Navigant Research Blog

DC Systems Boost Renewable Prospects

— December 2, 2013

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.

Wind-Hydro Synergy  

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.

In China

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.


Mobile Phones Fuel DC Networks in Developing World

— July 18, 2013

One of the first deployments of direct current (DC) – a form of electricity that was dominant worldwide more than a century ago – was on a U.S. Navy warship named the USS Trenton, commissioned in 1887.  The 2 kW ship used electricity for lighting instead of the common practice of oil lamps.  This may have been the first electric ship in the world, though that is a topic of considerable debate.

One could also consider this antique DC ship a microgrid, since it was not interconnected to any grid.  A similar argument is used today by Boeing, which refers to satellites powered by solar photovoltaic (PV) panels as remote DC microgrids (and whose expertise is now being applied for terrestrial microgrid applications).

Like the majority of machines that run on electricity today, most ships run on alternating current (AC), the format of choice throughout the industrialized world.  Nevertheless, the U.S. Navy is currently constructing a 78 MW DC ship under its DDG 1000 program.  In addition, large technology players like ABB have been selling high-voltage DC transmission systems for about 5 decades; the company now also offers a variety of DC-based products relevant to more distributed systems, such as data center microgrids.   (ABB has also put forward an innovative design for next-generation DC ships that can create efficiency savings of 20% and space and weight savings of 30%.)

ABCs of DC

Whether powering up a ship, data centers, or a cell phone tower, DC power is enjoying a comeback.

The business model that could help accelerate adoption of DC distribution networks such as microgrids is known as the A-B-C Model, which targets developing countries that make up approximately 80% of the world’s population, but consume only 30% of global commercially traded power.  This approach, which is being promoted by The World Bank, United Nations, Rockefeller Foundation, and others, takes advantage of the following starting facts: 550 million people out of the estimated 1.4 billion people without power own a cell phone.

The “A” stands for anchor, and in most cases today, that anchor load for remote microgrids running on DC power is green telecom towers.  “B” stands for businesses, which are the first customers served by the DC remote microgrid as the network expands.  The “C” stands for community, and refers to the DC distribution network microgrid extending out to residents as the final phase of this remote microgrid expansion model.

This A-B-C Model is being implemented today through a variety of pilot projects.  These systems would subsequently pave the way for state-of-the-art DC microgrids in the developing world that could be networked together to optimize regional energy provision, since most off-grid cell phone towers run on DC power.  These distribution networks are the largest market opportunity today, as evidenced by a recent report entitled Direct Current Distribution Networks by Navigant Research.

DC Telecom/Village Power System Revenue by Region, Conservative Scenario,
World Markets: 2013-2025


(Source: Navigant Research)

If we focus on the conservative scenario, total global capacity for DC distribution networks is expected to reach 2,308 MW by 2025, translating into worldwide vendor revenue approaching $25 million annually.   The vast majority of this capacity, surprisingly, will come from DC systems only 1 kW to 2 kW in size in the developing world.  In fact, almost 92% of total DC distribution network capacity will come from the green telecom/village power segment largely concentrated in regions such as India and Africa.

Ubiquitous mobile phones are helping to build this growing movement to shift from the current AC-dominated utility grid infrastructure back to the DC-based microgrids that were widespread at the birth of today’s electric utilities.


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