Has electricity decoupled from natural gas prices in Germany?

anovikov

Nice! This is the first time i see anyone providing a quantitative answer to this. When the effect becomes more pronounced, it will hopefully remove political barriers for renewable electricity.

wongarsu

Note that "gas" in this context means natural gas, not gasoline As noted in the methodology below, they are measuring the gas-implied level as the marginal running costs of a combined-cycle gas turbine plant: the price of the natural gas necessary to generate a given amount of electricity, plus the cost of the necessary carbon credits to burn that natural gas. Then they compare that to the actual electricity price

snehk

Has this benefitted the regular/average consumer? Nope. They pay more than they were with the "old" energy mix of more gas and nuclear. Telling people it could be worse isn't really something to be proud of. I personally now have solar panels on the roof and a heat pump so we only use electricity and don't rely on gas. Germany's strategy is really beneficial to households like my own. Unless you're relatively well off or on benefits, you're losing big time. The costs are constantly increasing with people telling others to just take money (you don't have) to install some solar panels on the house (you don't own) or buy an electric car (you can't afford).

azan_

I wonder what prices would they have if they did not implement sunsetting of nuclear energy. Has to be the worst energy policy decision ever.

qubex

My quant mind is sprained by the implied volatility around the mean.

ozlikethewizard

Good for the Germans, in the UK we use marginal cost pricing, so consumers pay for the highest costing output regardless of how much if any they use. Means even if we get gas down to 1% well still be paying gas prices.

morphle

This energy scam has been going on for more than 30 years in Europe and the UK. The former Economic minister and professor Yanis Varoufakis explains [1]. My Fiberhood cooperative has a solution: the Enernet smart grid where you pay $0.01 per kWh. We wire up one in three houses or more in a neighborhood with power routers. People buy and sell only solar electricity from panels in the neighborhood, from batteries and from every ev charging station on every parking spot in the neighborhood and from every parked ev. Each participating house saves $2000 to $5000 per year for 30 years or more[2]. You also get free 25 Gbps internet. You heat your house with a heatpump or cool the house with an ice storage ac powered only by solar. If the cooperative makes any money the share the profit with all the members or they vote to buy more solar panels and batteries. The cooperative gives loans to houses that can not afford their own panels. [1] Best version with info graffics https://www.youtube.com/watch?v=R3bo-s_OY4Q or Longer version https://www.youtube.com/watch?v=NicE0-N9ux0&list=TLPQMDcwNDI... or short version https://www.youtube.com/watch?v=TaHepQyE37Q [2] https://www.researchgate.net/profile/Merik-Voswinkel/publica...

_ink_

For me personally it did not. I was a happy Tibber costumer until recently, meaning I was charged the quarterly hour spot price per kWh. The Iran War let to a significant jump in the price during the hours when renewables were low. I switched back to a traditional fixed price per kWh plan because of the high gas prices.

ExpertAdvisor01

If anyone is interested here are the prices for electricity in munich (dynamic based on exchange price ). The price includes taxes & fees . 0:00-5:35 : ~ 0.32€ 5:35-8:45 : ~ 0.38€ 8:45-10.30 : ~ 0.30€ 10:30-16:45 : ~ 0.18€ 16:45-18:00 : ~ 0.31€ 18:00-24:00 : ~ 0.34€

ndoddhdudhhd

State propaganda: so you mixed in renewables as FREE?

jillesvangurp

Decoupling of energy prices from fossil fuel is going to be spreading around the globe. It's not that hard to grasp. If you are spending non trivial percentages of your GDP on stuff that you burn once in exchange for some twh of energy delivered, lowering that significantly will have a notable impact on your trade balance. Recent events in the middle east will have made a few countries keenly aware of how overly dependent they are on stuff coming from that region and how easily their economies are disrupted when stuff goes wrong there. I live in Berlin, electricity is rather expensive here and people are not treating their gas dependence with enough urgency yet. The city is surrounded by flat country side with lots of wind mills and solar installations. Yet most apartment buildings in the city are still gas heated. Mine is no exception. I have to pay into fueling the gas boiler every month to the extent of about 150ish euro per month. Down from 250ish during the worst of the aftermath of the Russian gas pipeline shut down. I'd love my building to be switched to a heat pump. That's 1800 euro down the drain every year. I'll take a 30-40% cut on that please. It's technically very feasible and measured over 10-20 years, there should be a very clear financial payoff. Done right it should pay for itself probably within a decade. The building has about 20 apartments. Monthly gas bills are 2.5K based on yearly statements. Or about 30K. All out the chimney. That's one hell of a budget to tackle a bit of energy efficiency in the building. But this is where Germany is its own worst enemy. We're talking a lot of vested interests. Nimby's somehow blocking the notion of literally saving money (as opposed to setting it on fire and chucking it out the chimney). A lack of incentives. A lot of bureaucracy, etc. Even the decision to stop building completely new buildings without a gas connection is somehow controversial in this country where gas is expensive. It is in the middle of a years long gas crisis of its own making and it can't get the decision to stop hitting itself with the proverbial hammer actioned. A bit of system thinking could turn this around relatively quickly though. For example starting to think of this as investments with clear ROI as opposed to just cost would change the decision making and could also open up a lot of financing. Banks love investments with predictable ROI, for example. And Germany has an excellent credit rating. However, Germany is grid locked on an irrational fear of financing and debt. It has very little of it relative to e.g. the US or even most other EU countries. It also has huge infrastructure problems. Addressing those requires investment. Investment requires financing. Investments have ROIs which should enable said financing. But that's where penny pinching politicians seem to have a mental block confusing investments for cost and consistently opting to "save cost" rather than to invest. And generally not seeing the forest for the trees. But the picture is pretty clear. Switch most house holds to heat pumps while at the same time investing in cables, on/off-shore wind, a bit of solar on the side. With lots of battery storage. Etc. would do wonders for the amounts of gas it has to import at great cost. The country has millions of apartment blocks like mine using about 2-3x more energy than needed for heating. Almost all of it in gas form. A program to change those buildings could be executed in 10-15 years and break even in about the same time. It would result in many billions of savings in gas imports per year. That's the few percent of GDP that makes the difference between growth or recession. Germany has been in and out of recession for the last few years. Even powering that exclusively with gas fired electricity plants would yield substantial savings. And it already is transitioning to a grid that is mostly not gas powered. This should be a no brainer. But it somehow isn't. And that's just domestic heating.