Study on regulatory matters concerning the development of the North Sea offshore energy potential
The Study on regulatory matters concerning the development of the North Sea offshore energy potential identified existing regulatory framework barriers, undertook a market analysis, and created a toolkit and road map to be implemented by the national governments around the North Sea and by the European Commission.
The importance of strong political commitment from all the countries in the North Sea and the Irish Sea to implement complex and international projects.
Since 2010, ten countries from the North Sea and the Irish Sea regions have signed a Memorandum of Understanding, where they agreed to exploit renewable energy sources in the North Sea and to launch the NSCOGI initiative.
The European Commission established a common target for Renewable Energy Sources consumption to be reached at European levels by 2030. This policy indicated the willingness of the regions to create a common policy towards solid international cooperation.
Meshed offshore grid analysis revealed greater benefits to the North Sea offshore energy potential
Regarding the market analysis, after a comparison between a radial grid and a meshed offshore grid in the North and Irish Seas, the study showed that meshed offshore grid would deliver more benefits to the different countries.
The annual electricity exchange could increase from 33% to 64%. There would be a reduction of use of expensive thermal generation plants in the region (especially coal, lignite and natural gas), and as a consequence a cutback in CO2 emissions.
The annual day-ahead market would benefit the whole stakeholder system in all the countries, due to a reduction in generation costs, and an increase in social welfare. It is estimated that by 2030 the benefits could go from EUR 0.7 to EUR 3.1 billion per year.
The market prices among the different countries would move towards uniformity.
However, there would be an uneven distribution of welfare benefits among the wholesale market players. The market sellers from Norway, Sweden, and France would receive more revenues as the market prices increased but their production costs remained the same.
Four actions that set the framework to facilitate international cooperation and exploitation of the energy capacity in the North and Irish Sea region.
- Develop an overall project plan and definition of the regulatory responsibility, enhancing planning cooperation, and allocating regulatory responsibilities.
- Establishment of a cooperation framework for the national governments for cost and benefits distribution.
- Finance, implement, and put the grid into action.
- Develop Renewable Energy Source plants and connect them to the grid.