Hannes Weigt. Take the Long Way Down : Integration of Large-Scale North Sea Wind Using HVDC Transmission. ENERDAY, Dresden 03 April 2009

Transcription

1 Take the Long ay Down : Integration of Large-Scale North Sea ind Using HVDC Transmission ENERDAY, Dresden 03 April 2009 Hannes eigt Chair of Energy Economics and Public Sector Management

2 Agenda 1. Introduction 2. ELMOD: Model Description 3. AC and HVDC extension 4. Results 5. Conclusion -2-

3 Introduction Background: German Energy Association (DENA) developed a concept for the grid-compliant integration of wind energy in the electricity system based on AC line upgrades (build of 870km lines in the high voltage grid); Demand in North-Germany rather low; demand centres in the est and South of Germany congestion and unintended boarder flows (mainly to Benelux countries) 1. elfare and price situation in Germany given the projected offshore wind capacity extensions 2. Cost-Benefit Analysis of an alternative network extension using High Voltage DC Cables (HVDC) -3-

4 Agenda 1. Introduction 2. ELMOD: Model Description 3. AC and HVDC extension 4. Results 5. Conclusion -4-

5 ELMOD Adjustments: Network Physical model Germany in detail and surrounding grid approximated Nodes: 420 (substations) Lines: 640 (380 kv, 220 kv, and 110 kv ) -5-

6 Mathematical Representation Objective n,t g n d n p(d n ) c(g n ) node, period generation in n demand in n demand function in n generation costs in n max q n, t = p( q ) dq ( c( g g ) n, t 0 * n, t n, t n, t ) n, t n, t Constraints Line capacities P i,t load flow on line i P P max i, t i Energy balance s g ns + wind n q n netinput n = 0 Generation capacities g max available capacity at n g g max n, t n -6-

7 Technical Constraints: Load Flow (Schweppe et al., 1988; Stigler & Todem, 2005) Assumptions 1. Neglecting reactive power flows 2. Small voltage angles 3. Standardization of node voltages to respective voltage level Power flow P on line i from node j to node k B i Susceptance of line i P = jk B i Θ jk Q jk Phase angle of voltages U j and U k Losses L on line i from node j to node k R Active resistance of the line L = jk R i P 2 jk -7-

8 Generation Data Fuel Total capacity [G] Total Capacity [G] Nuclear Power Lignite Coal CCGT Steam OCGT ater Pump storage ind Onshore ind Offshore Generation capacity per type of power plant (VGE, 2006) Marginal costs of generation per type of power plant (Bafa (2008), Knight (2006), own calculations) -8-

9 Market Assumptions and Demand Data Market: - No strategic players: perfect market bidding (marginal cost, no market power) - Independent ISO: welfare maximization Node demand: - Linear inverse demand function constructed using a reference price and point demand elasticity, reference prices are based on the spot prices of the national energy exchange - For Germany: Distinguishing between household, small business, and industry ind input: - Given as external parameter based on wind distributions derived from historic data, no stochastic simulation Periods: - Scenarios for high and average wind input - Scenarios for off peak, average and peak load; and winter and summer weighted to represent average yearly values -9-

10 Agenda 1. Introduction 2. ELMOD: Model Description 3. AC and HVDC extension 4. Results 5. Conclusion -10-

11 Extension Plans Dena extensions (AC) Proposed extension (HVDC) Source: UCTE-map modified -11-

12 HVDC Practical Implementation Identification of three wind farm concentration-zones (CZ) Building of 3 offshore converter stations close to each CZ (3 G each) Low-section AC-cables connect each wind farm with a offshore converter station Converter stations collect power and uncharge it to land stations Feed-in-nodes (cable length): 1. Dauersberg (approx. 400 km) 2. Grafenrheinfeld (approx. 550 km) 3. Hoheneck (approx. 700 km) Converter station Offshore wind farm HVDC-cables 3 G AC-cables M Source: BSH-map modified -12-

13 HVDC/Dena investment costs Investment costs HVDC-Installations: - Converted Stations: ranging from 150 and 350 Mio. : Offshore converter station 350 Mio. (Assumption) Onshore converter station 150 Mio. (According to 3GC/3GG-Projects) - Overhead lines approx. 250 to 450 Mio. per 1,000 km - Cables around 600 Mio. per 1,000 km: Due to the NIMBY problem we assume cable connection - Submarine cables up to 2,500 Mio. per 1,000km Assumptions: - 3 offshore and onshore converted stations (ca. 1.5 bn ) - ca km Cable lenght (ca. 1 bn ) Investment costs HVDC appraoch.: 2,5 Billion Vs. Investment costs DENA-extension: 1,1 Billion Source: Brakelmann and Richert (2004), Rudervall et al. (2000) and DLR (2006) -13-

14 Agenda 1. Introduction 2. ELMOD: Model Description 3. AC and HVDC extension 4. Results 5. Conclusion -14-

15 Scenarios 6 Scenarios: System Operation: Network extension: Uniform, Zonal, and Nodal Pricing Dena and HVDC Problem: In case of fixed wind input (feed in guarantee) two Dena cases (uniform and zonal) are infeasible due to network congestion Adjustment of energy balance: replacing fixed with a variable wind input Source: Brakelmann and Richert (2004), Rudervall et al. (2000) and DLR (2006) -15-

16 Result Overview Dena HVDC Extension Costs [mn ] Fixed wind input (feed-in guarantee) Average Price [ /Mh] Uniform Zonal Nodal Uniform Zonal Nodal 1,136 2, elfare [bn /a] Losses [%] - - 0,44 0,44 0,44 0,44 Variable wind input (active wind park management) Average Price [ /Mh] elfare [bn /a] Losses [%] Unused wind [Gh/a]

17 Price Comparison High ind Input nodal zonal uniform Dena Extension: Large price differences between North and South Germany /Mh N N N M M M S S S S SE SE E E E E Zone nodal zonal uniform HDVC Extension: Price convergence even in high wind input situations /Mh N N N M M M S S S S SE SE E E E E Zone -17-

18 Agenda 1. Introduction 2. ELMOD: Model Description 3. AC and HVDC extension 4. Results 5. Conclusion -18-

19 Conclusion Compared different scenarios to integrate offshore wind from the North Sea into the German electricity grid Show that HVDC connections to transmit North Sea wind the long way down to the South s centers of demand is superior to the existing plan to incrementally extend the AC network Investment costs of HVDC (2.5 bn Euro) are rapidly paid off by the welfare increase (about 0.7 bn Euro per year) HVDC connections lead to a more equalized price level in Germany Source: Brakelmann and Richert (2004), Rudervall et al. (2000) and DLR (2006) -19-

20 Thank you very much for your attention! Any questions or comments? Chair of Energy Economics and Public Sector Management

21 References (Selected) Asplund, G Sustainable energy systems with HVDC transmission. ABB Power Technologies, Stockholm. Bentzen, J., Engsted, T, 1993: Short and Long-run Elasticities in Energy Demand A Cointegration Approach, Energy Economics, 15 (1), Brakelmann, H., Richert, F., Dimensoring of Cables for Grid Connection of Offshore ind Farms Taking into Account the Time Factor of Energy Production. DEI-Magazin, 24, 2004, Bushnell, J., Day, Ch., et al. 1999: An International Comparison of Models for Measuring Market Power in Electricity, Stanford University, Stanford, orking Paper EMF P Butler, L. and Neuhoff, K., 2008, Comparison of feed-in tariff, quota and auction mechanisms to support wind power development, Renewable Energy, 33 (8), Dena, Dena-Netzstudie, Energiewirtschaftliche Planung für die Netzintegration von indenergie in Deutschland an Land und Offshore bis zum Jahr Deutsche Energie-Agentur. DLR, Trans-Mediterranean Interconnection for Concentrating Solar Power. Study commissioned by Federal Ministry for the Environment, Nature Conservation and Nuclear Safety Germany. Green, R Nodal Pricing of Electricity: How Much Does It Cost to Get It rong? Journal of Regulatory Economics 31(2), Hogan,.., Contract Networks for Electric Power Transmission. Journal of Regulatory Economics, 4, Leuthold, F., eigt, H., Hirschhausen, C.v., 2008a. ELMOD - A Model of the European Electricity Market. Chair of Energy Economics and Public Sector Management Dresden, orking Paper P-EM-00. Leuthold, F., eigt, H., Hirschhausen, C.v., 2008b. Efficient Pricing for European Electricity Networks - The Theory of Nodal Pricing Applied to Feeding-in ind in Germany. Utilities Policy, 16, Rudervall, R.; Charpentier, J. P.; Raghuveer, S., High Voltage Direct Current (HVDC) Transmission Systems - Technology Review Paper presented at Energy eek 2000, ashington, D. C., USA, March 7-8. Schweppe, F. C., Caramanis, M. C., Tabors, R. D., Bohn, R. E., Spot Pricing Of Electricity. Boston, Kluwer. Stigler, H., Todem, C., Optimization of the Austrian Electricity Sector (Control Zone of VERBUND APG) under the Constraints of Network Capacities by Nodal Pricing. Central European Journal of Operations Research, 13, Sweeney, J. L., 2002: The California Electricity Crisis, Hoover Institution Press, Stanford. -21-