On 5 July the weather conditions were favourable for both of the major renewable technologies; wind and solar. While coal-based generation has suffered the most with its generation down by a third compared to pre-pandemic levels, it can be seen that during the day with the record level of renewable energy production, natural gas-based technology made the most room for variable generation.
The graph below describes an hourly electricity generation of the three most populated EU countries – Germany, France and the United Kingdom – alongside with the hourly day-ahead prices from that same day.
Both the United Kingdom and France experienced negative day-ahead prices for half of the day while in Germany the price was strongly negative for most of the day. In all three countries the price of electricity rose above zero during the evening peak hours.
Despite being highly unprofitable, many inflexible baseload plants were still running throughout the day as their technical characteristics do not allow continuous starting up and shutting down. During the midday while having the lowest prices, Germany was exporting over 10 GW and had to pay over 750,000€ per hour for its neighbours just to get rid of this excess electricity, and not being forced to shut down their baseload plants.
Five years ahead of schedule
In 2018 renewable electricity accounted for 32% of the total consumption in the European Union1. To meet the EU renewable energy targets, the share of renewable electricity will have to increase to a little over 50% by 20302,3. The Wärtsilä Energy Transition Lab shows that since mid-March when demand began to deviate from the previous year, the share of renewable electricity has been 44%. Thus, the last few months can be seen as a massive opportunity to study how the future energy system behaves – not as a simulation but in the real world with real characteristics.
Last months have proved that from the technical point of view the European electricity system can handle much more substantial proportions of renewable energy than it has traditionally coped with in the past. However, the recurrent and long-lasting periods with negative prices clearly demonstrate that the system suffers from inflexibility. If there were enough flexible assets in the system, EU consumers would enjoy cheaper and greener electricity.
The data from the last two weeks suggests that the electricity demand is slowly getting back to the pre-pandemic levels. Hence, the time window for new renewable record days is closing – at least for now. While the load is returning to its preceding levels, more and more renewables are being built all around the continent. Achieving EU’s renewable energy targets for 2030 means that the proportions of renewable electricity seen on 5 July will need to become commonplace as early as in the mid-2020s.
To learn more about how Wärtsilä can help you navigate the seas of energy transition please visit:
1. Eurostat (2020). Wind and water provide most renewable electricity. https://ec.europa.eu/eurostat/web/products-eurostat-news/-/DDN-20200129-1
2. Banja, M., Jegar, M. (2017). Renewable technologies in the EU electricity sector: trends and projections: Analysis in the framework of the EU 2030 climate and energy strategy. Joint Research Centre, European Commission. https://ec.europa.eu/jrc/en/publication/eur-scientific-and-technical-research-reports/renewable-technologies-eu-electricity-sector-trends-and-projections-analysis-framework-eu
3. Knopf, B. et al. (2015). The European renewable energy target for 2030 – An impact assessment of the electricity sector. Energy Policy, Volume 85, pp. 50-60. https://www.sciencedirect.com/science/article/abs/pii/S0301421515002037