Cleantech Market Intelligence
DC Systems Boost Renewable Prospects
On November 22nd , the European Energy Commissioner, Günther Oettinger, reaffirmed the European Union’s support for the proposed HVDC supergrid, which will extend beyond the boundaries of the EU. Oettinger exchanged views about the Norwegian energy policy and EU energy priorities during an annual energy dialogue: “With its vast hydropower capacity, Norway can also become an important partner in renewable energy, provided the necessary electricity interconnections are built.”
Navigant Research’s new report, High-Voltage Direct Current Transmission Systems, analyzes the global market for HVDC technologies. An inventory of HVDC systems in construction and those that have been announced or planned is the basis for the forecasts in this report.
New capacity markets are being established in Germany and in the United Kingdom, which initially seemed to scupper proposed international HVDC interconnections. However, the main objective of these capacity markets is to pay generators to act as backup for intermittent solar and wind assets. The United Kingdom and Germany are simply preparing for a successful integration of renewables in large scale.
In 2012, the global installed base of offshore wind was 5 gigawatts (GW). The U.K. government is targeting 18 GW of offshore wind by 2020 (according to the recent third round of offshore wind license announcements), and Germany has set an ambitious goal to install 25 GW of offshore wind by 2030.
Because of the potential for synergy between wind and hydropower facilities, many countries are investigating the opportunity to integrate wind and hydropower systems in order to optimize output through coordinated operation. In general, the goal is to lower the cost of ancillary services required to balance wind intermittency, taking advantage of the inherent storage capability of hydropower reservoirs.
In areas with large hydropower facilities and high penetration of wind, such as in the Pacific Northwest, an oversupply of energy occurs when water flow rates and wind speeds are both high for extended periods during off-peak hours. That forces the utility to pick between two evils: wind curtailment or spill of water, both of which waste available renewable energy. Luckily Bonneville Power Authority (BPA) can evacuate 3,100 megawatts (MW) of hydropower from the Columbia River to Los Angeles via the Pacific Intertie HVDC line. In the spring of 2011, 350 MW of wind energy was curtailed, and in 2012, BPA decided to make a complete upgrade of the Celilo converter station, increasing its capacity to 3,800 MW.
Meanwhile, nearly 200 GW of new HVDC transmission capacity is planned during the next 8 years in China. Energy from hydroelectric generation in distant inland locations will be tapped and transported to power the big cities along the eastern and southern coast. The synergistic relation between hydro and wind will further accommodate Chinese wind power expansion. China is expected be a leading market for offshore wind, with 5 GW by 2015 and 30 GW by 2030.