CLUSTER 6: Social and Human Science

Background

Renewable Energy Sources are one of the main pillars of the EU’s transition to a low-carbon, resource-efficient economy. Current projections for 2030 foresee that 50% of electricity demand at the European level will be covered by renewables. Until now, RES development has been mainly incentivized by national support schemes. However, there is evidence that such schemes have a distortive impact on the internal energy market, resulting into high costs for households and businesses.

Given the relatively small scale of wind turbines and solar panels, a significant share of their capacity is connected to low- and medium-voltage grids, i.e. not at transmission level but at distribution level. To accommodate 50% VRE share and facilitate their system integration, significant changes in the power market design and power system management are needed (both at system and distribution level). This should also allow for making use of the grid-friendly features that renewables can offer.

Issues

The prospect of large-scale penetration of RES calls upon transforming the current power system management and market design. A key challenge will be to integrate RES into existing markets and let them compete with other energy technologies on equal footing. Options include a reform of support schemes in a cross-border perspective and the development of liquid short-term markets (including balancing and ancillary services) in a regional perspective. Cost-effectiveness will increase through technology learning but also through RES aggregators, providing benefits from economies of scale and risk hedging with respect to market and revenue uncertainties. Special attention is needed for the support of currently less economically mature technologies, in particular offshore wind and the associated grid requirements. InIn addition, grid-related constraints prevent an optimal use of renewables across Europe. Some of these constraints are technical in nature (inadequacy of distribution networks for decentralized energy, need of HVDC transmission backbones, storage and flexibility options…), while others are non-technical (regulation of system operators, grid access regulation, grid tariff design…).

 

 

 

DISCLAIMER

“The study is carried out for the European Commission and expresses the opinion of the organisation having undertaken them. To this end, it does not reflect the views of the European Commission, TSOs, project promoters and other stakeholders involved. The European Commission does not guarantee the accuracy of the information given in the study, nor does it accept responsibility for any use made thereof.”