Coal exit in Germany to be delayed this winter
We’re taking a look at the energy crisis across Europe and Germany, in particular, this winter. Gas prices are soaring, the European gas supply is under pressure when Russia is more or less cutting the gas delivery to Europe. The government in Germany has opened up to bringing back 5.9 GW of mothballed coal units in order to save gas as the country is struggling with its gas supply this winter. In addition, the power balance is worsened by the nuclear closures (4.1 GW) and some coal-fired plants seem to close down according to the coal exit plans despite the initiative from the government to re-start mothballed capacity.
EQ has made a study of the thermal plant availability for Q1-23 to see what capacity will be back online, and finally, we do a comparison to the Q1-22 level.
We will also include updated information about capacity outlooks for natural gas.
Findings
EQ has estimated that the net increase of coal-fired capacity next winter (Q1-23) will be about 4.3 GW (3.8 GW hard coal + 0.5 GW lignite) compared to the availability we saw this winter (Q1-22). This net number is a combination of plants that are re-started, plants that stay online despite exit plans, and plants that are following the ordinary coal-exit plan). The gross added capacity due to the government plan is estimated to be 6.1 GW, which is close to the official target of 5.9 GW.
When taking into account the newly built gas-fired capacity, the net conventional thermal capacity will increase by about 7.3 GW.
Availability since New Year 2022 – aggregated REMIT data
The production availability data is published everyday as so-called REMIT data for individual plants, and EQ calculates the aggregated REMIT number for each production category (hard coal/lignite/nat.gas). From the chart below you see how the total availability of hard coal plants has developed since 31.12.21. The 20.09.22 is the latest update, which we will study in more detail, while the update from 22.06.22 is used to show how the capacity has increased since June/July when some hard coal plants from the coal-exit plans were allowed to run until the end of March 23rd to improve the electricity supply security and to save gas.
We can observe that the hard coal capacity from these numbers has been raised by about 3000-3500 MW for Q1-23. The Q1-23 number is currently about 2000 MW higher than the Q1-22 level.
By doing the same updates for lignite and natural gas, we can summarize the results in the table below to show how the availabilities for Q1-23 have changed since the start of the year.
The increased hard coal capacity can only be explained by re-starts or delayed “coal exit” plants. For Lignite we don’t see any changes in the REMIT numbers, despite some information about likely re-started mothballed units until the end of March 23rd. We have checked individual plant information to see how the REMIT data covers the total production fleets.
Hard coal and lignite “exit” plants to re-start or “stay online” Q1-23
The hard coal table contains an overview of the “exit plants” now available during Q1-23. See comments for each plant. Information from the “non-REMIT” plants is based on information from the owners and the energy press. Some of them are included in the published REMIT data, a total of 2632 MW, while a total of 1592 MW is not included in the REMIT data. This means that 1.592 MW can be added to the REMIT number of 15.267 MW.
The overview for the lignite plants below is based on the same principle as for the hardcoal table. Currently, there is no REMIT information about these individual plants covered in the table, the data is based on information from the companies and the press. For the plants with a question mark (?), there is still no final confirmation if they will start up or not, but most likely some of them will do a re-start.
The uncertainty of the availability is larger for lignite than for hard coal, we believe the added lignite capacity may vary between 1886 MW and 3206 MW.
For gas-fired plants, there is information about added capacity besides the numbers covered in the REMIT data. The REMIT data for Q1-23 is 15.681 MW, while the Q1-22 numbers came out at 14.200 MW. This means an increase of 1.400 MW during 2022. The latest information from BundesNetzagentur (31.05.22) shows an increased gas-fired capacity of 2.982 MW for 2022. We will use this number in our later overview in this blog.
Expected increase in production capacity from coal and gas-fired plants
Based on these overviews for coal-fired plants we have made a summary of the expected production capacity.
About 9.000 MW conventional capacity will be added from last year for the Q1-23 period.
Notice that the number 6.110 MW for coal-fired capacity can be compared to the government target of 5.900 MW capacity for plants to “re-start” or “stay online”. And then nearly 3000 MW of natural gas will be added this year.
There will however be some closures according to the coal exit plans, and EQ has calculated the net increase from Q1-22 until Q1-23. We use the aggregated REMIT numbers as a reference, and then modify these numbers by the “non-REMIT” plants as earlier explained.
These numbers show us that the net capacity from thermal plants will increase by 7.399 MW from Q1-22 until Q1-23. We see that closures from Lignite plants will nearly compensate for the re-started units.
Final words
EQ will follow the German power balance and production capacity information closely towards and during this winter. We will give an update on this blog if the capacity outlooks change towards the winter.
Please contact EQ if you have questions about the German situation. You can contact us at support@energyquantified.com.
