Download Project Slides - European Commission

Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
RES-E Case Study Analyses and
Synthesis of Results
Dr.-Ing. Derk J. Swider
Institute of Energy Economics and the Rational Use of Energy (IER)
Universität Stuttgart, Germany
Coordinator of WP2 and WP5 of the GreenNet-EU27 project, financially
supported by the European Commission (Contract No. EIE/04/049/S07.38561).
Legal Disclaimer: The sole responsibility for the content of this work lies with the authors. It does not represent the opinion of the European
Communities. The European Commission is not responsible for any use that may be made of the information contained therein.
1
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Outline
RES-E Case Study Analyses and Synthesis of Results
1.
Introduction
2.
Description of electricity systems
3.
Conditions for RES-E grid integration
4.
Costs for RES-E grid integration
5.
Best-practice cases for RES-E grid integration
6.
Conclusions
2
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Motivation
Proposition:
The costs of integrating RES-E in an existing grid can form a
significant barrier for the deployment of RES-E.
•
Just starts to get into the focus of energy policy makers as it gains
importance if wind offshore is considered.
•
The allocation of grid reinforcement and extension costs may lead to
first-mover disadvantages.
•
This may reduce the willingness to invest and may thus hamper the
deployment of RES-E.
3
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Country specific analysis
For different European countries the questions
What conditions apply for RES-E grid integration?
Who has to pay for any additional costs?
are answered based on literature reviews and stakeholder interviews.
Country
Germany
Netherlands
United Kingdom
Sweden
Austria
Lithuania
Slovenia
Wind power
Onshore
Offshore








Biomass
Photovoltaic






4
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Electricity systems (I)
•
Considered electricity systems differ in terms of their respective size
but are similar in consumption per capita.
5
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Electricity systems (II)
2010 targets
(EU Directive 2001/77/EC)
6
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Supporting schemes (I)
Feed-in tariff
Are characterized by a defined price paid to the RES-E
generators. Any arising additional costs are passed
through to the consumers by way of a premium on the
price. Has the advantage of investment security but also
the disadvantage of a risk of over-funding.
Quota
Are characterized by selling RES-E at market prices. The
financing of additional costs is remunerated by all
consumers (in some countries producers) obliged to
purchase a certain number of certificates from RES-E
producers. Has the advantage of a market-based
instrument but also the disadvantage of risks for investors.
7
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Supporting schemes (II)
Country
Germany
Netherlands
United Kingdom
Sweden
Austria*
Lithuania
Slovenia
Supporting Scheme
Feed-in tariff
Quota







Incentives






* The supporting scheme is currently under revision. The most important change will be a cap on the financial
support for the various RES-E generation technologies.
•
Most of the countries decided to use the feed-in tariff as a
supporting scheme for the development of RES-E.
•
The implementation of these schemes is different from country to
country which effects the RES-E development.
8
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Grid connection (I)
•
In general, national governments demand RES-E to be connected
with priority compared to conventional generation.
•
They are usually connected to the next available connection point
of the existing grid with the procedure defined in grid codes.
•
Normally, RES-E does not have the same requirements as
conventional plants regarding the provision of system services.
9
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Grid connection (II)
Distribution grid
taken from WP6 presentation
Transmission grid
taken from WP6 presentation
10
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Grid related costs
•
In the case studies three cost categories are distinguished:
1) Shallow grid integration costs;
2) Deep grid integration costs;
3) Other fixed and variable costs.
•
Costs related to the central connection point of a RES-E site are
considered as shallow grid integration costs
•
All expenses in the existing grid related to the connection of the new
RES-E site are considered to be deep grid integration costs.
11
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Cost allocation (I)
Super-shallow approach
Advantage:
high incentive to invest
Shallow approach
Advantage:
reasonable incentive
Deep approach
taken from WP6 presentation
Advantage:
reflects real costs
All these approaches may lead to an inefficient system
as they do not sufficiently provide locational signals.
12
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Cost allocation (II)
Country
Germany
Netherlands
United Kingdom
Sweden
Austria
Lithuania
Slovenia
Cost allocation philosophy
Shallow
Hybrid
Deep







•
It can be seen that there is no consensus, due to the fact that there
are many different stakeholders involved.
•
RES-E cost allocation is of major importance and can adversely
affect the economic viability of RES-E.
13
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Grid integration costs (I)
•
Grid integration costs are often not specified separately or it is not
always clear what they comprise.
•
Grid integration costs are always site specific; influencing factors
are most importantly distance, trajectory, etc.
Country
Germany
Netherlands
United Kingdom
Sweden
Austria
Lithuania
Slovenia
* One case study only.
Wind power
Onshore
Offshore
Min
Max
Min
Max
45
40
95
170
150
130
85*
210*
35*
-
-
185
180
-
600
205
-
Biomass
Photovoltaic
Min
Max
Min
Max
-
-
0
50
125
100
600
985
100
-
30*
-
15*
(EUR/kW)
14
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Grid integration costs (II)
15
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Unit generation costs (I)
•
Cost estimation based on the average lifetime levelized electricity
generation cost (EGC) approach as applied in the OECD study.
•
The OECD study focused on calculating busbar costs, at the station,
and did not include transmission and distribution costs.
With:
It
Mt
Ft
Et
r
Investment expenditures in the year t
Operations and maintenance expenditures in the year t
Fuel expenditures in the year t
Electricity generation in the year t
Discount rate
16
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Unit generation costs (II)
•
Feed-in tariffs for established RES-E technologies are usually well
chosen and provide sufficient support to invest.
Upper bound of normalized RES-E unit generation costs and respective feed-in tariff (in
EUR/MWh for 2004; lifetime assumed 20 years; interest rate 10%; full-load hours: 2100 h/y for
wind onshore, 3000 h/y for wind offshore, 6000 h/y for biomass and 800 h/y for photovoltaics).
Country
Wind power
Onshore
Offshore
Costs Tariff Costs Tariff
Germany
Netherlands*
Austria
85
90
95
87
65
78
120
130
-
91
97
-
Biomass
Photovoltaic
Costs
Tariff
Costs
Tariff
145
115
97
165
830
-
97
-
* Premium on the market price
•
Feed-in tariffs for newer RES-E technologies, as for example for
wind offshore, do often not provide sufficient support to invest.
17
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Best practice cases (I)
•
For RES-E the most important and influencing actors in the energy
market are energy policy makers and associated regulators.
•
Often two partly opposite aims are followed:
i.
establishing an efficient and cost minimized market
ii.
introduction of a defined share of RES-E generation
•
Principally fixed RES-E investment incentives, like a feed-in tariff,
reduce the developers’ exposure to risk.
•
Regarding the past development of RES-E the situation in Germany
seems to be the most favorable of all considered countries.
•
However, for wind offshore the grid integration costs may constitute
a significant barrier to invest (lead Germany to switch to a super-shallow approach).
18
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Best practice cases (II)
450.000
Reference scenario
Wind generation of new plants
(installed after 2004) [GWh/yr]
400.000
Super-shallow charging
scenario
Deep charging scenario
350.000
300.000
250.000
200.000
150.000
100.000
50.000
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
taken from WP6 presentation
2007
2006
2005
0
19
Results on WP5: Case studies
on RES-E grid integration
GreenNet-EU27
Recommendations
Large-scale RES-E grid integration…
…may be hampered by barriers due to the chosen supporting scheme and
cost allocation approach (first-mover disadvantages).
…requires clarification concerning the distribution of any additional
expenses between the market actors (plant and grid operators).
Therefore…
…create mechanisms in grid regulation policies able to identify and
remunerate investments caused by RES-E grid integration.
…try to have the major part of the grid integration costs, especially
deep costs, covered by the grid operator (remunerate to society).
Then barriers for new RES-E deployment are reduced and
ambitious goals can be met with minimal (extra) costs for society.
20