Feed-In Tariffs

Denmark has just one-upped its status as the most cutting edge sustainable country in the world. They have committed to a goal of 100% renewable energy by the year 2050. That goal is not just limited to electric generation as other countries have done. They are including transportation as well. No burning of fossil fuels by 2050.

If that seems like an unrealistically lofty goal, keep in mind that these are the Danes we are talking about, who already get over 40% of their electricity from over 5,000 wind turbines, with every intention of making that 50% by 2020. Fossil fuel consumption is expected to fall by 20% over that same period.

While wind has carried most of the weight going forward, the latest initiative is more comprehensive. For starters, energy efficiency will play a major role. An intermediate target is looking for a 7% overall decrease in consumption from 2010 levels by 2020. Energy companies will be given specific targets.

Industrial heating and cooling is also a major part of the plan. Biomass will be substituted for coal on a large scale, for both heating and electricity. Subsidies will be provided for geothermal energy.

Also included are subsidies for energy efficient production processes, combined heat and power (CHP) applications, biogas, and smart grid. You could say the Danes are leaving no stone unturned in their search for a totally clean energy future.

What makes Denmark so successful while so many other nations are falling short?

According to Kurt Kornbluth, director of the Program for International Energy Technologies at the University of California, Davis, the first thing is that the government and the people are in accord. The government is willing to enact policies directed towards this shared goal, including a carbon tax, and feed-in tariffs, which the people were willing to accommodate. It also helps that as Rasmus Helveg Petersen, Minister for Climate, Energy and Building, has said, Denmark has been focusing on energy in a concerted manner ever since the oil crisis of 1973.

The second thing the Danes did was to establish wind cooperatives which funneled profits from excess power generation back to individuals and communities. BY 2001, the cooperative had over 100,000 members and owned a total of 86% of the nation’s wind power. That’s buy-in with a capital “B”.”When they see those turbines spinning,” said Kornbluth, they don’t say, that’s ugly, they say, that’s income.”

The third and final factor was a little bit of geopolitical luck. Denmark is positioned between Norway, home of abundant hydropower, and Sweden, which has lots of nuclear. The two form a gigantic grid that can readily provide backup when Denmark needs it. They can often be counted on to purchase excess wind power from Denmark when it is available as well.

Despite all of this good news, the Danes are facing some new challenges as they push into these unprecedented levels of renewable generation. As they are beginning to find out, each electrical grid has a level of renewables that they can economically support before they become saturated. That’s because the “baseline” power plants, that run on gas, coal, or nuclear are no longer economical if they are only used once in a while, when the wind has stopped or the sun has set. That’s because they can’t compete the rest of the time, with energy sources that are essentially free.

It’s not that this can’t be done. It’s just that the system hasn’t been designed for it. Real-time pricing and energy storage, an option that California is aggressively pursuing, and smart grids are some tools that can be applied. In the meantime, some utilities are being subsidized to operate plants at a loss, which is not sustainable.

“We are really worried about this situation,” Anders Stouge, the deputy director general of the Danish Energy Association, said. “If we don’t do something, we will in the future face higher and higher risks of blackouts.”

All of this is before Denmark has really started to ramp up on electric vehicles. That could put considerable further strain on the electric. But it could also be a blessing in disguise. Tens of thousands of electric cars could serve as a massive electric storage reservoir at times when most of those vehicles are parked, like at night. This is a synergistic relationship that the architects of tomorrow’s smart grid are counting on.

Article by RP Siegel of Justmeans, appearing courtesy 3BL Media.