According to a short study commissioned by the German Federation for Nature Conservation (BUND) from Montel Analytics, a high proportion of wind and solar power within the grid helps stabilize electricity prices during energy crises and smooths out extreme peaks. The environmentalists announced this on Tuesday.
The analysis compared three scenarios regarding the energy crisis pricing conditions of 2022: an energy system heavily reliant on fossil fuels from 2011, the baseline scenario of 2022, and a future scenario incorporating 80 percent renewable energy, reflecting the German government’s 2030 goals. The comparison clearly demonstrated the superiority of an energy system with a high renewable share during times of crisis.
For instance, under the 2030 scenario, the average price dropped by 64 percent compared to 2011. While the average price in the 2011 model, under crisis-like conditions, stood at 382.90 Euros per megawatt-hour (MWh), it was only 137.27 Euros/MWh in 2030 during a crisis. This represents a saving of nearly 100 Euros per MWh compared to the average electricity price of 235.44 Euros/MWh during the 2022 energy crisis.
Another key finding of the study is that renewable energies smooth out price spikes. In the specific example of the 80 percent renewable system, the price averaged only 41 hours above the 500 Euro mark. In stark contrast, the 2011 model hit this price barrier for 785 hours, while the 2022 scenario reached it for 499 hours.
The study also revealed that flexibility plays a crucial role in a system dominated by renewable energies. During periods of high solar and wind generation and consequently low prices, technologies such as heat pumps, electrolyzers, or electric vehicles can draw power at favorable rates. Conversely, when electricity is scarce and prices are high, their consumption can be largely reduced or shifted over time. Battery storage enhances this effect, simplifying the integration of wind and solar power and helping to dampen peak prices through an additional supply.
Olaf Bandt, chairman of the BUND, explained, “The study shows that the decisive shift to renewable energies is far more than just a climate policy obligation. Renewables could have guided us through past crises more smoothly, and now they must be consistently expanded. This is the only way to stop the fossil fuel dependency that drives up our cost of living.”
Bandt urged the federal government to utilize all available levers to exploit the full potential of solar and wind power. He criticized political actions, stating, “Instead, with the draft amendments to the Renewable Energy Sources Act and the grid connection package last week, they decided on new obstacles to their expansion. Urgent improvement of both laws is needed in the parliamentary process.”
“The solution to energy price crises is obvious: a consistent move away from fossil fuels and a rapid expansion of renewables,” he stated. “Instruments like the industrial electricity price or fuel discounts are costly state interventions. They temporarily relieve certain groups, but they do not solve the problem. On the other hand, increasing the share of renewable energy in the power system ensures that future price crises will be significantly mitigated. Given geopolitical conflicts and rising oil and gas prices, this added benefit of the energy transition is more relevant than ever.”
The BUND criticized the draft legislation in the Renewal Energy Sources Act (EEG) and the grid connection package, noting that both introduce new hurdles for renewable energy expansion. These draft laws specifically affect small photovoltaic rooftop systems and the Redispatch reserve also significantly slows down both wind and ground-mounted PV. The environmentalists warned this jeopardizes not only climate protection goals but also hundreds of thousands of jobs. Both legislative proposals also made the investment framework significantly more bureaucratic, leading to uncertainty. The BUND added that the government’s stated goal of ambitious expansion at minimal cost is thus unattainable.
