Nordic Grid Development Plan 2019 Presentation for stakeholders - - PowerPoint PPT Presentation

Nordic Grid Development Plan 2019

Presentation for stakeholders March 2018

Agenda

• Background
• Purpose
• Scope
• Relation to European, regional and national plans
• Overall timeline
• Nordic reference scenario
• Harmonized CBA methodology
• Bilateral studies
• Stakeholder interaction

Photo: Thomas Ärlemo

Background - Purpose

• Communicate status of ongoing, planned, and potential Nordic investments,

and how they contribute to Nordic socioeconomic welfare

• Communicate a common Nordic view on the development of the future

system, and how grid investments may help meet system challenges

• Communicate results of new system analysis investigating the cost/benefit of

further increasing the transmission capacity in the Nordic system

• Function as a “bridge” between the ENTSO-E process and the national

planning processes in the Nordics

Background - Scope

• Establish a common Nordic Reference Scenario based on ENTSO-E/TYNDP

scenario “Sustainable transition”

• Harmonize CBA methodology for the evaluation of socioeconomic welfare
• Carry out non-binding bilateral studies of the five corridors for an early

assessment of potential benefits from a Nordic system perspective

• Involve and interact with stakeholders to ensure quality

The way forward – Solutions for a changing Nordic power system Nordic Grid Development Plan 2019

2017 2018 2019 2016

… complementary Nordic publications …

Background - Relation to European, regional and national plans

Scenario TYNDP 2018 Mid-term Adequacy Forecast ENTSO-E Regional Plans, Pan European System Needs, TYNDP 2018 Scenario TYNDP2020 MAF 2019 +++ TYNDP 2016 National plans Nordic

2017 2019

Oct 2018 June Dec 2019 Jun

Nordic Reference scenario Harmonized CBA methodology Bilateral studies Final report, communication

Sep

Oct 17 – June 18 Jan 18 – June 18 Feb 18 – Dec 18

Background - Overall timeline

Jan 19 – Jun 19

NGDP 2019

Nordic Reference Scenario

Drivers and major changes in the Nordics – Recap from NGD 2017

A. Integration with the continent/UK B. Integration of renewables leading to increased north-south flows C. New consumption D. Baltic integration E. Decrease of nuclear and thermal capacity Drivers are similar and becoming stronger when we look towards 2040.

Fundamental assumptions and storyline

• Based on ENTSO-e scenario “Sustainable Transition” for continental Europe
• Both coal and gas is competitive in the merit order, coal is forced out due to national regulation ie EU

ETS CO2 price is still not the only driver for de-carbonization

• Rapid deployment of new renewable production.
• Demand is growing only due to new demand types
• A mix of energy only and capacity market
• New sources of flexibility enters the market as thermal and nuclear is phased out

Photo: Magnus Mikaelsson

Fuel prices and merit order

Demand

• Demand driven by new consumption types eg EVs, Heat Pumps , new industrial applications

Continent

Energy Balance

• Renewables replace nuclear and thermal

Power balance

• Conventional generation is phased out and replaced by new flexibility
• Capacity margins will be much tighter

New flexibility

• Additional flexibility in some EVs as well
• Large scale storage could be hydrogen production
• Load shifting could be industry changing fuels

Price volatility

• More volatile price but the pattern is changing

Annual prices and energy mix in 2030 & 2040

• Nordics closely tied to the continent after new interconnectors

Continental prices

• Convergence with UK and divergence with Poland

Economics of power plants

• Low return for thermal plants from spot market
• Achieved price drops for renewable generation

Sweden & Finland

• Future of nuclear is a key uncertainty

Norway & Denmark

• Y
• Z

Baltics

• Continued deficit situation both in terms of energy and capacity

NGDP 2019

Harmonized CBA methodology

Purpose and scope

• To agree on a common Cost Benefit Analysis methodology for evaluating new potential grid

investments of Nordic significance based on previous work in both ENTSOE and the Nordic region.

• The aim is not to include all potential costs and benefits, but rather those that are deemed most

important and possible to calculate/assess in the very early stages of investigating potential grid investments.

Photo: Thomas Ärlemo

Work done so far

• All benefits are calculated for the Nordic countries
• Pan-European benefits reported for discussion

Harmonized Non-harmonized

• Net Present Value – method
• 4 % real discount rate
• 40 years of analysis period

(25 years in sensitivity analysis)

• Currency: Euro
• CO2 is calculated for the whole modeled area
• Investment costs
• Each TSO reports their best estimate of

capital expenditure & operating expenses in their network area.

Included indicators

• Socioeconomic welfare
• Grid losses
• Impact on CO2 emissions
• Costs
• Security of Supply
• Integration of renewable electricity
• Environmental impacts
• Flexibility, Balancing resource trade,

Reserves

• Resilience, Robustness

Generally not monetized, may be done if it is a key economic driver for the investment Monetized Assessed when relevant to the specific investment, non-harmonized methods Always assessed – degree depends on the investment

NGDP 2019

Bilateral studies

Bilateral studies

Corridor Focus/Drivers NO2-DK1 Aging of infrastructure of Skagerrak 1-2 NO1-SE3 Impact of the Swedish nuclear decommissioning SE3-DK1, SE4-DK2 Aging of infrastructure of Kontiskan 2 NO4-FI Investigate consequences of large wind expansion and industry in the far North SE2-FI (Kvarken) Confirm results from 2016 studies and prepare for decision to move forward with planning

Stakeholder interaction

Stakeholder interaction

• Q1 2018:
• Communicate the purpose and scope of NGDP2019
• Collect input from market actors on scenario and sensitivities,

important aspects to investigate etc.

• Q4 2018:
• Present status on the bilateral studies
• Collect input to the bilateral studies