Is Britain’s energy leadership failing?

“National energy leadership requires clear policy around investment to manage risk and investment, and a healthy balance between the market, and the consumer (taxpayer)?”

By: Nicholas Newman

National energy leadership requires clear policy around encouraging investment to manage risk and development, and a healthy balance between the market, and the consumer (taxpayer)?

The question of energy and especially its price has always been a politically sensitive issue. The question, is whether Britain’s energy policy is failing? Many would suggest that significant parts of it already have. In fact, until recently, the United Kingdom did not enjoy an overarching energy policy framework; instead it depended on guidance from European energy policies for much of the day-to-day implementation of operational issues. In a sense, what there was of a discernible British energy policy was merely an incomplete jigsaw. What is certainly clear is that successive British governments have failed to demonstrate “responsible” energy leadership.

Some successes

Britain can certainly be proud of its successes largely due to the result of responsible leadership back in Brussels and not here in the UK. Such successes include the ban on old-style light bulbs, the backing of the use of biofuels in petrol, the introduction of carbon trading, the scrapping of ageing coal power stations, together with the introduction of smart meters in homes and energy-efficiency labels on domestic electrical goods. In addition, the introduction of more energy efficient domestic goods has certainly benefited the consumer’s pocket and in the case of cars, has reduced pollution in our cities.

Some disappointments

However, despite these advances there are still grumbles, not only from consumers, but major players in the energy market. From an energy security perspective, the actions taken to encourage investment in renewables, has only had a marginal impact on slowing down the UK’s reliance on imported fossil fuels such as coal, oil and gas . [1] [i] In 2010, the cost of energy imports contributed to around 15% of the UK’s then trade deficit. University of Lancaster’s environmental researcher Oluwabamise Afolabi, reports that the DTI in 2007 projected that UK natural gas imports will increase to 70% by 2017 and imported coal could be meeting up to 75% of the UK coal needs by 2020.

Certainly part of the reason is that the EU energy policies have not gone far enough in the implementation of its ambitions for a single energy market for the continent, whilst we do have a single market for bananas! A single market for energy would certainly help meet many of Europe’s energy security concerns and hopefully facilitate greater competition Europe-wide. In the UK, there is a serious need for more energy suppliers actively competing in the market. At present, for instance the gas and electricity market is dominated by six major players, so it is not surprising we suffer high power prices.

Lack of leadership?

Nevertheless, the current government has preserved the vacuum in clear policy ownership and focused leadership left by its Labour government predecessor. This is demonstrated by the recent fiasco of the U-turn over feed-in tariffs [1] [ii] for solar power [1] [iii] and the failure to encourage investment in insulation for buildings with solid walls. The government’s decisions over feed-in tariffs plunged the rapidly growing job-creating solar power installation industry into crisis at a time of high unemployment. It is clear that senior policymakers made a decision without clearly understanding the full impact it would have on Britain’s solar power sector.

There seems to be a lack of leadership being exhibited by ministers on energy policy by many in the governing coalition. We are seeing, increasing opposition in Parliament by Conservative MPs, but also by members of the public towards the government’s ambitious support for new wind power projects throughout the country. In January, 101 Tory MPs wrote to Mr Cameron, calling for onshore wind farms subsidies to be “dramatically cut” – well beyond the 10 per cent reductions already in the pipeline. In addition, there have been protests about new renewable energy projects across the UK, together with concerns about the increasing number of people being plunged into energy poverty due to the shambolic energy taxes and subsidy system. Overall, current subsidies paid out to renewable energy producer’s amounted to some £1.5 billion a year, of which £400 million was given to companies operating onshore wind farms, reports the Telegraph in June 2012. However, DECC reports that renewable energy subsidies are costing each British household around £103 per year and between 2004 and 2010 electricity prices rose by 60% and gas bills by 90%, noted DECC.

At a strategic level investors are increasingly concerned about the sense of drift on energy policy towards new investment by the current government towards various types of generating technology, many large-scale investors are complaining that they are not getting sufficient encouragement to move ahead on meeting the government’s ambitious programme to replace time-expired coal and nuclear power stations with new generating capacity from both traditional and new generating technologies.

Failing to identify risks

It also appears that the government appears to be failing to identify and manage risks and plan for such unforeseen events as natural disasters, supply disruptions and wars. There appears to be a lack of long term preparation against supply disruption, this can be seen from the following issues. At present, we have limited interconnector capacity amounting to just under 5% of UK generating capacity, is made up of high voltage undersea power cables linking Britain with France, Belgium and Holland. For energy security reasons the UK needs to double such capacity. Once completed Britain will be better able to balance shortfalls in renewable generation here with imports from elsewhere in Europe.

Then there is the question of gas security, Britain only has 3.3 bcm, equivant to 14 days of gas storage capacity available in theory, reports DECC, and much of that is reserved for storage capacity for other nations in Europe. Unfortunately, there are no reciprocity agreements to such storage capacity that is located in the UK with foreign owned companies at present; I was surprised to learn from an energy trader recently. Though there are ambitious proposals to increase gas storage capacity, given sufficient government support. Unlike France and Germany, which have at least one month gas storage capacity? Currently Britain imports 24% of its gas from Qatar. This apparent lack of direction and foresight can also be seen in the relatively low large-scale electricity storage capacity of only 20 GW hours: perhaps sufficient to replace current UK wind generating capacity for just two hours if the wind failed to blow.

In addition, unlike several other European countries Britain has failed to move ahead with pilot carbon capture projects. The realisation of carbon capture technology could aid Britain in its ambitions to further diversify its current sources energy, as coal is available worldwide in easy to reach commercial quantities including Poland, USA , South Africa and Australia.

There are increasing fears that Britain could face power shortages by end of the decade, unless urgent action is taken to construct sufficient new generating capacity to meet growing demand. I would hate to think Britain consumers will face in the future the prospect of regular power cuts, as is the case of Nigeria today.

We are also seeing a lack of realism, amongst policymakers into the impact of their policies. One of Europe’s and U.K.’s ambitions is to reduce reliance on gas imports. Unfortunately, the government’s neglect of creating a proper framework for reducing gas usage for power generation purposes is encouraging a reliance on this fuel source to back up for the variability of renewables. Which could raise interesting energy supply and security concerns for large scale consumers such as hospitals and railways that rely on 24/7 energy supplies.

Since 2004, the UK has been a net importer of gas, as domestic production has declined and the country’s power sector has switched to gas for power generation purposes [1] . Since the winter of 2009, the UK has depended for half its gas needs on imports. Current government policy neglect is encouraging reliance on imported gas to remain at present levels whether imported from Norway, Russia, Nigeria or Qatar. As Britain’s reliance on renewables increases we are going to see imported gas-for-power generation purposes providing a backup to wind energy projects when the wind fails to blow, because Britain has not invested enough in sufficient gas and electricity storage capacity and expansion of its interconnection links with the rest of Europe.

Danger of short term thinking

Overall, Britain’s energy policy is in danger of suffering from short term thinking, which might be building up new problems for the future that might prove expensive to solve. In other areas, there is much to be proud of, but it is clear much more needs to be done. In addition, there has to be greater dialogue between all stakeholders involved in energy policy so that Britain develops an affordable, reliable and secure energy sector that meets our economic ambitions for growth.

Conclusion

However, the government needs to demonstrate responsible energy leadership and move actively forward on implementing many of its ambitions quickly, such as starting construction on new nuclear power stations, stop dithering on proposed coal and carbon capture projects and encourage investment in new energy storage capacity. Nevertheless, the emphasis on energy policy should be rebalanced more in favour of the consumer and taxpayer, by enabling users near such projects to directly benefit from the profits of such schemes.

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[1] [i] DECC aims for at least 15% of UK energy mix to come from renewable sources by 2020 if current levels of investment are maintained.

[1] [ii] A feed-in tariff (FIT, standard offer contract or renewable energy payments) is a policy mechanism designed to accelerate investment in renewable energy technologies. It achieves this by offering long-term contracts to renewable energy producers, such as home owners, it is typically based on the cost of generation of each technology. Technologies such as wind power, for instance, are awarded a lower per-kWh price, while technologies such as solar PV and tidal power are offered a higher price, reflecting higher costs.

[1] [iii] Solar power is the conversion of sunlight into electricity, either directly using photovoltaic (PV), or indirectly using concentrated solar power (CSP).

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[1] In 2010, 34 per cent of natural gas demand (371 TWh) was for electricity generation reports the DTI.

Energy Efficiency in Austria

In a recent posting we had a closer look at the development of energy efficiency in the UK. Then we found that various sectors of the economy have been performing differently over the years. Some sectors managed to lower their energy hunger drastically, while others were much less successful.

Now we are going to look at the situation in Austria. There, too, has been much talk about the need to save energy. But how much of that has actually materialized into lower consumption or, to put if differently, higher efficiency? The Austrian statistical office, Statistik Austria, provides data on various sectors. We were particularly interested in the following areas: industry, domestic consumption and passenger transport.

Fig. 1 gives an overview of the energy efficiency of those sectors between 1990 and 2010. The figures are indexed with 1990=100, and the individual graphs refer to the following quantities: industry means industrial consumption per unit of output, domestic total refes to consumption per household, and passenger transport stands for energy use per passenger-km.

Fig. 1 Energy efficiency in Austria. For detailed explanations see text.

What do these graphs tell us? The clearest message stems from passenger transport showing a significant decrease since 1990 (83 index points in 2010). That is considerably more than what we have found in the UK. It seems that the Austrian car fleet is more modern than the one in UK.

Domestic consumption also tends to become less, though at a much more moderate pace (94 in 2010). It should be noted that those data have not been corrected for temperature effects which can lead to varying energy demand during the winter months. Industry consumption, too, tends to go down over the years, however, with strong fluctuations. During the economic crisis efficiency seemed to improve a lot (87 in 2008/09). Strangely, during the recovery in 2009 it appears to have become less important and its index rose to 1990 levels (101). After that production efficiency has improved again.

We may also have a closer look at domestic consumption. To that end we split up that sector into heating (including airconditioning) and other uses. The results are shown in Fig. 2.

Fig. 2 Domestic energy use per household. 1990=100.

This figure requires some detailed analysis. First, we note that the graphs for heating and total domestic use are roughly in line with each other. This does not come as a surprise since heating accounts for about 75% of total household energy demand. This dominance tends to cover the huge variations of other consumers of household energy (lighting, kitchen equipment etc.) which do not contribute to the overall trend. On the contrary, other domestic uses reached more than 123 index points in 2003 before a gradual downturn set in. At the end of our observation period we have reached the same levels as in the beginning. That is not what we call a success story.

Comparing efficiency figures between different countries is both interesting and enlightening. Nevertheless we should be cautious in interpreting the figures even if they are presented in an indexed form. If country A does very much better than country B it does not necessarily mean that at the end of the day A is more energy efficient than B. That would only be true if both countries started from the same or at least similar levels of absolute efficiency. However, if B was already more efficient than A in the beginning in absolute terms, then, clearly, B needs to make much more effort than A in order to come down by the same number of index points.

Now what do we mean by efficiency in absolute terms? It is not sufficient to consider energy consumption per output only, but one has to make sure to be talking about the same amount of output for each country. Thus, if we have GWh/EUR for one country and GWh/GBP for the other we have to make sure that the two currencies are put into relation. We first have to put both countries on the same footing and then are we in a position to analyse their relative performance. In that way, comparing energy efficiency between different countries can be put on a solid basis.

 

Efficiency vs. Effectiveness – towards sustainable cities

An important concept in this discussion is exergy, or the quality of energy. This follows from the ‘laws of thermodynamics’. The first law states that energy can never be lost, that it will remain. The second law introduces the notion of quality: although energy cannot be lost it loses quality and entropy is created when used (google for exergy and ‘laws of thermodynamics’ to learn more).

Using resources – energy, water, materials, etc. – in an efficient way means using these resources while trying to limit waste, trying to do things in the right manner. The concept of ‘Trias Energetica’ will be used to explain and some examples will be given. Trias Energetica was developed by Lysen and Duijvestein (1997). It consists of three, consecutive steps:

  1. Limit energy demand and energy use;
  2. Use renewable energy sources;
  3. Use fossil fuels as efficiently and cleanly as possible to fulfill remaining demand.

The first step is the most important, because each amount of energy that is saved does not have to be produced. An example of this first step is to insulate dwellings properly so less energy is needed to heat the dwellings. Remaining demand should be fulfilled by applying renewable energy sources, like solar or wind. The third step talks about the efficient use of fossil fuels. For example, the introduction of fuel-efficient cars or even hybrid cars. These cars still need fossil resources, but they use these resources more efficiently, see graph 1.

Graph 1: Fuel-efficiency of some car types, gasoline use

It is important when looking at efficiency and energy-saving measures that they do not result in a rebound effect. So, e.g., changing non-efficient light bulbs with efficient ones (LED, fluorescent light bulbs) is a good measure. The pitfall though is that people leave the lights on, because they know it is more efficient, so they think that it does not matter. This results in the end in more energy use anyway.

For a true sustainable system, the Trias Energetica should be adapted. Measures to save energy may not result in loss of comfort or health problems. A system can only be sustainable if it uses renewable resources. The rate in which we use fossil fuels, is not renewable. The resources of oil, coal and gas are not regrowing. Another point to consider: is it nowadays cheaper to invest in more insulation or to invest in renewable energy production systems? The importance of re-use, re-cycle and manufacturing, keeping the end of products in mind, is also growing. Therefore, a new concept has been developed ‘the New Stepped Strategy’ (Dobbelsteen and Tillie, 2009). In this strategy, the last step is replaced:

1.   Reduce consumption without loss of comfort and health;

2a.  Exchange and re-use waste energy systems;

2b.  Use renewable energy sources and ensure waste is re-used as food.

Applying those steps to a city or region towards sustainability can be seen as a sign of effectiveness. This means trying to use resources in the right way, trying to reach the result, to do the right things. Think with the result or purpose in mind and do not start from the means. For example, do you need your laundry cleaned or do we need the best, most energy-efficient laundry machine to clean our clothes? The question is ‘what is the most resource effective way to clean our clothes’ (we can come back to that another time)?

Reduce consumption still is the most important step. The New Stepped Strategy introduces also the importance of different scales, from dwelling level to neighborhood to city level. Before a decision is made, it has to be studied what is the most effective step to take at which level. Some things can be arranged very effectively at dwelling scale, like insulation, but others will be more effective at a larger scale, like cascading remaining qualities. An example is the remaining heat of a power plant or industry. Nowadays, it will be the remains after fossil fuel burning, but in the future it may well be the remains of renewable fuel burning or use. The idea is that the remaining heat of this industry is not a waste product, but can still be useful for another purpose. For example as processing heat for an industrial facility that needs only heat of lower temperatures. After use in this industry, it still has some heat quality remaining that can be used in, e.g. green houses. A last step can be heating of houses that needs only  a low energy (in the form of heat) quality, see graph 2.

Graph 2: Example of a heat cascade in an urban system

So, in order to reach sustainable cities, it is important to reduce energy consumption and to apply the local available renewable and residual resources in an effective way. The urban metabolism has to evolve to a circular metabolism in which any waste product is seen as a remaining quality that can be used by another function within the city. This will decrease dependency on foreign resources. It will increase the search for local potentials and characteristics. Cities are multi-functional entities. The different functions should and need to be connected and in close proximity to effectively use the local potentials towards sustainable cities.

Wouter Leduc

References:

Dobbelsteen, A., van den, Tillie, N., 2009. Towards CO2-neutral Urban Planning: Presenting the Rotterdam Energy Approach and Planning (REAP). Journal of Green Building, 4.

Duijvestein, C.A.J., 1997. Drie Stappen Strategie. In editors D.W., Dicke, E.M., Haas, Praktijkhandboek Duurzaam Bouwen. WEKA, Amsterdam, pp. (20) 1-10.

Energy Efficiency – A Sectorial Approach

Becoming more energy-efficient is one of the major challenges of our time. Modern societies are highly energy-dependent and thus all efforts to save this valuable resource are more than welcome. For many years, or rather decades, the responsible people, politicians and experts, have urged the importance of using less energy.

We may ask ourselves what has been achieved so far. We may equally ponder about future developments. How much more can we save?

In this posting we investigate the achievements of getting more energy-efficient in the UK from a sectorial point of view. The country can serve as a typical example of a European state trying to do both, using less energy for the same economic outcome and reinforcing its potential of renewable energies. The raw data for our analysis have been taken from UK National Statistics.

We consider the following sectors: Industry, domestic, services, passenger transport and freight transport. The energy consumption of the various sectors is measured as follows: industry (Mtoe/unit of output), domestic (Mtoe/household), services (Mtoe/unit of value added), passenger transport (Mtoe/person-km), freight transport (Mtoe/tonne-km). The transport sectors cover road transport only. In order to see how well each sector is doing compared to the others, we have indexed the quantities as 1980=100.  The results is given in the figure below.

Energy efficiency in the UK for various sectors.

This picture reveals immediately who the good and the bad guys are. Let´s start with the good ones. Both industry and services managed to reduced their energy use per unit of output considerably. In fact, in 2010 British industry was able to produce more than twice as many goods per unit of energy as in 1980. Within 30 years the index went down to less than 48. The services sector was even more successful. During the same period its specific consumption plummeted to an index value of 43 only.

The situation looks quite a bit different for the other sectors with passenger transport being the most successful among those. Since 1980 the use of energy per passenger-km has decreased by almost 20 % (index 81.9). Unfortunately, freight transport cannot compete with that value. Instead its energy consumption per tonne-km went up by almost 12 % during the reference period. This finding is both, surprising and disappointing at the same time. Surprising, because car producers make us believe that modern vehicles need less gasoline than older ones. Disappointing, because freight transport is the only sector showing a clear increase in its energy hunger.

When looking at the figures for household consumption we may equally feel disappointed. There is a slight tendency to use less energy per household, with the index being at 93 in 2010. This is a rather weak performance when compared to the other sectors with the notable exception of freight transport. Countless public campagnes have been run with the clear goal of getting more energy efficient. It is hard to imagine that millions of households have not got the message. However, the results are meagre. Why is that so? Is there too little incentive for households to save energy?

Renewable Energies in the UK

As in many other countries, the share of renewable energies in the UK is growing dramatically. During the past two decades renewables have surged at an impressive pace. In fact, supply from renewable energy sources has more than quadrupled since 1990 whereas overall consumption has remained fairly constant. The raw data of this analysis stem from Eurostat and UK National Statistics.

The huge gap in the respective trends between the overall energy demand and the contribution of renewables can be seen in Fig. 1 where the data for final energy consumption and the supply figures from renewable energies are shown. To make comparison easier we present the figures in an indexed form with 1990=100.

Fig. 1 Final energy consumption (FEC) and energy supply from renewable sources in the UK. 1990=100.

Whereas final energy consumption has increased only slightly (index value 105 in 2010) with a decreasing tendency since 2001, supply from renewables has more than quadrupled over the same period. Accordingly, the weight of  hydro, wind, biomass etc. in the energy mix has risen sharply. Nevertheless, this picture should not obscure the fact that in 2010 renewables contributed only 7 % to the entire energy production.

One interesting aspect of looking at the UK figures is to check the specific output of the various renewable energy sources, i.e. MWh produced per MW of installed capacity. Here we find significant differences between hydro, wind and other renewables as shown in Fig. 2. The latter comprise landfill gas, biofuels, waste combustion etc.

Fig. 2 Specific output of renewable energy sources in MWh per MW installed.

All of them show annual fluctuations which is normal since not the entire capacity is available all the time. Wind and hydro are particularly vulnerable to external factors. However, there is a significant difference between the two as regards short-term availability. Electricity generated from water is much more stable for the grid than wind which is by definition more erratic in its availability.

Apart from that we can see clearly in Fig.2 that the specific output of the various sources differs enormously. The least efficient way to produce electricity from renewables is wind as becomes apparent from Fig. 2. This conclusion is fairly independent of the fluctuating nature of all the sources taken into consideration. The average output of wind farms is 2140 MWh per MW installed. The values for hydro and others are 3060 MWh/MW and 5200 MWh/MW, respectively. Thus we may safely conclude that using hydroelectric plants is on average 43 % more efficient than using wind turbines. The difference is even more striking for the other renewables which tend to be more than 140 % more efficient than wind.

Given this state of affairs it might be worthwhile to put more emphasis on other green power sources rather than wind. However, wind farms have already become a significant factor in several countries as we have shown in some of our previous posts, e.g. here, here and here. Bearing in mind the inherent weaknesses of wind power, it appears that other renewables such as hydro and biomass are not only more reliable, but also more efficient. They, too, deserve their chance.

Wind Energy – The European Top Producers

Most European countries are now investing into wind energy. Only very few of them may be considered as “old” players in the field. Among those which used wind power already back in 1990 were Spain, Denmark, the Netherlands, Belgium and Sweden.

Unfortunately, the data quality of some countries in the beginning stages was rather low so that we confine ourselves to comparing the average output in MWh/MW installed over the period 2000-2010. Taking this as a reference we get the following ranking among those countries which have a relatively long tradition of using wind energy:

Netherlands 2273 MWh/MW (low: 2077 high: 2473)

Spain 2233 MWh/MW (low: 1921 high: 2621)

Sweden 2080 MWh/MW (low: 1784 high: 2625)

Denmark 2028 MWh/MW (low: 1760 high: 2293)

Belgium 1929 MWh/MW (low: 1022 high: 2750)

Germany 1586 MWh/MW (low: 1392 high: 1785)

As indicated these are average values over the first decade of the 21st century. Needless to say that these mean values are rather virtual figures since in reality the availability of the driving force behind the facilities, i.e. the wind, is rather varying by nature. By the way, these figures have been calculated using our specific model which enables us to smooth out distortions due to capacity changes during each year.

The graphics below shows the evolution of wind power in those countries since 1990. The missing data points for some countries refer to the fact that the quality of those data does not fulfil our standards. Thus, we omitted them rather than doing guesswork.

Specific output of European wind farms in MWh per MW installed capacity.

It is quite remarkable that the mean performance between different countries can vary a lot. The most striking feature, however, is that Germany is seriously underperforming when compared to the leading producers in Europe. This may well indicate that selecting the location of a wind farm may not always have been the best choice. Other countries have apparently done a better job.

Wind Energy – The Case of Denmark

Denmark is one of the leading producers of wind energy in the world. This is true not in absolute, but in relative terms. Being a small country Denmark simply does not have the capacity to compete with larger countries such as Spain or Germany when it comes to total output. The share of wind power in the electricity grid was 20.1 % in 2010. Portugal and Spain, the numbers two and three in the ranking, had shares of 17.0 and 14.6 %, respectively.

In a previous post we examined the specific performance of German wind farms. Now we will compare those findings with a similar investigation for Denmark. Fig. 1 shows the specific output of Danish wind energy in MWh/MW between 1990 and 2010. As usual we have applied our model to smooth out distortions caused by the building up of new capacity over a year. The remaining fluctuations are due to varying wind availability.

Fig. 1 Specific output of Danish wind farms in MWh/MW installed.

Fig. 2 gives a direct comparison between Germany and Denmark for the period 2001 till 2010. One striking feature of this picure is that Danish performance is consistently and considerably higher than the German one. On the averge, Danish facilities have an almost 29 % higher output in MWh/MW installed. Thus, their efficiency and productivity are much better than the ones of their southern neighbour.

Fig. 2 Specific output of wind farms in Germany and Denmark.

The average performance of German facilities was 1571 MWh/MW whereas Danish wind farms produced some 2026 MWh per MW installed. One of the reasons for this discrepancy may lie in the fact that Denmark has a higher share of offshore wind farms which tend to have a higher efficiency than the ones based on land.

The Solar PV Index

Last week we investigated the performance of German wind farms which, after a massive surge in capacity over the past two decades, are now in a position to contribute substantially to the electricity mix (7.6 % in 2011 according to the national statistical office). However, as we have seen, this comes at a price. The contribution shows large and largely unpredictable variations which have a destabilising effect on the grid.

Another source of renewable energy which has gained a lot of support recently is solar PV. Like wind PV has soared dramatically  in the past years. Nevertheless, its overall contribution to the energy mix is very low (3.1 % of total power generation in 2011).  Moreover, like electricity produced by wind mills, PV is a factor of instability to the grid. The sun is not shining uniformly throughout the day. Passing clouds may severly impact the output of solar cells causing fluctuations in the supply chain.

Impressive growth rates in both capacity and production, are inclined to mislead the observer. A more thorough consideration of the situation of solar PV, however, will have to look at the output per MW installed. That is the quantity which allows us to assess the investment in that energy source.

Like in the case of wind farms, the expected productivity of solar PV depends heavily on the location. And thus, we should not be surprised to see huge differences between various installations. Here, however, we look at the global picture. This point of view is even more justified since Germany decided to abolish all nuclear plants by 2022 which, in turn, means a higher burden for all other sources of energy. As the country, simultaneously, is highly committed to reducing its carbon footprint renewables are bound to play a much larger role in the future.

Fig. 1 Solar PV in Germany. Average output per MW installed capacity and solar irradiation.

Fig. 1 shows the average PV output (P/C) in MWh/MW (blue curve) while the red curve refers to the average solar irradiation (SI) in kWh/sqm (r.h.s. scale). The performance per MW installed has been adjusted by using a specific model in order to account for extra capacity added over the course of a year. The two curves appear to follow a similar trend. Nevertheless, their correlation is quite weak. An increase in irradiation may even coincide with a downturn in specific production. Thus, on a global scale, more sunshine does not necessarily mean more solar energy produced. Over the period in question we get an average PV output of 868.8 MWh per MW installed with a spread ranging from less than 700 MWh/MW to 1157 MWh/MW.

Fig. 2 Solar PV in Germany. Deviation from mean output per MW installed (P/C) and solar irradiation (SI) in %.

Fig. 2 displays the deviations of both specific output P/C and solar irradiation SI in % over the period in question. This picture confirms the conclusions drawn from Fig. 1. The variations in PV performance are not necessarily reflected in the respective variations of solar irradiation. They may even go in opposite directions. Remarkably, the fluctuations in SI are much larger than the ones in P/C, at least on an annual scale.

As in the case of wind more capacity does not always mean more output. The availability of sunshine comes in as a crucial factor which may be decisive for the performance of a particular facility. And, like the wind, this quantity may vary a lot over the years as can be inferred from the green curve.

There is one more message hidden in Fig. 2. One may argue that due to the relatively small scale of solar PV in terms of the entire German power production, the variations in P/C do not fully reflect the varying nature of solar irradiation. In other words, one might expect them to become even larger as the number of PV installations increases. This in turn implies that the fluctuations in the power grid may be even disrupting than today.

In view of this it is of utmost importance to develop storage facilities for the solar energy produced. This should in fact be a priority.

Wind Energy in Germany

Here are some brief considerations about the performance of German wind energy facilities. Over the past two decades the number of wind turbines installed in Germany has increased dramatically. The surge in capacity amounted to 350 % between 2000 and 2010. The growing capacity lead in turn to a growing production of electricity, 300 % up over the same period.

One question of particular interest to us was how much energy one might expect to be generated per MW installed on average. As the production of this kind of energy is highly sensitive to the availability of wind we were seeking for a model which is able to reflect the variations of the latter. The source data for our investigation were taken from both Eurostat and Bundesverband WindEnergie, the German association of wind energy producers.

We started by looking at the amount of energy produced per installed capacity (Prod/cap) measured in MWh/MW between 2001 and 2010. We may call this quantity the specific production. The result is the blue curve in the figure below showing a clearly increasing trend. It must be noted here that this graph needs to be interpreted with special care, since it is distorted by two major sources of uncertainty. The first source is the varying wind availability. The second source of uncertainty is based on the fact that the number of wind mills is constantly growing over the year as more and more turbines are constructed. The total installed capacity may go up by some 30 % and more during the course of a year. Some of the newly built turbines may take up operation in spring and others may be commissioned towards the end of the year. In each case their contribution to the entire production will be very different. Thus our model has to account for the extra capacity erected during one particular year.

Another factor coming into play is the location of the turbines. Although each of them is supposedly optimized in terms of output, there may be significant differences between various wind farms. However, as more and more turbines come into existence, the influence of individual outliers should diminish compared to the total average. We always have the big picture in mind, thus neglecting the performance of particular locations.

In theory, the specific production should exactly correspond to the amount of wind available. The latter quantitiy is represented by the red curve as a percentage over the long-term average (r.h.s. scale). As can be seen, the variations may be tremendous.

Production of wind energy in MWh/MW(installed) and comparision with wind availability.

We note that the red and the blue curve do not coincide as expected. This lack of coincidence is mainly caused by the addition of extra capacity which, in relative terms, was very large during the first part of the period in question (44 % and 37 % in 2001 and 2002, respectively, compared to the previous year).

In order to find a better agreement between the wind availablity curve and the specific production we developed a statistical model which enabled us to eliminate the distortions caused by the newly built wind mills. The result of our model calculations is shown in the green curve which nicely matches with the availability curve (red). What we got is a new quantity Prod/cap* which allows us to draw meaningful conclusions about the mean productivity of each MW of installed capacity.

Depending on the availability of wind Prod/cap* may vary considerably. At a value of 100 % availability each MW installed should produce slightly more than 1700 MWh annually. During our reference period Prod/cap* varied between a maximum of 1800 MWh and a minimum of 1250 MWh. This is a massive variation which must be taken into account when considering the energy supply stemming from wind farms.