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The idea is that a subsea transmission network would hook up offshore wind farms in the North, Baltic and Irish Seas and boost cross-border trade in electricity (see map, right). Energy trading would enable more competition in the market, ultimately bringing down consumer bills.

Another benefit of a more robust interconnected network would be its enhanced ability to cope with variations in demand and supply. With nearly 220GW of variable renewables due to be connected to the system by 2020, the latter is an important consideration according to supporters of the supergrid.

But how important is a supergrid’s role in smoothing the impact of increasingly large quantities of variable wind on Europe’s electricity network? The theory goes that it is always windy somewhere on the system at any one time. Connecting distant areas would allow local troughs in wind generation to be compensated for by high winds elsewhere. Yet, others argue that the smoothing effect might have been overstated.

The case for a supergrid

Beyond the headlines, the real value of a European supergrid lies in its ability to enable electricity networks to operate more efficiently across Europe. This would aid the integration of large quantities of wind and other renewables on to the network.

Trading electricity between utilities will become easier as they will collectively be able to exploit the economies of scale that result from the aggregation of demand and generation. Aggregation smoothes the variations in demand, for example, as times of national peak usage tend not to coincide.

The "Brit-Ned" connection between the UK and the Netherlands that was energised on April 1 is an example of a high-voltage direct current (HVDC) connection that started to prove its worth almost immediately. Mid-morning on April 5, 900MW was flowing from the Netherlands to the UK as electricity in the Netherlands was cheaper. At other times the flows reversed.

HVDC cables can transmit high power levels and are often the cheapest solution for long-distance power transmission. This link has a length of 260 kilometres, a capacity of 1GW and a price tag of €600 million.

The term "super" in supergrid refers to the high-voltage current flowing through both the undersea and onshore grid. Many of the subsea connections would use HVDC cables. Voltages for offshore cables can go up to around 1,000kV and a cable can carry up to 3GW. The higher the power that can be transmitted, the lower the cost per unit of electricity.

Alternating current (AC) cable voltages are lower than this — and lower than onshore overhead line voltages. The upper limit for offshore AC cables is around 250kV. Apart from higher voltage, HVDC is also more flexible and less susceptible to power losses than conventional AC transmission. However, HVDC requires the use of costly power electronic converters at each end to change the voltage level and convert it to or from AC, which is the standard transmission technology for onshore electricity networks. The extra cost of these converter stations means that HVDC is less suited to short distances. The boundary between short and long distance is project-specific but tends to be around
50-80 kilometres.

There is no single design for a supergrid. Various studies have come up with different blueprints for a European network capable of enabling the EU to meet its target of sourcing 20% of the energy it uses from renewable sources by 2020.

Smoothing variability

There is no consensus on the extent to which wind power fluctuations might be smoothed to make wind power more "reliable". It has been observed that large weather systems can engulf most of Europe, making the smoothing benefits from an offshore grid only modest.

When the supergrid concept was first mooted, Denmark’s Risø Laboratory examined the smoothing effects that would accrue from more interconnections in northern Europe. Taking data from 60 well-distributed sites across Europe over a 34-year period, the researchers found very few occasions when wind power production fell below 12% of the total rated output in the winter, which is when demand is highest. This demonstrates that some wind power will almost always be available on the grid. Their analysis of power swings suggested that a supergrid would deliver lower uncertainty and, as a result, less plant would be required to quickly equalise supply and demand — so-called balancing.

A Greenpeace study suggests that, in the presence
of a pan-European interconnected network, hourly variations in wind power output in excess of 10% of rated capacity would be rare. This means that a European supergrid could reduce balancing costs, which are highest when a larger swing occurs. At individual country level, the picture can be quite different. For example, western Denmark can experience hourly swings of up to 18%.

However, a 2007 analysis of power fluctuations over a short period, reported in our sister magazine Windstats, found that substantial variations in wind energy production still occur in a pan-European context. The Windstats analysis, which looked at outputs from Ireland, Spain and Denmark combined, found significant swings during the period in question.

The distance between Ireland and Spain is about 1,600 kilometres, between Spain and Denmark more than 1,900 kilometres, and between Ireland and Denmark about 1,000 kilometres. Because these distances are larger than many weather systems, this was a good test of geographic dispersion on a continental scale.

Scrutiny of more recent data from Ireland and western Denmark in January 2010 suggests that the additional smoothing effects of a supergrid may indeed be modest, as shown in the graphic on this page.

The Windstats finding is supported by global consultancy Pöyry’s recent report, The Challenge of Intermittency in North West European Power Markets, which concludes that "renewable generation will be highly variable and will not average out because of weather and geography". These studies broadly reach the same conclusions: a supergrid produces some additional smoothing, but wind power fluctuations are not eliminated and the monetary savings are modest.

More importantly, the costs of variability are also modest (see box, previous page). Arguments that stress the value of a supergrid in smoothing out fluctuations in wind power risk implying that its variability is a problem. In reality, electricity demand is itself highly variable; system operators already have an array of tools at their disposal to deal with that and provide a reliable supply. The same tools enable them to integrate wind into electricity networks.

The European imperative

The EU’s executive body, the European Commission, appears convinced of the supergrid’s role in connecting offshore wind. It has tasked EU co-ordinator Georg Wilhelm Adamowitsch with facilitating connection of offshore wind in Northern Europe. He claims there is no alternative to an offshore high-voltage grid. "You need this North Sea grid as a backbone for future European electricity security of supply," he says.

To reach the 2020 targets the EU has set itself under the 2009 renewable energy directive, countries expect to install 450GW of renewable generation — half of it from variable sources. Some 20% of all renewable generation is likely to come from onshore wind and 12% from 45GW of wind turbines installed at sea. More offshore wind capacity is expected after 2020.

According to the European Network of Electricity Transmission System Operators, Entso-e, Europe’s renewables and security of supply ambitions will require more than 40,000 kilometres of new high-voltage grid to be built. They estimate this will cost
€140 billion, €30 billion of which is earmarked for an offshore grid.

Meanwhile, countries are progressing with plans to connect offshore projects under development into their own national grids. This includes substantial quantities of German offshore wind and around 20GW of Round 3 capacity off the UK’s North Sea coast. The latter will be brought ashore into the British network at a total estimated cost of around €8.8 billion.

The UK’s energy ministry says: "We do not want to see the development of a wider vision for a supergrid delaying the deployment of offshore wind." The supergrid project involves many difficult cross-border regulatory and jurisdictional issues that will require significant time and effort to resolve, it explains.

An international attempt at solving these differences in regulation, market rules and technology is underway. In December, ministers from ten countries bordering the North Sea signed a memorandum of understanding to co-ordinate development of an offshore grid. Its interim report is expected by end-2012.

Although construction of a supergrid may not enable widespread lulls in wind strength to be overcome, it would facilitate easier access to European hydro resources during such periods. The advantage of using hydro is that the water can often be held back at minimal cost. Apart from Scandinavia, there are substantial hydro resources in France, Switzerland, Italy and elsewhere in Europe. This would reduce the need for thermal plants to be retained for standby purposes — provided the market prices sought by hydro operators are competitive.

Irrespective of the growth of wind energy, better cross-border connections will enable the pan-European network to function more efficiently. Whether this objective can be amalgamated with the aim of connecting offshore wind farms using the same links remains to be seen.

The effects of wind power variability on electricity networks are often overstated. Many of these discussions overlook a key issue: electricity networks are used to dealing with fluctuations in demand — some predictable, some less so. What matters is
the additional overall impact of wind fluctuations.

Case study UK

When these are taken into account, it is found that variability adds about 10% to the generation cost of wind. The chart shows how these costs vary with increased wind energy contributions, based on data from UK grid operator National Grid.

By 2020, the UK expects to be generating about 20% of its electricity from wind and so the extra balancing cost is likely to lie between €3.5-€7/MWh (€0.7-€1.4/MWh to the consumer).

A simple cost-benefit analysis suggests that significant savings from lower variability costs are needed to make the concept of European supergrids attractive from the standpoint of wind alone.

Questionable benefits

The additional cost of variability to the consumer for 20% wind might be €1.4/MWh at most. If a supergrid enabled that figure to be halved, the value of these savings over 20 years, with a test discount rate of 10%, is around €2.1 billion.

Whether or not this delivers savings for the UK consumer would depend on the size of the UK contribution to the supergrid, whose projected costs are much higher than this.