Filenews 18 June 2023 - by George Mourmouris
It is not only in Cyprus that it is a brake on more RES: It is the most important obstacle to the development of RES projects in Europe, USA and Australia
One of the main topics of discussion in Cyprus at this time is the inadequacy of the electricity transmission and distribution network to accept all the offered -and dispersed- electricity production from renewable energy sources, either from large commercial wind and photovoltaic systems, or from small rooftop photovoltaics, in homes and businesses. In combination with the equally serious problem of low electricity consumption in spring and autumn, which obliges the Transmission Operator to reject loads of green energy, in the absence of its ability to be transferred to other networks, they compose an environment of deadlock in the Cypriot energy environment and undermine the possibility of a large increase in the penetration of RES in electricity capacity in the coming period.
Although the responsibilities of the state, EAC and other authorities are given for the inadequacy of the network, in the following report (by G. Mourmouris from the Financial Postman, with information from foreign authoritative media) it is clear that similar problems, possibly even greater, are faced by many other countries, on all continents. And these problems are mainly linked to the sharp increase in the licensing of RES systems and their disorderly siting in areas remote from the existing grid.
"In the dark" threatens to leave important Renewable Energy Sources projects globally due to the lack of capacity in electricity networks.
Companies investing in renewable energy projects are told they have to wait between a few years in some parts of the US and up to 15 years in the case of the UK before they can connect their plants to grids, which are struggling to cope with changes in power generation.
Although the problem is significant and of global dimensions, it is only recently that its extent and its devastating impact on international efforts to reduce greenhouse gas emissions are beginning to be understood.
The big change
In short, the change that has taken place is this: 20 years ago, the electricity grid was just one of the available ways to get energy. Now, it's the basic way.
In much of the Western world, grids were developed after World War II to serve large power plants that burned fossil fuels such as coal or natural gas. The electricity generated by the power plant was then sent through a network of power lines and cables to our homes.
The green transition requires a revision of the current provision. Many wind and solar farms are often needed to replace a large power plant, in part because of the intermittent nature of renewables: the wind doesn't always blow. All these parks need grid connections, but are usually located in remote areas or even at sea, making it challenging to connect them to the grid.
Delays in Europe, USA, Australia
Matthias Taft, CEO of BayWa RE – a company that operates in more than 30 countries, said grid connection delays are now the major obstacle to the development of renewable energy projects in Europe, the US and Australia.
"We are facing a very real situation where we have to wait 5, 10 years for the connection to the grid. We have permission to build projects, but the physical connection to the grid is not available," he notes, stressing that this is a "real threat" to the energy transition.
As the Financial Times reports, the problem is so widespread that even the British prime minister has had to pay to upgrade the local electricity grid to heat a swimming pool in his home. Greenpeace activists staged a protest outside the property in Yorkshire in March where, dressed in swimsuits and carrying banners, they called on Rishi Sunak to upgrade the country's grid to provide green energy for all.
Blackouts
The situation is further complicated by the spread of small-scale photovoltaics on rooftops and businesses, which also supply electricity to the grid. Now, network operators globally are at breaking point, unable to handle the huge volume of projects requiring grid connection.
"We're seeing huge short-term bottlenecks due to grid operators not having enough people to do the necessary processing because of a chronic lack of investment," says Harald Overholm, CEO of Swedish solar energy company Alight.
"It's a huge problem, to the extent that I think we could double the rate of global deployment of renewables if it weren't for these blockages."
In the UK, Spain and Italy more than 150GW of wind and solar installations in each country are stuck in the grid connection queue, according to data compiled by BloombergNEF.
In the US, network connection requests increased by DF40% in 2022. Nearly 2,000GW of solar, wind and storage projects are waiting to be connected to transmission grids — the long-distance high-voltage power grid — far more than the installed capacity of all U.S. power plants.
Of course, many of these projects will never be built: Companies often submit speculative applications, which are ultimately not approved. It is estimated that only one in five projects applied for receive permission in the end.
Then, many investors turn away from projects when they discover that their development brings a high bill for upgrading or strengthening the electricity grid. Nick Pincott, a partner at law firm TLT, says a project in the UK was rejected when the developer was told it would face a €19m "booster charge" to the network. pounds, an amount higher than the work was worth.
What can be done?
International Energy Agency figures show that instead of increasing capital investment in global grids after the Paris Agreement, they fell between 2017 and 2020 and recovered to 2016 levels only in 2022, at €330 billion dollars. Network investment in Europe stagnated between 2015 and 2020 at around €50 billion. dollars per year and increased only slightly in the last two years. In China, after falling between 2019 and 2021, investment in the country's networks increased by 16%, to nearly €83 billion dollars last year.
Need for innovative solutions
Concerns about the cost of new networks being passed on to consumers, as well as opposition to building overhead power lines when they pass through farmland, further complicate the situation, with networks becoming the "forgotten giant" of decarbonisation.
Experts say countries should consider innovative solutions, such as building transmission lines alongside roads or gas pipelines, where permission is more likely to be granted. Frank Jotzo, professor of environmental economics at the Australian National University, says another option is to develop renewable energy zones in geographically suitable areas and prioritise grid development there. This is already taking place in parts of Australia, he adds.
Last year, the U.S. Federal Energy Regulatory Commission made proposals to resolve the grid connection queue issue, including reviewing projects in a way that prioritizes projects most likely to be built. He also suggested that developers should have access to more information about network capacity – such as where transmission lines are already overloaded.
In the UK, Ofgem, the British energy regulator, is also trying to solve the problem. In May he also proposed, among other measures, an overhaul of the country's priority system.
Cross-border and intercontinental networks
There is also a growing focus by countries on creating cross-border grids that can rely on transporting energy from different places at different times. The Netherlands and the UK, for example, are working on the so-called LionLink power line between the two countries.
In March, Greek Prime Minister Kyriakos Mitsotakis called for an overhaul and expansion of the EU grid to allow the transmission of electricity generated from renewable energy sources between the north and south of the continent, a proposal that has so far won the support of about half the bloc.
Other analysts underline the importance of developing local and international, intercontinental networks in Africa. They argue that the continent could become the "most important locomotive for clean energy in the world" because of the potential to install large solar parks. But it lacks the network infrastructure, from cables to battery storage, that is necessary.
Thus, they underline that multilateral development banks must focus on developing the necessary infrastructure to support the new energy system.
Big problem everywhere
"I don't know of any country where the grid isn't currently some level of obstacle to the energy transition," says Mark Hutchinson, director for Asia at the Global Wind Energy Council.
One of the big issues, he adds, is that there is "not enough grid infrastructure" to meet the needs of the changing energy system.
BloombergNEF estimates that 80 million kilometers of new network are needed by 2050, more than the total of the currently installed global network.
* From the Financial Postman
