Uniper and Engie have made further write-downs on their still very new Dutch coal power plants, writes independent consultant Gerard Wynn, confirming the bleak prospects for coal power production in Europe. Yet Uniper is pressing on with plans to build another new coal plant in Germany. Courtesy IEEFA.
In “The Dutch Coal Mistake” report we published late last year we warned of further write-downs to come from the extraordinary commissioning of three brand-new coal power plants in the Netherlands in 2015.
That report spoke directly to the Dutch gaffe but raised broader questions about investing in new coal-powered generation anywhere in Europe.
The policy backdrop here: A recent Dutch court ruling that the Netherlands will have to increase the ambition of its 2020 emissions target. The energy market backdrop: Falling electricity demand and power prices, and a massive rise in renewable energy capacity in neighboring Germany.
Our report went into the scale of investment risk clouding new coal power plants in Western Europe and showed how, by mid-2016, three major European utilities—Engie, RWE, and Uniper—had already written down up to half the value of the new plants in the Netherlands. The takeaway was clear: the utilities had no chance of meeting their target investment returns on those plants.
Indeed they had written down the value of the coal plants to as little as €1 million per megawatt (MW), compared with a construction cost and implied book value of about €1.9 million per MW. The discounted cash flow model we detailed in our report found that, under generous assumptions of load factor and power price, those plants may be worth around half that again.
Detective work
So we anticipated further write-downs, and those have come to pass now at two of the power plants. In its year-end results in early March, Uniper reported that it had made further impairments to its new Maasvlakte 3 power plant in the Netherlands, by €100 million, at the end of last year. It reported a “recoverable amount” (i.e. book value) of €700 million, or €0.7 million per MW, at the end of 2016. That was less than half the book value of €1.5 billion just 12 months earlier, at the end of 2015, and an original construction cost of about €1.7 billion.
Uniper did not mention Maasvlakte 3 explicitly by name, but some basic detective work seems conclusive. We know at the end of 2015, Uniper had written down the value of “one conventional power plant in the Netherlands,” to €1.5 billion. Maasvlakte 3 is the only Uniper power plant with a value nearing that in the Netherlands. Uniper then stated that in 2016 it further impaired a “conventional power plant outside Germany” by €0.8 billion, to a recoverable value of €0.7 billion. Since it also stated that the Netherlands was a major target of its 2016 impairments, alongside Germany and France, it’s safe to say that this power plant and Maasvlakte 3 are one and the same.
Meanwhile, Engie noted in its 2016 year-end results a €168 million impairment on its thermal power plants in the Netherlands. Given that its new Rotterdam coal power plant is the company’s only substantial asset not yet largely or fully depreciated, we can assume that much of this impairment applies to the Rotterdam plant.
Gambling on capacity market
These impairments on new coal plants in the Netherlands make it all the more surprising that Uniper is now pressing on with plans to complete the construction of a new coal plant in Germany, Datteln 4. While this plant may be more efficient because it is supposed to supply district heating as well as power, Uniper may well still be gambling either on a capacity market in Germany, which pays for flexible back-up to variable renewables, or a big surge in power prices as a nuclear phase-out continues.
It may find, however, that it is caught out, as it was in the Netherlands, by rapidly evolving market trends, which include the falling cost of renewables and lower than expected demand.
Editor’s Note
Gerard Wynn is a London-based independent energy consultant. He writes a regular blog, EnergyandCarbon.com, with Berlin-based energy expert Gerard Reid. Wynn regularly works for the Institute for Energy Economics and Financial Analysis (IEEFA). This article was first published on the website of IEEFA and on the EnergyandCarbon blog and is republished here with permission.
[adrotate group=”9″]
Travis says
Good investigation. What do you think the reason was for the miss evaluation?
Helmut Frik says
The investments were based on the assumptions that renewable power would never work, same assumptions as the nuclar fanboys here have. This assumption was wrong, and so nobody waited for these plants to come online in the market. So they are sunk costs, nothing more now. They just came online on time to participate in the coal phase out.
Nigel West says
Conventional capacity is needed regardless to cover when there is inadequate renewables generation. However German wind surplus generation floods The Netherlands grid at times so has reduced market share for coal fired generation, but not eliminated the need. That undermines the economics of coal or gas fired generation due to reduced market share. However the capacity is still needed to keep the lights on when wind and solar are down.
The owners are writing down investment costs to reflect the lower returns their plant will now make with reduced market share.
There are no winners here. German consumers have subsidised wind which they do not need at times which is then dumped elsewhere at below cost.
Germany has plenty of coal and gas fired capacity to back up renewables that they can call on when needed. But surrounding countries will still need conventional capacity too. The point may not be too far off where, as has happened in the UK, operators of conventional plant find they are needed when renewables are down but for not long enough to be economic to remain trading. Operators will then move to shut plant. This has happened in the UK and Grid has paid old coal plants to remain open as new conventional plant is not being built because subsidised renewables that do not rely on wholesale prices and elbow out conventional generation have taken so much market share. Capacity payments may be needed to underpin the fixed costs of conventional plant.
Helmut Frik says
You will not find significant changes in german power exports due to wind power generation today.
And wind power in regions far away from each other that they are uncorrelated mathematical inevitable start balancing out each other.
And if just capacity is needed, and not significant amounts of energy, then other options than old coal fired plants are cheaper. But that’s a question how tenders for capacity are designed, if any are neccesary.
Nigel West says
Last year Germany consumed around 600TWh and produced 650TWh. The balance being exported. Germany has about 90GW of combined wind and solar power which is more than enough to cover national consumption at certain times. Dumping is likely to occur during low load periods, not today at this time of year. The problem is set to grow too so threatening the economics of conventional stations that are needed for security. Unless, as Poland is doing, QBs are installed to repel unwanted German exports.
Even if grid connections could handle the power flows, it would be far too risky in terms of supply security standards to rely on wind being available elsewhere 100% of the time and not have local conventional plant too. Germany holds plenty of spare capacity. Of all the EU countries Germany would not take such a risk with supply security, neither should any other country too.
When the chips are down and renewables are unavailable Grid operators will turn to whatever conventional capacity is available as insurance against the lights going out.
Helmut Frik says
There was never a minute when production from wind solar, hydro and biomass exceeded consumption in germany. So why should ther be dumping neccesary? Main problem could be nuclear, but nuclear is down to 5,3 GW at the moment.
“Unwanted german exports” – these are unwanted circular flows due to the inabiliyof the polnish anczech grid to control _any_ flow in their grid (outdated) which means a inability to participate in eletricity markets.
Exports are based on contracts and so are always wanted.
Before switching on “nything” it is usually chaper to import excess power from other areas.
Wind being available elsewhere – is more sure than relying on th availability of imports of coal, gas, oit or uranium, if the grid size is beig enough. It is no use to fight mathematics and physics here.
[censored no personals please]
Nigel West says
100% renewables and big grids would never work. See this comprehensive review (link below) of 24 similar studies that finds serious problems with all of them.
“While many modelled scenarios have been published claiming to show that a 100% renewable electricity system is achievable, there is no empirical or historical evidence that demonstrates that such systems are in fact feasible.”
http://euanmearns.com/the-lappeenranta-renewable-energy-model-is-it-realistic-lappeenranta-responds/#comment-28088
Helmut Frik says
You think I did not read the fake news on euan mearns before?
Well, some Author defines som criterias after some other authors have made various studies about various aspects of 100% renewable generation, and finds out that the glass bowls of the previously writing authors were not working so perfect to guess what the author of the referenced meta study would set as criteria.
Which says nothing about the results of the studies. It might tell something in which the original studies could be extended sometimes, when somebody has time and money to do so.
E.g. the author complains that many simulations do not include variations blelow 1 hour. Well what should be the use of such temoral resolution of e.g. 5 miniutes, or 1 scond or whatever smaller? In biggger grinds, andd the talk is here about bigger grids, neither demand nor supply do really surprising things within a hour, which more detailed online data shows, in terms of TWh Energy. Small storages providing ancilliary services for grid, as they are distributed in many places can already deal with such variathions as a side effect. But increasing the temporal resolution multiplies calculation time and data volumes, hindering all other work in the study, so the work targeted at the targets of the study.
So this requirement does not make much sense. it increases costs of the study without any likelyhood to produce anything useful for the result.
This way you can go on threw all of the texts. But it’s not worth the time.
Nigel West says
The report I pointed to on the ‘Mearns website, “Burden of proof: A comprehensive review of the feasibility of 100% renewable-electricity systems” was sponsored by Bright New World, not the ‘Mearns website. That website link provides free limited time access to the full report. So the ‘fake news’ accusation is prejudicial – perhaps because some renewables fanatics are heavily moderated on the ‘Mearns website?
Your cherry picking of one aspect of the study in isolation to criticise and by extension dismissing the rest of the study is very bad science and not a credible response. Peer type reviews of research is essential which is why this study is so important.
Fake views that Europe could exist on near 100% renewables poses a serious, unacceptable and highly dangerous risk. Far more so than safe nuclear power together with a mix of generation sources including renewables. Which is where sensible national energy policy like in the UK is heading. Germany will catch on eventually, but perhaps not before wasting huge sums of money.
Helmut Frik says
So you have nothing to say about my example critics on this report?
But go in a general atack on all use of renewable power again?
[…]
Yes Euan Mearns site produces a nice echo chamber for Fossil fuel and nuclear fans, where all serious critics, and proofs that the articles include planty of faults are moderated away quickly.
I could go more in detail with the errors in the studys, and the valid questions in includes (but these are often points not relevant or in the focus of the original study) as well as the omission of other studies where these points have been in the center of the study.
But that does not make sense if you go either ad hominenm or in general against renewables instead of answerting to the topic.
For the system design based on wind and solar, for the additional factors you have the following substitution lines:
Grid size / stength Storage (inkl hydropower, dynamic loads etc.)
Grid size / stength Biomass use
Biomass use Storage (inkl. Hydropower, dynamic loads etc.)
Also the introduction of the new system is not done by flipping a switch, but a continuous process over many years, where any unexpeced deviation can be handeled in case it shows up. So far nobody in germany, including the utilities feels any wish to retor to a concentional power generaion sheme. And nobody relevant wants nuclear power, since it’s much too expensive and offers no benefits.
Bas Gresnigt says
Nigel,
Bright New World is an Australian organization erected by pro-nuclear Ben Heard.
He stopped with his personal WEB-site (which promoted nuclear) when S.Australia decided not to invest in detailed investigations regarding a commercial nuclear waste repository (would be a good place for us in Europe).
Nigel West says
Bas, understood.
However the other three authors of the report “Burden of proof: A comprehensive review of the feasibility of 100% renewable-electricity systems” are far from being nonentities. Barry Brook is a leading environmental scientist with hundreds of publications to his credit, Tom Wigley is “one of the world’s foremost experts on climate change and one of the most highly cited scientists in the discipline” and Corey Bradshaw has co-authored books with Paul Ehrlich. The authors are not, as one might expect, climate change sceptics, but firm believers in the threat that climate change allegedly poses and the need to do something constructive about it.
Helmut Frik says
@ Nigel, so you say that the other Authors are not realy speicalised on large grids & power supply systems, but as it seems are writing this document as hobbyists.
This does not devalue the article in iteslf, the value of the article comes and goes with the words and thoughts within the text, and not with the names of the authors.
Bas Gresnigt says
Nigel,
Prof. Brooks is Australian’s most authoritative pro-nuclear.
One of the authors of the eco-modernist manifest,
which promotes nuclear.
Together with Heard cs he pushes that Australia should start with nuclear.
Jens Stubbe says
Barry Brook also has a pro nuclear home page https://bravenewclimate.com
The Netherlands has a large chunk of the valuable North sea real estate. Offshore wind in the shallow parts of the North sea can power the entire European continent including electrifying the transportation sector.
Currently North sea wind power auctions are won with bids without FIT based upon electricity cost approximately 80% below Hinckley Point. (Much lower seen over the projected lifetime of the wind power plants DONG just has won due to the insane cost model for Hinckley Point.)
As for the recent new coal power plants in the Netherlands they are fast tracked to stranded assets.
Power2gas will completely dominate the energy future here in Europe as well as the globe in general. The nice thing about offshore wind is that the NIMBY effect is negligible.
Interestingly the write down brings the valuation of the soon to be stranded assets Dutch coal power plants very close to the cost point DONG has used for their recent bid as a retrograd calculation suggest an installed cost of €1.25 Mill. per MW.
The main difference is that the new wind power plants will deliver a much higher capacity factor than the soon stranded dutch coal power plants and off cause that wind is free as well as pollution free.
However DONG is probably bargaining on going significantly below €1.25 Mill. as they are in it for the money.
Bas Gresnigt says
The market should adapt towards the new situation which implies high share of wind & solar.
Conventional (=steam turbine, etc) capacity needs to much staff, etc to be competitive in such environments. Their marginal costs are already too high as they can produce during only small part of the time above their marginal costs.
In such environments unmanned simple gasturbines (who may burn renewable generated gas) or fuel cell assemblies (using renewable generated H2) are or will be far better suited to compete.
Capacity market payments will only keep noncompetitive orthodox plants open at higher costs for the ratepayers, while delaying the introduction of more flexible competitive solutions (unmanned turbines, fuel cell assemblies, advanced CHP, etc).
Nigel West says
Capacity payments keep the lights on.
Bas Gresnigt says
Germany & Denmark with far higher share of wind+solar keep the lights better on!
HarryDutch says
I noticed that you made reference to two gentleman. FYI – I guess that you already know this, but for the other readers. Ben Heard is a South Australian environmental consultant and an advocate for nuclear power in Australia. Heard completed a Bachelor of Applied Science, Occupational Therapy from the University of South Australia and a Masters of Corporate Environmental and Sustainability Management from Monash University. As of February 2015, he is a PhD candidate at the University of Adelaide.
Professor Barry Brook is an an ARC Australian Laureate Professor and Chair of Environmental Sustainability at the University of Tasmania in the Faculty of Science, Engineering & Technology.
Including myself, we are members of the Australian Nuclear Association and strong proponents for nuclear power as a viable carbon-free energy source for wholesale replacement of fossil fuels in Australia. On the proposed South Australian Geological Nuclear Waste Depository. This project is not finished as some of the media makes you believe. Currently Allison Macfarlane ex-head the US NRC is spending 6 months in Australia, she is working at Flinders University further investigating this project. By my request, I arranged for Ben Heard to meet with her last week.
Political and Community Support for Nuclear Energy to replace it’s dependency for fossil fired power plants is steadily growing in Australia.
Bob Wallace says
Yep, if there’s anything Australians want is even more expensive electricity.
Crowds are in the streets demanding nuclear and higher prices.
Bas Gresnigt says
Interesting.
The proposal of the SA royal commission to investigate a nuclear waste dump in SA as a service to the global nuclear community, was rejected with overwhelming votes in SA.
How do you think that the opinions of the population, parliament, etc. can be changed?
Furthermore the royal commission rejected already the idea for a NPP as being economically not viable at all. Considering the continued price decreases of wind & solar and the price increases of nuclear since then (2015), how would it be possible that they change their minds?
HarryDutch says
It was not the population of South Australia that rejected the geological nuclear waste depository, and a possible reprocessing plant (nuclear fuel cycle). It was a rather small inexperienced citizens’ jury. Statewide consultation found more South Australians in favour of continuing these investigations than opposed.
Jacobs MCM produced the most comprehensive insight available into this potential market. As well as a team of seven authors, the work was peer-reviewed by a panel of eminent scholars and economists: Professor Mike Young (University of Adelaide); Professor Sue Richardson (Flinders University); Professor Paul Kerin (Head of Economics, University of Adelaide); Professor Ken Baldwin (Australian National University); Professor Quentin Grafton (UNESCO).
The recommendations from the Royal Commission: pursue a purpose-built waste storage and disposal facility for used nuclear fuel and to remove the legislative constraints to properly consider this opportunity. Nuclear power generation would not be commercially viable in SA under current market rules, but should be considered as a future low-carbon energy source to contribute to national emissions reduction targets. The cost used for a NPP were way to high and currently this is all under review.
Bob Wallace says
When you use talk about the subsidized cost of renewables please include the full price of fossil fuels. The subsidies provided for coal do not show up in the wholesale rate but are hidden in government and private expenditures.
“Coal-fired power stations cost the European Union up to €42.8 billion a year in health costs associated with coal-fired power stations. ‘The Unpaid Health Bill: How coal power plants make us sick’ — found that EU-wide impacts amount to more than 18,200 premature deaths, about 8,500 new cases of chronic bronchitis, and over four million lost working days each year.
The total costs are up to €54.7 billion annually when emissions from coal power plants in Croatia, Serbia and Turkey are included.”
http://www.evwind.es/2013/05/03/coals-hidden-health-costs-40-billion-euros-a-year/32333
“Coal’s cost including externalities is more than double the market price, at around €167 per megawatt hour, making coal the most expensive major energy source. Under these assumptions onshore wind is the cheapest source of power. Next would come nuclear and large, utility-scale solar parks.”
http://reneweconomy.com.au/true-cost-of-energy-and-subsidies-in-europe-renewables-win-72398/
In the last quote I’m pretty sure Evans is using the cost of electricity from paid off nuclear plants. If capex and finex costs are included nuclear is second to coal as the most (all in) expensive source of electricity.
Nigel West says
The moral of your story is if the anti nuclear movement had not conflated military and civil nuclear power, Europe would have built much more nuclear capacity over the last 40 years so marginalising coal burning. So the health problems you highlight due to dirty coal would be much less of an issue today. Furthermore CO2 emissions would be far less today.
The blame for this huge mistake lies firmly with Green NGOs who were run by people whose ideology was to oppose nuclear weapons and nuclear power. Some have realised the mistake and now support nuclear power like Prof. James Lovelock.
Today, wind and solar can partially displace fossil fuels, but not replace them fully. There is only one technology that can fully replace fossil fuels.
Bob Wallace says
I don’t know about Europe, but nuclear builds ceased in the US for economic reasons. Well before Three Mile Island and the rise of any significant opposition to nuclear new construction starts had plummeted.
Completed reactors were costing 2x to 3x their initial “promised” cost and many reactors were abandoned well after construction started.
I suspect both the US and Europe have now gone through a refresher course on the cost of nuclear. We tend to not learn from history as well as we should.
Nigel West says
The UK is magnate for new nuclear build. The UK’s first new nuclear plant at Hinkley is needed to replace closing nuclear capacity in the next decade. The UK is planning for large offshore wind farms too but will not be emulating Germany’s renewables experiment.
A great deal of time and effort has gone into the commercial arrangements built around CFDs for both new nuclear and large renewables. Consumers are not on the hook for any cost overruns with new nuclear.
To proceed with further plants, the UK Government is known to be insisting that follow on plants are cheaper than Hinkley Point C. The Koreans and Chinese will be able to achieve that target.
Helmut Frik says
Well we will see if some chinese or coran design will pass the allowence proces for the design in some years – or maybe decades? – from now on, and if some years later some costruction will start somewhere to be finished in a unknown future many many years from now.
And we will see if EDF/Areva can absorb eventual cost overruns in Hinkley point, or if they will go out of business at some point and leave it to the customers to pick up the bill.
During this time new renewable capacity comes online everywhere, reducing the needs for other capacities, as well as new interconnectorcapacity. Which will make it likely that nuclear projecs will be postponed because they are not needed “now”. Which can result in infinite delays without officially canceling the project. Let’s see how things go on.
Bob Wallace says
Hinkley Point strike price is about $118.72 per MWh. (£92.50)
Twelve cent wholesale electricity.
Offshore wind in Europe is now dropping to about six US cents.
Do you think it makes sense to spend twice as much for electricity?
Nigel West says
Bob, the EPR based Hinkley project is not seen as a benchmark. Before it was given the go ahead many nuclear supporters were saying it is too expensive. Actually the cost is now higher at around £100/MWhr due to indexation. It’s a ‘rolls royce’ design which is unlikely to be repeated. EDF is working on a more modular design to get the costs down and shorten the period from first safety concrete to commissioning.
EDF is also assisting the Chinese with the design approval of a Hualong reactor for a UK site. That will be cheaper being a Chinese showcase for their nuclear tech. in Europe.
Follow on new nuclear in the UK needs to be lower cost – likely around £80/MWhr to get the Government go ahead. It’s a negotiated CFD arrangement with the developer, not a capacity auction. Next in line is Horizon Nuclear Power and plans for 5.2GW based on the ABWR. BWR technology should be cheaper to build than PWRs
On UK offshore wind, prices are now expected to be under £100/MWhr for new capacity.
https://www.ft.com/content/e7cce732-e171-11e6-9645-c9357a75844a
BEIS is holding an auction, shortly after which offshore wind CFD strike prices will be known and the details compared with recently awarded projects on the continent.
http://www.offshorewind.biz/2017/03/14/uk-govt-clearing-path-for-april-cfd-allocation-round/
Bob Wallace says
Adding…
The rate for Hinkley (in earlier contracts) is inflation linked so that the actual annual cost will almost certainly increase.
Wind and solar PPAs are almost always fixed price for the life of the contract.
Nigel West says
I already mentioned the Hinkley indexation. Not desirable but at least it is CPI, not RPI which tends to escalate more. It was financially engineered. If the price had been flat for 35 years the headline strike price would have looked worse.
Government published reports and studies as justification. E.g. energy security as opposed to relying on imported gas for CCGTs, carbon emission reductions and climate change commitments, jobs and investment.
Bob Wallace says
Yes, by increasing the selling price over 35 years it makes new nuclear look more affordable.
In the US utility companies have been allowed to raise rates and use the “confiscated” money to offset some of the costs of building reactors.
South Carolina consumers have now enjoyed at least 6 rate increases based totally on raising funds for the Summer reactors. Rates have risen 30% just for reactor construction.
And then (they publicly discussed this) once the reactors come online the resulting further increases won’t seem as bad.
If SC can sneak in a 30% (or more) raise before the reactors open then they won’t be hitting customers with a sudden 50% raise, only the last 20%.
(I’m totally guessing about the 20%.)
Helmut Frik says
Well hopes are that nuclear might become cheaper. Somehow. Sometimes. Somewhere.
Prices for renewable come down in projects actually being built.
That’s why the big utilities changed their plan for further capacities.
Bob Wallace says
We built our first commercial reactor almost 70 years ago.
In that period we haven’t found a way to make nuclear cheaper. The price has only increased.
When I first became concerned about climate change I thought we would have to accept higher electricity prices because we would have to turn from fossil fuels to nuclear. Wind and solar were simply far too expensive at that point in time.
Over the following years I’ve watched the price of wind and solar fall to where they would cost only a little more than nuclear, then a little less than nuclear, and now a lot less than nuclear.
Nigel West says
In the UK we’ve yet to see off shore wind prices below the Hinkley Point strike price and at the levels trumpeted on the continent. The most recent contracts for offshore wind were >£114/MWhr for 15 year support contracts. The industry is now forecasting <£100/MWhr using the latest tech. but based on longer contracts for up to 25 years.
A new auction is under way. Prices are eagerly awaited.
Competitive pressures should be good for the consumer.
Bob Wallace says
“In the UK we’ve yet to see off shore wind prices below the Hinkley Point strike price ”
Then you need to be asking what you’re doing wrong.
Bas Gresnigt says
The UK auction model almost guarantees much higher prices for Offshore wind.
Seems UK govt doesn’t want to learn from the model Denmark, NL, Germany use.
onesecond says
Well, the problem with Datteln is, that it is almost finished. They will never make any money from it, but want to recoup at least only a little bit of the sunk cost. They probably curse the day they decided to build this money pit, but they are kind of stuck with it now.
HarryDutch says
It is all so simple to see the failure of the German and Danish energy transition. One only has to check from time to time the Electricity Map Live · Database · API. Today it’s very bad for both of them with a Carbon Intensity of some 600g(CO2eq/kWh). They are both a failure. https://www.electricitymap.org
Nikolai Beier says
Claiming failure without the criteria for evaluation does not make any reader any wiser on the subject.
Despite the intermittency of solar and wind, in Denmark in 2017 wind produced electricity amounting to 43 % of the total electricity use.
http://en.efkm.dk/news/news-archive/2018/jan/new-danish-wind-power-record/ . The rest is coal, wood and 2 % solar. (If I remember correctly about coal, it provided more than 95 % of electricity in year 1990 and was in 2017 around 25 %.
Gasification of biomass from the farm industry, food industry sewage treatment plants et. is projected to fill the estimated need for methane gas in Denmark around year 2035 (and 10 % at the end of 2018)
Energy storage in some shape or form will continue to be needed to meet electric power demand at any given time. But et does not need to be piles of coal or wood, and most likely it will be a good mix om different technologies, not just wood, bio-methane and a few batteries. Today the “on-demand” tech is expensive compared to the LCOE of intermittent wind and solar, put it seems possible that “power to gas”, gasification and battery storage will be able to drop in price, to a level where it is better in the long run to invest in storage than continue burning fossil fuels.
Bob Wallace says
How should one evaluate the success of Danish and German RE programs?
CO2/MWh might be one. But one has to use the proper countries against which to compare. It makes no sense to use those countries with above hydro resources. And it makes no sense to use France which installed a lot of nuclear decades ago when they were forced to get off oil.
So, how are Denmark and Germany doing compared to, say, Poland or other European countries which had similar coal use years ago?
Denmark is down 18% and Germany 16% from 1990. Only seven EU countries have dropped their CO2 emission levels. Eleven are up. Six of the eleven have more than doubled their CO2 output over the period.
The only ‘coal use’ country that has done better than Denmark and Germany is the UK which has also replaced coal with wind power.
Might use cost. Denmark and Germany have some of the lowest wholesale electricity costs in Europe. Their wholesale electricity costs are lower than France with all its paid off nuclear reactors. And both have wholesale electricity rates that are about one third less than the UK’s.
(Don’t make the mistake of comparing retail electricity rates. Some countries heavily tax electricity, some don’t.)
So, since Denmark and Germany are doing fine on reducing CO2 emissions and generating low cost electricity then how does one declare them to be failures?
Wishful thinking?
HarryDutch says
The experience of the German Energiewende shows that increasing amounts of renewable energy on the power system, harms the environment. In support of the unreliable performance of intermittent (unreliable) generation sources Germany and other European member countries relies on fossil fuels such as Coal & Gas. With the closure of their remaining German nuclear power plants by 2022 it will only get worse. Yet Germany’s image as selfless defender of the climate, which was once largely deserved, is now a transparent fiction. Germany has fallen badly behind on its pledges to sink its own greenhouse gas pollutants. In fact, Germany’s carbon emissions haven’t declined for nearly a decade and the German Environment Agency calculated that Germany emitted 906 million tons of CO2 in 2016, the highest in Europe, compared to 902 million in 2015. And 2017’s interim numbers suggest emissions are going to tick up again.
Yes, France installed a lot of nuclear decades ago when they were forced to get off oil. However now they are the best example with the lowest carbon emissions.
Today’s performance is again a testimony on the failure of Germany’s Energy Transition. Carbon Intensity Germany 523g(CO2eq/kWh) vs France 60g(CO2eq/kWh). Denmark is doing not much better with 540g(CO2eq/kWh). Sweden with it’s support from Nuclear Energy 91g(CO2eq/kWh).
https://www.electricitymap.org
Bob Wallace says
Germany’s CO2 emissions are down 6% over the last decade. They would have fallen more except for two factors. First, the Fukushimi disaster cause a speedup of nuclear reactor closures. Second, Germany has greatly increased its net electricity exports which means that CO2 produced for other countries’ electricity consumption is being counted against Germany.
Yes, France has low CO2 emissions. But no longer is nuclear an affordable option. Even France is planning on replacing its paid off reactors with wind and solar due to the high cost of maintaining their reactors and the now very low cost of wind and solar.
Germany has already met the EU 2020 CO2 reduction goal. What Germany will not meet is the more aggressive 2020 goal they set for themselves prior to the Fukushimi meltdown. Seeing a technologically advanced country lose control of a nuclear reactor increased the desire to get dangerous reactors closed sooner.
Bas Gresnigt says
German
– reliance on fossil fuels; and
– carbon emissions;
due to electricity generation are decreasing since the start of the Energiewende in 2000.
2000; share fossil 66% ; emissions 640gCO2eq/KWh
2010; share fossil 61% ; emissions 558gCO2eq/KWh
2017; share fossil 55% ; emissions 503gCO2eq/KWh*)
(figures from AGEB and UBA)
As detailed elsewhere, the emissions on the electricitrymap.org site are highly biased (far too low for nuclear)…
_____
*) extrapolation
HarryDutch says
I keep reading; “the price of wind and solar fall to where they cost only a little”. What I fail to read is that both require the back-up from Gas Fired Power Plants, required when the wind does not blow and the sun is not there. I also keep reading that the German CO2 equivalent emissions refuse to budge 10 straight years running, despite hundreds of BILLIONS invested in green energies.
As we have been hearing recently, global CO2 emissions continue their steady climb, despite the trillions of dollars committed to green energy sources worldwide and efforts to curb CO2 emissions. If any country has seen huge chasm between its CO2 reductions performance and its lofty green rhetoric, Germany is it. Despite the hundreds of billions already spent on green energies, mainly, wind, sun and biogas, Paris Accord cheerleader Germany has not seen any progress in CO2 reductions ten years running. According to Germany’s UBA Umweltbundesamt (Federal Environment Agency), Germany’s reductions still remain stuck at the levels of 10 years ago (2009 = 908 million tonnnes CO2 equivalent. Most of the country’s CO2 reductions since 1990 arose from the shutdown of old communist run East German industry, after the eastern and western parts of the divided nation united in 1990. Also huge CO2 reductions resulted from the offshoring of energy-intensive industries, to countries where regulations are less strict, labour is cheaper and energy efficiency is woefully lower; for example: China. The true result: Germany managed to cut its CO2 equivalent emissions, but the net result is most likely greater overall CO2 emissions.
Meanwhile environmental groups have come out and blasted Germany’s weakling result. Alarmist climate and energy site Klimaretter (Climate rescuer) commented here: “Germany is practically making no climate change progress at all.”
Greenpeace Germany’s Karsten Smid fumed: “The UBA figures are the bitter result of Chancellor Merkel’s climate policy.”
Russia will be laughing at all of you by the end of this century. It’s energy policy states; Electricity Generation at 80% from Nuclear Energy…
Helmut Frik says
Another one mixing up sectors, blaming non success in the traffic and the building sector on the electricity sector which reduces CO2 emissions this year again. Besides, not much energy intensive industry left Germany if at all. Taxes need to be changed to move energy consumption in many areas from gas to electricity. But things like this are most likely a bit to complex for the one size fits all nuclear fanboy groups.
HarryDutch says
The Intergovernmental Panel on Climate Change (IPCC) (2014) Fifth assessment report tamps down enthusiasm about renewable energy. The report candidly discusses the difficulties of spurring a renewable energy transition and integrating renewable energy. Nuclear is once again grouped with renewable energy as the key elements of a low-carbon energy system, along with carbon dioxide capture and storage (CCS). Looking ahead. In its 2014 report, the IPCC struck a note of urgency on the need to use all available low-carbon technologies to avert climate change. The sixth assessment report is not due until the end of the decade, and it’s premature to speculate about what it will say regarding nuclear power. But trends suggest that major intergovernmental agencies increasingly view nuclear energy as an essential climate wedge within a global climate stabilisation system. Last month, two OECD agencies, the International Energy Agency and the Nuclear Energy Agency, projected that nuclear power will have to double by 2050 for the world to meet the international goal of limiting warming to 2 degrees Celsius.
Bob Wallace says
What a great idea. Let’s waste buckets of money and keep burning fossil fuels longer while we dick around with nuclear.