Friday, July 25, 2014

Why German Electricity Costs So Much

It's a nifty little article on Bloomberg today.  It tells a basic story over German electrical rates and why things have risen so much over the past decade.

Once upon a time.....folks got all hyper about nuke power and coal power in Germany.  Both were evil.  We were told this in the 1980s, and almost weekly....some German newspaper blasted away at the terrible price Germans were going to pay for a nuke accident or pollution from the coal used in running the electrical plants.

German usage of electricity?  The average average capita rate (per person) is 861 watts (Wiki's numbers).  Some countries like Sweden and Norway are way above that (2000 or more).  But Germany compares easily to Austria or Switzerland with the same per capita.

Various decisions were made over the past two rig up the plan to terminate German nuke plants, and to force dirty-coal power plants to close.  All of this....was going to lead onto more solar power and wind-generators.

There's an odd thing though.  On a daily basis.....there's simply not enough wind or solar generated power and the grid is on a minute-by-minutes shortfall situation. prevent need to have plan "B".

In Germany....twenty companies are lined up to provide plan "B" coverage, when shortfalls occur.  Naturally, none of this "help" is free.  Companies who are in the government's circle to ensure adequate power because of the nuke and coal strategy?  They can sit there and on some days....charge up to four-hundred times the normal rate.  This leads onto a billion-Euro fund that the government set cover the current strategy.

How many Germans know of the shortfall energy fund (the billion Euro deal)?  I would take a guess that less than a thousand know of the fund and most don't talk much about it.  It's best to avoid discussions over it....because it's the only way that you avoid blackouts.

The odds of the billion-Euro fund rising in the future? It's virtually guaranteed as more nuke plants go off-line permanently, and the number of solar/wind generation plants operate.

The threat of blackouts?  The average German will tell you that most of the three or four outages that come per year right now....are weather-driven....and usually last two to five hours.  We are talking about a region thing, with maybe 100,000 residents in one area affected.

What happens on a calm August a moderately high temperature situation....but almost no wind occurring....if regional grid for an entire state of Germany (say Hessen)....went out for twenty minutes?  And the response that evening was that they had basically burned through all normal power production, used up what plan "B" option they had, and still had a shortfall?  Some Germans would start to ask stupid questions.

It's one thing to have good dependable power and know a couple of times a year storms will take down your grid.  It's another to come to a non-storm event and admit you just don't have enough power to run the national grid.  The answer?  A two-billion or three-billion Euro fund to buy excess power from others who are just grinning over your own planned stupidity?  And this coming out of some tax pocket....meaning you pay really more for electricity....but the government never wants to call it the second bucket of revenue for energy consumption.  Eventually, the one-billion Euro fund, will's only a matter of time.

All of this.....while Germans start to toy with the idea of battery-powered cars....that require charging from mythical electrical production creation?  Yeah, this leads to a puzzling situation....but it's best not to discuss this with a German.  It's all know.

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