How Germany achieved a record share of renewables during the COVID-19 pandemic while relying on the European interconnected power network

in Energy (2022)

In 2020, Germany reached a maximum share of 50.5% intermittent renewables in electricity generation. Such a high share results in an increasing need for flexibility measures such as international ... [more ▼]

In 2020, Germany reached a maximum share of 50.5% intermittent renewables in electricity generation. Such a high share results in an increasing need for flexibility measures such as international transmission flexibility, i.e., electricity imports and exports. In fact, during the COVID-19 pandemic, Germany changed from a former electricity net exporter to a net importer. This paper, therefore, analyzes what we can learn from the resulting development of German electricity imports as a flexibility measure from a market, environmental, and network perspective. We analyze data on electricity imports/exports, generation, prices, and interconnection capacities of 38 bidding zones, respectively 11 countries within the ENTSO-E. In particular, we formulate three hypotheses to partition our overarching research question. Our results reveal that from a market perspective, Germany's increased need for transmission flexibility did not generally result in increased prices for German electricity imports. Also, from an environmental perspective, Germany increasingly relied on electricity imports from countries that exhibited a lower share of renewables. Finally, during the COVID-19 pandemic some of Germany's interconnection capacities to its neighboring countries exhibited a higher utilization. In view of our results, German policymakers may reflect on decarbonization policies considering a holistic European perspective. [less ▲]

Electricity Market Design 2030-2050: Shaping Future Electricity Markets for a Climate-Neutral Europe

Report (2021)

Speeding up the energy transition in the European Union (EU) is a major task to quickly reduce harmful greenhouse gas emissions. Market design plays a crucial role in the decarbonization of the European ... [more ▼]

Speeding up the energy transition in the European Union (EU) is a major task to quickly reduce harmful greenhouse gas emissions. Market design plays a crucial role in the decarbonization of the European energy system, driving the expansion of both Renewable Energy Sources (RES) and accompanying flexibility sources. In particular, demand flexibility by energy-intensive industrial companies can play a key role. By flexibilizing their production processes, industrial companies can contribute to an increased use of variable RES (in the following referred to as Variable Renewable Energy (VRE)) to lower the CO2 footprint of their products with positive effects on economic competitiveness. Together with other flexibility sources like electric vehicles, the EU can transition to a just, low-carbon society and economy with benefits for all. However, to actually realize these benefits, market design must account for the changing production and consumption characteristics, e.g., the intermittency of VRE. Starting with current challenges of the energy transition that need to be solved with a future market designin the EU, the whitepaper takes alternative market design options and recent technological developments into account, which are highly intertwined. The whitepaper elaborates on the role of, for instance, flexibility, digital technologies, market design with locational incentives, and possible transition pathways in a European context. The “Clean energy for all Europeans” package offers a new opportunity to deepen the integration of different national electricity systems, whereby Transmission System Operators (TSOs) are required to reserve at least 70% of transmission capacities for cross-border trades from 2025 onwards. The corresponding scarcity of transmission capacities on the national level, however, may aggravate congestion to a critical extent, calling for transformational changes in market design involving, e.g., a redefinition of bidding zones close to the network-node level. The present whitepaper can be seen as part of a series of whitepapers on electricity market design 2030 - 2050 [14, 15] and continues the analysis of regionally differentiated prices or Locational Marginal Pricing (LMP) as a means to address congestion problems in future VRE-based electricity systems. Thereby, the whitepaper extends the findings of the previous two whitepapers (where in the latter whitepapers, e.g., a detailed discussion of the pros and cons of LMP can be found) and elaborates on the question how LMP could be implemented in one or several European countries and how possible implementation pathways may look like in a coupled European system. Moreover, the whitepaper describes preparatory steps that are necessary for the introduction of LMP, and – at the same time – create advantages for countries under both, a nodal and zonal market design. All in all, the results and outcomes of the whitepaper shall support the market design transition in Europe and, thus, the integration and activation of flexibility potentials to foster a fast reduction of CO2 emissions through a better use of VRE. Therefore, the whitepaper contributes with concrete policy measures to the overarching vision of a future European electricity market design that bases on low-carbon technologies and enhances welfare and fairness, while ensuring economic competitiveness of Europe. We would like to thank all the partners and are grateful for the financial support from the Federal Ministry of Education and Research as well as the Project Management Jülich. Martin Bichler, Hans Ulrich Buhl, and Martin Weibelzahl (SynErgie) Antonello Monti (OneNet) [less ▲]

Electricity Spot Market Design 2030-2050

Report (2021)

Driven by the climate conference in Paris in December 2015 countries worldwide are confronted with the question of how to shape their power system and how to establish alternative technologies to reduce ... [more ▼]

Driven by the climate conference in Paris in December 2015 countries worldwide are confronted with the question of how to shape their power system and how to establish alternative technologies to reduce harmful CO2 emissions. The German government plans that even before the year 2050, all electricity generated and consumed in Germany should be greenhouse gas neutral [1]. To successfully integrate renewable energies, a future energy system must be able to handle the intermittent nature of renewable energy sources such as wind and solar. One important means to address such electricity production variability is demand-side flexibility. Here, industry plays a major role in responding to variable electricity supply with adequate flexibility. This is where the Kopernikus project SynErgie comes in with more than 80 project partners from academia, industry, governmental, and non-governmental organizations as well as energy suppliers and network operators. The Kopernikus project SynErgie investigates how to best leverage demand-side flexibility in the German industry. The current electricity market design in Germany is not well suited to deal with increasing levels of re- newable energy, and it does not embrace demand-side flexibility. Almost 6 GW of curtailed power in 2019 provide evidence that changes are needed with respect to the rules governing electricity markets. These rules were designed at a time when electricity generation was concentrated on a few large and dispatchable conventional power plants and demand was considered inelastic. The SynErgie Cluster IV investigates how a future-proof electricity market design should be organized. The corresponding Work Package IV.3.1 more specifically deals with analyzing and designing allocation and pricing rules on electricity spot markets. The resulting design must be well suited to accommodate demand-side flexibility and address the intermittent nature of important renewable energy sources. This whitepaper is the result of a fruitful collaboration among the partners involved in SynErgie Cluster IV which include Germany’s leading research organizations and practitioners in the field. The collaboration led to an expert workshop in October 2020 with participation from a number of international energy market experts such as Mette Bjørndal (NHH), Endre Bjørndal (NHH), Peter Cramton (University of Maryland and University of Cologne), and Raphael Heffron (University of Dundee). The whitepaper details the key recommendations from this workshop. In particular, the whitepaper recommends a move to a locational, marginal price-based system together with new bidding formats allowing to better express flexibility. We argue in favor of a one-step introduction of locational, marginal prices instead of repeatedly splitting existing zones. Frequent zone splitting involves recurring political debates as well as short- and long-run instabilities affecting the basis for financial con- tracts, for example. Importantly, the definition of stable prize zones is very challenging with increasing levels of distributed and renewable energy sources. The recommendation is the outcome of an intense debate about advantages and downsides of different policy alternatives. However, such a transition to locational, marginal prices is not without challenges, and it is a call to arms for the research community, policymak- ers, and practitioners to develop concepts on how to best facilitate the transition and ensure a reliable and efficient electricity market of the future. We’d like to thank all the project partners and are grateful for the financial support from the Federal Ministry of Education and Research as well as the Project Management Jülich. Hans Ulrich Buhl (Cluster Lead) Martin Bichler (Work Package Lead) [less ▲]

Ein Blick auf aktuelle Entwicklungen bei Blockchains und deren Auswirkungen auf den Energieverbrauch

in Informatik-Spektrum (2020)

The enormous power consumption of Bitcoin has led to undifferentiated discussions in science and practice about the sustainability of blockchain and distributed ledger technology in general. However ... [more ▼]

The enormous power consumption of Bitcoin has led to undifferentiated discussions in science and practice about the sustainability of blockchain and distributed ledger technology in general. However, blockchain technology is far from homogeneous—not only with regard to its applications, which now go far beyond cryptocurrencies and have reached businesses and the public sector, but also with regard to its technical characteristics and, in particular, its power consumption. This paper summarizes the status quo of the power consumption of various implementations of blockchain technology, with special emphasis on the recent ‘‘Bitcoin Halving’’ and so-called ‘‘zk-rollups’’. We argue that although Bitcoin and other proof-of-work blockchains do indeed consume a lot of power, alternative blockchain solutions with significantly lower power consumption are already available today, and new promising concepts are being tested that could further reduce in particulary the power consumption of large blockchain networks in the near future. From this we conclude that although the criticism of Bitcoin’s power consumption is legitimate, it should not be used to derive an energy problem of blockchain technology in general. In many cases in which processes can be digitized or improved with the help of more energy-efficient blockchain variants, one can even expect net energy savings. [less ▲]

Industrielle Energieflexibilität im Energiesystem

in Energieflexibilität in der deutschen Industrie : Ergebnisse aus dem Kopernikus-Projekt - Synchronisierte und energieadaptive Produktionstechnik zur flexiblen Ausrichtung von Industrieprozessen auf eine fluktuierende Energieversorgung (SynErgie) (2019)

Energy from renewable resources is not always readily available. Depending on the season and the weather, the power made available by solar parks or wind turbines varies, for example. Due to the ... [more ▼]

Energy from renewable resources is not always readily available. Depending on the season and the weather, the power made available by solar parks or wind turbines varies, for example. Due to the continuous expansion of renewable energies, the volatility in the energy system will become more and more pronounced in the future. Preparing and adapting the industry to the changing supply structures is a major challenge for the next few decades. In the future, companies must be able to design their processes and operational organization in such a way that energy consumption can at least partially adapt flexibly to the volatile energy supply. In addition to developing technologies, Concepts and measures to make industrial processes more energetic, a second focus of future work is the development of a consistent IT infrastructure with which companies and energy providers can provide and exchange information from the production machine to the energy markets in the future. This leads to a paradigm shift in the operation of industrial processes - away from continuous and purely demand-driven energy consumption towards the adaptable, energy-flexible operation of industrial plants. This reference work presents the most important results of the research in the context of the Kopernikus project Synergy and clarifies trend-setting findings for further developments in the still young field of industrial energy flexibility. [less ▲]

Using Financial Derivatives to Hedge Against Market Risks in IT Outsourcing Projects ? a Quantitative Decision Model

in Journal of Decision Systems (2013), 22(4), 249--264

Inside Tomorrow?s Retail Bank

Report (2012)

Digital (r) evolution in private customer business \ "a ft? Call to banks to act proactively

in Die Bank (2012), 52(6), 46--50

An Economic Analysis of Service-Oriented Infrastructures for Risk/Return Management

in 17th European Conference on Information Systems (ECIS 2009) (2009)