Littoral benefits – a North Sea cross-border grid

“Are we going to see tears?” burbles the announcer. “Can he make this serve work?”

The answer comes instantaneously, as the ball bounces harmlessly off the net. Andy Murray retreats for a second serve. The ball shoots across the line, glancing across the strings of Novak Djokovic’s racket. The Serb composes himself and tries to fire the ball back at the right-hand corner of the court, hoping to catch his opponent unawares. He fails.

Cut to Murray, his racket falling out of his hand as he roars to the crowd in delight. Cut to his girlfriend, hands on forehead, ecstatic. Cut to 17.29 million Britons rising from their sofas to relieve 76 years of tension with a cup of tea and a power surge of 1,100MW coursing through the national grid.

Such a spike in demand is normal for national sporting events, but when the news of the surge was revealed the following day, it underscored growing concerns as to the overall flexibility of the grid (one can only imagine the strain on the grid if the England team shrug the odds to reach the finals of the UEFA European Championship). In 2013, as Murray celebrated his victory, the grid’s spare capacity began to fall to new lows. On 4 November 2015, National Grid dispatched its first Notification of Inadequate System Margin to suppliers, the only serious event in a winter supply pattern somewhat cushioned by the restitution of previously mothballed power plants and the purchase of surplus electricity from France, via a 2GW-interconnector cable running underneath the channel. For Jonathan Gaventa, director at think tank E3G, it is illustrative of the growing constriction that power generation is experiencing in the UK as it moves away from coal and towards renewable sources of energy.

“We’re seeing very tight capacity margins at the moment, and the existing 4GW of interconnection that we’ve got available to us has actually been very useful in terms of ensuring capacity when margins are tight,” he says. Yet for Gaventa and E3G, the solution to the problem is not more investment in UK power generation assets. Instead, the situation requires regional cooperation that reaches beyond the channel, out towards all those nations of the North Sea’s littoral, and a schema underpinned by an energy resource abundant to the region: wind power.

The North Sea is one of the most crowded stretches of navigable ocean in the world. In addition to the numerous oil rigs and spaces reserved for dredging, fishing and military exercises, wind farms helped to transform this area of the high seas into an economic powerhouse worth up to €150 billion to the countries that border it. However, a report published last year by the House of Lords noted that the space allocated to wind farms is predicted to increase “fiftyfold” in the next few years. That in itself justifies a closer look at how investment can be more efficient, Gaventa says, and makes the idea of uniting the disparate national wind farms into one supranational authority all the more appealing.

“The first piece of the argument is actually around how much cable you need,” Gaventa says. “In a situation in which you’re looking at every wind farm being connected to shore individually, and every interconnection going forward separately, you end up with an awful lot of cable in the sea, which isn’t being used all the time. Particularly in the case of offshore wind farms, they’re not always going to be on full output: there’ll often be spare capacity on interconnections.

By linking them together, the overall amount you need to spend on some quite expensive cabling is reduced.”

In a recent report advocating a North Sea grid, E3G predicted that the potential operational savings could reach €25–€75 billion. Space could also be saved by routing cabling around, rather than through, North Sea beaches. “Developers will tell you just how difficult it is to get permission, and to get public support for laying cables across a beach,” says Gaventa. “The coastal regions of the countries around the North Sea are some of the most prized by the populations there, and for good reason. If you’re looking at every individual project needing an additional shore crossing and an onshore substation, then I think that’s going to become increasingly difficult to achieve and get public backing.

“I think there would be value in having some form of regional system operator, perhaps just for offshore operators or as a collaborative body rather than a fully independent institution. The second question is that of renewable support schemes and feed-in tariffs, essentially making sure that you’re not having free riders who don’t want to pay subsidies but want to benefit from the cheap power that results from it. That’s a political question, and I think it is one that’s resolvable.”

Political jitters

When asked how long it will actually take to build such a grid, Anders Stouge chuckles quietly to himself. “We know that the process of doing things like this in Europe takes time,” he replies. “If you want to speed up the process, you need to start with cooperation.”

It is an aphorism, of course; anyone who wants to start a cross-border initiative inside the EU has to begin with an open mind and the patience of a saint. Luckily, Stouge is one of these people. Deputy director-general of the Danish Energy Association since 2011, he has as a member of the corporate advocacy group SeaStar Alliance, spoken out in favour of a North Sea grid. A great deal of the organisation’s work has revolved around identifying practical obstacles to ratification of such a network. That starts with overcoming narrow national self-interest in infrastructure investment.

“Seen from a single country’s point of view when analysing investment in a grid, you’re not looking at it from a regional or European perspective,” Stouge says. This might mean that, even though there could be net benefits to enhancing interconnections for the host country’s neighbour, they will not be taken into account, since they do not exceed the gains that could be made domestically. “A national TSO might then say, ‘Why are customers in one particular country paying for the benefits being harvested in Germany, and not the Germans?’.”

This sentiment seems to have doomed the North Sea grid up until now. In 2009, Germany, the UK, France, Denmark, Sweden, the Netherlands, Belgium, Ireland and Luxembourg signed an agreement endorsing the proposal and creating the North Seas Countries’ Offshore Grid Initiative. Although the scheme was presented as a smart way to drive down prices and allow all of these countries to meet their renewable energy targets, it was nonetheless caught in a morass of technical negotiations, studies and competing spending priorities.

“After that initial political impulse, the proposal was transferred almost wholesale to the civil servants to work out what to do next,” Gaventa says, “and essentially, they did a lot of very good work in terms of mapping out the regulatory challenges and difficulties, but it never fully closed the loop back up to those decision-makers that were able to make the core decisions that would need to happen to progress things forward.”

However, in the past 18 months, several factors have dovetailed and granted new life to the proposal. The first is a sustained effort on the part of the European Commission to push for an ‘energy union’ that would dramatically increase the number of grid interconnections across the EU. “The Commission is looking at more regional cooperation initiatives as really core to their energy agenda in terms of European policy in general, so they’re putting these resources in to try to make it happen,” says Gaventa. “We’ve also seen much more vocal backing from the European Parliament, including a report written by 20 MEPs from across the North Seas region, covering five different political groups giving very strong backing for the initiative.”

Dutch courage

Then there are the Dutch. The Netherlands assumed the rotating presidency of the EU in June, and advocates of a North Seas grid are hopeful that their traditional pro-wind energy stance, combined with their occupancy of such a bully pulpit, will significantly enhance the project’s chances of ratification. This already seems to be yielding significant results. Another memorandum echoing all of the basic aspirations contained in the 2009 agreement and signed by all of the same countries (barring the UK) was agreed to at the beginning of the month. The document endorses enhanced cooperation in spatial planning, greater accommodation of wind energy within respective national grids, an effort towards the sharing of information about new offshore projects and a push towards the harmonisation of energy standards between all signatories to the agreement.

“I think in the first instance, it doesn’t necessarily need full buy-in by all 28 European countries,” Gaventa says. “I also know there is a lot of interest in the project from other areas and other regions, so I think if the scheme begins to succeed, there will be a lot of interest in looking at a similar approach in the Baltic, for example. Countries such as Spain and Portugal have been floating interest in the idea of an Atlantic interconnected grid in the longer-term, as well. So, I think it will be watched with interest, but we’re not in a situation where we need full sign-on from everyone.”

It certainly has not stopped individual countries on the North Sea littoral from pursuing sizeable interconnection projects. Then there are the projects just beyond, that feed off of the success of wind power in halting ways. Germany is such a place, experiencing similar constriction in supply as the UK, a legacy of forsaking nuclear in a post-Fukushima world. In fact, the problem there is regional: the electricity in the centre of the country does not yet have the capacity to carry the power being generated by offshore wind farms in the North Sea south to Baden-Württemberg, Bavaria and Austria. Instead, the electricity is routed east, via the Polish and Czech grids, before it reaches its intended destination.

This causes as many problems as it solves. Speaking at a press briefing last year, the Czech Republic’s permanent EU representative said: “If there is a strong blow of the wind in the north, we get it, we have the blackout.” Yet sooner or later – if the heady idealism at the Commission holds, if it can be proven in falling prices and greater efficiencies – a strong gust off Aberdeen could, conceivably, keep the lights on in Prague.