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10 November 2020 – Electricity generation in Germany was down 0.9% and electricity consumption up 1.2% compared with the same month of the previous year. The average wholesale price was €33.97/MWh, which was lower than the average price a year earlier. Overall, Germany was still a net exporter this October.
Electricity generation from renewable and conventional energy sources totalled 45 TWh in October 2020 (2019: 45.4 TWh). While generation from conventional sources was 9.3% lower than in October 2019, generation from renewable sources was 10.9% higher.
Electricity consumption in October totalled 41.9 TWh (2019: 41.5 TWh), representing the first slight year-on-year increase in 2020. Electricity consumption in earlier months had been lower than in the previous year due to the Covid pandemic.
The chart illustrates electricity generation and consumption in Germany in the month of October.
Highest and lowest outputs of renewable electricity generation
Electricity generation from renewable energy sources reached its highest level of 53 GWh on Sunday 4 October between 1pm and 2pm, thereby accounting for around 78% of total generation.
During this time, there was a high level of onshore wind generation at 23.9 GWh (45.1%). Solar generated a further 19.1 GWh (36.0%) and offshore wind farms 3.8 GWh (7.2%). The remaining 6.2 GWh (11.7%) came from biomass, hydropower and other renewables. Electricity consumption totalled 54.6 GWh. Renewables therefore covered 97.1% of the electricity consumption, ie grid load, during this hour.
Generation from renewable sources fell to its lowest level of 8.4 GWh on Saturday 17 October between 6pm and 7pm when electricity consumption totalled 55.8 GWh. At 4.6 GWh, biomass accounted for the majority (54.8%) among the renewables. Hydropower generated around 2 GWh (23.8%), onshore and offshore wind farms together generated 1.5 GWh (17.9%); solar and other renewables generated the remaining 0.3 GWh (3.5%).
Overall, electricity generation from renewables was 10.9% higher than in October 2019. In particular, wind generation was up 19.6% due to higher wind levels (onshore: +15.7%; offshore: +35.4%). Wind output accounted for 31% of total generation in October. In addition to favourable weather conditions, continuing expansion also plays a role.
Solar generation was around 11% down on October 2019. This could be due to the number of sunshine hours; at 70, the total was much lower than the number of sunshine hours usually expected in the month of October of 109.
The wholesale electricity price in Germany
Wholesale prices for electricity were lower compared to a year earlier. In October, the hourly products on the EPEX Spot day-ahead market were traded at between minus 54.97 and plus 78.68 euros per megawatt hour (€/MWh), resulting in an average price of €33.97/MWh. This was €2.97 lower than the average in the same month of the previous year (October 2019: €36.94/MWh). The increase in generation from renewables and the resulting negative wholesale prices both contributed to the lower monthly average.
The chart illustrates actual electricity consumption and wholesale prices for electricity in October 2020.
The lowest exchange price was recorded between 1pm and 2pm on Sunday 4 October and was minus 54.97 euros per megawatt hour. During this time, the total electricity consumption of 52.6 GWh was met almost completely by the higher level of renewable generation of 52.1 GWh. That day, negative wholesale prices were recorded in seven consecutive hours between 9am and 6pm. This was the only time in October when the "six-hour rule" took effect, meaning that larger new installations receiving payments under the Renewable Energy Sources Act (EEG) and selling electricity directly did not receive payment in these periods. Under the rule, if the day-ahead price on the electricity exchange is negative for a period of at least six consecutive hours, the installation operators do not receive the market premium as from the first hour in the period with negative prices.
In total, negative electricity prices were recorded in 18 of the 745 hours of trading this October. In October 2019, this was the case in only five hours, which is why the "six-hour rule" did not take effect that month.
On the day-ahead market, the highest price of the past month of €78.68/MWh was recorded on Monday 12 October between 7pm and 8pm. The high price was due in particular to the high electricity consumption of 66.6 GWh, which coincided in that hour with a low level of renewable generation of 8.9 GWh.
Biomass generated 4.5 GWh, onshore and offshore wind farms together 2.3 GWh, hydropower 1.9 GWh, and other renewables the remaining 0.2 GWh. There was no solar generation output at that time as it was quite late in the day.
The electricity market reacts to this kind of situation by taking power from storage facilities (such as pumped storage stations), reducing the consumption of flexible loads and increasing the use of conventional power stations.
Wholesale prices in Germany
Number of hours with negative prices
Data basis: smard.de
Commercial foreign trade
In total, Germany exported 3,252.9 GWh more electricity than it imported in October, making it a net exporter. It had also been a net exporter in October 2019, exporting 4,217.6 GWh. Net exports were therefore 22.9% down on the previous year.
Changes in imports and exports are the result of frequent price fluctuations and are part of normal market activity. They reflect the interaction of supply and demand throughout the whole of Europe. At what point in time electricity is imported or exported does not depend solely on supply and demand, but also on the electricity prices of the other countries. Wholesale prices determined as a part of market coupling result from what are known as the relative generation costs, which vary over time. Among other things, wholesale prices reflect the costs for fuels or CO2 certificates, which in turn depend on other factors.
Available transmission capacity at the national borders also plays a role. This October, the two northern sections of the central axis connecting Schleswig-Holstein and Denmark went into operation. The southern section was put into operation back in 2018.
The first direct connection between Germany and Belgium – the Aachen Lüttich Electricity Grid Overlay (ALEGrO) – also went into operation in October. The 90-kilometre-long underground cable has a transmission capacity of 1,000 MW. Commercial trading beginning with day-ahead capacity is due to start in November.
The first direct connection between Germany and Norway – NordLink – is due to begin operation this December. The 623-kilometre-long interconnector will have a transmission capacity of 1,400 MW and has been planned in particular to enable the exchange of renewable energy, for instance to transport hydropower electricity from Norway to Germany and wind-powered electricity from Germany to Norway.
The chart gives an overview of Germany's commercial electricity trade. (Gross) exports are shown above the zero line while (gross) imports are shown below the zero line.
Germany was a net importer this month only from Denmark (721 GWh; 2019: net exports 508 GWh) and Sweden (282 GWh; 2019: net exports 11 GWh).
One reason for the shift from net exports to net imports in electricity trading with these two countries is the wholesale prices. Electricity from Sweden was less expensive than in Germany in 585 of the 745 hours of trading. In the previous year this was the case in only 64 hours. Electricity from the Denmark 1 zone was less expensive than in Germany in 526 hours (2019: 37 hours). As in September, no electricity could be imported from or exported to the Denmark 2 zone because of maintenance work on the Kontek interconnector.
The chart shows wholesale prices and commercial foreign trade between Denmark 1 and the Germany/Luxembourg market area in October.
There was a shift from net imports to net exports in Germany's commercial foreign trade with the Netherlands this October. Germany recorded net imports of around 10 GWh in October 2019, compared to net exports of around 414 GWh this October. This shift could be due to the wholesale prices. In October 2019, there was a difference of only one euro between the average wholesale prices in the two countries (Germany: €36.94/MWh; Netherlands: €37.94/MWh); this October, however, the average wholesale price in Germany was more than three euros below that in the Netherlands. Although wholesale prices in the two countries were identical in only 311 of the 745 traded hours (2019: 418 hours), the price in Germany was lower in 269 hours and thus in more than twice as many hours as in last October (118 hours).