensured power plant production will dwindle throughout Europe in the medium and long term.

When power production is low in Germany, the neighbours step in: Power from France, Austria and the Netherlands or Switzerland flows into the German power grid. In the reverse situation, when other countries have shortages, power from Germany is routed to neighbouring countries.

However, what us common practice today will be more difficult in the future and European solidarity will become more fragile. This is the conclusion of a study by the Federal Association for Energy and Water Management (BDEW) in Germany. The context of the report was to determine how Germany will guarantee security of supply in the next decade when, after the nuclear phase-out, coal-fired power plants will also be taken off grid. Like Switzerland (see box), in the opinion of many players, Germany should rely on increasing imports from abroad as a central element.

Significantly less production

The BDEW analysed data from the office of research and documentation and transmission grid operators to determine how the power plant parks in neighbouring countries would develop.

The results indicate: "Announced or discussed plans in neighbouring countries (EU28) show that the general trend is toward the reduction of coal capacities as well as nuclear energy with a simultaneous strong development of renewable energies. As expected, this is in line with foreseeable developments in Germany. The current remaining over-capacities for ensured power plant production will dwindle throughout Europe in the medium and long term."

Reduction of 63 per cent

The EU coal-fired power plants will experience a drop in installed capacity from 150 GW to 105 GW and by 2030 down to 50 GW, signifying a reduction of 63 per cent.

The likelihood that a shortage in Germany would occur simultaneously to a surplus in a neighbouring country is rather low, says BDEW Director Stefan Kapferer.

«The times when the demand for power is high are nearly congruent in Central Europe»
Stefan Kapferer, Director of BDEW

Because: The times when the demand for power is high are nearly congruent in Central Europe. A particularly cold winter does not just stay within the German borders. And power-intensive workdays in Europe are usually identical.

"In such phase, we cannot simply depend on high volume power imports from these countries." Unfortunately, the idea that security of supply in Germany can be supported with the import of more renewable electricity from other EU countries does not work either according to Kapferer: "In Central Europe the determining high pressure systems needed for wind and photovoltaic occur more or less simultaneously for both shortages or surpluses in Central Europe."

The study concludes: "It would be too risky for Germany to rely on electricity imports for example during a winter power slump." And: "Germany will need new generation capacities on the basis of gas."

Situation in Switzerland

The Swiss Federal government says: Switzerland will have enough power available until 2035 - if integration into the European power market succeeds, energy efficiency increases and the proportion of renewable energies continues to grow. This is the conclusion of a study presented by Doris Leuthard at the Infrastructure Day 2017 of the Swiss Federal Department of the Environment, Transport, Energy and Communications (DETEC).

For Benoît Revaz, Director of the Swiss Federal Office of Energy, the study on "System Adequacy" indicates that security of supply is ensured until 2035 based on several development scenarios. This also holds true if a rapid transformation in the direction of renewable energies occurs in Switzerland and neighbouring countries. Switzerland will not have capacity problems in the foreseeable future, making a capacity mechanism inexpedient and unnecessary. Long-term security of supply can be ensured by imports through a market-oriented approach in cooperation with our neighbouring countries.

According to Revaz, a new market design must contribute to strengthening the market and to the integration into neighbouring markets. Full market liberalisation is an important element to strengthen market signals and efficiency. In order to ensure energy availability in extreme situations, a reserve strategy should be examined as an additional security element for a strong "energy only" market.

Axpo's position: "Axpo regrets that the focus of supply security lies almost exclusively on imports. In this respect, the creation of a strategic reserve is welcome if the design is consistent with the market. Even better would be the reinforcement of domestic, renewable hydropower that is suffering under low wholesale prices. It will be the backbone of Swiss electricity supply in the upcoming decades."

More articles for you

Show all

Energy market

Growing business: how Axpo is helping French greenhouse farmers

Innovative partnerships in France

Read more

Energy market

Weather and geopolitics shape European energy markets

European Energy Markets Monthly, June 2024

Read more

International business

Gas decarbonisation and hydrogen package

EU internal gas market: More green & low-carbon molecules

Read more

Energy market

Weather shifts and renewables drive market volatility

European Energy Markets Monthly, May 2024

Read more