More coordination needed in the deployment of renewable energy sources to prevent grid congestion in Europe: report

The continued deployment of distributed renewable energy generation in areas with high wind and solar energy potential is a key factor driving the clean energy transition in Europe. However, according to a new study, the capacity of the transmission network infrastructure must be properly taken into account to avoid further network congestion.

By examining different network expansion scenarios, researchers found that without quick action, reverse shipment volumes could increase almost sixfold by 2040, in a massive network expansion (XGE) scenario in which the total network length in Europe would increase by more than a third.

What is reshipment?

Redispatch is the primary mechanism used by power grid operators to ensure the stability and balance of the power system.

In the event of restrictions in the transmission network between power plants and demand centers, redispatch makes adjustments to the power plant capacity after settlement of the wholesale electricity market.

This process helps prevent transmission line overloads and subsequent power outages, ensuring a reliable and efficient supply of electricity, offsetting additional generation in areas with insufficient energy, while reducing grid injection in regions with excess generation.

However, European legislation only treats redispatching as a temporary measure if congestion is reduced in the foreseeable future, for example through additional investment in the network. Market zones with periodic diversions should be divided into multiple areas to facilitate better exchanges between regions rich in renewable energy sources and demand centers.

Different scenarios, similar result

The study examined three network expansion scenarios for the target years 2030 and 2040, focusing on how countries are strengthening their national networks.

Two of the three scenarios predict an amount of redistribution in 2040 comparable to current electricity consumption in countries such as France or Germany.

The costs associated with these activities may range from EUR 11 billion in 2030 to EUR 34 billion in 2040, assuming a high level of network expansion. Under a business-as-usual scenario, costs could rise from €26 billion in 2030 to a staggering €103 billion in 2040.

Even in an extreme network expansion scenario, in which the total length of circuits in Europe increases by more than a third, the volume of return shipments would still increase almost sixfold.

Network congestion

Due to network bottlenecks, there is a risk of wasting a significant amount of renewable electricity. The 2040 scenario predicts that due to network overload, up to 310 TWh of renewable energy may be limited, which is equal to half of the electricity production from wind and solar in the EU in 2022 (according to EUROSTAT data).

The matter is complicated by the fact that the use of electrolyzers for hydrogen production may further exacerbate network congestion. Increased demand from electrolyzers could concentrate in areas where congestion is already present, increasing the need for redistribution by at least 78 TWh in 2040 under a business-as-usual scenario based on conservative estimates.

Mitigation strategies and cooperation

Policy instruments to mobilize investment, such as renewable energy auctions and capacity markets, can be improved by adding a location element that reflects local grid conditions.

This approach encourages the deployment of renewable energy and hydrogen production in areas that cause less traffic congestion.

In order to establish better incentives for efficient operation, it is recommended to introduce divisions of market areas that improve market performance. The study further highlights the importance of a detailed cost-benefit analysis of locational marginal prices in a climate-neutral electricity system.

Collaboration and coordination between various stakeholders, including policymakers, network operators, energy producers and consumers, will be crucial in building a resilient and efficient electricity system for the future.

Provided by the European Commission, Joint Research Center (JRC)