Climate Denial Crock of the Week

I’ve been following the energy crunch in Europe, which is indeed serious. The fundamental shortage is gas, which fell off a cliff during the Covid shutdown, and has been slow restarting as the economy has taken off this year. New data shows how much demand was avoided with clean energy.

Centre for Research on Energy and Clean Air:

Power generation from zero-carbon sources avoided a gas bill of €33 billion across the European Union (EU) in the first three months of the gas shortage (July-September), as well as €2.3 (£2.0) billion in Great Britain, according to new CREA analysis. The share of zero-carbon generation in the region reached an all-time high of 66% in the third quarter of the year, helping keep the lights on and cut fossil fuel import bills.

Power prices in Europe and the UK have skyrocketed in recent months as a result of rallying wholesale prices of coal, gas and carbon in tandem with power demand rebounding to pre-pandemic levels, and against a background of low fuel reserves in Europe and delays in commodity exports from producing countries. The last week of September saw these commodities trading at all-time highs — coal delivered to Europe traded at $233 per tonne, while fossil gas reached €92/MWh and CO2 emissions priced at nearly €65 per tonne.

The price volatility in EU and UK power markets are a timely reminder that reliance on fossil imports is risky and expensive. During this time, renewables in most European countries covered a significant portion of demand, despite reports of lower generation output, shielding some part of the mix from the effects of fuel costs that would have likely required more gas.
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Our analysts scrutinized renewable generation from July to September, as some commentaries around Europe’s situation have gone as far as to claim that the crisis means intermittent renewables “require fossil fuel back-up” as they were unable to meet peak demand,” implying that the energy transition has gone too fast, too soon.

However, our analysis of the contribution of wind and solar to meeting peak loads in July to September shows that solar and wind generation provided 28 GW worth of firm capacity in the EU. Notably, wind&solar generation during this time was higher than the average wind&solar output in 2016-20 (Figure 4). Great Britain is the notable exception to this, as wind&solar generation was 11% less than the average 2016-20 output over the same period, but wind&solar still provided 3.2 GW of firm capacity in Great Britain.

This amount of additional thermal power capacity would have needed to run at peak hours if the wind&solar capacity hadn’t been in place. We quantified the contribution of wind and solar to peak loads by comparing hourly electricity demand in each country to electricity demand with wind and solar generation subtracted, and assessing how much lower the residual load was. If there were events in the data where combined output from wind and solar was zero during times of peak load, this contribution would be zero, even if they had generated at other times. The methodology is documented in the CREA report on fossil fuel overcapacity in Europe, Ripe for Closure.

Europe has deployed a significant capacity of renewables in recent years. In 2020, the EU and the
UK generated more electricity from renewables than fossil fuels. In the midst of the current energy
crisis, they are doing their job in meeting peak loads in Europe during high power and gas prices. By far the biggest factor in the electricity price surge were the commodity prices of fossil fuels, which by market design sets the wholesale price for electricity. Their current price evolution signals the high risk of exposing power systems to volatile fossil fuel prices for most generation hours in a year. This underscores the need for more renewable capacity and diversity of energy sources across the continent, which could yield lower and more predictable electricity prices.

The narrative of fossil fuel as a back-up fuel is a precarious one. There are costs associated with maintaining fossil fuels plants, which are oen borne by consumers. Conventional fossil fuel generators receive payments regardless of whether or not they are available to service demand, In addition fixed operating & maintenance (FOM) costs, which do not vary with generation and could be avoided with additional renewables, are incurred regardless of whether the plants are not needed to service demand.

Our recent report “Europe — Ripe for Closure” found that a combined 48.8 gigawatts (GW) of excess fossil fuel capacity in Bulgaria, Czech Republic, Germany, Italy, Netherlands, Poland, Romania, Spain, and Turkey that are not needed to keep the light on, even on the most demand intensive days.

Keeping these unneeded and underutilised fossil fuel plants in operating condition consumes €1.9 billion ($2.1 billion) in FOM costs annually, which could otherwise be invested in zero carbon energy. With the exception of Poland and the Netherlands, the nine countries covered in this report saw zero-carbon technologies generating more than 30% of peak demand over the July and September period. In Spain and Germany, solar and wind accounted for 31% and 32% of peak capacity respectively.