Reactive power is the portion of the power provided by the grid that is produced as a result of the interaction between voltage and amperage in an alternating current system and cannot be actively used by consumers. Reactive power is generated or consumed in many electrical devices (capacitors, electric motors, generators). Reactive power plays a role in building up the electric and magnetic fields of motors or capacitors. Reactive power is to be differentiated from power loss, which represents the energy that is lost as heat energy due to frictional losses, for example. Reactive power, on the other hand, is not “lost” but is “cached” and returned to the network when the fields are dismantled. The reactive power cannot therefore do any useful work, but it still loads the network, which is why it is generally kept as minimal as possible. However, it is unavoidable in order to build up electric and magnetic fields, which are not only important for the operation of numerous electrical devices, but also for the transport of electricity.
Just as large-scale battery storage systems can participate in the control energy market, it would also be possible for storage systems to participate in such a free reactive power market without difficulty. The provision of reactive power is not limited to times during which energy is stored or stored out. Because in these times, the provision of reactive power is required anyway in accordance with the Technical Connection Guidelines. In addition, large battery storage systems have the technical ability to provide reactive power even when the system is at a standstill, i.e. when no active power is stored or stored. During these rest periods, reactive power can be provided on a contractual basis, which enables a flow of revenue during idle phases. The end customer also benefits, because an additional supply of reactive power reduces procurement prices for network operators and thus customer network charges.
In general, it is the responsibility of grid operators to provide the required reactive power by requesting the generation plants in the network. Up to a certain area, the supply of reactive power for generation plants is regulated in the grid connection conditions of the respective network operators or in the Technical Connection Guidelines (“TAR”) issued by the VDE. It states that generation plants may only be connected to the grid if they can provide part of the power as reactive power. Depending on the network operator, the exact proportion to be delivered is often in the order of 10% of the connected power. For example, if a large battery storage unit supplies 10 MW of active power, it must provide an additional 1 var (=1 MW) of reactive power with a static idle power supply of 10%. However, the generation plants are not paid any additional remuneration for this provision of reactive power, although there are additional costs for the generation plant due to increased line resistances and wear.
The demand resulting from this “forced” procurement measure for reactive power is currently often regulated by bilateral contracts between conventional large power plants and the respective network operators. Pricing takes place in individual negotiations between the parties and is not presented to the public. It is therefore opaque. According to BNetzA, the agreed prices differ significantly in some cases and fluctuate from 0.08 to 2.27 €/mVARh (source: discussion paper “Reactive power supply for network operation”, BNetzA). As early as 2019, legislators legislated in Section 12h of the EnWG that, as with many other electricity products such as balancing energy, the trading of reactive power should also be based on a transparent, non-discriminatory and market-based process. However, the reality is completely different, due to opaque price negotiations between network operators and a few conventional large power plants. As part of the introduction of Section 12h, the Ministry of Economic Affairs commissioned an expert opinion which verified the economic efficiency of such a procedure. The result shows that reactive power can generally be purchased using a market-based, transparent process. The industry is currently waiting for the Federal Network Agency to determine exactly how the future reactive power market should be structured. Unfortunately, the timetable for this is still open.
Currently, reactive power is mainly offered by large power plants. There is continuous communication between them and the network operators in order to calculate requirements as precisely as possible. However, renewable energy generation plants and large battery storage systems are also able to provide reactive power. In the meantime, they are even required to deliver a certain quantity. By expanding renewables and gradually shutting down conventional power plants, this is particularly important as network operators can access more and more generation plants. In this way, the power grid can also be stabilized by reactive power in the future.
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