Energy security: an electricity system perspective – Session 1: Electricity system security: from basics to lessons learned

This EEF online briefing offered MEP Advisers and Assistants an opportunity to better understand the basis of the electricity system operation.

Timothée Decroix and Tahir Kapetanovic, respectively Chair of the Policy and Communication Group and Chair of the System Operations Committee, ENTSO-E, dived deep into different aspects of energy security. The concept of synchronous area was first introduced: in the EU energy system, production and consumption of electricity must always be balanced. If they are, the frequency in the system will be kept at 50 Hertz. Keeping this 50 Hertz frequency in the synchronous area is the main role of TSOs  - Transmission System Operators - to avoid the collapse of the system.

Keeping the system in balance was delivered by vertical integrated utilities in the past. Following market liberalization, the task is now split between TSOs and several other markets players: cooperation is thus essential.

The speakers then focused on system security both on a short run – operational security – and on a longer run – system adequacy. Operational security relies on several aspects, among which the fulfilment of the N-1 criterion (a tripping of one line must not provoke the tripping of others), security standards (network codes), and redispatching to manage grid congestions.

Long-term security requires both generation and infrastructure adequacy. Adequacy is assessed by the ENTSO-E and the speakers briefly presented us two main products of such assessment. The seasonal outlooks, focusing on a shorter term, and the longer-term Ten-Year Network Development Plan (TYNDPs), where the infrastructure needs of the system are identified together with projects that could help fulfil them.

Finally, some insights were offered on the current evolution of the electricity system. The increase in electricity demand, the need to ensure system integration as well as flexibility, the further market integration, and the rapid penetration of renewable electricity, whose production is generally decentralized, all present challenges requiring close cooperation between all actors and a regulatory framework able to incentivize the required investments in infrastructure and generation capacity.

Santiago Gallego, Member of the Policy and Regulation Committee, E.DSO and Regulation Manager at i-DE, Iberdrola, offered an overview of electricity DSOs’ role in ensuring energy security. DSOs  - Distribution System Operators -operate at local level and their main task is securing the flow of electricity from the transmission grid to the final costumers through the distribution network. Like TSOs, DSOs are fully regulated entities, which means first, that the objective of their work – ensuring system security, reliability, and efficiency – is set by regulation and, second, that if their role needs to evolve, the regulatory framework will also have to. He explained that while there is in most countries only one TSO, this is not the case for DSOs, and indeed Europe counts more than 2,400 DSOs today. Another difference compared to the transmission level is that the voltage level at which DSOs operate differs between countries, which brings harmonization challenges in the EU. He then reflected on the profound change the electricity system is undergoing, with the deployment of renewables leading to a more integrated system with a higher number of active participants. Innovation is key in this context: smart grids and digitalization can help improve transparency by enabling dynamic tariffs and pave the way towards a more efficient and flexible electricity system. Mr Gallego concluded by reiterating DSOs - TSOs cooperation is crucial to achieving EU energy and environmental goals.

Jakub Fijalkowski, Policy Officer “Internal Energy Market”, DG ENER complemented these presentations by providing a legislative and political dimension. He first offered an in-depth historical overview of the evolution of TSOs as well as of the technical rules underpinning their operation. As a result of TSOs unbundling and of market liberalization, these rules evolved from voluntary cooperation between TSOs to framework guidelines and legally binding network codes designed at EU or regional level by TSOs in cooperation with ACER and National Regulatory Authorities. This evolution took time, especially given the complexity of the power system and the need to avoid causing any possible operational or security problems. This complexity and the need for caution should be kept in mind whenever thinking about further changing the electricity system framework, Mr Fijalkowski said. He also discussed the increasing role of TSOs in assessing and ensuring system adequacy – and the value of the ENTSO-E’s TYNDP in this regard –, the growing importance of DSOs and the harmonization challenges previously pointed out. He then focused on cross-border electricity trade, explaining the Third Energy Package mandates a minimum capacity to be made available for cross-border trade, which is crucial both for security of supply and market integration. This is important because, as he concluded, indeed the EU electricity market will bring not only efficiency and cost-optimization, but security of supply as well.

The exhaustive presentations were followed by an open exchange between the speakers and the audience.