The operators of the Irsching 4 and 5 power plant units agreed with Tennet TSO GmbH not to close down the highly efficient but presently unprofitable gas-fired power plant units near Ingolstadt within the next three years. The units were needed to secure grid stability and the security of supply, and would continue to be operated to allow Tennet to resort to so-called redispatch measures if necessary, Tennet said. E.ON will receive the fixed costs for the power plants.
The agreement was concluded in close cooperation with the Federal Network Agency (BNetzA), Tennet said. It was based on the decision by BNetzA that fixed costs will be paid to power plants that are operated more than 10% of the time on demand of the transmission operators, the TSO explained, adding that a closure of the two power plant units had resulted in higher costs for electricity customers (to which the payments to E.ON are ultimately passed on).
The growing input of renewable energy, in particular wind and solar energy, has put an enormous strain on the grid, Tennet said. Enough base load power was needed to stabilise the grid and ensure the security of supply, in particular since grid expansion could not yet keep up with renewable power plant growth. With so-called redispatch measures, i.e. interventions into the operation of power plants connected to their grids, the TSOs strove to avoid or overcome grid congestion, Tennet pointed out, saying the Irsching 4 and 5 power plants were regularly being used for redispatch measures, and a further increase of the measures was likely.
The Irsching 4 and 5 are modern highly efficient combined cycle power plants. With a capacity of 569 MW, unit 4 (Ulrich Hartmann unit) reaches 60.4% efficiency, the highest efficiency worldwide. Unit 5 with a gross output of 860 MW reaches an efficiency of 59.7%. Yet it was not possible to operate the plants profitably in the recent past, as the growing renewable power plant output in Germany has to be purchased and transmitted with priority by the grid operators pursuant to the Renewable Energy Sources Act (EEG). Regarding the very high wind and solar power generation output on 18 April 2013, please see here.
Lex Hartmann, member of the executive board of Tennet, welcomed the agreement, but said it showed that amendments of the regulatory framework of the German and European electricity markets were urgently needed to come to a market-oriented solution for enough generation capacity (in terms of base-load power).
In March, Economics Minister Philipp Rösler, responsible for grids and power plants, announced to present a proposal for a new market design for conventional power plants until the summer. In April, German EU Energy Commissioner Günther Oettinger also announced a proposal for an EU framework regarding back-up capacity to balance renewable energy.