Support is
growing for the German federal government to take a greater role in pending
grid development projects that will increase the connectivity of scattered
renewable sources, with calls even for part-privatization.
The growing pace of the German Energiewende is highlighted by the
fact that the share of renewable electricity generation in Germany rose to 26%
in the first half of 2012, primarily from solar and wind capacity.
Yet Germany is already facing network stability issues resulting
from sudden increases in electricity generation from renewable sources. The
fluctuations in generation on the grid can affect the production of major
industries such as coal mines and aluminum process units, forcing them to
install backup power supplies in the interests of uninterrupted production.
The German Energy Agency estimates that up to EUR42.5bn is
required in infrastructure investment by 2030 to support the country's
transition from nuclear to renewable generation, including major projects to
connect its renewable sources of electricity generation to demand centers in
the south.
This marks Germany as a potential market for grid investments by
both domestic and foreign players: for example in January 2013, Japan's
industrial conglomerate Mitsubishi partnered with German-Dutch grid operator
TenneT to announce the construction of four underwater connections for German
offshore wind farms in the North Sea.
Yet other grid investment is lacking. The fragmentation of the
transmission industry along with the recent network divestments made by the
large German utilities has placed management of the nation's transmission
assets in the hands of investors with little interest in co-ordinated network
development projects. Proponents of federal involvement hope that this will guarantee
that these projects proceed in the national interest.
Datamonitor sees calls for part-privatization as a step too far,
and recommends instead the shared ownership of the transmission planning
function, with federal and state governments, transmission companies, and
renewable project developers holding shares in a network development agency. A
successful example of an organization with this ownership model is the
Australian Energy Market Operator, which among other roles has responsibility
for co-ordinating transmission network development across five states.
The scope of such a transmission planning entity could grow
organically, commencing with the development of the three key lines required to
connect offshore wind projects. The question of asset ownership could be left
open, avoiding an upfront commitment by German taxpayers, but allowing for the
possibility of future government investment as an absolute last resort.
The challenge, as always, will be balancing competing development
interests and delivering renewable power to high-demand centers, while avoiding
excessive costs for German consumers.
Written by:
Rhys Kealley
Lead Analyst, Datamonitor Energy
email: rkealley@datamonitor.com
Follow Rhys on Twitter: @RhysKealley
If you have any comments or questions on the above article, please leave a comment below and the author will get back to you as soon as possible. Alternatively, contact Rhys directly using the details above.
No comments:
Post a Comment