Abstract
Abstract. Fixed feed-in tariffs based on the Renewable Energy Act grant secure revenues from selling electricity for wind turbine operators in Germany. Anyhow, the level of federal financial support is being reduced consecutively. Plant operators must trade self-sufficiently in the future and hence generate revenue by selling electricity directly on electricity markets. Therefore, uncertain future market price developments will influence investment considerations and may lead to stagnation in the expansion of renewable energies. This study estimates future revenue potentials of non-subsidized wind turbines in Germany to reduce this risk. The paper introduces and analyses a forecasting model that generates electricity price time series suited for revenue estimation of wind turbines based on the electricity exchange market. Revenues from the capacity market are neglected. The model is based on openly accessible data and applies a merit-order approach in combination with a simple agent-based approach to forecast long-term day-ahead prices at an hourly resolution. The hourly generation profile of wind turbines can be mapped over several years in conjunction with fluctuations in the electricity price. Levelized revenue of energy is used to assess both dynamic variables (electricity supply and price). The merit-order effect from the expansion of renewables as well as the phasing out of nuclear energy and coal are assessed in a scenario analysis. Based on the assumptions made, the opposing effects could result in a constant average price level for Germany over the next 20 years. The influence of emission prices is considered in a sensitivity analysis and correlates with the share of fossil generation capacities in the generation mix. In a brief case study, it was observed that current average wind turbines are not able to yield financial profit over their lifetime without additional subsidies for the given case. This underlines a need for technical development and new business models like power purchase agreements. The model results can be used for setting and negotiating appropriate terms, such as energy price schedule or penalties for those agreements.
Highlights
Renewable electricity generation has increased exponentially in Germany over the last few decades due in large part to subsidization by the Renewable Energy Act (Erneuerbare Energien Gesetz, EEG)
The electricity exchange price at the time of electricity generation will become a crucial factor for profitability next to the already widely considered cost of electricity generation (Federal Ministry for Economic Affairs and Energy, 2019a–c)
The model results can be used for the derivation of development goals in terms of LCOE and deliver the necessary values for break-even consideration in terms of cost reduction or annual energy production
Summary
Renewable electricity generation has increased exponentially in Germany over the last few decades due in large part to subsidization by the Renewable Energy Act (Erneuerbare Energien Gesetz, EEG). Fixed feed-in tariffs secured revenues from selling electricity for renewable energy sources and ensured independence from the fluctuating electricity exchange price. Electricity from renewable energy sources will have to be sold in alternative ways to generate revenue. These are likely to be based on the electricity exchange markets. The electricity exchange price at the time of electricity generation will become a crucial factor for profitability next to the already widely considered cost of electricity generation (Federal Ministry for Economic Affairs and Energy, 2019a–c)
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