$137B needed for Europe grid uprades

March 5, 2012 at 6:30 AM
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BRUSSELS, March 5 (UPI) -- Europe will need $137 billion for electricity transmission systems to accommodate the pace of renewable energy production, grid operators say.

National grids need to be better connected with new high-voltage power lines quickly to meet the EU's 2020 energy policy targets on renewables and greenhouse gas reduction, contended a report issued last week by the European Network of Transmission System Operators for Electricity, which is known as ENTSO-E.

The group, comprised of Europe's national transmission system operators, asserted in its EU-mandated 10-Year Network Development Plan that more than 30,000 miles of extra-high-voltage power lines need to be deployed across the continent to achieve Brussels' goal of an efficient, pan-European power grid capable of integrating the many new sources of renewable power.

The need for better connections between renewable energy sources with national grids remains the biggest challenge, the report said. Some 80 percent of the identified 100 power bottlenecks in Europe are related to the inadequate links with renewables, it found.

The intermittent nature of wind and solar production has caused power flows to become more volatile over longer distances across Europe, especially in the north-south grid running from Scandinavia to Italy and along connections linking mainland Europe to the Iberian Peninsula, ENTSO-E reported.

The report came as the European Commission, the EU Council and European Parliament are working on a draft infrastructure package first introduced in November that proposes funding $12 billion in energy infrastructure projects deemed of "European significance."

The grid operators said EU member nations could cut 170 million tons of carbon dioxide equivalent if all of the more than 100 projects were implemented.

Some 150 million tons of that total would be saved through better connections with renewable generation technologies, with a further 20 million coming from closer integration of national electric grids, the group said.

Jean Verseille, chairman of ENTSO-E's system development committee, told Platt's business news service in Brussels Wednesday the $137 billion in proposed upgrades works out to $2-$2.50 per megawatt-hour in higher energy prices -- or about 2 percent of current European wholesale levels.

"It is less than 1 percent of the total end-users' electricity bill," he said.

The 10-year plan said Germany would need to construct nearly $40 billion worth of transmission upgrades -- mainly due to its decision to phase out nuclear power -- while Britain will need $25 billion of upgrades thanks mainly to its burgeoning North Sea wind power sector.

Another key obstacle in achieving the grid upgrades by the EU's 2020 timeline is the slow pace of local regulatory approval of new transmission lines.

The group said 1-in-3 planned upgrades in Europe are experiencing delays in due to "long permitting processes," and urged the European Commission to fight for a "fast-tracking" directive that would establish a three-year deadline on planning appeals and appoint "grids czars" to police it, the Brussels online news portal EurActiv.com reported.

The idea, however, is encountering opposition from some European energy ministers who object on the grounds of "subsidiarity," or the de-centralizing of power to the smallest local unit.

"Any longer time period or leaving it entirely to 'subsidiarity,' we fear could really endanger many of these needed projects and could thus really endanger the overall energy policy goals for Europe," ENTSO-E Secretary-General Konstantin Staschus told the Web site.

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