Wholesale prices fell so low that a number of baseload plants were simply shut down for the entire weekend. Still, day-ahead prices were close to zero yesterday. Solar and wind are not only making conventional power unprofitable in Germany, but also in neighboring France and Switzerland – and the Czech Republic says that low wholesale prices are the reason why it has stepped away from a new nuclear project.
Industry website Montel provides an overview of some of the plants switched off before the weekend, one of which was a nuclear plant that has gone off-line for refueling and is scheduled to be back on May 9. Another is Neurath F, one of the two new lignite plants completed in 2012. Because the new units ramp fairly well, they will ironically be the first ones to be shut down temporarily, while older, less efficient coal plants continue running – because they do not switch on and off so easily.
In this business environment, the Czech Republic announced it cannot afford a new nuclear plant. Last week, the country’s big utility CEZ specifically stated that low power prices left it “no other option” than to abandon the plans for a new nuclear build.
Montel estimates that 15.7 GW of conventional capacity went off-line for the weekend. To understand how much that is, we need to keep in mind that the country’s peak demand is generally around 70 GW. On weekends and federal holidays, it can, however, dip closer to 50 GW – but that did not even happen this weekend.
Here, we see a number of things. First, note that the red line indicates how much power Germany actually consumed. It fell only to 60 GW on Saturday and Sunday (the best way to count the days is to follow the seven yellow bumps representing solar power generation during daylight). Note that much more was generated than consumed, a clear indication of massive power exports – especially at times of high demand.
Because solar and wind rose so much during peak demand, there was actually little increase in production from conventional capacity. On Tuesday and Wednesday, for instance, solar and wind reach nearly 40 GW alone, leaving only about 40 GW for conventional plants to cover domestic demand. The nearly 10 GW in demand from abroad is a reaction to the relatively low price of power in Germany during peak demand on those normal business days.
The results are not yet available for yesterday, but here is flat demand for conventional power on Saturday – in fact, “flat” is probably an overstatement, for conventional generation actually dips during the early afternoon.
We know that the situation was much worse for conventional power on Sunday because power prices fell to nearly zero. In the chart below, also note the reversal of peak and demand prices not only in Germany, but also in neighboring France and Switzerland. Normally, peak prices would be higher than baseload prices.
And those prices came about even with 15.7 GW switched off!
Finally, Johannes Meyer, the Fraunhofer researcher who produces the fantastic PDF on electricity spot prices and production data in Germany, pointed out in his recent newsletter that the “inflation adjusted day-ahead base price” in Q1 2014 was “the lowest price level since 2002.”
Keep in mind that the summer is not even here yet. The days on which power demand really does fall to 50 GW are coming – along with days of 20-25 GW of solar alone. (Craig Morris)