German green power shift costly, unneighbourly — RWE  

Credit:  www.reuters.com 17 January 2012 ~~

Germany’s ambitious plan to transform its energy generation in favour of renewable sources is too costly and will place great strains on its neighbours, the chief executive of German utility RWE said on Tuesday.

The country’s fast closure of nuclear plants and move to wind and solar was already stressing transmission networks in neighbouring EU countries, Juergen Grossmann said in an address to the annual energy conference of daily newspaper Handelsblatt.

This strain was especially marked when high wind speeds caused Germany’s installed wind power capacity of 27,000 megawatts to produce power at full blast, he said.

“Wind power (from northern Germany) is pushed into the Netherlands and via Belgium into France,” he said.

“The same happens with wind power from Mecklenburg-Vorpommern state, it goes to Poland, then into the Czech Republic and back via Bavaria into Germany. Our neighbours are not happy with that sort of energy shift.”

Grossmann’s company was forced to shut two nuclear reactor blocks at Biblis last summer when Germany, in a quick reaction to Japan’s Fukushima disaster in March, committed itself to a new energy regime.

Since then, along with its big power sector peers, RWE has been struggling to tap new areas of growth to prepare for the nuclear-free futures.

Its Innogy renewable unit has announced plans to invest about 5 billion euros ($6.34 billion) to expand its green power business over the next four years to counter shrinking profits that have resulted in major job cuts and asset disposal plans.

Grossmann said a shortfall of some 1,000 megawatts on Dec. 8-9, when Germany imported power from Austrian reserves as northern German wind volumes could not be rapidly transported to Germany’s south, must not be repeated.

“From 2013, the Austrians will need these capacities themselves,” he said.

He said that Austria was expecting to increase its power consumption by 1.8 percent per annum while Germany assumed its usage would be sinking, despite new technologies likely to require more, rather than less, electricity.

Turning to costs, Grossmann put a figure of 250 billion to 300 billion euros on Germany’s shift away from fossil fuels at a time when the global financial crisis was making capital less available.

The government envisages that “green power” will account for 80 percent of Germany’s electricity by 2050, compared with 20 percent now.

So far, Germany was coping with the about-turn only because it was efficient at deploying reserves in distribution grids and power generation capacity, Grossmann argued.

“I would not call it economically rational,” he said. ($1 = 0.7891 euros) (Reporting by Vera Eckert; Editing by Anthony Barker)