BMWi Publishes Study Analysis of Selected Factors Affecting the Market Value of Renewable Energies

Today the Federal Ministry for Economic Affairs and Energy (BMWi) published the study “Analysis of selected factors affecting the market value of renewable energies”.

The study was conducted by Fraunhofer ISI and it is part of the  “pilot study electricity market” which the BMWi commissioned in 2013.

1. Summary of the Study

In the study, the Fraunhofer ISI examined ten different scenarios with regard to the share of renewable energies and different measures to make the energy system more flexible, such as grid expansion, expansion of storage systems, coupling of the electricity and heat market, etc.  The study comes to the conclusion that suitably making the energy system more flexible will keep the market value of renewable energies close to the market price value, even if their shares will rise. The need for support schemes for fluctuating renewable energies will decline distinctly.

An important factor for the increase of the market value of renewable energies will be a sufficient grid expansion. For example in a basic scenario for 2050 with high grid expansion the market value be ca. 71€/MWh for wind onshore, 72€/MWh for wind off-shore and 76€/MWh for solar. These amounts will be lower in a basic scenario 2050 with low grid expansion: ca. 63€/MWh for wind onshore, 66€/MWh for wind off-shore and 73€/MWh for solar.

The study also assumes that an expansion of storage systems in addition to an expansion of the grid will only have a limited effect. Further more the study states that a high expansion of solar energy will lead to distinctly reduction of this technology’s market value. This also applies if all measures for more flexibility will be used and also if the solar expansion in Europe will be low.

2. Statement of the State Secretary Baake

State Secretary Baake states that the study shows two things: First, if the grid expansion continues minimum production of conventional power plants will be further reduced, the absolute market value of renewable energy will rise and the need for support schemes could decline. Second, the measures mentioned in the White Paper will not only enhance the efficiency and security of the current electricity system, they can also increase the market opportunities of renewable energies and reduce the need for support schemes. Based on this argumentation Baake demands a quick implementation of these measures.

Source:Federal Ministry for Economic Affairs and Energy

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