German Power Surplus: Paying to Consume

The German Power Authority hit a new record this past week when on May 8th renewable energy sources were producing so much energy the company experienced a surplus, and saw energy prices in the negatives. During the day 87% of the energy being consumed was supplied by renewable energy.

What does this mean? Essentially when an energy surplus happens other energy providers need to turn off supply to the grid otherwise they must pay for the grid to accept their power. Turning off supply is not problematic for renewable energy options like solar panels or wind, or even cleaner energy like gas that are easy to take offline, but nuclear and coal plants cannot be quickly shut down and therefore continued producing during the surplus, costing them money.

The phenomenon was beneficial for commercial consumers too, with factories actually being paid to operate and consume energy. This is not an unheard of experience and is estimated to become more and more frequent as countries shift to renewable energy sources. Although initially sceptics claimed that countries could never run on 100% renewable power because of the variability in wind and solar conditions, it seems that they are wrong and more and more countries will scale down their less-clean energy sources.

Already in Germany 33% of the country’s energy is provided by renewables, with the goal established of 100% by 2050 – and it seems more and more achievable everyday.

“We have a greater share of renewable energy every year,” said Christoph Podewils of Agora. “The power system adapted to this quite nicely. This day shows again that a system with large amounts of renewable energy works fine.”