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Germany

Germany

Not that difficult

As a global leader in wind power, how Germany structures its regulatory framework is keenly watched by law makers and power system operators the world over. No other country has assimilated over 23 GW of wind capacity into its national system. Few countries equal Germany in having geographic regions getting 40% of their electricity from wind energy over periods of six months and more. For those doubters who loudly proclaim that wind energy will never contribute more than insignificant amounts of electricity, these are salutary lessons indeed.

Germany's achievement is the result of a determined political will to see wind power happen. A law passed in 1991 simply told the owners of the grid they had to accept all renewable energy offered to them by independent generators and pay a premium price for it. That price was high enough to attract thousands of investors and has been kept high enough ever since to drive a steady market. The grid companies complained, bitterly at times, but nonetheless found ways of managing wind power within their existing operational framework. That task, however, is becoming ever more difficult. Renewables and combined heat and power are now providing an impressive 30% of Germany's electricity -- and all of that has "must run" status, guaranteed by law. Something has to give.

Full integration of renewables cannot happen within a framework designed for an earlier era and without introducing much greater market flexibility than currently allowed for. The government is working on a solution, in part with a plan for wind power to be sold directly into the market instead of operating in its own protected enclave (page 29). For that to work, however, requires making the transmission operators conduct a major rethink of how they manage the job of efficiently balancing supply and demand, instead focusing on how they can make wind power behave like coal or gas fired generation.

Fortunately, system operators have years of experience in furnishing secure supplies of electricity. The statistics involved in setting reserve levels to cope with a possible surge in consumer demand occurring at the same time as a generation trip by the largest unit on the system are of mind blowing proportions. Managing the 7% of wind power on the German system today, or even 40%, should not be beyond them. As Britain's National Grid company says (page 108), 40% wind power is quite manageable, with the maximum extra cost of doing so amounting to no more than EUR 15 annually for a typical household. Given current fuel price trends, that sounds like an attractively cheap alternative to business-as-usual.

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