Workman laying the Nexans subsea cable in Corfou, GreecThe i

The interconnection of Europe’s power grids is seen as one of the key factors in developing a single electricity market in the region. Here, PEi examines the projects that have come to fruition, which are under construction and planned, and how recent events in the global economy are affecting development of the so-called ‘supergrid’.

Chris Webb, UK

Just a year ago, Günther Oettinger, the European Union’s (EU)commissioner for Energy, was pressing member states to increase interconnectivity of electricity grids more rapidly than previously. His call was in response to that of developers of low-carbon generation for a steer on Europe’s drive towards a single electricity market. Unsurprisingly, the initiative has suffered setbacks in light of the economic gridlock that has all but paralysed investment.

Reinhard Bütikofer, vice chair of the Greens/European Free Alliance and spokesperson on industrial policy, painted a gloomy picture. “In 2002, at the Barcelona Council, EU member states agreed to the goal of a 10 per cent electricity interconnection target for every one of them,” he said. “Eight long years later even this meagre goal remains elusive.”

The Commission considers that an increase of interconnections between the member states is important especially to cope with the growing generation of electricity from renewable energy sources. But Italy, Spain, Ireland, the UK and Poland, though committed to the concept, have failed to meet the 2002 target.

Bütikofer continued: “A low level of interconnectivity not only obstructs the uptake of renewable energy, but hurts competition in the oligopolistic electricity sector, ultimately hurting consumers, and it prevents the creation of a single European market in electricity. The Commission is right in pointing out the importance of increasing interconnectivity, particularly for the Central and Eastern European member states, for whom this has a relevant energy independence dimension. However, the Commission has previously shown little ambition to push hard on interconnectivity.”

The Greens’ concerns, though specific to their cause, are somewhat replicated across a broad political spectrum which, in spite of the global economic downturn, has expressed its regrets that the pace of interconnectivity has slackened. The focus is on Oettinger who key industry figures hope will be able to translate the importance he assigns to the topic into concrete actions in the European Energy Infrastructure Package.

So, where exactly do we stand today? Dirk Steinbrink, executive vice president of high-voltage and underwater cable operations at Nexans, a global player in the infrastructure, industry, building and local area network (LAN) markets, provide some insight. “We’re talking about multi-million Euro projects with high levels of risk. This takes time and so does the engineering. The economic downturn has caused delays, and most of our projects have a times-cale of two to three years. What we’re seeing today is a kind of [economic] recovery, but we’re looking at 18 months from a project tabled to fruition; that’s longer than it was before the global economic downturn.”

The good news is that, according to Steinbrink, there are no European ‘slouches’ though each nation has its own agenda. “In Europe there is a common approach. There are no ‘high-speed or low-speed countries’, “but it will take more time to come to fruition.”

But Europe is, inevitably, a geopolitical patchwork, he agrees. In Germany, which recently turned its back on nuclear power, priorities have changed, and so has its position on the super grid. “Renewables are now more at the forefront; but it will take time to make the position clear. It’s not a high speed approach, in Germany or elsewhere.”

The Skagerrak, Nexans’ cable ship, will lay Malta’s mailand Europe interconnector Source: Nexans

Nexans recently won the contract to install a 100 km submarine cable that will provide Malta’s first power interconnection with mainland Europe. Last December, the cable specialist secured the €178 million ($254 million) turnkey contract from Enemalta Corporation, the state-owned energy authority in Malta, to design, manufacture, install and provide seabed protection of the new high-voltage subsea power link between Malta and Sicily.

With a capacity of 200 MW, the cable will provide Malta with its first power interconnection with mainland Europe, reducing the island’s reliance on local generation and increasing its security of electrical power supply. The interconnector will be operational in 2013.Further, the entire system has been designed to allow the construction of a second 200 MW interconnector by the end of 2015.

Steinbrink explained how the project fits in with Europe’s expanding interconnector infrastructure: “The European Commission [EC] laid out a comprehensive plan a few years ago identifying priority electricity interconnections. They have been focused on translating into reality and this is reflected in the multiple interconnection projects that have taken off in the past few years. This may be a small part of that plan, but it is significant.”

Malavika Tohani is a research manager at Frost & Sullivan’s Energy and Power Systems. She puts the current interconnector situation into perspective, and is particularly concerned that Europe’s renewables ambitions, for a low-carbon future, may be at risk. “The transmission and distribution grid infrastructure that exists today in Europe is 40- to 50-years-old and was developed to accommodate conventional and large-scale power generation, such as coal, gas and nuclear.”

“The power generation landscape today looks very different, with renewable and distributed generation occupying a rising share,” Tohani continued. “The European Commission’s 2020 directive of generating 20 per cent energy from renewable sources by 2020 implies that renewables would have to contribute 34 per cent of electricity generation in 2020. This is putting immense pressure on the existing grid and in some instances even restricting the connection of renewables. A good example is Spain, where system integrators are unwillingly restricting the connection of wind farms to the grid in some parts because of the grid’s inability to support greater renewable energy penetration.”

The situation has improved little since December 2008, when the European Network of Transmission System Operators for Electricity (ENTSO-E) was created, since it was then that the global economic crisis began to bite. Tohani explained: “This was supposed to integrate the operations of the five different TSOs (transmission system operators) across Europe into one entity.” The organization, expected to speed up decision making to guarantee grid upgrades and increase the share of renewable generation in distributed networks, and the Third Energy Package, launched with a development plan to overcome the challenges and prepare for the electricity markets in 2020 and beyond, have been slowed by the downturn.

Yet various legislations and directives to ensure grid improvements and grant priority access to renewables, and other forms of distributed generation to the transmission and distribution networks enacted before the economic woes took grip, state that distribution network operators (DNOs) must give priority to renewable generators, waste-to-energy plants and combined heat and power schemes while dispatching generation. The first and foremost challenge that needs to be addressed is with respect to who should bear the cost of connection to the grid, renovations or extensions and reinforcements. Countries within Europe follow different charging methodologies. For instance, Denmark, Belgium and Germany amongst others, follow ‘shallow’ connection charges, wherein the generator only pays for the cost of physical connection to the grid, while reinforcements, for example, are borne by the DNOs and these charges are passed on to the final consumer by including them in system charges. On the other hand, in countries like Spain, Greece and Sweden, the generator not only pays for the connection to the grid but also for any upstream reinforcement costs. This is known as ‘deep’ connection charges. This of course places a higher burden of costs on the producer and hence discourages electricity production from renewable sources. There is also a third form of charging which combines the features of the shallow and deep charges called ‘shallowish’ connection charges, which is followed in the UK. In this model the generator pays for a part of the reinforcement costs depending on the proportion of increased capacity required.

Efforts are also ongoing to reduce bureaucracy and red-tape in granting planning permits and permission for renewable energy projects, in order to help countries achieve their 2020 targets. This problem is particularly acute in Italy and the UK.

In 2009, UK streamlined the approval process for large energy projects in order to fast-track decision making and avoid long delays. However, this is only applicable to projects above 50 MW and given that majority of the solar and onshore wind farms are below this capacity, real benefits accrued are expected to be limited. The need of the hour is to enforce and adhere to set deadlines, increase manpower to deal with the volume of projects and appoint a central body rather than having to deal with local authorities or various departments.

ABB has been involved in one of the biggest interconnectors yet completed in Europe, that between Norway and the Netherlands (NorNed), as well as the more recent BritNed connection between the UK and the Netherlands. According to Harmeet Bawa head of communications at ABB’s Power Products and Power Systems Divisions: “Each of the projects is interesting for different reasons. For instance NorNed is interesting from the length viewpoint, [while] BritNed connects the UK to mainland Europe.” Yet, he said, there remain both individual and collective actions EU members must take if they are to achieve true European interconnectivity, and a single electricity market. “There must be continued focus by the EC on implementation of the remaining interconnections, and actions to strengthen the European transmission grid in order to cope with the large amount of renewables being planned in the north sea [wind], in the south [solar], and in the Alps [hydro], must be redoubled. The respective EU countries will also have to take substantial actions to strengthen their transmission networks.”

Currently under construction, the grids of Ireland and Wales will be connected by a 500 MW ±200 kV high-voltage DC (HVDC) transmission system. Irish transmission system operator, EirGrid, awarded the contract to ABB, which is the first to use HVDC Light ±200 kV cables and one of the largest orders in the company’s HVDC history. The system will enable Ireland to expand its wind power generation and provide the opportunity to export excess energy to the UK market. The transmission link will run underwater for 186 km and underground for 70 km, with what ABB describes as “minimal environmental impact”. The project follows the EC’s recent allocated more than €903 million to electricity interconnection projects as part of its broader European Economic Recovery Plan, injecting new impetus into long standing electricity grid development plans within the EU. There is a specific focus on renewables projects. Nine projects received funding, including the vital France-Spain interconnection, which has been planned for a long time. “Despite the importance of this connection, which will allow Spain to exchange more electricity with other European countries and ensure interconnectivity between continental Europe and the Iberian peninsula, the project has suffered continual setbacks since its conception in the 1980s,” said Paul Wilczek, regulatory affairs advisor at European Wind Energy Association. “This funding is a boost for the integration of wind power in Europe, will improve the operation of Europe’s electricity markets and benefit consumers.”

The Estonia-Finland Estlink was the first interconnection between the Nordic and Baltic energy markets Source: ABB

Funds will also be allocated to a link between Sweden and the Baltic States, the so-called Nordbalt line, as well as reinforcing Estlink, an exisitng interconnection between Finland and Estonia, i.e. Estlink 2, amongst other transmission linnk projects.

“If we want to fully exploit the potential of renewable energies, create a truly European power market, and keep electricity prices low for consumers, we need to connect the whole of Europe,” Wilczek said. “These projects are a good start and the right way forward. Europe now needs to carry on developing the interconnectivity of its electricity grids.”

Last December, ABB also won orders worth $580 million from Svenska Kraftnät of Sweden and LITGRID turtas AB of Lithuania to supply a new transmission link between the Nordic and Baltic regions. The company will deliver an HVDC transmission system comprising two converter stations and cable for a 700 MW link across a distance of more than 400 km. The new transmission link will increase capacity, facilitate power exchange, enhance grid reliability and improve the security of electric supply at both ends, according to Peter Leupp, head of ABB’s Power Systems Division. The project is being supported by EU funding and is scheduled to be completed by the end of 2015.

The following February, ABB won an order worth $180 million from utilities Statnett of Norway and of Denmark to supply a HVDC converter solution to support the 500 kV interconnection of the Norwegian and Danish power grids. The underwater link will boost transmission capacity between the mainly hydroelectric-based Norwegian system and the wind and thermal power-based Danish system. It will enable both networks to add more renewable energy to their mix, and to use electricity more efficiently.

However, the jewel in the crown is NorNed, which Peter Leupp, head of ABB’s Power Systems Division calls a “landmark feat of engineering that brings Europe even closer to the goal of creating a reliable, continent-wide electrical network with low environmental impact.” NorNed, which is now operational, was the first direct power link between Norway and the Netherlands, and is part of the EU’s plan to improve cross-border power infrastructure, reduce blackouts and help create more efficient power markets within Europe.

Shortly after, the company secured its biggest cable order to-date, a $350 million contract for a high voltage connection between the power grids of the UK and the Netherlands. The 260 km BritNed link allows energy trading between the two countries and increase the reliability of electricity supplies to both. “BritNed is another step towards an integrated electricity network for Europe,” explains Leupp.

“Grid interconnections have an integral part to play in the evolution of a more flexible, reliable and smarter grid. They help in optimizing energy flows and strengthening transmission networks. Interconnections also facilitate the balancing of loads and the efficient integration and compensation of intermittent renewable energy sources like wind and solar”, explains Leupp. “Europe is very much in the forefront when it comes to cross-border transmission interconnections, with many such projects already commissioned, under construction and planned for the future. General political consensus and global commitment to minimize environmental impact, combined with the increasing contribution of renewables to the energy mix are likely to provide further impetus to transmission interconnections in the coming years.”

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