Distributed Energy Supply

For decades, around 500 fossil and nuclear power plants provided the required electricity in Germany. But expansion of renewable energy is changing the power station park and the balance of power in the market. By the end of 2016, more than 1.58 million photovoltaics systems had been installed on German rooftops, with the trend continuing to increase significantly. There are also wind farms, biomass power plants, micro and mini combined heat and power plants, heat pumps, and more. The future of energy generation is distributed.

Energy in the Peopleʼs Hands

While 80% of fossil and nuclear power is generated by the four large energy conglomerates, in 2012 only 12% of the renewable energy plants were under the management of conglomerates, compared to 47% in the hands of private individuals and farmers, and 41% attributed to new investors such as project developers and funds.

In Germany distributed energy is `citizen-owned´, Picture: PantherMedia
In Germany distributed energy is `citizen-owned´, Picture: PantherMedia

Customers Become Energy Producers/Consumers

The clear line between producers and consumers that has existed for over a hundred years is blurring. In the future, energy producers/consumers, meaning people who in addition to their traditional role as electricity consumers also fill a new role as electricity producers, will form at least one of the important pillars of the new energy system, or perhaps even the whole system. That’s because, for real estate owners, it will become more and more economical to produce, consume, and store as much energy as possible on-site, rather than sourcing it from energy providers at higher prices. This will also apply in the future when users of self-generated electricity are exempt from their former privileges and, for instance, cover their fair share of the power grid costs.

Falling Prices Expected

Thanks to new battery storage, it will be possible to significantly increase the amount of self-generated energy consumed in-house in the future. For instance, when at noon the sun is shining and producing more electricity than is needed, a battery stores the excess energy. The house owner can then use the stored solar power for light, TVs and computers in the evening, at night, or on cloudy days.

Experts forecast that prices for both photovoltaics systems and batteries will continue to fall. The price per kilowatt-hour of output for a photovoltaics system decreased by 60% between 2006 and 2014. Battery prices are expected to fall at a similar rate, with experts predicting a decrease in price of around 45% between 2015 and 2020. With lower prices for solar power technology and, in the future, more affordable batteries for photovoltaics systems and electric vehicles, more and more houses will be transformed into power plants and energy storage facilities.

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