Markets, infrastructure and energy security - Energy infrastructure

Energy infrastructure is the backbone of energy markets. Natural gas and electricity cannot be consumed unless sufficient infrastructure exists. Changing generation and demand for electricity and gas requires additional infrastructure to transport the electricity and gas. Several developments drive this need for additional energy infrastructure and concomitant changes in the regulatory framework.

For sustainability (EU ‘20-20-20’ goals) and security of supply considerations, the share of electricity generation from renewable energy sources (RES-E) is increasing, and will continue to increase in the coming decades. Part of these sources is of intermittent nature (wind and photovoltaics), which induces a more variable and less predictable electricity output. This has profound consequences for the operation and expansion of both electricity as well as gas infrastructure (through its role of flexibility provider on the electricity market).

In addition, new top-down legislation (EU third energy package) and bottom-up regulation (regional initiatives) aim to contribute to the goal of achieving truly integrated European electricity and gas markets.  This requires an increasing amount of infrastructure capacity between national markets. Existing infrastructure connections need to be expanded while available infrastructure capacity needs to be used as efficiently as possible.

Finally, gas and electricity supply interruptions (e.g. Russian-Ukrainian conflict in the beginning of 2009) need to be prevented. Concerns related to the ability of markets to provide a sufficient level of security of supply need to be addressed. In order to prevent any security of supply failures from occurring, efforts to increase coordination and resilience of energy systems need to be intensified.
ECN Policy Studies is well positioned to contribute to overcoming the challenges that future energy infrastructure systems are facing.

Role for ECN Policy Studies

The Energy Production, Markets and Networks group of ECN Policy Studies participates in a wide range of European and national projects that address the issues raised above. Since European network operators are commonly subjected to incentive regulation, the role and character of regulatory incentives for proper network investment and operation are at the centre-stage of our work. ECN Policy Studies contributes to both technical and economic studies that evaluate the system impact of different type of policy and regulatory options. We are thus strongly involved in advising national and international (public and private) organizations on infrastructure-related policy studies. Specific topics addressed in recent projects are: network tarification, congestion management, network innovation, and intelligent grids.

A number of ongoing and recently finished projects particularly analyse solutions for the lower voltage distribution networks (intelligent grids, intelligent metering, storage), since renewable energy sources are connected particularly to these networks. With the (expected) further increase of RES-E, another stream of projects is especially targeted at studying the need for system flexibility in higher voltage cross border transmission electricity networks as well as the implications for gas networks. They are aimed to provide insights in the infrastructure and regulatory requirements to accommodate the increasing network demands from RES-E and G.

For a list of ongoing and finalized projects, please see the project section below.

Partners or Stakeholders

Comillas University (Spain), Imperial College (UK), DTU-RISOE (Denmark), Labein-Tecnalia (Spain), RWTH (Germany), Dena (Germany), IWES (Germany), SINTEF (Norway), EEG (Austria), Fraunhofer-ISI (Germany), Enviros (Czech republic), Enero, BSREC (Bulgaria), ECBRECIEO (Poland), Oeko-Institut (Germany), Fondazione ENI - ENRICO MATTEI (Italy). University of Warwick (UK), REE (Spain), Union Fenosa (Spain), Alliander (Netherlands), MVV Energie (Germany), Bremen International University (Germany), OME (France), IZES (Germany), IFZ (Austria), VTT (Finland), University of Manchester (UK), European Commission (EC), Ministry of Economic Affairs (Netherlands) , Energiened (Netherlands).

More information

Projects:

• IRENE-40 (ongoing)
  ECN is involved, amongst else, in the development of a roadmap for investors and regulators on how to realise a more secure, ecologically sustainable and competitive European electricity system.
• SUSPLAN (ongoing)
  Development of strategies, recommendations, and benchmarks for the integration of renewable energy sources. WP5 of the Susplan project will offer a set of recommendations for overcoming non-technical barriers for gas and electricity infrastructure developments.
• IMPROGRES
  Improvement of the Social Optimal Outcome of Market Integration of DG/RES in European Electricity Markets.
• RESPOND
  Renewable Electricity Supply interactions with conventional Power generation, Networks and Demand.
• DG-GRID
  Project on the enhancement of Sustainable Electricity Supply through improvements of the regulatory framework of the distribution network for distributed generation.
• ENCOURAGED
  Optimisation of future 'energy corridors' between the EU and neighbouring countries.

Publications:

• Market and regulatory incentives for cost efficient integration of DG in the electricity system. May 2010.
  Final report of the IMPROGRES project on the improvement of market and network conditions for the integration of Distributed Generation.
• Distributed generation and the regulation of distribution networks. January 2010.
  Regulatory recommendations for improved integration of Distributed Generation.
• Net Benefits of a New Dutch Congestion Management System. November 2009.
  Implications of the new connection policy for generation units in the Netherlands and comparison of differnet congestion management schemes.
• Fenix deliverable 3.3 Financial and socio-economic impacts of embracing the Fenix concept, October 2009.
  Assessment of the economic viability of the FENIX concept.
• Regulatory road maps for the optimal integration of intermittent RES-E/DG in electricity systems. August 2009.

 For more information please contact Adriaan van der Welle.