We have entered the era of energy abundance

How to manage abundance? We know scarcity: prices soar. But abundance… In the energy sector, we talk about "negative prices" when producers have to pay to remove excess electrons from the grid. This is happening very regularly in Spain these days, but sometimes also in Germany when the sun is at its zenith and the wind turbines are running at full power. This anomaly is explained by storage capacities that are insufficient or poorly adapted to the extreme variations in production that can occur, particularly around noon.

National electricity transmission and distribution networks have been outpaced by the spectacular deployment of renewables, particularly solar. Thus, in Europe, for the first time in history, renewable electricity accounted for 50% of production in the first half of 2024. In Germany, the share of renewables covered 58% of electricity consumption during the same period. The goal of production covering 80% of electricity consumption by 2030 should be reached, according to government projections.

A historic turning point

To borrow the phrase of the British weekly "The Economist", we have definitely entered the solar era, which will be, in less than ten years, the largest source of electrical energy on the planet. And as early as 2040, solar could even become "the largest source not only of electricity but of all energy."

It's the law of large numbers: installed solar capacity in the world doubles roughly every three years.

It's the law of large numbers: installed solar capacity in the world doubles roughly every three years. It is therefore multiplied by ten each decade. That means that the entire planet will have installed in ten years "a capacity equivalent to multiplying the world's reactor fleet by eight, in less time than it usually takes to build a single one," writes "The Economist".

This solar surge has no industrial equivalent in history. Surprisingly, the price of energy has always been fairly constant over time. But this time, everything changes with solar; prices only keep falling. It's a revolution. We are entering an era of abundance that could change the future of the world like never before and allow entire regions of the planet to escape energy poverty.

The grids are not adapted

However, this prospect clashes with mundane realities. The grids are not ready. Germany, which was the first to initiate an energy transition, is today entangled in its own contradictions. Its storage, transmission capacities, and power reserves are largely insufficient. It is so serious that the Court of Auditors warns the country about supply risks! The green hydrogen highways that are supposed to replace gas networks, secure winter supply and decarbonize industry are delayed.

In short, investments in energy infrastructure are not commensurate with the country's ambitions. Germany has put significant resources into producing renewables but invests too little in its grid. the German failure worries all of Europe because the country will soon no longer be able to export electricity in winter.

The abundance of renewables has masked a technical shortage inherent to intermittent sources like solar or wind. To succeed, storage and power reserves must keep pace with the advancement of new energies.

The abundance of renewables has masked a technical shortage inherent to intermittent sources like solar or wind. To succeed, storage and power reserves must keep pace with the advancement of new energies.

Olaf Scholz's government says it is aware of this. Shortly, it should present a plan to build new gas-fired power plants to secure the country's supply, plants that should be converted in the long term to hydrogen, the vector that will serve as a backup to renewables.

Siemens' reaction

Technological solutions exist and are mostly close to industrialization. What is missing is a framework that encourages investment from both the public and private sectors. A political headache in a country like Germany, which runs up against a debt brake that is too rigid. And, paradoxically, a real energy revolution is underway but we are slow to grasp its true nature, disruptive and massive.

The German giant Siemens seems to have understood the issue. In a recent interview with the "Financial Times", Tim Holt says: "We see a huge boom coming," citing the strong demand for electricity, a wave of renewable projects under construction requiring better grid connections and a widespread aging infrastructure poorly adapted to production peaks. The group says it wants to hire 10,000 people in its "grid" division.

This column also appeared in the pages of 24 Heures and Tribune de Genève.

This article has been automatically translated using AI. If you notice any errors, please don't hesitate to contact us.