Medium-term forecast: Falling demand for electricity, rising electricity self-sufficiency

15.10.2018

The Fraunhofer Institute for Systems and Innovation Research ISI has projected the nationwide electricity consumption in Germany for the years 2019 to 2023 within the scope of the EEG medium-term forecast, and analyzed the EEG surcharge payments. Working together with the House of Energy Markets and Finance at the University of Duisburg-Essen, Fraunhofer ISI identified a moderate rise in electricity self-sufficiency, among other things. The study on behalf of the German Transmission Network Operators is a key reference for the development of distributed electricity self-sufficiency in Germany.

In the study “Medium-term forecast of electricity supplied to final consumers in Germany for the calendar years 2019 to 2023”, Fraunhofer ISI determined how much electricity is supplied by energy providers and required by the so called final consumers. These final consumers can be divided into self-suppliers of electricity (certain solar panel owners etc.), electricity-intensive companies and other consumers. The costs for refinancing renewable energies are split among these consumers based on the electricity used. These surcharge payments are regulated in the German Renewable Energies Act (EEG).

The analyses showed a declining net electricity demand; this falls by 1.8 Terawatt hours (TWh) between 2017 and 2019 due to increased efficiency, among other things. Anna-Lena Klingler, who coordinates the project at Fraunhofer ISI, cites other findings from the study: “For 2019, we forecast a moderate increase in electricity self-sufficiency to about 67 TWh, i.e. a rise of about 1.4 percent compared to 2017. This is mainly due to the installation of photovoltaic systems in private households. Using combined heat and power (CHP) to self-supply electricity remains relatively constant due to complex legislation and comparatively low funding. However, existing plants are increasingly being modernized and replaced: in 2019, a proportionate surcharge will be paid for 3.4 TWh of self-generated power, 2.5 TWh of which is for power from CHP plants.”

In its study, Fraunhofer ISI not only analyzed the final consumption subject to the EEG surcharge, but also estimated the associated payment flows. The EEG surcharge covers the difference between the payments for electricity generated from renewable sources and the lower revenues from selling EEG-financed power on the energy exchange. The main cost burden for the surcharge is borne by non-privileged final electricity consumers. The special equalization scheme (BesAR) and regulations governing distributed electricity self-sufficiency determine which customers have to pay a limited EEG surcharge.

Above all, electricity-intensive companies only pay a reduced EEG surcharge due to the BesAR. According to Fraunhofer ISI’s analyses, this privileged final consumption will amount to 114 TWh in 2019. Non-privileged final consumption, which must pay the full EEG surcharge, is predicted to be 344 TWh next year – a reduction of 2.8 TWh. Anna-Lena Klingler explains this drop with a combination of falling demand, rising electricity self-sufficiency and a relatively constant amount of electricity regulated by BesAR.

Fraunhofer ISI differentiated its final consumption forecast into the various privilege categories in order to account properly for the varying EEG surcharge rates. The surcharge payments by final consumers (privileged and non-privileged) help to finance renewable energies. The financing is roughly equally spread across the demand sectors households, trade, commerce and services (TCS) and industry.

The Fraunhofer Institute for Systems and Innovation Research ISI analyzes the origins and impacts of innovations. We research the short- and long-term developments of innovation processes and the impacts of new technologies and services on society. On this basis, we are able to provide our clients from industry, politics and science with recommendations for action and perspectives for key decisions. Our expertise is founded on our scientific competence as well as an interdisciplinary and systemic research approach.