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Erschienen in: Zeitschrift für Energiewirtschaft 1/2015

01.03.2015

New Spain: France Transmission Line: A Cost-Benefit Analysis

verfasst von: Stefan Perras, Dr. Friedrich Kunz, Prof. Dr. Dominik Möst

Erschienen in: Zeitschrift für Energiewirtschaft | Ausgabe 1/2015

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Abstract

As the costs for the new planned underground high-voltage direct current (HVDC) line between Spain and France exceed the ones of alternating current (AC) overhead line alternatives it raises the question if the high costs can be justified by adequate benefits for society like increased security of supply. For this reason, the economic effects of the planned HVDC underground transmission line are evaluated through a cost-benefit analysis and the results are compared to an alternative new AC overhead line along the same route as well as an upgrade of a nearby AC overhead line. For an evaluation of the economic welfare effects, investment and operating costs as well as benefits from increased security of supply are quantified using the electricity network model ELMOD. All considered line options result in overall positive discounted net welfare gains for society with the new AC line option showing the highest ones. However, it is stressed that the HVDC solution holds certain advantages over the AC technology that cannot be explicitly quantified in a line assessment.

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Fußnoten
1
Reactive power is increasing with line distance. In other words, if transport distance is longer than approx. 40 km, a transport of active power is very limited (due to reactive power work load) and compensation units are necessary. This is why HVDC lines are often the preferred option.
 
2
“A detailed description of the economic assessment methodology can be found in CAISO (2004).”
 
3
ELMOD is theoretically capable of calculating a timeframe of 24 hours, although this gets computational challenging for a scope of more than one country included with its detailed grid.
 
4
For details how to technically derive the demand function see Leuthold et al. (2010)
 
5
This is referred to as ‘adjusted’ demand in Table 8 in Appendix B. We are aware that a subtraction might have a theoretical impact on nodal prices. But as the subtracted capacity is comparably low, the effect can be neglected here.
 
6
The “Nomenclature of Statistical Territorial Units” (NUTS) is a hierarchical system for dividing up the economic territory of the EU.
 
7
We are aware that through this we might ignore some congestion rents on the Morocco-Spain interconnection, but this approach has been chosen as it is a quite simple way (and the only possibility) to model the ensured export in an AC grid.
 
8
In reality, regional differences might exist due to transportation costs for fuels, different regional potentials (e.g. biomass availability), etc.
 
9
For details see Table 8 in Appendix B.
 
10
Dynamic effects can be expected due to reactions of market players to welfare changes. For instance producers might react to their lower producer surplus over time by changing their investment plans (de Nooij 2011, p. 3103). These effects are difficult to consider in a model and therefore neglected here.
 
11
100 % would be too high as the interconnector is most probably utilized to a certain extent all the time. Golder Associates and ECOFYS (2008) propose an average line utilization of 60 % leaving 40 % for backup. We use 30 % as a more conservative approach.
 
12
Several TSOs are exposed to public resistance in grid extension projects, so that there is a research need how to overcome public resistance. The dissertation under preparation of Perras addresses this important problem and the interested reader is referred to Perras (2014).
 
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Metadaten
Titel
New Spain: France Transmission Line: A Cost-Benefit Analysis
verfasst von
Stefan Perras
Dr. Friedrich Kunz
Prof. Dr. Dominik Möst
Publikationsdatum
01.03.2015
Verlag
Springer Fachmedien Wiesbaden
Erschienen in
Zeitschrift für Energiewirtschaft / Ausgabe 1/2015
Print ISSN: 0343-5377
Elektronische ISSN: 1866-2765
DOI
https://doi.org/10.1007/s12398-014-0144-x

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