GigaOM Pro

There are a set of interesting graphs circulating that compare Germany’s hour by hour energy pricing in 2008 and that pricing today. The graphs are fairly clear in showing that in 2008 peak pricing rose to around 60 Euros per MWh at 9am and stayed constant till nightfall, while today’s prices do spike at 9am but then fall sharply. What happened? One explanation is that in the intervening years, Germany installed 25 GW of solar power. Deutsche Bank solar analyst Vishal Shah recently noted that peak pricing was dropping by as much as 40 percent in strong solar markets. The reason is that solar is strongest during the daytime so it provides the most electricity when it’s needed most, increasing supply during peak demand. (Interestingly, today’s graph shows a quick peak in pricing at 7pm, presumably because the sun has gone down and there’s still trailing power demand in the early evening). Utilities aren’t thrilled with this phenomenon and are fighting feed in tariffs in some markets like Australia. At the very least, there’s an argument to be made that solar installations offer unique benefits during peak demand. Imagine places like Texas with soaring summer heat driving AC usage and then having solar power on hand to address those needs.