Germany has a 20 Billion Euro Electricity Problem

Some have heard of the controversy about direct current (DC) and alternating current (AC) with Thomas Edison and the ghoulish stories about the practical uses in electrocution of this or that may be forgiven sensing a whiff of roasted flesh – what is this all about.

For the technically minded reader I’ve pinched this directly from Siemens AG (NYSE:SI) it is in English (sort of). Those that think high tension is something Alfred Hitchcock monopolized: Skip to CONCLUSION.

That is a typical German technical advertisement – totally incomprehensible to all without a technical degree – and as exciting as telephone directory. Now Angela Merkel is reasonably sold on the idea – and if you think you can convince that lady of anything she doesn’t totally comprehend: You are unforgivably naïve (I skimmed it).

The advantages of a Direct Current (DC) link over an Alternating Current (AC) link are:

 • A DC link allows power transmission between AC networks with different frequencies or networks, which cannot be synchronized, for other reasons.

• Inductive and capacitive parameters do not limit the transmission capacity or the maximum length of a DC overhead line or cable. The conductor cross section is fully utilized because there is no skin effect.

For a long cable connection, e.g. beyond 40 km, HVDC will in most cases offer the only technical solution because of the high charging current of an AC cable.

This is of particular interest for transmission across open sea or into large cities where a DC cable may provide the only possible solution.

• The DC has considerably lower line costs per kilometer than AC. For long AC lines the cost of intermediate reactive power compensation has to be taken into account.

• The breakeven distance is in the range of 500 to 800 km depending on a number of other factors, like country specific cost, interest rates for project financing, loss evaluation, cost of right of way etc.


Large amounts of electricity is best transported over 500 miles with DC jacked up to 500 kV and can transmit 1800 MW.

 (By the way: Who do you think delivered such stuff to China?)

 Now Germany – and indeed Europe – has a power problem as nuclear power plants are closed down.

Ironically enough this technology could make nuclear power interesting in the USA: You could place the plant in a remote location where a major disaster wouldn’t be noticed (Utah f.i.) and transmit all you need to f.i. California – but that is for the next presidential election.

If you are to use wind turbines and large solar cells you need to move the power a long way to reach areas reasonably fit for human habitation. This was the real story behind the firing of Röttgen – he wasn’t up to the job, so Merkel had to take over personally: I didn’t help him botching the election in the largest state (Nordrhein-Westphalen); but confusing a HVDC Smoothing Reactor with graphite moderated Nuclear Reactor demonstrated his total incompetence with teeth grinding clarity – you flunk kindergarten in Germany for such fundamental mistakes.

Handelsblatt has a run down:

 1) We are talking a 20 bio. EUR investment in 1700 km new transmissions and updating 4000 km existing transmission. It is not clear if the suggested if 2100 km doubling of 4 major lines are included; but the 10 bio. EUR connections to the offshore windparks are not.

2) The existing transmission will probably go through without too much local political nonsense; but the 1700 km new build will get all sorts of local political bickering.

3) The local governments have a point. The system is difficult to tap locally and thus it will be a transit transmission.

4) When the fickle sun and wind power is generated conventional power plants will have to be shut down (not to mention a surge in the power networks in Poland and the Check Republic.

5) To coordinate matters the management power (no pun intended) will be concentrated – with a plan and appropriate law in the Bundesnetzagentur before the end of the year – this year!

This will definitely put the 16 states of the German Union out of the loop.

(Comment: Any guess where the final decision power will rest when the rest of Europe is hooked up? F.i. the Danish wind generator parks make much more sense in a European context)

6) When the consumer (industrial and private) will have to pay for this – the question is not so much if it is reasonable – but how the cost is going to be calculated. Not only that, but how are the producing plant going to be paid: Capacity, availability, amount, distance, voltage???

This will most certainly be a cost-accounting exercise of the highest order to generate power at minimum cost at any given time to pay not only for fuel, but much worse the maintenance and service on debt.

Juggling 10-15 different power sources each with their own characteristics in a cost accounting system to determine the correct shadow prices is a task worthy of a Nobel price.