FOSSIL SHOCK

German Power: Start, Stop, Start, Stop, Start…

Kohlekraftwerk Staudinger, coal-fired power station
Germany needs coal power plants to fire the energy transition.
  • Why it matters

    Why it matters

    Utilities are already caught between decreasing revenue and rising costs. The risk that critical parts could break down in on-and-off operation adds to their problems.

  • Facts

    Facts

    • Mechanical fatigue and deteriorating parts are increasing from the wear of starting and stopping power plants repeatedly.
    • Germany will soon be getting 30 percent of its power from renewable sources – more than twice the percentage in the United States.
    • Economics minister Sigmar Gabriel, will announce plans in autumn to pay utilities to maintain power-plant capacity.
  • Audio

    Audio

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Germany’s transition to cleaner and more renewable energy is confronting operators of coal- and gas-fired power plants with unexpected challenges.

Day-to-day electricity production from renewable sources varies widely, and conventional power plants have to fill in the gaps when the sun does not shine and the wind does not blow. That means plants have to be switched on and off more frequently. And that regular routine – starting, stopping, starting, stopping – is gnawing away at the machinery. Mechanical fatigue and deteriorating parts are increasing, and that translates to greater security risks and higher costs.

“The facilities were not designed to be switched on and off constantly,” said Reinhard Maass, director of the power plant industry association (Fachverband Anlagenbau). “The power plants now in operation would not even be certified to meet today’s operating requirements.”

On windless and sunless days, fossil-fuel power plants have to jump in and guarantee the delivery of electricity.

Gerd Krieger, of the power-plant engineering federation (Verband Deutscher Maschinen- und Anlagenbau), agrees that today’s plants were not designed to operate like this. He said starting up and shutting down systems repeatedly reduces their dependability, and is causing a rise in the number of unplanned shutdowns.

These problems are hitting plant operators at a tough time in the utility industry, as Germany continues its ambitious and costly push to remake the way it gets electricity. According to a recent report, the country will soon get 30 percent of its power from renewable sources like wind and solar – more than twice the percentage in the United States.

In this fast-changing energy landscape, many power-plant operators are barely earning profits. Electricity from renewable sources is flooding the market and causing prices to plummet. Meanwhile, the capacity use of plants fired by fossil fuels is sinking dramatically.

In many cases, operators can’t break even between rising costs and declining revenue. That’s why many utilities have contacted Germany’s electrical grid authority and given notice that their power plants will be closed. Economic pressures are also forcing operators to cut back on  investments to their power plants. Mr. Maass said properly regulated maintenance programs are also being cut.

“Sporadic use of power plants could lead to a succession of damage scenarios involving critical components.”

Martin Eckel and Stefan Thumm, Power-plant experts for Allianz

But fossil-fuel power plants are still indispensable. On windless and sunless days, they have to jump in and guarantee the delivery of electricity and Mr. Maass said that the government must assure that out-of-vogue power systems are safeguarded.

Politicians are considering how to guarantee the survival of fossil-fuel power plants. This fall the German economics minister, Sigmar Gabriel, will present his first plans for paying utilities to maintain power-plant capacity.

The growing technical problems of power-plant operators have meanwhile caught the attention of the insurance industry. Damage to power-plant turbines increases especially “when operating conditions are altered,” wrote Martin Eckel and Stefan Thumm, power-plant experts for Allianz, the global financial services firm that specializes in insurance and is headquartered in Munich. They noted that sporadic use of power plants could “lead to a succession of damage scenarios involving critical components.”

That carries a “changed risk situation,” the Allianz power experts wrote. “(It’s time) to take a closer look and, in individual cases, to adapt insurance protection for our customers to the altered situation,” they said.

That sounds very much like a hike in insurance premiums. And at this time, higher costs are exactly what power-plant operators need least of all.

Klaus Stratmann is a Handelsblatt correspondent in Berlin where he covers energy politics. Contact the author: stratmann@handelblatt.com

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