Denmark Faces a Tricky Transition To 100 Percent Renewable Energy

HughPickens.com writes Justin Gillis writes in the NYT that Denmark is pursuing the world's most ambitious policy against climate change, aiming to end the burning of fossil fuels in any form by 2050 — not just in electricity production, as some other countries hope to do, but in transportation as well. The trouble is that while renewable power sources like wind and solar cost nothing to run, once installed, as more of these types of power sources push their way onto the electric grid, they cause power prices to crash at what used to be the most profitable times of day. Conventional power plants, operating on gas or coal or uranium, are becoming uneconomical to run. Yet those plants are needed to supply backup power for times when the wind is not blowing and the sun is not shining. With their prime assets throwing off less cash, electricity suppliers in Germany and Denmark have applied to shut down a slew of newly unprofitable power plants, but nervous governments are resisting, afraid of being caught short on some cold winter's night with little wind. "We are really worried about this situation," says Anders Stouge, the deputy director general of the Danish Energy Association. "If we don't do something, we will in the future face higher and higher risks of blackouts."

Environmental groups, for their part, have tended to sneer at the problems the utilities are having, contending that it is their own fault for not getting on the renewables bandwagon years ago. But according to Gillis, the political risks of the situation also ought to be obvious to the greens. The minute any European country — or an ambitious American state, like California — has a blackout attributable to the push for renewables, public support for the transition could weaken drastically. Rasmus Helveg Petersen, the Danish climate minister, says he is tempted by a market approach: real-time pricing of electricity for anyone using it — if the wind is blowing vigorously or the sun is shining brightly, prices would fall off a cliff, but in times of shortage they would rise just as sharply.

Comments

Home storage

[lorinc]

Seriously. If a car can get a 50+kwh battery in it, why can't every house have it too? That storage capacity is enough for a few days of intensive use.

Re:Are renewable energy generators up to task ?

[jklovanc]

The think you both miss is that on January the sun is much lower on the horizon causing solar panels to produce much less electricity. From these real like German numbers solar panels produced 0.8TWh in January and 4.9TWh in June. The production capacity in January was only 16% of June.

Replacing all roofs is not that great as north facing roofs would only get indirect sunlight and east/west facing roofs would only be viable half the day. Then there are the roofs that are in the shade of other buildings or trees. Just because light is hitting a solar panel does not mean that it producing anywhere near capacity.

Also, do you have any idea the cost of that many PVs?

Re:Real-time market approach

[FireFury03]

It's somewhat like buying a last minute airline ticket. If people were unwilling to pay more for a last minute ticket, all tickets would cost more (fine) but it would be impossible (because the airlines would price tickets to insure every seat was sold - or oversold - many hours before wheels up to minimize the risk of a single empty seat) to get a ticket on a commercial airliner to get to mom's bedside 1500 miles away before she expires.

Airline tickets are an interesting one; and other products that have a relatively inflexible supply - i.e. the costs of flying the plane are basically the same whether or not that seat is sold, and similarly you can't sell more seats than you have, so the supply is inflexible. There are two opposing forces at work here:
1. The airline wants to ensure that every seat is sold, since filling a seat at the last minute increases profit, even if it is sold for below cost (the plane is flying anyway, the costs can't be avoided, selling the seat rather than flying with it empty is beneficial no matter how cheaply you sell it). This is going to tend to push the prices down for "last minute" sales as the airline tries to attract sales.
2. The passengers that need to get somewhere at short notice are willing to pay a premium. This is going to push the "last minute" prices up as the airlines cash in on this willingness to pay over the odds.

Figuring out which of these forces wins is certainly a non-trivial exercise.

By increasing prices when demand approaches the absolute maximum supply, consumers will reduce demand quickly (good, since supply can't be increased quickly). When power gets expensive enough, they will shut off rooms, wear more sweaters, turn lights off, instead of cooking a fancy dinner they will nuke something in the microwave and use disposable utensils (or, just wait to wash them until the next day), they will sit around in a single room and talk instead of playing on their computer or watching TV in individual rooms. Demand is extremely elastic, supply is inelastic at the top end. In extreme cases, they will shutdown their entire house (using winter shutdown procedures as needed) and gather in friends and neighbor's houses (perhaps, splitting the cost of the very expensive power during those times).

I think expecting people to monitor electricity prices on a minute by minute basis and change what they are doing _now_ is (largely) not realistic - virtually no one is going to look at the electricity price before deciding to put the TV on, for example. What is realistic is getting people into a routine - if people know that it's always cheaper for them to put the dish washer / washing machine / whatever on over night, then a reasonable proportion of them will probably choose to do so. In fact we've had this in the UK for decades - you can subscribe to an "Economy 7" tariff, which gives you more expensive than normal power during the day and then 7 hours of cheap power each night. Unfortunately the "more expensive than normal during the day" bit tends to make it an unrealistic tariff for anyone who doesn't use electric storage heaters.

I can, however, see a possibility for automated algorithms deciding when to use power - e.g. telling the dishwasher "automatically do the washing up when it'll be cheapest" and having it sit there monitoring the instantaneous electricity prices and automatically doing the right thing. Or loading the washing machine with instructions like "this washing needs to be done some time in the next 3 days, do it when the power is cheapest". This is essentially the same as having computers doing stock-market trading. The interesting bit will be when many people have the same device and they all decide the power is cheapest at the same time, causing a surge in demand and raising the prices.