German Power Prices Set To Keep Skyrocketing In 2019 Due To 50 Billion Euros Annually In Grid And Feed-In Levies

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According to German online business daily Handelsblatt here, German electricity are set to get significantly more expensive in 2019 due to the power grid becoming 8 percent more expensive to use.  This will make already painfully high electricity prices even more excruciating.

The Handelsblatt cites calculations by German think tank “Agora Energiewende”, which reports that revenues for the network operators total 24 billion euros this year.

According to Agora, “Costs previously referred to as grid costs are expected to rise by a total of six to eight percent.” For household customers the grid already amounted to 7.17 cents per kilowatt hour in 2018, which compared to 6.79 cents per kilowatt hour levied for the renewable energy feed in tariffs. This year it was 6.41 cents.

According to the Handelsblatt, “The EEG levy and grid fees thus add up to amounts of over 50 billion euros” annually. The rising grid fees are due to “massive investment in grid expansion to integrate renewable energies into the grid”. And because Germany’s Energiewende (transition to green energies) still finds itself in the early stages, the costs are projected to keep rising.

In Germany, electricity prices of around 30 cents per kilowatt hour for private consumers are among the most expensive worldwide, and are in fact “the highest in Europe” Handelsblatt reports.

What is especially warped about Germany’s electricity market is that one kilowatt-hour of electricity “is available in wholesale for less than five cents”, reports the Handelsblatt. This shows how grotesquely distorted the price structure has become since renewable energies have been mandated and nuclear power plants taken offline. .

The high end-user prices have become a huge burden on private individuals and energy intensive companies alike. German think tank Agora is demanding reforms and more transparency in the country’s murky electricity pricing structure.

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9 responses to “German Power Prices Set To Keep Skyrocketing In 2019 Due To 50 Billion Euros Annually In Grid And Feed-In Levies”

  1. John F. Hultquist

    It is hard to see a way out of the mess.
    It is like digging a hole. Should stop before you can’t get out.

    In this Energiewende situation wealth is being destroyed.
    Whatever is done next will not solve anything, continued
    wealth destruction is all that is in view.

    Sadly, the effect on global temperature / climate change will be zero.

  2. RickWill

    One of the fundamentals in a power grid is that transmission losses are a function of the current squared.

    The term Root Mean Square (RMS) current is the well recognised method for determining the losses associated with transmission. For a normal sine wave from a constant generating source the RMS value is 1.1 times the average value. That means the losses due to a sine wave are 10% higher than if it was a steady current.

    With an intermittent generator achieving an average capacity factor of 25% the peak output is 4 times the average. At peak output the transmission losses will be 16 TIMES the average.

    This means there is a significant operating penalty for highly variable generating sources. So beyond all the extra capital to connect the intermittent generators to the network, there is a massive increase in transmission losses that are ever present.

    In Australia, the line loss factors have been recently amended to recognise this rapidly increasing component. The more remote subsidy farms have been hit with loss factors as low as 0.72; meaning that only 72% of the power generated makes it to consumers. Factors this low negates any benefit from subsidies and their economic viability is at risk.

    If intermittent generators cost nothing to build and operate they would still add cost to the network because they do not replace any dispatchable generators; they increase the operating cost of dispatchable generators; they add tremendously to the network capital cost; they destabilise the network thereby increasing the cost for frequency and voltage control and they increase transmission losses.

  3. tom0mason

    Well someone has to pay for all that ‘Free’ energy.

    Next someone will demand that you all pay even more tax because they’ve invented the perpetual energy “mechanism” (which of course can not be explained to ordinary folk).

  4. sasquatch

    An easy solution is to provide electricity for everybody, regardless of the ability to pay.

    50 billion euros can be printed and can be applied to the deficit resulting from unpaid electricity bills, the cost is too much. Solves the problem.

    In India, power companies drive through communities and advise people to pay their electricity bills.

    Spaghetti wiring from power poles in India is the norm.

    Provide the usable energy in the form of electricity to everybody, it is the answer. At some point in time, they will be able to pay.

    No reason whatsoever to leave somebody out in the cold.

  5. BoyfromTottenham

    Here in Australia we have legislation called the Large Scale Renewable Energy Target, which is a cunning hidden subsidy for all ‘renewable generators’, currently costing consumers about A$4 billion a year, and rising. It is modelled on EU legislation, and is very clever – it is not called a ‘tax’ or a ‘subsidy’, but is actually both. It works by the government giving ‘free’ renewable energy certificates to the generators – one per megawatthour of energy that they supply to the wholesale electricity market via the grid. Retailers MUST buy about 30% of their electricity from these renewables generators, and buy one of these certificates from the renewables generators for each megawatthour they buy, which currently costs A$85, or about the same as the cost of the wholesale electricity. This is the subsidy part. The retailers have to add the cost of buying these certificates to their retail price of course, so my home electricity bill is higher. This is the tax part. None of this is visible to the average voter – I had to read the whole legislation to figure it out. The tax does not appear on my bill, and the renewables generators never admit that they get a 100% subsidy. It is a very clever confidence trick! I would check to see if your government is playing the same games with you.

  6. Steve

    If the Labour party gets in, energy prices will be doubled within a few years.
    But I reckon that poor old Shorten won’t get to the lodge unless he has a personality transplant ..stat !

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