If Germany had four times more solar…

Germany is the country with the most photovoltaics installed worldwide. A new study now says that solar in combination with batteries would allow a lot more PV to be installed. Craig Morris says the investigation confirms his worst fears.

Battery Storage

Battery storage for PV can provide benefits to individual households – but is it actually economically desirable on the grid level?


Back in 2012, German solar campaigners launched a campaign calling for 200 GW of PV in Germany. That year, Germany installed around 7.5 GW, with product warranties of 25 years. That number produces around 200 GW, so the sector was calling for continued growth at that level. This year, that number will probably fall below 1.5 GW of new solar installations. With 39.4 GW built at the end of September 2015 (source in German), it seems that the old target that some solar proponents wanted is out of reach for good.

Or is it? Some market watchers believe that the current low in the German market is the calm before the storm – everyone is waiting for storage to get cheap. At that point, they say, there will be no turning back.

Now, a new study published by Berlin-based think tank Agora Energiewende investigates the impact of 150 to 200 GW of PV. The main finding is that it would be “technically and economically possible.” But scratch deeper, and you find something disconcerting.

First, Agora confirms that these storage units cannot simply continue to ignore what is happening on the grid. The result would be an incredibly steep ramp. However, the study does not call for utility control of grid-attached storage units; Germans are generally skeptical of smart meters, especially in households – utilities knowing what your battery’s state of charge is raises privacy issues. Instead, the paper calls for a blunter instrument. At present, new solar arrays are only allowed to export 70 percent of their rated capacity to the grid at a time; that level could be lowered to 50 or 40 percent, the authors argue. The result would indeed be a limit on the height of the spike, but still it would come around the same time (when the battery storage systems are full around noon), and not when the grid needs it (during peak demand in the evening).

The study mentions the option of orienting “battery operation to electricity market prices,” which would be a step forward – but even spot market prices do not reflect local grid bottlenecks. What Germany needs is local signals. But as the study puts it, “the real obstacle to Information Communications Technology (ICT) control of household battery units is less cost than the wish for independence” – German households don’t want their utilities poking their noses into their homes.

Effect of self-consumption optimized batteries on grid

Agora speaks out against a focus on optimizing on-site solar power consumption and for a focus on grid needs. Source: Agora

In the chart above, the load ranges from 60-80 GW, but PV, wind, and hydropower peak above that level. In other words, we will not only need to store solar (or export) power at that point, but also wind and hydro. Note that biomass is not even considered but would also need to be stored.

One good piece of news is that not all of the new transmission power lines currently planned would be needed, which would save costs. The study says that the renewable energy surcharge would increase by around one cent, as would grid fees. Two cents does not sound like much, but what about the cost of backup power? There would be no demand for conventional electricity 10 hours at a time, but then conventional generators would need to kick in at 50 GW within just a few hours. When these plants run less often, they won’t be profitable and may require more capacity payments. This could get expensive.

Overall, this arrangement seems undesirable. In the summer of 2014, I wrote, “Germans will go for PV plus storage in the 2020s when the combination costs 30 cents per kilowatt-hour, and there is little anyone can do to stop them. This option is bad in terms of the overall cost of the energy transition; onshore wind power is a much better option at 5-9 cents per kilowatt-hour, but then people don’t get to say they make their own energy at home.”

Back in 2010, I wrote that such an arrangement is also “a terrible idea because it produces windfall profits at least in the amount of your power bill.” Today, I would propose a different solution. If you want to stay hooked up to the grid, the utility controls your battery storage, and you get a feed-in tariff (currently around 10 cents) with a target six-percent return, which is fairer than offsetting a much higher 25 cent retail rate.

Craig Morris (@PPchef) is the lead author of German Energy Transition. He directs Petite Planète and writes every workday for Renewables International.

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Craig Morris

Craig Morris (@PPchef) is the lead author of Global Energy Transition. He is co-author of Energy Democracy, the first history of Germany’s Energiewende, and is currently Senior Fellow at the IASS.

6 Comments

  1. ” but even spot market prices do not reflect local grid bottlenecks. ”

    Why not use a, fairly distributed, curtailment at the moments this happens, like it is done currently with windparks in northeastern Germany? This seems less crude than a general export limitation and more democratic than giving grid operators complete control over private batteries.

  2. heinbloed says

    Agora has made several out-of-touch predictions in the past, the “negative power price study” for example was a total flop already before it was published.

    But that is beside the point.

    Batteries offer long-term storage capacities and there is a lot of power to be consumed when the sun doesn’t shine.
    If the owner can’t sell it he’ll sit on it. So what ?

    Most local grids connect PV producers with non-producers within the very same local grid, the batteries can’t be big enough to support the whole lot.
    Power-to-heat hasn’t been looked at in the entire study, a PV-power producer and battery owner can support not only the cooker of a non-producer but for example stored domestic hot water in the neighbour’s house as well.
    If the neighbor (the non-producer) is interested in cheap DHW then he can get a smart meter. If not then not.
    At the moment we see 2 technical lines followed in Germany next to the traditional feed-in: battery storage and power-to-heat.

    Still the majority of power producers has neither the one or the other, being in a producer-only position and is not intending for the next ten years to change this situation.

    The huge majority of grid connected meters are those of the ‘consumer-only clients’.
    They live door-to-door to the producers. And can (they do!) take whatever there is.

    There is a technical solution b.t.w. to keep out unwanted power from the grid, that is the 50.2 Hertz outlocking mechanism.

    http://www.pv-magazine.com/news/details/beitrag/germany-retrofits-200-000-pv-installations-to-meet-50-hz-requirement_100016243/

    Technically better explained by the VDE:

    https://www.vde.com/en/fnn/pages/50-2-hz.aspx

    The slow adaption to market forces will follow demand, I have no doubt about that.
    Those participants being to slow to follow will lose out. Be they sellers or consumers or both.

    As poster Hans has written already: when the market is closed there is no sale.

    —————–

    Last week was a new record for wind power generation in Germany, 3.69 TWh had been produced.
    And no one filled a battery.

    https://www.energy-charts.de/energy.htm

    (click in the left column on “weekly”)

    This week looks as if we could break the new record just achieved.

  3. Ulenspiegel says

    A 200 GW PV scenario is very unlikely in the next decades with the low addition of PV capacity, there is no need for a heated discussion when less than 3 GW of PV are added per year. Peanuts.

    The more interesting question is, why do people suggest 200 GW PV? What would be the issue with a more wind heavy scenario:

    180 GW onshore wind (35000 turbines, >500 TWh/a)
    40 GW offshore wind (5000 turbines, 180 TWh/a)
    100 GW PV (100 TWh/a)

    More cross-border transmission capacity and moderate imports of electricity would be IMHO a better scenario, even or especially if we see a demand in the 900 TWh/a range.

  4. S. Herb says

    As I see it, the purpose of the Agora paper is to present a possible scenario which can be used (together with many other scenarios) in judging possible effects of new legislation and regulations, e.g. to avoid creating perverse incentives which would be hard to change after they have been established. It is not unreasonable to present it in a somewhat extreme form.

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