Electricity prices in Europe are scary. Reason? In France, there is a shortage of available nuclear power plants, in Germany, gas, in Great Britain, wind, and in Poland, coal, so much so that power plants are already limiting production. However, the market is betting that the worst is ahead of us, which will be combined with further shutdowns of nuclear power plants in Germany.
Poland:
Most of the coal power plants will reduce their generation again. The operators do not provide detailed reasons for their indisposition, but it is easy to guess that it is most likely the effect of critically low coal reserves.
Coal shortages are the result of an unexpectedly high demand for energy from Polish power plants. According to preliminary data from the Polish Power Grid, from January to November, they produced as much as 31% more energy than last year, burning several million tons of coal more. This growth is mostly generated by energy exports abroad, where for several months electricity prices have been much higher than in Poland.
France:
Energy from all over Europe, including Poland, via Germany, is sucked in primarily by France, until recently the continent's largest electricity exporter. In December 2020, the French supported their neighbors with net exports. This month, they were able to import as much as Poland needs for half of the winter demand.
This change is due to the extremely low availability of French nuclear power plants. Many of them are undergoing renovations that could not be carried out on schedule due to the pandemic. To make matters worse, faults were detected in two renovated units, which extended their repairs and forced the shutdown of two more reactors of the same design for safety reasons.
As a result, in January the French transmission system operator RTE estimates that the availability of nuclear power plants will be 45-55 GW, compared to the 2010-2019 average of 55-65 GW. Meanwhile, the country's demand for power already exceeds 80 GW, and the record demand during cold winter can raise up to 100 GW.
Germany:
The astronomical valuation of energy supplies in France is linked to a shortage of natural gas in storage. However, it is not about stocks in France, because there, like in Poland, the warehouses were almost completely full before winter. The market is concerned that France will not be able to import enough electricity from Germany, where gas stocks (similar to neighboring Austria) are at their lowest levels in years and are already falling at the same pace as in other years. As a result, they may be at a critically low level at the end of February.
Meanwhile, in January, Germany, in line with the plan from a decade ago, will shut down another three of the six remaining nuclear reactors. All three are currently operating at almost full speed, but the exact schedule of their shutdown by 11:45 PM on New Year's Eve has already been announced and there is no real chance that the new German government will change this decision. The other three reactors will be shut down at the same time next year.
England:
Unfortunately, wind power generation, which has traditionally helped to lower winter electricity prices on European exchanges, is not bringing relief to the tense energy situation across Europe. The largest operator of offshore wind farms in Europe and in the world, Orsted, showed in the results for the third quarter how drastically production in its installations fell this year. From July to September, the average wind speed on its offshore wind farms was 7.6 m/s, compared to 8.6 m/s a year earlier at that time. This "slight" difference of 1 m/s translated into a decrease in the windmill load from 35% to 27%. The company expects to close the entire year with lower production not only compared to the previous year but also in "normal" weather conditions. Orsted's CEO, Mads Nipper, described the situation as "completely abnormal."
As a result, already in September, the average energy prices on the spot market in Great Britain were more than twice as high as in Poland, and the British were importing energy from the rest of Europe through connections with Norway, the Netherlands, and France while exporting some of it to Ireland, where it happens to be even more expensive.
Crisis in Europe now and in the future:
This winter shows the flowering of the energy crisis in Europe. The fact that all technologies are failing today - from coal and gas to nuclear, to renewable sources - shows that there is no ideal solution in the energy sector that would be able to provide energy security at a reasonable price in all situations.
Europe doesn't seem to have any solution, apart from believing that everything will fix itself as long as they do the "right thing."
So, the thermal power plants (mainly coal and nuclear) are being liquidated on a massive scale in almost all of Europe and replaced with gas-fired power plants in hope that energy storage and management technologies will develop quickly enough to replace the rest of classic power plants.
Unfortunately, it doesn't seem to be happening.
- Based on the article at Wysokienapiecie(.)pl.
