Indirect Costs of the Renewable Energy Sources Act
Presentation : Anastasios Moutoupas Supervisor : Prof. Dr. Georg Erdmann 19/12/2008
Indirect Costs of the R.E.S. Act
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Agenda
1. Introduction 2. Development of R.E.S. 3. Indirect Costs as a consequence of investments in the electricity network 4. Indirect Costs for energy reserves 5. Merit‐Order Effect 6. Literature 19/12/2008
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Introduction
• Direct Costs: amount of money that the non‐ privileged electricity customers have to pay • 2007, Year‐ahead‐future: 61 Euro/MWh • 2008, 117 Euro/MWh • Direct costs : 9,40 Euro/MWh or 1 Cent/kWh 19/12/2008
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Introduction
Indirect Costs of the Renewable Energy Sources Act • the connection costs of offshore wind parks to the main transmition and distribution network, • the additional costs for the development of the network , • the line losses, • the need of additional balancing energy, • the non‐cost‐efficient extent of utilization of existing power plants, • the transaction costs which occur from varying R.E.S. electricity feeds • the costs of the Federal Network Agency (Bundesnetzagentur) 19/12/2008
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Development of R.E.S.
R.E.S. prognosis of the BDEW, 22.04.2008 ‐ Development of the electricity produced from R.E.S. (in GWh) Total
Wind Wind Hydroelectrical Biomass Geothermical onshore offshore
PV
2008
34.877
1.332
3.334
15
24.459
30
5.013
2009
37.894
1.337
3.713
21
26.148
300
5.695
2010
43.103
1.447
4.064
27
28.295
2.175
6.401
2011
48.674
1.491
4.361
45
29.739
5.305
7.024
2012
53.470
1.526
4.628
69
31.150
7.705
7.666
2013
58.252
1.562
4.872
90
32.543
10.105
8.341
2014
62.497
1.595
5.102
112
33.988
11.905
9.040
Source : BDEW 2008 19/12/2008
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Development of R.E.S.
• Wind power plants : goal until 2020, an installed capacity of onshore 45,000 MW offshore 10,000 MW • Today : 24,000 MW installed capacity • Prognosis for installed capacity and electricity feed onshore 45.000 MW 81.000 GWh offshore 20.000 MW 71.000 GWh 19/12/2008
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Development of R.E.S.
• Solar energy/photovoltaics: Cent/kWh
around
25
• According to the development scenario installed capacity : 15,000‐20,000 MW
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Electricity Network
• Costs for the connection of offshore wind power plants to the transmission network, investment 2,7 Mil. Euro/MW • Reduction of costs equal to 0,54 Mil. Euro/MW of installed Offshore‐capacity for the investors • Target: 10,000 MW, investment of 6 billion euro needed until 2020 • Indirect costs, 540 Mil. Euro until 2020 19/12/2008
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Electricity Network
• Costs for the development of the network • Important Measures ‐Network reinforcement, 400 km length, ‐construction of new network , 850 km length
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Electricity Network
• Dena : Investment around 3,8 billion euro until year 2020 network development, 1.1 billion euro partial wiring of high‐tension lines, 1.2 billion euro at least 1.5 billion euro, development of electricity production through R.E.S. • Indirect costs, around 270 Mil. Euro at year 2020
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Electricity Network • Costs for line losses • Extra operating costs for line losses and other operational expenditures of the transmission network, approximately 160 million euro in year 2020 Investions (Euro)
Operating Costs (%)
Operating Costs (Euro/year)
Offshore Network
6,0 Bil.
1,7
102 Mil.
Onshore Lines
2,6 Bil.
1,5
39 Mil.
Onshore Wiring
1,2 Bil
1,7
20 Mil. 161 Mil.
Source: “Indirekte Kosten der EEG‐ Förderung”, Erdmann, 2008
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Electricity Network
• The effect of network’s reliability • N‐1‐Criterion, Union for the Co‐ordination of Transmission of electricity (U.C.T.E.) • “Bottleneck”‐Effect 19/12/2008
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Energy Reserves
• Institutional treatment of the electricity produced from R.E.S. • Power suppliers : Month‐ahead electricity tariffs increase the operational risk of the electricity suppliers • Distribution System Operators : indirect EEG costs arise during the production prognosis, the measurement and the management of energy data, as well as the completion of horizontal electricity equation • Transmission network operators
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Energy Reserves
•
Indirect costs arise as consequence of varying renewable electricity feeds
•
onshore 81.000 GWh 868 million euro in the year 2020
•
offshore 71.000 GWh 476 million euro in the year 2020
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Merit‐Order Effect
Merit‐Order Effect
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• 2006: Merit order effect between 3,17 and 7,83 Euro/MWh, 88.700 GWh, advantage of 490 Mil. Euro • the prices for the fuel and the CO2 emission (2006, 25 Mil. Euro/ advantage of 90 Mil. Euro) • reserve capacity (590 Mil. Euro in year) 2006 • reserve capacity as stored energy (1.180 Mil. Euro on year 2020) 19/12/2008
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Conclusion • 2006: 445 Mio. Euro 2020: 3,3 Bil. Euro (Erdmann, 2008) • Indirect Costs should always be quantified and should always be taken into consideration
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Literature
• Bundesverband der Energie und Wasserwirtschaft (BDEW), http://www.bdew.de/bdew.nsf/ID/DE_Home • Federal Ministry for the Environment, http://www.bmu.de/english/aktuell/4152.php • “Indirekte Kosten der EEG‐Förderung”, Erdmann, 2008 • “The Merit‐Order effect: A detailed analysis of the price effect of renewable electricity generation on spot market prices in Germany”, Frank Sensfuss, Mario Ragwitz, Massimo Genoese • VDN (2005) EEG‐ Verfahrensbeschreibung. Fassung vom 15.02.2005. Berlin: Verband der Netzbetreiber • (www.vdn‐berlin.de/global/downloads/Netz‐Themen/eeg/ EEG‐VB‐ 2005‐02‐15.pdf)
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Thank you for your attention
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