The role of Transmission System Operator in Belgium and in Europe Vlerick Alumni Event 26 January 2016
Agenda Introduction Infrastructure management Controlling the system Developing the EU Market 1/25/2016 2
TSOs active in two European Regions The Elia Group encompasses two leading TSOs in two European regions, with a unique international expertise on how the electricity transmission system works and evolves. 3 1/25/2016
Facts & Figures: Elia Group Top 5 Players in the EU TSO Business 30,000,000 143,000 km 2 18,000 km 6 residents covered covered of high-voltage lines in Belgium and in Germany interconnections 800 30,000 MW 2,000 22 experienced engineers and technicians of installed capacity of renewable energy employees nationalities 4 1/25/2016
Fact & Figures: Elia Belgium 11 million 30,528 km 2 8,412 km 800 residents covered covered of lines and cables substations 22,000 transmission towers 12,736 MW Maximum load Elia Grid Load 13,500 MW Total load Belgian Consumption 1,200 employees 23,000 Interventions on the grid 5 1/25/2016
TSOs at the Heart of the Electricity System Producers Electricity is produced from conventional and renewable energies. Transmission System Operators Ensure that electricity arrives from the producer to the consumer via the distribution system operators. Consumers Use the electricity fed by the producer into the power transmission grids 6 1/25/2016
Addressing the EU Objectives EU objectives Security of supply Competitiveness Competitiveness Sustainability Sustainability 7 1/25/2016
Addressing the EU Objectives EU objectives Security of supply Competitiveness Competitiveness Sustainability Sustainability 8 1/25/2016
Increasing uncertainties Uncertainties today 2020 2030 From today to 2020 From 2020 to 2030 Essentially, the following uncertainties Nuclear power plants EU 2020 targets New thermal plants Additional decommissioning Load growth Key drivers shaping the future energy landscape No nuclear power plants after 2025 Pace of RES integration Security of supply : autonomy or dependency CO2 market reforms Additional decommissioning Load growth and energy efficiency Storage developments Off-grid solutions 9 1/25/2016
Key Activities Elia Group 1 Infrastructure management Operation, maintenance, planning and expansion of the on- and offshore high voltage infrastructure. 2 Controlling the system Secure operation and balancing of the whole electricity system, 24/7. 3 Developing the EU market Frontrunner in the development of the EU electricity market (NWE & CEE regions) to make the EU energy system more competitive, secure and sustainable. 10 1/25/2016
Infrastructure management
Infrastructure management is about... Maintenance, reinforcement & development of the grid Integrating renewables Developing the European electricity market Safeguarding a high level of system security at an affordable price and never compromising safety while 1. Optimizing grid usage Controllable devices Capacity allocation Ampacimon HTLS-lines Smart maintenance 2. Excelling in asset management ToTex optimisation Maintenance & replacements 3. Developing interconnections Nemo Link (BE UK) ALEGrO (BE- GE) STEVIN Brabo 4. Redeploying the network Boucle de l Est RES Hubs Load evolutions 12 1/25/2016
Belgian grid maintenance On a yearly basis, the Elia team handles: 13,000 interventions for preventive maintenance 41,000 inspection rounds Repainting work totalling more than 10 million 73,000 requests for ground maps by third parties 13 1/25/2016 13
Expected evolution of renewables ( MW installed capacity) Forecasts in line with ENTSO-E scenario EU2020 4500 4000 3500 3000 2500 2000 1500 1000 500 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Biomass Solar Wind onshore Wind offshore Hydro Installed capacity/year (MW): 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2,772 4,255 5,194 5,860 6,232 6,540 6,947 7,471 8,095 9,851 10,550 14 1/25/2016
UK Top Projects Elia Belgium 1 Modular Offshore Grid Plug at sea for offshore wind 4 Brabo Grid reinforcement Port of Antwerp & increased cross-border capacity with Netherlands 6 2 Stevin Large infrastructure project to integrate offshore wind & crossborder trading with UK 3 Nemo Link Subsea HVDC-interconnection with UK 5 ALEGrO First HVDC-interconnection with Germany 6 Boucle de l Est Grid reinforcement to integrate renewable production 16 1/25/2016
Raising acceptance as a guideline The Elia Group creates a better understanding of grid development needs through: 1 Communication and collaboration with stakeholders 5 Compensation for land owners 2 Bundling of infrastructures 6 Compensation and replacement measures (nature) 3 Use of existing powerlines 7 Ecological corridor management 4 Undergrounding The Elia Group s objectives in grid development = as little impact as possible on people, nature and landscape. 17 1/25/2016
Controlling the system
Key Activities Elia Group Infrastructure management Operation, maintenance, planning and expansion of the on- and offshore high voltage nfrastructure 2 Controlling the system Secure operation and balancing of the whole electricity system, 24/7. 3 Developing the EU market Front runner in the development of the EU electricity market (NWE & CEE regions) to make the EU energy system more competitive, secure and sustainable 19 1/25/2016
Controlling the system is about... Balancing the system Reserve capacities Security of supply Integration of fluctuating renewables Keeping system security Control Centres Avoiding grid overloads & maintaining voltages International dimension of system operation Integrating innovative system control solutions Demand response Operating phase shifters Increased grid usage 20 1/25/2016
Importance of instantaneous balance between offtake and generation Injection and offtake of electricity must always be balanced Any imbalance between injection and offtake at European level leads to frequency deviations: Injection Generation Import Offtake Offtake Export Surplus energy in the system: > 50 Hz Shortage of energy in the system: < 50 Hz Large frequency deviations can lead to the (automatic) interruption of offtake and/or injection in order to prevent a general blackout. 21 1/25/2016
General roles & responsibilities of balance management All TSOs Frequency Belgian ARPs System Imbalance TSO ensures balance in its control area Balance between electricity consumption and generation: coordination between TSOs ACE Federal Grid Code (Article 157(1)): The ARP will provide and deploy all reasonable resources in order to maintain, on a quarter-hourly basis, the balance between total injections and total offtakes within its perimeter. 22 1/25/2016 Elia 22
Balancing the system Reserve generation capacity N-1 principle Primary, secondary, tertiary reserves Security of supply Activation of Strategic Reserves Integration of fluctuating renewables 23 1/25/2016
System flexibility: needs, resources and time horizons Needs Variability of consumption Variability of generation, especially renewable resources Forced generation outages Resources Flexible deployment of generation units Flexible demand (demand response) Interconnections Storage of electricity Day -1 Market Intra-Day Market ID up to real time RT Balancing Each market party nominates its portfolio hourly, in balance, on the basis of forecasts. To achieve this balance the various flexibility resources are deployed every hour of the day, via contracts or via own flexible resources. Adjusting balance on the basis of the most recent forecast: Via ID market, or Via own flexible resources Elia balancing tariff gives incentive to adjust balance Additional deviations (sudden outage, wind, etc.) can still be bilaterally covered between parties or via own resources. Elia manages the residual total imbalance: With ancillary services (R1, R2, R3 reserves) With energy bids from the balancing market parties. Market parties Elia 24 1/25/2016
Maintaining system security Control centres Regional National International (Coreso) Avoid grid overloads & maintain voltages Plan infrastructure works Topological actions Generator redispatch Determine safe exchange capacities for the market 25 1/25/2016
How are exchange capacities currently determined? Every TSO builds its best forecasts for Day+2: 24 common grid models each day Topology Consumption Distribution of generation Solar and wind generation Exchange capacities can then be calculated (taking into account the N-1 principle and available remedial actions) With the recent flow-based methodology, the available capacity for each grid element can be defined (= no longer per border) 26 25/01/2016
Day-Ahead Market Coupling Daily process to optimise the market results for the next day Capacities By TSOs via Coreso Order books By market parties (via exchanges) Algorithm By exchanges Optimisation by Euphemia at international level Net Positions per hub / per hour Prices per hub / per hour 27 25/01/2016
Integrating innovative system control solutions Demand response (Strategic) Reserves on consumption Be transparent and inform the public Phase Shifting Transformers Increase grid usage Ampacimon High-Voltage Direct Current Interconnection 28 1/25/2016
Developing the EU market
Key Activities Elia Group Infrastructure management Operation, maintenance, planning and expansion of the on- and offshore high voltage nfrastructure 2 Controlling the system Secure operation and balancing of the whole electricity system, 24/7. 3 Developing the EU market Front runner in the development of the EU electricity market (NWE & CEE regions) to make the EU energy system more competitive, secure and sustainable. 30 1/25/2016
Developing the EU market is about Integration of the European Electricity Market Flow based market coupling NWE and CEE regions Cooperation with Power Exchanges Developing methods, tools and market processes Capacity allocation and congestion management Developing network codes Market Products and Platforms Developing new market products Auction platforms for ancillary services 31 1/25/2016
Developing the EU market MRC Multi-Regional Coupling 2010 CWE Central-West Europe: Belgium, France, Germany, Netherlands, Luxembourg 2014 NWE North-West Europe: NWE + UK, Scandinavia SWE South-West Europe: Spain, Portugal 2015 CSE Central-South Europe: Italy 32 1/25/2016
Developing the EU market The Elia Group is a frontrunner 1 in supporting close cooperation with power exchanges 2 in auctioning longterm interconnection capacity 3 in supporting the design of new market products as shareholder of EPEX Spot through JAO, the joint allocation platform closer to real-time for new types of players like flow- based methodology and in the electricity system 33 1/25/2016
Flow-based market coupling & impact on energy prices Price decrease of 3.1 in Belgium (based on 19164 representative hours between 01/01/2013 and 19/05/2015) 100% optimum ( = purely hypothetical) Price with flow-based Price with previous mechanism 34 1/25/2016
Thank you for your attention