Europe’s green energy transition faces overproduction hurdles

Hornsea wind project, UK

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The time and duration of any oversupply of renewable-sourced power (prices dropping fast) is of course unpredictable, as is the opposite undersupply (prices rising fast) when it’s not windy and/or dark. But the regular occurrence of such fluctuations is totally predictable, hence the price volatility. The article notes: ‘Already, a cottage industry has sprouted up around trading on renewable energy price volatility.’ Climate obsessives may dream of mass storage of electricity, but cost and practicality pretty much rule that out. The nearest equivalents are fuels, also ruled out by ‘net zero’ dogma apart from CO2-rich wood pellets.
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Summary
— The rapid expansion of renewable energy sources, particularly wind and solar, has led to an oversupply of electricity in Europe, causing prices to plummet.

— This oversupply has resulted in decreased investment in offshore wind, as evidenced by recent failed auctions in Denmark and the United Kingdom.

— Energy trading firms are capitalizing on price volatility, while the search for effective energy storage solutions continues.
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Energy prices across Europe fell below zero for a record number of hours in 2024, says OilPrice.com.

An accelerated buildout of large-scale wind and solar farms has flooded European grids at peak production hours, causing surplus energy to be sold at a loss at increasingly frequent increments, for a grand total of 7,841 hours during the first eight months of this year.

At their worst, prices have fallen below -€20 per megawatt hour, according to the consultancy ICIS.

While rapidly expanding solar capacity is the main culprit for the price inversions, a decades-long boom in wind power is also a major contributor.

This reality was underscored earlier this month in Denmark when an offshore wind auction failed to receive a single bid. The government-run event was the biggest-ever auction for offshore wind farms in Denmark.

This is a relatively clear sign that the market for wind power is pretty much saturated in Denmark and in other European countries, like Sweden, that started renewable buildout early and aggressively. Last year, Denmark generated 58% of its electricity from offshore wind, setting a world record. But it looks like that number is set to plateau.
. . .
The search for commercial-scale, long-term energy storage solutions is also heating up. Energy storage technologies capable of capturing and storing excess renewable energy until demand outstrips supply will be critical to achieving a 100% renewable power grid.

But technology is not quite there yet [Talkshop comment – surely a massive understatement].

For now, “we cannot have an electricity system that’s based solely on wind and solar,” Brian Vad Mathiesen, a professor at Aalborg University in Denmark, told gCaptain. “There are stark technical and economic limits to how much we can integrate into the grid.”

Full article here.
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Image: Hornsea Wind Project, England