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Glossary · Energy industry & energy transition

Energy

Energy physics power Kilowatt hour Joule energy sector conversion efficiency

In physics, energy is often described in simplified terms as the capacity to do work or to transfer heat. More precisely, energy is a conserved quantity: in an isolated system its total remains constant and it can only change from one form into another. Whether a given amount of energy can actually be converted completely into work is a different question, which is addressed further below under the term exergy. In technical and energy-economic contexts, energy is above all a balancing variable. It indicates what quantity is converted, transferred, stored or transformed over a period of time.

In the International System of Units, energy is measured in joules (J). In Germany, under the Units Ordinance (Einheitenverordnung), the joule is the legal unit for energy, work and quantity of heat. The watt (W) is the legal unit for power and energy flow. For electricity and heat, the kilowatt hour (kWh) is more commonly used because it fits technical power ratings and billing better. One kilowatt hour is the amount of energy converted at a power of one kilowatt over one hour. Because one joule equals one watt second, the following applies: 1 kWh = 1000 W × 3600 s = 3.6 million joules (3.6 MJ). Larger quantities are expressed with the usual prefixes, that is, in megawatt hours (MWh), gigawatt hours (GWh) and terawatt hours (TWh), or in petajoules (PJ).

Energy and power

The distinction from power is fundamental. Power indicates how fast energy is converted. In short: energy is the quantity, power is the rate. A device rated at 2 kW that runs for half an hour requires 1 kWh. A device rated at 0.5 kW needs the same amount of energy if it runs for two hours. For the energy calculation, both cases are the same. For grid load, the sizing of the connection and peak load, they differ considerably. Many misunderstandings in debates about electricity, heating or electromobility arise because kilowatts and kilowatt hours are confused. A comparison helps: power corresponds to the speed of a car, energy to the distance covered.

Forms of energy and conversion

Energy occurs in various forms. Chemical energy is bound in fuels, biomass or batteries. Electrical energy is transported via power grids. Thermal energy is related to the temperature of a body or medium. Mechanical energy resides in motion (kinetic energy) or in position (potential energy, for example in water that has been pumped uphill). Technical installations do not destroy energy; they convert it. A boiler turns chemical energy into heat. A wind turbine turns the kinetic energy of air into electrical energy. A heat pump uses electrical energy to raise ambient heat to a higher temperature level. Every real conversion involves losses, usually in the form of heat that can no longer be used.

The term energy consumption is therefore physically imprecise but firmly established in the energy sector. It does not mean that energy disappears. It means that a usable form of energy changes into a form that is less usable for the purpose in question. Electricity that performs mechanical work in a motor and is ultimately released into the surroundings as heat is still energy. For the user and for the power system, however, it has been consumed, because it is no longer available as electrical energy. This distinction makes it possible to describe efficiencies and losses precisely.

Balance levels: primary, final and useful energy

Energy balances distinguish between several levels. Primary energy is the energy in naturally occurring sources, such as coal, natural gas, crude oil, uranium, wind, solar radiation or hydropower. Final energy is the energy that reaches the consumer: electricity from the socket, district heating at the house connection, heating oil in the tank or petrol at the pump. Useful energy is what is actually available for the purpose after the last conversion, that is, space heat, light, motion, process heat or mechanical work.

These levels must not be equated. One kilowatt hour of heating oil, one kilowatt hour of electricity and one kilowatt hour of heat are numerically equal amounts of energy. However, they fulfil different functions and originate from different conversion chains. In a fossil-fuelled power plant, a considerable share is lost as conversion loss between primary energy and electricity.

How the accounting works depends on the method. For Germany, the AG Energiebilanzen, like international statistical institutions, uses the efficiency method. Electricity from hydropower, wind and photovoltaics has no calorific value and is therefore recorded with an efficiency of 100 percent. One megawatt hour of wind power thus counts as one megawatt hour of primary energy. For nuclear energy, an efficiency of 33 percent is assumed as a flat rate. About three times the primary energy is therefore attributed to one megawatt hour of nuclear electricity. If renewable electricity replaces nuclear or fossil power plants, the reported primary energy consumption falls purely in arithmetic terms, even if the energy service provided remains the same. Under the substitution method used previously, renewable electricity would by contrast have been valued as if it replaced fuel in thermal power plants. Anyone unfamiliar with the accounting method can easily misinterpret primary energy statistics.

Electrical energy is particularly high-grade for the energy system. It can be transported quickly, controlled well and used very efficiently in many applications. An electric motor converts a much larger share of the final energy supplied into motion than an internal combustion engine. A heat pump delivers several kilowatt hours of heat from one kilowatt hour of electricity because it additionally uses ambient heat. For this reason, the electrification of transport, heating and industry can increase electricity consumption while at the same time reducing total final or primary energy demand. A rise in electricity demand therefore does not automatically mean that the overall system needs more energy.

Why the quantity of energy is not enough in the power system

Electrical energy is balanced and billed in kilowatt hours. Suppliers sell quantities of energy, meters record quantities of energy, and statistics report annual consumption in terawatt hours. For a secure supply, this view is not sufficient. In the power system, feed-in, storage and exchange with neighbouring grids must cover consumption, including grid losses, at every moment. An annual quantity of, say, 500 TWh does not reveal whether enough firm capacity is available on a winter evening with little wind, whether regional grid bottlenecks will arise, or whether flexible loads can be shifted into hours with a lot of wind and solar power.

The decisive question therefore often shifts from the quantity of energy to its profile over time, the load profile. Two consumers with the same annual consumption can place very different demands on generation, grids and reserves. A heat pump that runs mainly on cold days shapes the load curve differently from a data centre with constant demand. An electric car that charges in an uncoordinated way in the early evening loads the distribution grid differently from one that charges at night or at midday when photovoltaic feed-in is high. The quantity of energy stays the same; the effect on the system does not.

This also determines the role of flexibility. Flexibility does not generate additional energy. It changes the timing of consumption, charging, discharging or generation. A battery storage system absorbs electrical energy and releases it later, but loses part of it in the process. Its value lies in bridging time gaps between generation and consumption, relieving grids or exploiting price signals. Anyone who describes storage as an additional source of energy misses its actual function.

Efficiency, losses and energy quality

Efficiency indicates what share of the energy supplied arrives in the desired useful form. For a power plant, this is the share of the fuel energy that is delivered as electricity. For a charger, it is the share of the mains electricity that is stored in the battery. For heat pumps, instead of an efficiency one usually uses the coefficient of performance (COP) for a specific operating point or the seasonal performance factor for real operation over a year. Both indicators can be greater than 1 because the heat delivered is greater than the electricity used. The law of conservation of energy is not violated by this, since the additional heat comes from the environment.

Not all losses are to be assessed in the same way. The waste heat of a vehicle engine usually remains unused. The waste heat of an industrial plant, by contrast, can be used for district heating or other processes if temperature, distance, timing and infrastructure fit. The quantity of energy alone therefore says little about practical usability. One kilowatt hour of low-temperature heat and one kilowatt hour of electricity are physically equal in size but not technically equivalent. Thermodynamics describes this quality with the term exergy: it refers to the portion of an amount of energy that can be converted into work under the given ambient conditions. Electricity consists practically entirely of exergy. For heat close to ambient temperature, by contrast, it is only a small part.

These differences in quality show why blanket comparisons of forms of energy are often wide of the mark. Electricity should not be compared with fuels solely on the basis of its energy content. Also important are the service it enables, the conversion losses of the alternatives, and the requirements regarding time, place and infrastructure. One kilowatt hour of electricity at the wrong time can be expensive for the grid. One kilowatt hour in an hour with a lot of renewable feed-in, by contrast, can replace fossil fuels in heating, transport or industry.

Economic and institutional significance

Energy is also a variable for billing and planning. Households generally pay an energy price per kilowatt hour plus a base charge. Larger commercial and industrial customers often also pay a demand charge as part of the grid fee, which depends on the highest power drawn in the billing period. This tariff structure shows that the power system has two sources of cost. Quantities of energy mainly cause procurement and generation costs. Power demand and simultaneity drive the costs of grids, reserves and connections. Anyone who looks only at kilowatt hours easily overlooks the costs of short, high load peaks.

Political goals are also often formulated in quantities of energy: expansion targets for renewable generation, efficiency targets, consumption statistics or savings requirements. Such figures are necessary but need a clear system boundary. Is it a question of primary energy, final energy or electricity consumption? Of a national balancing area, individual sectors or a particular grid node? Are imported electricity, imported fuels and upstream conversions counted? Depending on the answer, the same technical development is assessed differently. The AG Energiebilanzen points out, for example, that the shares of renewable energies in gross final energy consumption and in primary energy consumption cannot simply be converted into one another.

The concept of energy thus shows what quantity is converted. It says nothing, however, about when this quantity arises, what power is needed for it, what quality the energy has, over what infrastructure it flows and what conversion chain lies behind it. In the power system, energy must therefore always be considered together with power, time profile, efficiency, grid level and balance boundary. Only then does the mere addition of kilowatt hours become a correct energy calculation.

Sources

Related glossary entries

Edited by eCMS on 11.11.2026 19:45

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