Blowin' in the wind

Flying into Berlin, you can't help but notice the wind farms.

Germany has 22.2 gigawatts of installed windpower, just a percentage point shy of a quarter of the world total, and a third more than the United States.  It gets more than 6 percent of its electricity from windpower, a number matched only by Denmark and the great state of Texas.  Inside Germany, the mouthful provinces of Sachsen-Anhalt, Mecklenburg-Vorpommern, and Schleswig-Holstein get almost 30% of their electricity from wind. 

How did Germany do it?  How far can they go?  Will others follow?  Some analysis below the fold. 

The German government's chief policy tool for encouraging windpower is the “feed-in tariff.”  A feed-in tariff is a mandate on the utilities to guarantee two things to windpower generators:  first, that they will connect wind farms to the grid; and second, that they will purchase as much electricity as the windfarmers can generate at a fixed price.  As with so many things, the idea actually originated in California in 1981 with the wonderfully-named “Standard Offer no. 4,” but it came to its fullest fruition in Germany. 

Germany passed its first law mandating that the utilities hookup wind farms in 1979.  Nothing happened until 1987, when the Kohl Administration started the “100 MW Program,” a sort-of scaled-down Manhattan Project for windpower.  (A Frankfurt Project?  Bonn Project?)  The government paid a fixed subsidy of 4 eurocents per kilowatt-hour.  Turbines installed under the project sent data to the Institut für Solare Energieversorgungstechnik (I love that last word) which used it to suggest design improvements that it communicated back to turbine manufacturers. 

Not surprisingly, according to Richard Vietor of HBS, five German firms (Enercon, Siemens, Nordex, REPower, and Fuhrlander) dominate the world turbine business, in addition to Winergy and Hansen, the two leading gearbox manufacturers, and a slew of windpower engineering consultancies.  ¡Viva la política industrial!

In 1990, with the country only 62% of the way towards its 100 MW goal, the country passed its feed-in tariff law.  The industry exploded.  Germany passed the U.S. in total installed wind capacity in 1997, and by 2005 it exceeded the U.S. by a factor of 2½, despite rapid American growth.

Past performance, however, does not predict future growth.  Can Germany keep up this astounding pace?  Growth rates have been monotonically slowing since 2001, falling to 8% last year.  Only 5,000 more megawatts are planned over the next few years, and the southern part of the country has shown a more resistance to allowing windfarms than the north.  (Claudia!  Why?)  Given that, another 1,500 mw can be squeezed out by replacing older turbines with newer bigger ones.

So ... the growth will be offshore.  In 2007, the German legislature voted to make the feed-in tariff for offshore wind farms a full two-thirds higher than the onshore rate:  14 eurocents per kilowatt-hour versus 8.4.  The goal is to build an additional 25 gigawatts of offshore wind by 2030, which will take Germany's total windpower up to 15% of its capacity. 

In fact, it will be higher, since offshore windfarms operate at maximum capacity far more of the time ... almost all the time, in fact.  The wind is simply much more constant out at sea than it is overland.  The hitch is that offshore windfarms are more expensive to build and face much much higher maintenance costs. 

Will others follow?  Well, many European countries already have:  Spain has jumped into wind in a very big way, going from nothing in 1991 to 15 gigawatts in 2007, following a policy mix a lot like Germany.  Texas has promoted massive growth by a blunter policy, simply mandating that utilities get a fixed percentage of their electricity from wind.  (Waitasecond ... isn't the Lone Star State a bastion of free-marketism?  Not that I'm complaining.) 

Elsewhere in the United States, though, well ... there are problems. Serious big actual built-stuff problems.  If there's interest, I'll discuss them in another post.

Thoughts?  Requests?   

Comments

[Andrew R.]

All of Germany's improvements in windpower pale in comparison with what innumerate Greens have done to Germany's nuclear power generation. As a result, even with all those wind farms, Germany's admitted that it's not going to reach Kyoto targets.

France is the country to follow on these matters.

[Will Baird]

First off wind power == good thing.

What's the fluctuation for the power taken in for Germany over the course of a day? It's probably regionally dependent; however, how dependable is it for baseline power generation?

Cali has NIMBYism forever and then some. However, we do have some wind generators already. But you knew that.

[Will Baird]

Oh yes, Noel, referring to a comment on my blog about nukes not being economical. Could it be that they are not for two reasons?

First would be because the other power generating industries not held to the same standards for the impacts that they have? Coal plants, frex, are not held accountable for the CO2 they release. If they were, it would bounce up the price per watt to the same price range as a nuclear reactor. What about the health effects of coal extraction? What are the costs wrt that compared to those generally caused by nuclear reactors?

The second reason, I suspect, has to do with the lack of fuel recycling in nukes. Because of some less than well thought out legislation, iirc, we can't recycle the barely used nuclear fuel here in the US. We ship it off to France to do so and that adds a nontrivial amount of dinero to do so. That would help make it less than economical as well.

Actually, there may be a third. It's one that is anecdotal rather than one I've seen in print: if the radioactivity emissions standards that are applied to the nuclear industry were done to the coal industry, they'd have greatly increased costs.

Might it be that nukes are just legislated into uneconomical status wrt its competitors because of misunderstandings of the technology than anything else? I have my very strong suspicions there. I am willing to be corrected.

If I have time, maybe I'll do some digging and a post on the subject.

[Noel Maurer]

Re wind fluctuation: I'm not sure for Germany, but Denmark seems to have pretty much smacked into the economical maximum. (Their grid generates /no/ power about one day in every seven, with an average base load of 20 percent.)

Re nukes: there are three issues that I think need to be separated.

The first has to do with the negative externalities generated by carbon-based fuels. I strongly suspect that a serious cap-and-trade system or a carbon tax would make nuclear power more attractive.

The second has to do with the perceived negative externalities involved with nuclear power. I'm not sure that those are significant, at least not on a national scale, given that there are parts of the United States that would welcome new plants.

The third has to do with the immense capital cost, especially the long start-up times for a plant. The French, contrary to popular myth, have not solved this problem.

http://www.nytimes.com/2006/07/16/magazine/16nuclear.html?_r=1&sq=nuclear%20power&st=nyt&oref=slogin&scp=10&pagewanted=all

Key paragraph (if correct):

“The fact that the T.V.A. is spending $1.8 billion to fix up an old plant, rather than just spend it on a new plant, suggests that a new one costs well over $2 billion,” David Lochbaum, of the Union of Concerned Scientists, told me in Washington. Lochbaum, a nuclear engineer and former consultant in the industry, agrees that carbon taxes could make a new nuclear plant financially viable. For now he says that the AP1000 just costs too much. This is something Westinghouse will not concede, but company executives did say they are fully aware that it isn’t passive safety or modular construction that will sell their designs. It’s the price tag, as well as proof that for the first time in history, a slew of nuclear plants can be built quickly, smoothly and within a budget.

[Doug M.]

Noel, great post. I love this stuff. And I'd be interested to hear about the "actual built-stuff problems".

Andrew, what do you think the innumerate Greens have done in Germany?

Doug M.

[Andrew R.]

Doug,

I was referring to their effort to phase out nuclear power, thus causing them to miss Kyoto targets.

See here:

http://www.spiegel.de/international/germany/0,1518,544926,00.html