Germany is at risk of facing a generation capacity shortage of up to 30 GW in 2030 and needs to take a bundle of measures besides the rapid expansion of renewables to close the gap, according to the latest issue of McKinsey's energy transition index.
The available capacity at peak load is expected to fall from 99 GW currently to 90 GW in 2030 as a result of the phase-out of nuclear power and fossil fuels, while the peak load is likely to rise to up to 120 GW.
According to McKinsey, the renewables rollout will not be enough to address the issue on the supply side if not combined with the construction of new gas-fired power plants and the temporary extension of the operation of coal-fired power stations.
In addition, Germany could rely more on electricity imports to avoid bottlenecks. In 2022, the interconnector capacity with neighbouring countries was 24 GW and is projected to reach 35 GW by 2030. Since Germany's neighbours also have increasing power demand peaks, the analysts assume that around 10 GW will be available for import into Germany in the future which could reduce the capacity gap to 20 GW.
Another lever on the supply side is the use of battery storage. Under the grid development plan, energy storage facilities with a cumulative capacity of 10 GW should be in operation across Germany by 2030, with the bulk of 8 GW coming from decentralised solar battery storage systems and 2 GW from large batteries.
If these measures are not sufficient, demand management could be used to close temporary supply gaps and reduce peak loads. McKinsey's analysts see potential for Germany to reduce the peak load in 2030 by 8 GW to 112 GW through demand management. This, however, does not include the potential from electric mobility and heat pumps, and when these two areas are considered, peak load demand could further drop by 3 GW and 5 GW-20 GW, respectively.
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