On December 7^th, nine European countries signed an agreement to develop an integrated offshore grid in the North and Irish seas. WindEnergyUpdate interviews EWEA’s head of regulatory affairs, Justin Wilkes, to find out what lies ahead in the offshore grid challenge.

By Rikki Stancich in Paris

In the second week of December, during an Energy Council meeting in Brussels, the UK's Energy and Climate Change Minister Lord Hunt signed an agreement along with ministers from Germany, France, Belgium, the Netherlands, Luxembourg, Denmark, Sweden and Ireland to develop an offshore grid in the North and Irish seas.

The proposed offshore grid will serve to augment energy security for the participating countries while making it easier to optimise offshore wind electricity production. It will also assist the EU as a whole to meet its renewable energy target for 2020.

Rikki Stancich calls on Justin Wilkes, head of regulatory affairs for the European Wind Energy Association, to explain the technology, investment and the degree of political and technical cooperation required to transition the vision of an offshore super grid to reality.

WindEnergyupdate: What kind of investment will the North Sea grid require and where is the bulk of finance likely to come from?

Justin Wilkes: A safe bottom line assumption for investments in offshore transmission up to 2030 is in the range of €20-30 billion. This number would include both the ‘trade’ interconnectors and the dedicated lines for wind power connection.

For comparison, the International Energy Agency (IEA) estimates total investments in European electricity transmission grids of €187 billion in the period 2007-2030.

The financing of the future pan-European offshore grid will involve significant investments.

If allowed by regulators, merchant interconnectors could represent additional profits for TSOs, which would incentivise their construction.

Private companies investing in these face higher risks, in particular for the connection of large offshore wind arrays, as the profitability of the interconnector would then depend on the development speed in the area.

In these cases a specific instrument could guarantee the investment. For example, the European Investment Bank Risk Sharing Finance Facility (RSFF).

In order to speed up the process, and in addition to dedicated streamlined legislation, support should be provided to the investments. In this respect, the European Economic Recovery Plan is a welcome small step in the right direction.

But existing EU instruments, such as the funds for Trans-European Networks, or the ‘Marguerite fund’, managed by the European Investment Bank, should be directed towards offshore wind power, key components of the value chain, and electricity infrastructure for offshore wind power.

At regional level, structural funds should also be directed towards the development of electricity infrastructures

WindEnergyUpdate: What technologies will enable the roll out of the North Sea grid and are these technologies ready for deployment?

Justin Wilkes: The utilisation of HVDC (High Voltage Direct Current) technology for the offshore grid is very attractive because it offers the controllability needed to allow the network both to transmit wind power and to provide the highway for electricity trade.

Moreover, HVDC offers the possibility of terminating inside onshore AC grids, and thus avoiding onshore reinforcements close to the coast.

There are two basic types of HVDC transmission links: HVDC-LCC (conventional HVDC) and the recent HVDC-VSC (Voltage Source Convertor). HVDC-LCC has been extensively used worldwide.

Today, the drivers for the offshore grid favour HVDC-VSC as the best option because the technology is suitable for the long distances involved (up to 600 km), with minimal losses.

The compactness (half the size of HVDC LCC) also minimises environmental impact and construction costs, for example of the HVDC platforms. The system is modular. A staged development is possible, and stranded investments can more easily be avoided.

Also, the technology – because of its active controllability - is able to provide flexible and dynamic voltage support to AC and therefore can be connected to both strong and weak onshore grids.

Moreover, it can be used to provide black start and support the system recovery in case of failure, while multi-terminal application is possible, which makes it suitable for meshed grids.

In this way the HVDC VSC technology seems to offer the solution for most of the offshore grid’s technical challenges.

There are two major manufacturers of HVDC VSC technology. ABB uses the brand name HVDC Light, whereas Siemens has branded its technology HVDC Plus.

The technologies are not identical, and efforts are needed to make them compatible and jointly operable, when used together in the future offshore grid.

For that purpose, two major conceptual decisions have to be taken – namely, to agree to standardise the DC working voltage levels and to agree on the largest possible plug and play boundary.
 
WindEnergyUpdate: What key regulatory and operational issues would be resolved by the establishment of the European Network of Transmission System Operators?

Justin Wilkes: The principal operational tasks concerning the offshore grid include operating and maintaining the grid in a secure and equitable way, whilst granting fair access to the connected parties; and scheduling the HVDC lines for the predicted amounts of wind power and the nominated amounts of power for trade.

The operation of the offshore grid will, however, be an integral part of the operation of the interconnected European grid and therefore very close coordination is required between the various connected power systems, which is a challenging task for the newly formed ENTSO-E.

It is therefore vital that ENTSO-E establishes a structure that is suited to such cooperation, for example through the North Sea Regional Group, as well as within the System Operations and Market Committees.

Beside these organisational developments, one of the first tasks for the TSOs and industries involved is to set up a system of standards and grid connection requirements. New standardisation efforts are needed in the field of HVDC, more specifically to agree on a common system of voltage levels.

In order to enable a smoothly and efficiently constructed grid, it will be essential that parties agree on a system of plug and play and standard –  interchangeable building blocks.

WindEnergyUpdate: Where does the Pentelateral Energy Group fit into the picture and how will it compliment the achievements of ENTSO-E? What kind of progress has been made by the Pentelateral initiative to date, in terms of creating a common European electricity market?

Justin Wilkes: Representatives from industry, regulators and members of the scientific community from thirteen countries (where of twelve European Member states and Norway) and European Commission met for the fourth “European Policy Workshop on Offshore Wind Power Deployment” in Stockholm on the 15th of September 2009.

The Stockholm Declaration called upon the Pentalateral Forum to work on international North Sea grid issues and to allow other North Sea countries to participate in the work presently considered on market integration and regulatory issues.

WindEnergyUpdate: What other challenges exist with regard to developing a North Sea grid and what kind of timeline are we looking at before the North Sea grid becomes operational?

Justin Wilkes:  Other than the technical challenges, the construction of a supergrid will require a European vision, including the contribution of the European Commission, the European Network of Transmissions System Operators, and other stakeholders such as EWEA.

It will require strong cooperation among member states, and it will require access to finance.

Europe’s offshore grid should be built to integrate the expected 40 GW of offshore wind power by 2020, and the expected 150 GW of offshore wind power by 2030.

It is for this reason that EWEA has proposed its 20 Year Offshore Network Development Master Plan.

This European vision must now be taken forward and implemented by the European Commission and the European Network of Transmission System Operators (ENTSO-E), together with a new business model for investing in offshore power grids and interconnectors, which should be rapidly introduced based on a regulated rate of return for new investments.

The European Commission will publish a ‘Blueprint for a North Sea Grid making offshore wind power the key energy source of the future.

ENTSO-E will publish its first 10 Year Network Development Plan, which should, if suitably visionary, integrate the first half of EWEA’s 20 Year Offshore Network Development Master Plan.

The European Commission will also publish its EU Energy Security and Infrastructure Instrument which must play a key role in putting in place the necessary financing for a pan-European onshore and offshore grid, and enable the European Commission, if necessary, to take the lead in planning such a grid.

The EWEA Master Plan is visualised at page 30 of the Oceans of Opportunity report. Here we provide our vision and therefore also what we think should be tie timeline for the building of the North Sea supergrid.

To respond to this article, write to the Editor:

Rikki Stancich: rstancich@gmail.com