Germany’s power grid to absorb 40% EV market share


An independent study released by Aurora Energy Research states that the electric grid and utility systems in Germany could absorb a market shift to 40% plug-in electric vehicles by the year 2035, while generating extra income for power companies.

This increased market share will increase energy demand by 31TWh, equivalent to 5% of the country’s current annual consumption.

The increase in demand will be manageable as a result of an expansion in the country’s renewable energy capacity.

E-mobility will be the more economic choice by then and its impact on the German power market will tend to be moderate,” states Benjamin Merle, a study author.

“We don’t see any threat of significant price increases for households or industry.”

According to the study report, Europe’s biggest economy had roughly 46 million small passenger cars on the road on January 1, 2017, of which only 0.1% were electric-powered.

“However, around 10% of cars get replaced each year and Aurora’s Berlin office, the German arm of an Oxford-based parent company, assumes that falling battery costs and a far better climate record of electric cars versus the combustion engine will start supporting mass adoption in the next decade”, the report further stated.

Battery-powered cars should emit 40% less carbon dioxide in 2035 than those with traditional engines. This assumes that carbon efficiency of traditional engines will not be improved much, as less research and development goes into mature technology.

“Higher battery density will ensure that driving ranges expand due to more powerful batteries while charging infrastructures are built up to meet demand, it also assumed. It estimated that exchange-quoted power prices for the day-ahead will nearly double to an average around the mid-$75 a megawatt hour by 2035, as Germany is to phase out cheap nuclear and much coal-fired capacity by then.

“Within that price, the additional costs required to meet the 31 TWh were estimated at $3.35/MWh,” addded Merle.

German utility companies stand to gain between $620 and $868 million a year in additional earnings before interest and taxes, if they exploit cross-selling opportunities with start-ups in the charge point sector that are springing up fast, the researchers estimated.”