Bottlenecks – projects of Nordic interestChallenges and opportunities facing the future Nordic electricity market

Jussi Jyrinsalo

Key drivers for Nordic projects

1. Increasing energy and regulation power exchange with the continent

2. Internal transmission needs due to surplus in north and deficit/export in south

3. Potential for consumption growth in the arctic, mainly Norway

4. Integrating the Baltic States5. Nuclear and thermal decommissioning in

south of Sweden/Finland

Regional grid planning in ENTSO-E

Projects in the 2014 pan-European plan (TYNDP) and new project proposals for TYNDP 2016 studies

Mid Term 2014-2018 Long term 2019-2030

Evaluating the market benefits of cross-border investments

• Market simulation tools and joint models are used by all regional groups.

• The total market benefit is calculated with and without the investment, consisting of:

– consumer surplus– producer surplus– congestion income– grid losses.

• You have large positive and negative benefits, the sum being much smaller: large uncertainties in results.

• Problem: the Nordic projects do not give enough market benefits compared to the ones towards the continent, where price differences and volumes are and will be bigger

• The Nordic system benefits/problems still need to be better monetized

• Especially the last one is currently being jointly studied => what is the true value of a secure Nordic power system (being very small compared to the continent)?

Should we have more Nordic projects in TYNDP?

Trends that challenge the security of the Nordic system

Adequacy of generation capacity

2015 2025

Inertia to support system stability

2015 2025

System flexibilityto back-up RES

20252015

need

Note: more and more interconnections towards the RES dominated continental Europe will create large and frequent changes in power and affect the stability of the Nordic system

available capacity

Selected priority areas for Nordic TSO cooperation

Systemoperation

Marketfacilitation

Systemdevelopment

New technologies,common tools

Highly efficient

and secureNordic green

power system

Ensuring a future robustNordic power system1

Maintaining current high level of security of supply2

Market to better support the adequacy3

Empowering consumers4

Strong Nordic voice in EU5

1. Ensuring a future robust Nordic power system

Pursue solutions that have socio-economic benefits for the Nordic

region as a whole

Take advantage of new technologies to develop

smart solutions

From grid planning to system planning

Optimize the use of the existing Nordic system

TSOs can agree on regional solutions but final decisions often by entities with national focus

Challenge: lack of competent regional structures and procedures (cf. national or EU-level)

How to enhance regional decision making and implementation?

Purpose: to assess regional tasks and, if mutually agreed,

to commit to promote

implementation

Need for a regional high-level forum bringing together

all relevant stakeholder groups

Cf. Florence Forum,

Pentalateral Forum