Capacity markets little understood
In a conversation yesterday at Husum, two of Europe's "founding fathers" in the renewables sector were unable to answer questions about the need for backup power when not enough solar and wind are available.
At a panel discussion, Lyn Harrison, founder of Windpower Monthly, asked a question that tripped up two of Europe's most well respected supporters of renewables: Germany's Hans-Josef Fell and Denmark's Preben Maegaard. Both gentlemen had come to discuss how the renewables sector can go forward. Maegaard, for instance, gave an impressive presentation on how Denmark can start using excess electricity from wind power to offset imports of oil and gas for heating purposes; with wind power increasingly less expensive than imported fossil fuels, electric heating can be a useful, inexpensive way of "storing" excess green power.
But a seemingly innocuous question posed by Harrison showed that Fell and Maegaard, for all of their groundbreaking work, have not yet thought enough about an issue that is increasingly moving into the foreground: "What about capacity markets?"
Essentially, the issue revolves not around what to do with excess renewable electricity – the issue addressed by the panel – but around what to do when not enough green power is available. In such cases, we have to resort to backup power generators, but they increasingly run for fewer and fewer operating hours each year because they are increasingly offset by renewables. As a result, the profitability of conventional power generators continues to be reduced, though demand for dispatchable backup power remains unchanged. In particular, power demand generally peaks in Germany on November evenings, when the sun never shines. So whenever there is not much wind on such an evening, Germany will have to have nearly 80 gigawatts of dispatchable power to prevent blackouts – a figure that has not changed over the past few years and will not change relative to the growth of photovoltaics.
Unfortunately, both Fell and Maegaard answered the question by pointing out what can be done with excess green power – which is not at all what Harrison asked. Fell is the co-author of Germany's Renewable Energy Act, without which Germany would not be where it is today in terms of renewables. Nonetheless, Fell and Maegaard's generation is used to reacting to charges that renewables will always be a niche energy source. Now that renewables are clearly out of their niche, Fell and Maegaard have been vindicated – but future steps moving forward will require a different focus and different argumentation.
No one today doubts that renewables can be a major source of power. The irony is that proponents of renewables now have to start thinking about how to protect the profitability of dispatchable power units – even the ones owned by companies that historically opposed the switch to renewables. (Craig Morris)