Nuclear Energy in Germany
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October 2011 Expert Opinions and Studies on Economic and Social Policy Diskurs Scenarios for Phasing Out Nuclear Energy in Germany I II A Study for the Economic and Social Policy Department of the Friedrich-Ebert-Stiftung Scenarios for Phasing Out Nuclear Energy in Germany Brigitte Knopf Hendrik Kondziella Michael Pahle Mario Götz Thomas Bruckner Ottmar Edenhofer WISO Diskurs Friedrich-Ebert-Stiftung Contents Table of fi gures 3 Summary 4 1. Introduction 8 2. Modelling Results 10 2.1 Additional Need for Fossil Fuel-fi red Power Stations 10 2.2 Electricity Prices 12 2.2.1 Comparison of Expansion of Gas-fi red Power Stations instead of Coal-fi red Power Stations 13 2.2.2 Electricity Prices for Households Customers 14 2.2.3 Electricity Prices for High Electricity Using Industrial Customers 14 2.3 CO2 Emissions 14 2.4 Sensitivities and Robustness of the Results 16 3. Required Government Action 18 3.1 Grid Expansion 18 3.2 A Coordinated European Climate and Energy Policy Is Needed 19 3.3 Transparency and Scientifi c Monitoring 20 Authors 21 The views expressed in this publication are not necessarily those of the Economic and Social Policy Department of the Friedrich-Ebert-Stiftung or of the organization for which the author works. Impressum: © Friedrich-Ebert-Stiftung | Herausgeber: Abteilung Wirtschafts- und Sozialpolitik der Friedrich-Ebert-Stiftung | Godesberger Allee 149 | 53175 Bonn | Fax 0228 883 9205 | www.fes.de/wiso | Gestaltung: pellens.de | Lektorat: Sönke Hallmann | Fotos © Vojtech Soukup, CLUPIX images, cinema2000 | bub Bonner Universitäts-Buchdruckerei | ISBN 978-3-86872 - 889 - 7 | WISO Wirtschafts- und Sozialpolitik Diskurs Table of fi gures Figure 1: Defi nition of scenarios 9 Figure 2: Replacement requirement due to the closure of conventional capacities by 2020 11 Figure 3: Replacement capacity required in conventional power stations (by 2030; comparison of scenarios Exit 2015 – coal, Exit 2020 – coal and Exit 2022) 11 Figure 4: Development of the electricity price at the spot market (base) in the period 2015 - 2030 under selected scenarios 12 Figure 5: Development of wholesale prices comparing the replacement options of coal and gas 13 Figure 6: Electricity prices for household customers 2015 (in real terms 2007) 15 Figure 7: Electricity prices for household customers 2020 (in real terms 2007) 15 Figure 8: CO2 emissions in conventional power stations 2015-2030 16 Figure 9: Sensitivities in relation to spot market prices, FIT levy and household electricity prices in 2020 with regard to the scenario Exit 2020 – gas 17 Figure 10: Distribution of EU-wide greenhouse gas emissions by individual sectors in 2008 19 3 WISO Diskurs Friedrich-Ebert-Stiftung Summary The exit from nuclear energy planned by the government decisions (for example, the decisions German government presents a number of op- of the former coalition of Christian Democrats portunities but also harbours risks. This study and Social Democrats in 2007, the so-called shows that electricity prices for private house- “Meseberg decisions”). This includes, in particu- holds will be only slightly affected by withdrawal. lar, measures to expand renewable energy and The competitiveness of the German economy is cogeneration, as well as reductions in energy con- also unlikely to be affected severely since elec- sumption. The planned exit will once again make tricity prices for industry and large companies these measures the focus of energy policy. An im- will increase only temporarily. However, the CO2 portant aspect of the analysis presented here is a emissions of the German electricity sector could discussion of the additional challenges which rise, depending on the timing of the exit from would arise if the exit takes place not, in accord- nuclear energy. In addition, if security of supply ance with the previously valid Nuclear Energy is to be guaranteed, besides the expansion of Act (Atomgesetz; AtG), in 2022, but is completed renewable energy new fossil fuel-fi red power earlier (for example in 2020 or 2015). stations must be built or older plants permitted In order to assess the implications for effi - to remain operational for longer than originally ciency, environmental sustainability and security planned. of supply in the case of different exit times in this Against the background of the objectives study model-based analyses of the development of effi ciency, environmental sustainability and of electricity prices and CO2 emissions will be security of supply laid down in the Energy Mana- conducted for a series of exit scenarios: Exit 2015, gement Act (Energiewirtschaftsgesetz) the phas- Exit 2020, Exit 2022 (that is in accordance with ing out of nuclear energy must be done in such a the Nuclear Energy Act AtG 2002 in force until way that electricity prices remain affordable for autumn last year and also valid for the recent industry and consumers, security of supply is not decision taken in July 2011), and Exit 2038 (that jeopardised and the goals of climate protection is in accordance with the Nuclear Energy Act can be achieved over the long term. These energy AtG 2010 that was valid from October 2010 to policy aims will be achieved only if the exit from July 2011). Besides the expansion of renewable nuclear energy also marks an entry into a new energy, the various effects of gas- as opposed to energy policy. The resolution of possible confl icts coal-fi red power stations as replacements for of aims was discussed in connection with the de- nuclear energy are examined and further alter- cision on phasing out nuclear energy in 2002 and native scenarios explored. has already been addressed in the form of specifi c 4 WISO Wirtschafts- und Sozialpolitik Diskurs The following key fi ndings could be identifi ed: – Industrial customers that are exempt from the FIT – The development of spot market prices1 shows, for levy will be harder hit by the medium-term increase the various exit scenarios, regardless of the exit in the spot market price. If existing billing proce- date, an increase up to 2020 and a fall back to the dures are retained, however, there is the possi- base level of 2010 by 2030. In the case of an bility of benefi ting from the price-dampening early exit in 2015 or 2020 prices on the energy effect of renewable energy over the long term. exchange at the beginning will be higher than In the case of Exit 2015 in comparison to Exit in the case of an exit in 2022 since replacement 2020 or 2022 the burden for a typical indus- capacities with higher generation costs than trial customer (with 24 GWh electricity con- nuclear power stations must be put in place sumption per year) would be 216,000 per year. earlier on. Over the long term the price level – The exit from nuclear energy requires more rapid will fall due to the growing proportion of expansion of fossil fuel capacities than previously renewable energy. planned. By the respective exit times of 2015, – In the case of an exit in either 2020 or 2022 the 2020 or 2022, on top of the projects under spot market price in 2015 will be 5.9 ct/kWh. Exit construction, new fossil fuel-fi red power sta- 2015, by contrast, would lead to an increase of tions with a net output of 8 gigawatts (GW) 13 per cent. The spot market price in 2015 must be planned in order to meet the annual would be 5.9 ct/kWh in the case of Exit 2020 or peak load. This not only means that all the 2022 in comparison to a price of 5 ct/kWh at power stations under construction must be the beginning of 2011. Assuming a scenario built but also requires the commissioning of involving the prolongation of the operational fossil fuel-fi red power stations which are at life of nuclear energy (Exit 2038) the result present only at the planning stage or leaving would be a spot market price of 5.2 ct/kWh. In older plants in the grid longer than originally the case of accelerated exit (Exit 2015) the ad- planned. ditional price increase will amount to 0.8 ct/ – In the case of an earlier exit from nuclear energy kWh (13 per cent) in comparison to Exit 2020 than in 2022 there is likely to be a temporary in- or 2022. With the further expansion of re- crease in CO2 emissions but their total quantity newable energy by 2030 spot market prices would be limited via European emissions trading. will fall to 5-6 ct/kWh. Exit 2022 would broadly mean a return to the – For households liable to the feed-in tariff system old »status quo« – the legal framework of the (FIT) levy2 the timing of the exit from nuclear energy Nuclear Energy Act AtG2002 that was in force will have little effect on electricity prices. In the until autumn last year. Europe-wide, addition- case of Exit 2020 or 2022 the electricity price in al nuclear power stations, if any, would be used 2015 will be 21.7 ct/kWh, and in the case of only to a limited extent because, as a rule, be- Exit 2015 it will be 22.4 ct/kWh. Calculating ing a low cost option they are operating at on the basis of average electricity consumption their capacity limits most of the time. Exit 2020 per household of 3500 kWh per year, this would lead to a moderate short-term increase means a difference of around 2 per month. The in CO2 emissions. In the case of an exit by maximum difference between an exit in 2015 2015, by contrast, CO2 emissions would in- and in 2038 is 1.2 ct/kWh (3.5 per month).