Fabian Arnold, M.Sc.
is Research Associate at EWI since 2018 and doctoral candidate at the University of Cologne. In consulting projects for clients from the industry and public sectors, he has analyzed, e.g., the effects of a coal phase-out on the electricity market, carbon emissions and industry. He has advised, among others, the Ministry for Economy, Innovation, Digitalization and Energy of North Rhine-Westphalia (MWIDE). His research focus lies in economic and technical modeling of energy systems, local energy markets and households. Before joining EWI, Fabian Arnold studied Business Administration and Electrical Power Engineering at the RWTH Aachen University (Germany) and at the National Taiwan University of Science and Technology (Taipeh, Taiwan).
Client: Wirtschaftsvereinigung Metalle e.V.
Coal phase-out: EWI develops methods for determining possible compensation payments for electricity intensive industries
How does the accelerated coal phase-out affect the wholesale electricity price – and how can this effect be estimated in the course of a compensation mechanism? In a new report commissioned by the WirtschaftsVereinigung Metalle e.V., scientists from EWI have developed and described three concrete methods for this purpose. In addition, they have analysed what effects the coal phase-out decided by the cabinet will have on the other electricity cost components of industrial companies.
The background to this is that both the final report of the so called coal commission and the Kohleausstiegsgesetz passed by the German Cabinet call for a compensation mechanism. This instrument is intended to compensate for possible electricity price increases that the coal phase-out may bring to the electricity intensive industry. The extent to which these compensatory measures are necessary to ensure the continued international competitiveness of German industry is not part of the report.
Client: Ministry of Economy, Innovation, Digitalization and Energy of the state of North Rhine-Westphalia (MWIDE)
Effects of the phase-out of coal-fired power generation by 2038 on the electricity market, CO2 emissions and selected industries
At the end of January, the Coal Commission presented its final report. The EWI examined the effects of that report on behalf of MWIDE NRW (Ministry of Economic Affairs, Innovation, Digitalisation and Energy of North Rhine-Westphalia). The European electricity market model DIMENSION+ was used to compare the developments of a reference scenario with those of the phase-out scenario. Based on this analysis and further investigation, an international comparison of electricity prices for selected power-intensive industries was made.
In the scenario analysis, the EWI reaches the following key results: The recommended exit path makes it possible to achieve the 2030 climate target for the energy sector even with a moderate increase in demand for electricity. Whereas this target is clearly missed in the reference scenario. However, in the coal phase-out scenario, an ambitious expansion of the number of peak-load power plants by 2025 is necessary in order to ensure security of supply. Electricity prices will rise significantly in both scenarios due to rising prices for CO2 certificates. For the German industrial companies considered, electricity prices are rising relatively strongly in both scenarios compared with foreign prices. Aid payments to compensate indirect CO2 costs (so-called electricity price compensation) can reduce the increase in electricity prices.