Memorandum by Energy Networks Association
LONG-TERM
INVESTMENT IMPLICATIONS
OF HITTING
THE RENEWABLES
TARGET
1. The UK faces a significant challenge
in delivering its share of the EU Renewable Energy target. Critical
to success is Government support and recognition of the need for
significant investment in network infrastructure and the creation
of a more efficient and supportive planning framework. In addition,
the need for a supportive regulatory regime, aligned to Government's
ambition in meeting EU targets, is paramount.
2. The Business Council for Sustainable
Energy UK (UKBCSE) believes that by 2020 around two-thirds to
three-quarters of the new renewable electricity generation capacity
could come from offshore and onshore wind energy. This will have
implications for the supporting infrastructure needed to maintain
energy system stability, including securing sufficient generation
capacity to manage intermittent supply from renewables.
3. There is a need for significant investment
in the network infrastructure to manage the increased contribution
from renewable energy, and to manage the associated peak capacity
and operational and system stability issues. Innovative approaches
to optimising use of present network assets as well as network
expansion will need consideration.
ELECTRICITY DISTRIBUTION
SYSTEMS
4. Distributed Generation by definition
is connected to the distribution networks. Within England and
Wales distribution networks are defined as 132kV and below which
are owned and operated by Distribution Network Operators. In Scotland
132kV and above is defined as transmission network with distribution
limited to 33kV and below. As of March 2007, approximately 3.5GW
of renewable generation was connected to distribution systems
throughout the UK.
5. A number of projects have been undertaken
to assess the potential levels of distributed generation, in particular
the Supergen Future Network Technologies Consortium work and the
UKBCSE May 2008 paper. It is estimated that the potential for
onshore renewable distribution connections will be in the order
of 12GW by 2020. This can be further classified into generation
technology; onshore wind—1-2GW; Biomass—2-4GW; Hydro—1GW;
Marine—1-2GW; Microgen—2-3GW.
6. Larger schemes, such as offshore wind
farms, large onshore wind farms and projects the scale of the
Severn Barrage will connect directly to the transmission system,
with no impact on the distribution network.
7. Although there are some exceptions, in
England and Wales projects generating less than 100MW are likely
to connect to distribution networks. These networks were originally
designed to supply energy and when distributed generation results
in the reversal of this flow of energy, this can trigger modification
to the associated network.
8. In areas where natural renewable resources
are plentiful, for example wind, the distribution system is often
sparse. This will result in new generation triggering significant
infrastructure, and in many cases this will include the construction
of new overhead lines. The provision of infrastructure to accommodate
2020 targets will be challenging. This will only be achieved with
supportive planning policies and a regulatory regime that enables
the timely investment in new network infrastructure.
9. As distributed generation connects, it
will initially displace local demand, however it will ultimately
result in "export" onto the transmission system, this
in turn will have implications for the requirement for transmission
infrastructure including potential uprating.
10. The energy mix that will be realised
by 2020 will be a major influence on where infrastructure will
be required. If the larger projects do not proceed but a larger
volume of distributed renewables do connect, then the impact and
resulting need for investment in the distribution system will
be intensified.
11. To date, significant work has been undertaken
by the joint BERR/Ofgem sponsored Electricity Networks Strategy
Group (ENSG) to consider the future penetration of renewable generation
connecting to the Distribution Network. This work has culminated
in several reports being written covering topics such as Network
Access; Solutions for the Connection and Operation of Distributed
Generation; Technical Guidance on the Connection of Generation
to the Distribution Network; and more recently, completed in 2007,
Future Network Architectures Report.
12. The Future Network Architectures Report
considered a number of DG penetration scenarios and provides an
insight into the scale of change to network architecture that
might be required under each scenario.
ELECTRICITY TRANSMISSION
SYSTEM
13. Electricity transmission infrastructure
is key to enabling the increased levels of renewable generation
estimated to be seeking a connection. The three GB electricity
transmission licensees have provided a preliminary view of the
capacity of the existing GB transmission system to accommodate
new renewable generation without the construction of new overhead
line routes. The diagram below, taken from the May 2008 paper
produced by UKBCSE, is a summary of the indicative guidance from
the three licensees.
Figure 6
CAPACITY OF THE TRANSMISSION SYSTEM TO ACCOMMODATE
RENEWABLES
14. The diagram provides a general indication
of the levels of renewable generation that could be accommodated
on the GB transmission system by 2020. It assumes completion of
transmission upgrades already in train (eg the South West Scotland
and Beauly-Denny upgrades) as well as completion of those works
expected to be delivered without protracted planning issues.
15. The proposed offshore licensing regime
gives rise to individual licences for connecting offshore wind
farms to the onshore grid. This will promote a "radial connection"
approach and raises questions as to whether such an arrangement
is sustainable or whether instead (or in addition) an offshore
interconnected transmission system might be desirable from both
a technical and economic perspective to fully realise the potential
offshore resource. It should also be noted that in order to accommodate
offshore generation (expected to be in the order of 33GW), significant
investment in the onshore network will be required (estimated
at £300/kW). It will also be necessary to consider an integrated
approach towards both the planning and design of both the onshore
and offshore system.
16. Delivery of the 2020 renewable energy
target will require swift action to ensure that; the supporting
infrastructure is in place; planning decisions are made in a timely
manner; and that key issues such as technology supply chain constraints
are addressed. In addition to planning and construction for renewable
energy projects, there are also time implications of new network
infrastructure, including identifying Offshore Transmission Owners,
coordinating connection between offshore and onshore infrastructure
followed by construction.
17. It is therefore particularly important
that investment in necessary network infrastructure is facilitated
in a timely manner to ensure progress towards delivering the 2020
renewable energy target.
David Smith, CEO
13 June 2008
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