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New Energy World magazine logo
New Energy World magazine logo
ISSN 2753-7757 (Online)

Making hybrids happen: the case for shared offshore interconnectors in Europe

8/5/2024

5 min read

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Head and shoulders photos of Olivia Breese and Catherine Vandenborre, set side by side Photo: Ørsted and Elia Group
Olivia Breese, Executive Vice President, Europe, Ørsted (left) and Catherine Vandenborre, interim CEO, Elia Group (right)

Photo: Ørsted and Elia Group

Catherine Vandenborre, interim CEO of Belgian system operator Elia Group, and Olivia Breese, Executive Vice President, Europe, of wind developer Ørsted, argue that 'hybrid' interconnectors to more than one country will help Europe to harness the full renewable potential of its seas while more effectively distributing the electricity produced.

Offshore wind potential is not spread equally across Europe. Some countries have a shortage of renewable energy sources – such as Belgium and Germany – whilst others, such as Denmark, have more renewable energy than they can use domestically. This means that purely national solutions will not be appropriate for a successful energy transition. Just like the European Commission, we believe that combining offshore wind farms and interconnectors (forming hybrid interconnectors) carry several advantages when compared with conventional offshore infrastructure projects, such as radially connected wind farms and point-to-point interconnectors.

 

Offshore hybrids are a crucial element for securing Europe’s green transition. This has been confirmed in ENTSO-E studies which outline that up to 80 GW of offshore wind capacity could be connected to two or more markets by 2050. Yet, to date, only one such project (the Kriegers Flak Combined Grid Solution, which connects Denmark to Germany) has been realised.

 

computer graphic showing how the Kriegers Flak Combined Grid Solution is set up

The Kriegers Flak Combined Grid Solution serves as the grid connection for the offshore wind farms, and also connects the transmission grids of Denmark and Germany. In case of strong wind, the full capacity of submarine cables can be used to feed the wind power generated offshore into two grids via one single system. Transformers mounted on platforms step up or step down voltages between the national grids (Germany: 150 kV, Denmark: 220 kV). The system was developed by German grid operator 50Hertz (a subsidiary of Elia Group) with project partner the Danish transmission system operator Energinet, and became operational in 2021.
Source: 50Hertz

 

This is primarily due to the regulatory framework in place, which has traditionally supported the development of either generators or interconnectors, rather than encouraging assets that include both – which hybrid projects do. Moreover, existing planning strategies tend to prioritise individual national interests, meaning that cross-border and regional solutions are sidelined.

 

As a result, there is no mechanism for ensuring that the costs of hybrid interconnectors are shared out and borne by all of the parties and countries which benefit from them. TritonLink is a good example of this. The Belgian and Danish grid operators want to develop this hybrid interconnector and have to bear all the costs of it, but other European countries that will not contribute to the interconnector will also feel its positive effects.

 

That is why international co-operation and a political focus on the issue from the European Union are so important here. If these asymmetrical benefits are not reflected in cost-sharing agreements, the acceleration that we need will be obstructed.

 

The development of an international mechanism may sound complex – but examples of cross-border critical infrastructure already exist and there can be no doubt that the benefits of resolving these regulatory and planning issues significantly outweigh their complexity, both in terms of the speed at which assets can be deployed and also in terms of the cost reduction potential.

 

Proposed solutions 
Four solutions are proposed for fostering the development of offshore wind across our seas.

 

The first involves regional planning at sea basin level that prioritises projects with the highest potential in terms of generating socio-economic welfare and reaching net zero. In order to identify and prioritise such projects, criteria need to be identified across Europe and its North Sea neighbours (the UK and Norway), specifically at the level of its sea basins. We are asking national authorities to give a clear mandate to their system operators which operate in and around sea basins to co-operate and identify the most beneficial layout for connecting up offshore wind zones in their marine spatial plans.  

 

This regional planning at individual sea basin level should be accompanied by regional offshore investment banks that would aim to allocate existing funding streams for each sea basin area in a more efficient manner to maximise impact. This includes subsidies from the Connecting Europe Facility for Energy fund (or CEF fund), contributions from member states and congestion revenues. Additionally, it is suggested that private investors should be invited to contribute.  

 

To make sure that the financial risks and benefits of hybrid projects are allocated in a fair way, a review of the framework for hybrid interconnectors is needed, with a specific focus on the fair distribution of risks and benefits amongst transmission system operators, wind farm developers and society at large. We propose two alternative approaches: firstly, capacity based two-sided contracts for difference; and secondly, a ‘commercial +’ approach, focused on enabling power purchase agreements for offshore wind farms connected to two or more markets.

 

Finally, countries and the European Union should encourage the development of more hybrid projects from which we can learn to expand the use of hybrid solutions on a larger scale. ‘We must start delivering tangible projects as soon as possible so that we can speed up the learning loops – commercial, technical and regulatory – and deliver more and better projects on an accelerated timeline. If we wait for the perfect regulatory and commercial solution, then we will be too late to offer the accelerated solutions Europe needs.

 

Making Hybrids Happen’ was launched at the WindEurope conference in Bilbao, 20–22 March 2024.

 

The views and opinions expressed in this article are strictly those of the authors only and are not necessarily given or endorsed by or on behalf of the Energy Institute.

 

  • Further reading: ‘Forging a new UK-German electricity link’. The NeuConnect electricity interconnector will be the first energy link between Germany and the UK, and could provide a model for clean energy distribution.
  • Decarbonising the energy supply across the 10 member states of the Association of South-East Asian Nations (ASEAN) could see a reduction of $800bn in costs through power interconnectors, hydrogen networks and energy storage infrastructure, according to new research by DNV.