WEBVTT - Here's Why Heatwaves Spell Trouble for Power Networks 0:00:02.480 --> 0:00:10.200 Bloomberg Audio Studios, Podcasts, radio News. I'm Stephen Carroll and 0:00:10.240 --> 0:00:12.479 this is Here's Why, where we take one news story 0:00:12.520 --> 0:00:14.560 and explain it in just a few minutes with our 0:00:14.560 --> 0:00:16.000 experts here at Bloomberg. 0:00:19.239 --> 0:00:22.400 There's a heat wave, if you haven't noticed, gripping Western 0:00:22.480 --> 0:00:26.840 Europe and we are anticipating more dangerously hot and humid conditions. 0:00:26.840 --> 0:00:29.440 We're breaking records across the continent. 0:00:29.640 --> 0:00:30.680 It's pretty severe. 0:00:30.840 --> 0:00:35.120 I mean we're seeing temperature records falling and you know 0:00:35.159 --> 0:00:38.040 it's not even at its peep yet. This is only 0:00:38.080 --> 0:00:40.360 the second ever red heat worn in for the UK. 0:00:40.880 --> 0:00:45.680 We're seeing training cancelations and delays really across the continent 0:00:46.040 --> 0:00:49.040 here in the UK, France and the Netherlands. It's just 0:00:49.120 --> 0:00:51.800 not built, wasn't hill for these types of temperatures, and 0:00:52.200 --> 0:00:53.199 not these temperatures this. 0:00:53.200 --> 0:00:56.040 Early Western Europe has been baking in a heat wave 0:00:56.040 --> 0:00:59.960 that's pushed temperatures to dangerous levels, triggering extreme heat worn 0:01:00.240 --> 0:01:04.080 from authorities in France, Germany, the UK and elsewhere. The 0:01:04.120 --> 0:01:08.000 scorching weather has driven record demand for cooling as households 0:01:08.040 --> 0:01:11.280 and businesses rely more on air conditioning, but it's also 0:01:11.360 --> 0:01:15.959 added other strains on electricity supplies. Here's why heat waves 0:01:16.120 --> 0:01:23.600 spell trouble for power networks. Our power and renewables reporter 0:01:23.680 --> 0:01:26.399 Aiman Farhat joins us now for more, and then let's 0:01:26.440 --> 0:01:29.200 talk about the demand side first. So in northern Europe, 0:01:29.319 --> 0:01:32.200 relatively few homes have air conditioning, but it is becoming 0:01:32.240 --> 0:01:35.400 more common. How much does demand for power go up 0:01:35.640 --> 0:01:36.680 when the weather gets hotter? 0:01:37.360 --> 0:01:39.759 Hey, right, when you look at Europe, I mean, France 0:01:39.840 --> 0:01:41.280 is kind of the middle ground where when you come 0:01:41.319 --> 0:01:43.520 to the south of France than south of that Spain Italy, 0:01:43.560 --> 0:01:45.319 you do have quite a bit of a conditioning, but 0:01:45.319 --> 0:01:47.800 once you're in northern Europe you're right, which still quite limited. 0:01:48.040 --> 0:01:49.960 That being said, we're looking at France, which is really 0:01:50.000 --> 0:01:53.080 where the heat has been centered in Europe, and powder 0:01:53.080 --> 0:01:55.040 them on in the last few days is about up 0:01:55.040 --> 0:01:57.800 fifteen percent on the evening peaks compared to kind of 0:01:57.800 --> 0:02:01.040 a more normal summer week. I mean, are kind of 0:02:01.080 --> 0:02:02.960 going to do almost crazy levels of talking about forty 0:02:02.960 --> 0:02:05.800 four degrees in France, you know, reaching forty degrees in Paris. 0:02:05.840 --> 0:02:08.400 So that really is what is driving those those peaks 0:02:08.400 --> 0:02:10.079 in demand and that fifteen percent increase. 0:02:10.760 --> 0:02:13.000 So what do high temperatures do then to the power 0:02:13.040 --> 0:02:16.400 grids themselves. How resilient are networks in Europe to these 0:02:16.480 --> 0:02:17.640 kinds of heat waves. 0:02:18.360 --> 0:02:19.799 I mean, when you think about the grid itself, I 0:02:19.840 --> 0:02:22.880 mean the physical infrastructure. You have these wires connecting power 0:02:23.160 --> 0:02:26.240 you know, from your home to generation stations, you know, 0:02:26.280 --> 0:02:28.839 across borders, and when it gets too hot, those power 0:02:28.880 --> 0:02:32.000 lines start to sag, and grid operators have to think 0:02:32.000 --> 0:02:33.760 about that and think about how much power they can 0:02:33.760 --> 0:02:36.520 transport through the lines to kind of limit that happening, 0:02:36.560 --> 0:02:39.240 because that can become dangerous, that cause blackouts. So that's 0:02:39.320 --> 0:02:41.520 kind of one of the major impacts. But even more 0:02:41.560 --> 0:02:43.680 than that when it comes to, for example, on the 0:02:43.720 --> 0:02:46.080 generation side, which it kind of also fits into the grid. 0:02:46.360 --> 0:02:48.239 In France, we have all these nuclear reactors and that 0:02:48.320 --> 0:02:51.239 kind of underpins a lot of Europe's generation, especially in 0:02:51.240 --> 0:02:52.920 the evenings when the sun is not shining or at 0:02:52.960 --> 0:02:55.480 times with low wind. These nuclear reactors really are the 0:02:55.520 --> 0:02:58.280 backbone of Europe's generation. And when it gets too hot, 0:02:58.400 --> 0:03:01.000 the rivers that cool these reactors get too hot, so 0:03:01.000 --> 0:03:03.200 you have to actually turn down or turn off the reactors, 0:03:03.400 --> 0:03:05.840 and that is really what creates some stress on the 0:03:05.840 --> 0:03:07.400 system and on the grid across Europe. 0:03:07.520 --> 0:03:10.120 You mentioned renewables there as well. You think sony weather 0:03:10.280 --> 0:03:12.920 is good for solar power for example, but is this 0:03:13.000 --> 0:03:15.480 actually a good period for renewables generation. 0:03:15.919 --> 0:03:17.679 Yeah, every year we're having kind of record levels of 0:03:17.760 --> 0:03:20.399 solar power, but it always happens more in April and May. 0:03:20.600 --> 0:03:22.200 This is kind of the peak solar period. You'd think 0:03:22.200 --> 0:03:24.519 it would be during the summer, but actually solar panels 0:03:24.840 --> 0:03:27.760 are slightly less efficient at high temperatures, so it's actually 0:03:27.760 --> 0:03:30.280 more around when it's about twenty twenty two degrees that 0:03:30.320 --> 0:03:33.000 they solar powers are at their maximum efficiency. Obviously, we've 0:03:33.040 --> 0:03:35.440 had very sunny weather, so during the midday peaks, so 0:03:35.440 --> 0:03:37.880 between maybe ten to three pm, you have very good 0:03:37.880 --> 0:03:41.000 solar generation. But actually right now in the last kind 0:03:41.000 --> 0:03:43.400 of week, we've also had very very low wind levels. 0:03:43.400 --> 0:03:46.360 We're talking about maybe six month lows across some countries, 0:03:46.600 --> 0:03:49.520 and that means that you know, renewable generation total is 0:03:49.520 --> 0:03:52.480 actually down, and so gas new careactors and sometimes even 0:03:52.520 --> 0:03:53.960 coal have to come in and fill the gap. 0:03:54.360 --> 0:03:57.960 Can the grids cope with a surge in power generation? 0:03:58.040 --> 0:04:00.960 I'm thinking about what led to the major blackout in 0:04:01.000 --> 0:04:04.080 Spain and Portugal last year. Part of that was blamed 0:04:04.120 --> 0:04:07.960 on the unstability that coming from renewables. Can grids actually 0:04:08.040 --> 0:04:10.800 adapt to having this big change and energy mix. 0:04:10.960 --> 0:04:12.560 When it comes to that that issue in Spain and 0:04:12.560 --> 0:04:14.160 in any grid, you know, whether if you have a 0:04:14.160 --> 0:04:17.599 surgeon generation or a dropping generation, that can cause issues 0:04:17.600 --> 0:04:19.200 for the grid stability I mean right now. Actually a 0:04:19.240 --> 0:04:21.560 very interesting dynamic which you haven't discussed, is actually the 0:04:21.600 --> 0:04:23.400 World Cup as well. You know, we're having spikes and 0:04:23.440 --> 0:04:26.120 power demand when people at halftime and at full time 0:04:26.160 --> 0:04:28.599 and everyone gets up, puts their cattle up, opens their fridge, 0:04:28.720 --> 0:04:30.880 and that can cause you know, a very sharp increase 0:04:30.880 --> 0:04:32.960 in a very short period of time, which is exactly 0:04:33.000 --> 0:04:34.360 what renewables also do. You know, you can have a 0:04:34.440 --> 0:04:37.279 very sharp increase or decrease in generation as it's weather driven. 0:04:37.800 --> 0:04:40.360 Grid are definitely becoming more resilient. Spain was a big 0:04:40.400 --> 0:04:43.080 example of where that residency wasn't there, and now European 0:04:43.080 --> 0:04:45.440 countries are definitely investing a lot in the last year 0:04:45.640 --> 0:04:47.640 to make sure that isn't repeated this summer. 0:04:47.960 --> 0:04:50.680 What does all of this mean for prices, because that's 0:04:50.680 --> 0:04:51.880 an important factor too. 0:04:52.160 --> 0:04:54.080 It's really interesting when you look at the power prices. 0:04:54.120 --> 0:04:56.400 You know, we follow it on many different contracts. The 0:04:56.480 --> 0:04:59.039 day ahead is basically the kind of the daily power price, 0:04:59.279 --> 0:05:01.239 and the power price for today actually went in France 0:05:01.279 --> 0:05:03.920 to its highest level is twenty twenty two, so it's 0:05:03.960 --> 0:05:06.000 not even been this high since you know, the peak 0:05:06.000 --> 0:05:08.240 of the energy crisis due to the rush of Ukraine War, 0:05:08.279 --> 0:05:10.599 you know, when gas supplies were limited into Europe. So 0:05:10.640 --> 0:05:12.839 it just shows how this kind of these hottest summers, 0:05:13.200 --> 0:05:16.360 this hot weather, definitely driven in some ways by climate change, 0:05:16.600 --> 0:05:19.640 is creating extreme stress on prices and this doill trickle 0:05:19.680 --> 0:05:21.880 down to businesses, to households. You know, we're already seeing 0:05:21.880 --> 0:05:24.400 that this month so far prices are up compared to 0:05:24.480 --> 0:05:26.960 last year, when the juctory that we should be having 0:05:26.960 --> 0:05:29.560 in Europe is a decrease in prices as renewables increase. 0:05:29.600 --> 0:05:32.119 That's what all governments want, that's what will give economic growth. 0:05:32.200 --> 0:05:34.080 But actually that the heat in some times of the 0:05:34.160 --> 0:05:36.000 year can cause US prices to increase. 0:05:36.640 --> 0:05:38.560 I mean, we're told that we'll need to expect more 0:05:38.600 --> 0:05:42.000 of these kind of heat waves in Europe. What does 0:05:42.040 --> 0:05:44.880 all of this mean for energy providers in the future, 0:05:45.360 --> 0:05:48.120 How will they plan to cope with events like this 0:05:48.279 --> 0:05:50.080 that are expected to become more regular. 0:05:50.360 --> 0:05:52.400 It's difficult because when we talk about these types of 0:05:52.440 --> 0:05:55.040 heat waves and these extreme weather events, they are supposed 0:05:55.080 --> 0:05:57.160 to happen once every five years, ten years. They seem 0:05:57.160 --> 0:05:59.440 to be happening once every year or maybe other year. 0:05:59.520 --> 0:06:02.640 So it's definit becoming more important for you know, energy 0:06:02.680 --> 0:06:05.240 providers to become resilient, whether it be you know, for 0:06:05.360 --> 0:06:07.719 double edf building new ways of cooling their reactors, whether 0:06:07.760 --> 0:06:10.240 it be you know, building up good infrastructure to be 0:06:10.279 --> 0:06:13.200 more resilient to temperature. But right now, I think in 0:06:13.240 --> 0:06:15.839 the kind of short term it just shows the importance 0:06:15.920 --> 0:06:18.599 of just having a kind of a flexible system, different 0:06:18.600 --> 0:06:21.080 type of generation, not relying too much on solar, on wind, 0:06:21.320 --> 0:06:24.520 on nuclear, because at any moment the sun the heat 0:06:24.560 --> 0:06:26.400 can actually affect those quite significantly. 0:06:27.240 --> 0:06:30.440 Yeah, indeed, it's very interesting to see how providers are 0:06:30.480 --> 0:06:33.880 going to adapt to these changing patterns in our climate. 0:06:34.000 --> 0:06:36.000 AIM and thank you very much for joining us. AIM 0:06:36.040 --> 0:06:40.000 and Firehat there are Power and Renewables Reporter. For more 0:06:40.040 --> 0:06:43.000 explanations like this from our team of three thousands journalists 0:06:43.040 --> 0:06:45.599 and analysts around the world, go to Bloomberg dot com 0:06:45.600 --> 0:06:51.039 slash Explainers. I'm Stephen Carroll. This is here's why. I'll 0:06:51.040 --> 0:06:53.200 be back next week with more. Thanks for listening.