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Fortune
Fortune
Ryan Hogg

'Dunkelflaute' weather phenomenon pushes German energy prices to 2-decade high

A wind turbine is seen in front of the lignite-fuelled Schkopau power plant south of Halle on January 4, 2024. (Credit: JOHN MACDOUGALL/AFP via Getty Images)

A weather phenomenon dubbed “Dunkelflaute” that causes chilly, low-wind conditions is sweeping across Europe and causing fresh havoc to Germany’s embattled economy, where energy prices have risen to a two-decade high.

A Dunkelflaute, translated as “'dark doldrums” or “dark wind lull,” is the bain of renewables companies, with an extended period of low wind and cloudy weather hurting their ability to generate electricity from either wind or solar. 

Montel Analytics forecast German wind output to drop to 2.8 gigawatts, compared to a normal capacity of 19 gigawatts at this time of year.

The shift in weather has forced Germany to burn more fossil fuels, fire up coal power stations, and import energy from France to meet an electricity demand shortfall. Data from EpexSpot and reported by The Telegraph showed prices for power in the window jumped above €900 per megawatt hour on Wednesday, the highest level recorded in 18 years.  

Wind turbines generate power in a fashion similar to a yield curve, with turbines optimized to handle a predicted wind speed. A drop in wind levels below the optimal speed leads to a disproportionate reduction in the amount of power generated.

The problem isn’t just affecting Germany, with all of Western Europe experiencing low wind levels. In the U.K., National Grid data shows the country generated 5.9% of its electricity from wind as of 2 p.m. on Thursday, compared to an average of 31.8% over the past year.

However, the problems have been amplified in Germany due to the country’s energy structure. Germany has faced an unfavorable energy environment since Russia’s invasion of Ukraine, leaving it without its vital source of Russian oil and gas following sanctions. It is also overreliant on wind as a source of renewables after abandoning nuclear earlier in the 21st century.

Sabrina Kernbichler, lead power analyst at Energy Aspects Ltd, told Bloomberg: “German wind generation is even lower than the already low forecast levels.”

Kathryn Porter, an independent energy analyst at Watt Logic, told The Telegraph the current situation was the result of “poor choices made by Germany over the past 20 years.”

“They have closed most of their nuclear power plants and also many conventional thermal plants, while building wind farms like gangbusters,” she added.

“At the same time, a lot of their wind generation is concentrated in the north while the biggest demand centres are in the south and, like the UK, they have failed to build enough grid infrastructure, so there is a lot of congestion.”

It’s the latest thorn in the German economy’s side, with high energy prices partly contributing to what is now a two-and-a-half-year recession in the country’s manufacturing sector.

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