Archive for November 2011

A Smart Grid wake-up call

November 23, 2011 6:56 AM by KelvinR

A report out today tells energy companies in Europe and the US that unless they invest in Smart Grids they will face crippling blackouts in the next few years.

The primary cause of these blackouts, says the risk analysis by Allianz Global Corporate & Specialty, is that the existing grid cannot cope with the surge in capacity that is expected to come from renewable energy in the next few years.

This week also saw transmission system operator TenneT warn the German government that its programme to connect offshore wind farms to the grid had reached saturation point in terms of “human, material and financial resources”.

TenneT said that “the construction of connecting cables for offshore wind farms in the North Sea is no longer advisable and possible under current conditions and at the current speed”.

Network operators, particularly in Europe, are fast approaching a tipping point of power. The renewables race has gathered such pace that it has left transmission and distribution companies in the starting blocks.

And while many European countries are initiating domestic Smart Grid initiatives, what’s missing is a co-ordinated Europe-wide approach to the problem. A sharing of research, technology and, ultimately, networks, would bring reliable, effective results more quickly.

Paul Smith, operations manager of the UK’s Energy Networks Association, says: “The rollout of smart meters and Smart Grid technologies represents a once in a lifetime opportunity to address many legacy issues.”

It’s an opportunity power companies cannot afford to miss.

Posted in Smart Grid, Smart Grid T&D Infrastructure and Strategic Development | 1 Comment »

Will Germany’s ‘romantic’ energy policy woo business hearts?

November 15, 2011 11:05 AM by KelvinR

The head of RWE, Volker Beckers, recently told a conference in London that the German government had a “romantic view of energy” because of its decision to withdraw from nuclear power.

Now the impact of that “romantic” strategy is breaking hearts in the boardrooms of German companies RWE and E.ON.

Both suffered a significant profits drop this month, with RWE chief Juergen Grossmann acknowledging that “the coming years will be difficult for us”, while E.ON’s chief financial officer Marcus Schenck said the company will seek damages in court for losses linked to the nuclear exit.

Angela Merkel’s government has maintained ever since it took the nuclear decision in June that it will be renewables that take up the slack in the country’s future energy mix, and with Germany already one of the wind power world leaders, it’s better placed than most to take that gamble.

But a gamble it nevertheless is. Germany prides itself on its domestic manufacturing prowess, and in turn its position as one of the world’s exporting heavyweights. The undoubted increase in energy costs that will come with a shift to renewables will add to exporting costs. Not good news for any industry in the current economic climate, particularly in the eurozone.

Yet the country is firmly set on this course. Last month Germany’s environment minister Norbert Roettgen said that “renewable energy and energy efficiency are the two pillars of the new energy policy” and the government has said that its renewables share of the energy mix must rise from the current 17 per cent to 35 per cent by 2020 and 80 per cent by 2050.

And critically it has the backing of public opinion. A recent survey found 79 per cent of Germans polled that increased energy tariffs were “reasonable”, with only 15 per cent feeling they were too high.

The eyes of the governments and the energy world – particularly players in nuclear and renewables – will be fixed on Germany in the coming years. Because if its blueprint for change works, it will set a pattern around Europe that in time will feed out to the rest of the world.

Posted in Europe, Nuclear and Renewables | No comments yet »

Pause for thought on shale gas?

November 3, 2011 7:36 AM by KelvinR

There are two news stories this week that, far from derailing the shale gas bandwagon, might cause it to slow down somewhat.

In the UK an independent report from European seismic experts found that it was “highly probable” that tremors in the region were caused by exploratory drilling by shale gas firm Cuadrilla Resources.

And in China, analysts have said it will take the country 10 years to have the infrastructure in place to successfully tap into, and market, its vast reserves of shale gas.

In the US the shale dash for gas continues apace, but many European countries already cautious of the environmental effects of fracking – the process to release the gas – will greet the news from the UK with a ‘told-you-so’ reaction.

Only last week UK energy secretary Chris Huhne said there was too little known about shale gas side effects to “bet the farm” on it as an energy security silver bullet.

There might now be many investors who now may not bet the barn, never mind the farm, on it.

 

No comments yet »