The German electricity system is undergoing a fundamental transformation: As the share of renewable energies increases, so does the dependence on weather-dependent generation, while the phase-out of coal and nuclear power eliminates firm reliable generation capacity. To ensure security of supply – especially during longer periods of low electricity production – the German government is planning up to 20 GW of new gas-fired power plant capacity by 2030 as part of a power plant strategy, including 5–10 GW in an initial tender.

Frontier Economics was commissioned by the State Association for Renewable Energies of North Rhine-Westphalia (LEE) to analyse the German government's technological pre-commitment to gas-fired power plants in a short study.

Key findings include:

• Technology neutrality as a guiding principle – ensuring security of supply efficiently and in a system-supportive manner through open competition between different technologies. Different options – from flexible combined heat and power (CHP) and bioenergy plants to storage and demand-side management and power-to-X – each offer specific strengths that, when combined with gas-fired power plants, enable a robust technology mix.
• Technology-specific tenders for gas-fired power plants as a short-term interim step – An initial technology-specific tender for gas-fired power plants is plausible as a pragmatic interim solution given lead times and maturity levels. However, it should be designed to be technology-neutral within the gas segment and limited to the necessary minimum to avoid market distortions. The scope must be determined based on current, well-founded analyses. Furthermore, smaller and decentralized plant types, such as gas engines, should also be eligible to participate to enable rapid implementation and grid-friendly structures.
• Optimally integrate renewables – Surplus wind and solar power should be harnessed through storage or conversion into green molecules to reduce system costs and enable climate-neutral, secure power.

The full study is available here (in German): Kraftwerksstrategie: Festlegung auf Gas Oder Technologiemix?