Germany, often at the forefront of this shift, provides a compelling case study of how these renewable sources can work together to create a more sustainable energy future. Tom Darell, Nord Pool’s CEO elaborates. 

Complementary production patterns 

Wind and solar energy, while both renewable, have distinct production patterns that can complement each other throughout the year.  

“When looking at Germany as an example, you see that the total wind production during the year and the solar production are quite complementary,” Tom Darell explains. 

“You have more sun during the summertime and more wind in the fall and winter.” 

However, this balance is not without its challenges. The phenomenon known as “Dunkelflaute” – periods with no wind and no solar production – creates significant residual demand that must be met by other means. This highlights the need for a diversified energy mix and robust storage solutions to ensure reliability. 

Challenges with renewable energy capture rates 

One of the less-discussed challenges of renewable energy is the lower capture rates for wind and solar compared to more flexible production methods.  

“The average price you get is lower for wind and solar than for flexible production,” Tom notes.  

“When you have a lot of wind, it tends to happen at the same time, or if you have a sunny day, there’s too much power in the market, creating a surplus and lowering price.” 

This surplus can lead to a significant price difference, particularly for solar energy.  

“There is about a 20% difference, which is quite large, especially on the solar side,” he adds.  

This price volatility underscores the importance of flexible energy sources like hydro, which can store water and produce power during more expensive hours. 

Germany’s energy market dynamics 

Germany’s energy market dynamics offer a fascinating glimpse into the broader European transition. From December 2021 to April 2023, Germany phased out 65 TWh of nuclear production capacity, a move Darell describes as “surprising” given the clean nature of nuclear technology.  

“If you want to reach your climate target, you look at your gas and your coal first,” the CEO argues.  

“But they did it, and this adds to the challenge because they had flexible capacity they could have used.” 

Despite these challenges, Germany’s ability to build five floating LNG terminals in a short period demonstrates its capacity to adapt and drive the energy transition.  

“They managed to build the first one in Friedrichshafen in five months,” he points out. 

 “They have an enormous capacity as a powerhouse to drive this transition.” 

Installed capacities and the Duck Curve 

Over the past decade, Europe has significantly expanded its solar and wind capacities. However, this growth has also led to the emergence of the “Duck Curve,” a pattern illustrating the daily fluctuations in electricity demand and supply.  

“In the past, energy was cheaper at nighttime,” Tom explains.  

“Now, the lowest prices are in the early afternoon because we have built so much wind and solar.” 

This pattern poses challenges such as over-generation during the day and the need for rapid ramping up of power plants in the evening. Addressing the Duck Curve involves strategies like energy storage, demand response programs and enhancing grid flexibility to ensure a stable and efficient power supply. 

A cornerstone of the energy transition 

The complementary nature of wind and solar energy is a cornerstone of Europe’s energy transition. While challenges such as lower capture rates and the Duck Curve persist, the potential for a diversified and flexible energy system remains promising.  

“The vision is that we will have a sustainable price in the future based on clean energy, giving access to decent prices for people and competitive terms for industries.” 

By leveraging the strengths of wind and solar energy and addressing their inherent challenges, Europe can continue to lead the way towards a more sustainable and resilient energy future.