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The Costs of Power Interruptions in Germany - an Assessment in the Light of the Energiewende

Author

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  • growitsch, christian

    () (Energiewirtschaftliches Institut an der Universitaet zu Koeln)

  • Malischek, Raimund

    () (Energiewirtschaftliches Institut an der Universitaet zu Koeln)

  • Nick, Sebastian

    () (Energiewirtschaftliches Institut an der Universitaet zu Koeln)

  • Wetzel, Heike

    () (Energiewirtschaftliches Institut an der Universitaet zu Koeln)

Abstract

The German Energiewende’s potential effects on the reliability of electricity supply as well as the corresponding economic consequences have recently entered both the political and scientific debate. However, empirical evidence of power outage costs in Germany is rather scarce. Following a macroeconomic approach, we analyse the economic costs imposed by potential power interruptions in Germany. Investigating a rich data set on industry and households we estimate both Values of Lost Load (VoLLs) and associated costs of power interruptions for different German regions and sectors and every hour of the year. This disaggregated approach allows for conclusions for optimal load shedding in case of technical necessity and the economic efficiency of measures to improve security of supply. We find that interruption costs vary significantly over time, between sectors and regions. Peaking on midday of a Monday in December at 750 Mioe per hour, the average of total national outage costs amount to approximately 430 Mioe per hour. Our results emphasize the prominent regional aspect of the German Energiewende as the regions with the highest estimated cost of interruptions in South and West Germany coincide with the areas which face nuclear power plant shut downs in the near future.

Suggested Citation

  • growitsch, christian & Malischek, Raimund & Nick, Sebastian & Wetzel, Heike, 2013. "The Costs of Power Interruptions in Germany - an Assessment in the Light of the Energiewende," EWI Working Papers 2013-7, Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI).
  • Handle: RePEc:ris:ewikln:2013_007
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    References listed on IDEAS

    as
    1. de Nooij, Michiel & Lieshout, Rogier & Koopmans, Carl, 2009. "Optimal blackouts: Empirical results on reducing the social cost of electricity outages through efficient regional rationing," Energy Economics, Elsevier, vol. 31(3), pages 342-347, May.
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    4. Serra, Pablo & Fierro, Gabriel, 1997. "Outage costs in Chilean industry," Energy Economics, Elsevier, vol. 19(4), pages 417-434, October.
    5. LaCommare, Kristina Hamachi & Eto, Joseph H., 2006. "Cost of power interruptions to electricity consumers in the United States (US)," Energy, Elsevier, vol. 31(12), pages 1845-1855.
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    Citations

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    Cited by:

    1. Bertsch, Joachim & Brown, Tom & Hagspiel, Simeon & Just, Lisa, 2016. "The relevance of grid expansion under zonal markets," EWI Working Papers 2015-7, Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI).
    2. Becker, Sophia & Schober, Dominik & Wassermann, Sandra, 2016. "How to approach consumers’ nonmonetary evaluation of electricity supply security? The case of Germany from a multidisciplinary perspective," Utilities Policy, Elsevier, vol. 42(C), pages 74-84.
    3. repec:eee:juipol:v:48:y:2017:i:c:p:41-50 is not listed on IDEAS
    4. Aaron Praktiknjo, 2016. "The Value of Lost Load for Sectoral Load Shedding Measures: The German Case with 51 Sectors," Energies, MDPI, Open Access Journal, vol. 9(2), pages 1-17, February.
    5. Hagspiel, Simeon, 2016. "Supply Chain Reliability and the Role of Individual Suppliers," EWI Working Papers 2016-5, Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI).
    6. Henning Thiesen & Clemens Jauch & Arne Gloe, 2016. "Design of a System Substituting Today’s Inherent Inertia in the European Continental Synchronous Area," Energies, MDPI, Open Access Journal, vol. 9(8), pages 1-12, July.
    7. repec:gam:jeners:v:9:y:2016:i:2:p:116:d:64126 is not listed on IDEAS
    8. Castro, Rui & Faias, Sérgio & Esteves, Jorge, 2016. "The cost of electricity interruptions in Portugal: Valuing lost load by applying the production-function approach," Utilities Policy, Elsevier, vol. 40(C), pages 48-57.
    9. Wolf, André & Wenzel, Lars, 2015. "Welfare implications of power rationing: An application to Germany," Energy, Elsevier, vol. 84(C), pages 53-62.
    10. repec:aen:journl:ej38-5-just is not listed on IDEAS
    11. Keles, Dogan & Bublitz, Andreas & Zimmermann, Florian & Genoese, Massimo & Fichtner, Wolf, 2016. "Analysis of design options for the electricity market: The German case," Applied Energy, Elsevier, vol. 183(C), pages 884-901.
    12. Wolf, André & Wenzel, Lars, 2016. "Regional diversity in the costs of electricity outages: Results for German counties," Utilities Policy, Elsevier, vol. 43(PB), pages 195-205.
    13. Frondel, Manuel & Sommer, Stephan, 2017. "Der Wert von Versorgungssicherheit mit Strom: Evidenz für deutsche Haushalte," RWI Materialien 115, RWI - Leibniz-Institut für Wirtschaftsforschung.

    More about this item

    Keywords

    Security of Supply; Value of Lost Load (VoLL); German Energiewende; Electricity outage costs;

    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices

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