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German Nuclear Policy Reconsidered: Implications for the Electricity Market

Author

Listed:
  • Fürsch, Michaela

    () (Energiewirtschaftliches Institut an der Universitaet zu Koeln)

  • Lindenberger, Dietmar

    () (Energiewirtschaftliches Institut an der Universitaet zu Koeln)

  • Malischek, Raimund

    () (Energiewirtschaftliches Institut an der Universitaet zu Koeln)

  • Nagl, Stephan

    () (Energiewirtschaftliches Institut an der Universitaet zu Koeln)

  • Panke, Timo

    () (Energiewirtschaftliches Institut an der Universitaet zu Koeln)

  • Trüby, Johannes

    () (Energiewirtschaftliches Institut an der Universitaet zu Koeln)

Abstract

In the aftermath of the nuclear catastrophe in Fukushima, German nuclear policy has been reconsidered. This paper demonstrates the economic e ffects of an accelerated nuclear phase-out on the German electricity generation sector. A detailed optimization model for European electricity markets is used to analyze two scenarios with di fferent lifetimes for nuclear plants (phase-out vs. prolongation). Based on political targets, both scenarios assume significant electricity demand reductions and a high share of generation from renewable energy sources in Germany. Our principal findings are: First, nuclear capacities are mainly replaced by longer lifetimes of existing coal-fired plants and the construction of new gas-fired plants. Second, fossil fuel-based generation and power imports increase, while power exports are reduced in response to the lower nuclear generation. Third, despite the increased fossil generation, challenging climate protection goals can still be achieved within the framework of the considered scenarios. Finally, system costs and electricity prices are clearly higher. We conclude that the generation sector can generally cope with an accelerated nuclear phase-out under the given assumptions. Yet, we emphasize that such a policy requires a substantial and costly transformation of the supply and the demand side.

Suggested Citation

  • Fürsch, Michaela & Lindenberger, Dietmar & Malischek, Raimund & Nagl, Stephan & Panke, Timo & Trüby, Johannes, 2011. "German Nuclear Policy Reconsidered: Implications for the Electricity Market," EWI Working Papers 2011-12, Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI).
  • Handle: RePEc:ris:ewikln:2011_012
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    References listed on IDEAS

    as
    1. Dr. Ulrike Lehr & Anke Mönnig & Dr. Marc Ingo Wolter & Dr. Christian Lutz & Dr. Wolfgang Schade & Dr. Michael Krail, 2011. "Die Modelle ASTRA und PANTA RHEI zur Abschätzung gesamtwirtschaftlicher Wirkungen umweltpolitischer Instrumente - ein Vergleich," GWS Discussion Paper Series 11-4, GWS - Institute of Economic Structures Research.
    2. Nagl, Stephan & Fürsch, Michaela & Paulus, Moritz & Richter, Jan & Trüby, Johannes & Lindenberger, Dietmar, 2011. "Energy policy scenarios to reach challenging climate protection targets in the German electricity sector until 2050," Utilities Policy, Elsevier, vol. 19(3), pages 185-192.
    3. Richter, Jan, 2011. "DIMENSION - A Dispatch and Investment Model for European Electricity Markets," EWI Working Papers 2011-3, Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI).
    4. Paulus, Moritz & Borggrefe, Frieder, 2011. "The potential of demand-side management in energy-intensive industries for electricity markets in Germany," Applied Energy, Elsevier, vol. 88(2), pages 432-441, February.
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    Citations

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    Cited by:

    1. Koppelaar, Rembrandt H.E.M. & Keirstead, James & Shah, Nilay & Woods, Jeremy, 2016. "A review of policy analysis purpose and capabilities of electricity system models," Renewable and Sustainable Energy Reviews, Elsevier, vol. 59(C), pages 1531-1544.
    2. Hecking, Harald, 2015. "CO2 abatement policies in the power sector under an oligopolistic gas market," EWI Working Papers 2014-14, Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI).
    3. Thure Traber & Claudia Kemfert, 2012. "German Nuclear Phase-out Policy: Effects on European Electricity Wholesale Prices, Emission Prices, Conventional Power Plant Investments and Eletricity Trade," Discussion Papers of DIW Berlin 1219, DIW Berlin, German Institute for Economic Research.
    4. Grossi, Luigi & Heim, Sven & Waterson, Michael, 2014. "A vision of the European energy future? The impact of the German response to the Fukushima earthquake," The Warwick Economics Research Paper Series (TWERPS) 1047, University of Warwick, Department of Economics.
    5. Fürsch, Michaela & Lindenberger, Dietmar, 2013. "Promotion of Electricity from Renewable Energy in Europe post 2020 - the Economic Benefits of Cooperation," EWI Working Papers 2013-16, Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI).
    6. Malischek, Raimund & Trüby, Johannes, 2016. "The future of nuclear power in France: an analysis of the costs of phasing-out," Energy, Elsevier, vol. 116(P1), pages 908-921.
    7. Dillig, Marius & Jung, Manuel & Karl, Jürgen, 2016. "The impact of renewables on electricity prices in Germany – An estimation based on historic spot prices in the years 2011–2013," Renewable and Sustainable Energy Reviews, Elsevier, vol. 57(C), pages 7-15.
    8. Friedrich Kunz and Hannes Weigt, 2014. "Germanys Nuclear Phase Out - A Survey of the Impact since 2011 and Outlook to 2023," Economics of Energy & Environmental Policy, International Association for Energy Economics, vol. 0(Number 2).
    9. Knaut, Andreas & Tode, Christian & Lindenberger, Dietmar & Malischek, Raimund & Paulus, Simon & Wagner, Johannes, 2016. "The reference forecast of the German energy transition—An outlook on electricity markets," Energy Policy, Elsevier, vol. 92(C), pages 477-491.
    10. Rehner, Robert & McCauley, Darren, 2016. "Security, justice and the energy crossroads: Assessing the implications of the nuclear phase-out in Germany," Energy Policy, Elsevier, vol. 88(C), pages 289-298.
    11. repec:gam:jeners:v:10:y:2017:i:8:p:1235-:d:109067 is not listed on IDEAS
    12. Fürsch, Michaela & Malischek, Raimund & Lindenberger, Dietmar, 2012. "Der Merit-Order-Effekt der erneuerbaren Energien - Analyse der kurzen und langen Frist," EWI Working Papers 2012-14, Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI).
    13. Brigitte Knopf & Michael Pahle & Hendrik Kondziella & Fabian Joas & Ottmar Edenhofer & Thomas Bruckner, 2014. "Germany's Nuclear Phase-out: Sensitivities and Impacts on Electricity Prices and CO2 Emissions," Economics of Energy & Environmental Policy, International Association for Energy Economics, vol. 0(Number 1).

    More about this item

    Keywords

    Nuclear policy; climate protection; renewable energy; electricity market modeling;

    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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