Wed, May 21, 2014 - Page 8 News List

The true cost of power grid plans

By Chen Shao-wen 陳紹文

Power grids need to be provided with electricity that is flexible and can be quickly allocated. However, renewable energy sources, such as wind power and photovoltaic power, are dependent on climatic conditions and cannot be automatically allocated. As a result, countries in which renewable energy sources account for a greater proportion of the supply often rely on transnational grids to exchange electricity with neighboring countries as demand dictates.

They also often have to maintain a greater number of power plants to ensure a stable supply of electricity, which is why renewable energy sources cannot greatly reduce the number of traditional power stations. This is why renewable energy sources still cannot replace traditional power stations.

Taiwan is a small and densely populated nation. Onshore wind farms are almost saturated, so even if the public was encouraged to invest in power generation to earn money to help stop complaints about wind farms, there is a limit to how much further onshore wind farms can be developed.

Furthermore, photovoltaic power is expensive and, if excessively developed, could cause rapid electricity price increases.

Many people who claim that Germany’s electricity prices have not increased by much mostly ignore the tax issue. Considering only the price of electricity, from 1998 to last year Germany’s electricity prices for household consumers only increased by 11.7 percent. However, when taxes such as surcharges on renewable energy are factored in, the figure is 68.5 percent.

One of the prices that Germany has had to pay for its transformation in energy sources has been a rapid increase in taxes to help support the development of renewable energy sources. For example, surcharges on power from renewable sources went from 0.0008 euros to 0.00528 euros, and Germany’s electricity prices today are more than double those in the US.

Germany has started amending its Renewable Energy Law, and it has greatly lowered its development goals for renewable energy to slow down the problem of massive electricity price hikes. At present, Taiwan’s onshore wind farms are becoming saturated and if too much is invested in other renewable energy sources with a higher possibility for growth too early, it will result in large increases in electricity prices.

Although Germany is a net power exporter, it must still rely on imported power to ensure the stability of its power supply. Germany uses transnational power grids. As a producer of excess electricity, Germany can export power to neighboring countries and when renewable energy reserves are low due to climatic factors, it can purchase power.

Therefore, transnational power grids are one of the major conditions that allow Germany to spend a lot of effort on developing renewable energy sources.

In addition, part of the reason Germany can be a net power exporter is the uncontrollable nature of balancing renewable energy sources. For example, when energy supply exceeds demand — when there is a lot of sunlight and sufficient wind — it must export this surplus power to neighboring countries by selling it cheaply or even paying to export it to maintain the stability of its own domestic power networks. On the other hand, at night or when there is a lack of sufficient wind, Germany must purchase power from its neighbors at elevated prices.

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