TEPCO study provides recommendations for Baltic States on expansion of renewable energy sources by 2050

As Baltic States prepare to dramatically increase renewable energy production and generate up to 100% electricity from renewable energy sources by 2050, Japanese energy company TEPCO Power Grid Inc analyzed technical measures and economic considerations that need to be tackled. TEPCO’s feasibility study provided recommendations and specified minimum requirements for new converter-based generation in Baltic States. 

The study shows that the development of the Battery Energy Storage System (BESS) is the best way for Lithuania, Latvia and Estonia to ensure smooth and reliable operation of their power systems when up to 100% electricity is generated from renewable energy sources. Specifically, 240MW capacity of the grid forming type battery systems will countermeasure the lack of inertia associated with wind and solar generation.

Transmission system operators are constantly looking forward and searching for solutions to problems that will probably only occur in the coming decades – this is the only way to ensure reliable power transmission. This study is particularly important, because it shows a clear path to 100% green energy generation in the Baltics.

The main objective of the study was to create an economically reliable model and identify technical measures related to the capabilities of the Baltic States for supply and demand adjustment and frequency control, considering that 98–100% of energy production in each State will come from renewable energy sources by 2050. TEPCO investigated the synthetic inertia and grid forming control technology for High Voltage Direct Current links, new BESSs, and renewable energy generation units such as wind and solar.

Lithuanian, Latvian, and Estonian transmission system operators – Litgrid, AS Augstsprieguma Tīkls, and Elering AS – signed a Joint Study Agreement with TEPCO Power Grid Inc in May 2020. 

The power systems of Baltic States are being prepared for connecting to the synchronously operated area of the Continental Europe by the end of 2025. Equally, all three Baltic States are planning to dramatically increase renewable energy share and reach up to 98–100% of energy production from renewables in each state by 2050.
Japanese transmission system operator TEPCO Power Grid has extensive experience in providing power supply, handling, and development services, including system functionality in extreme conditions. The company is also responsible for reliable power supply on small remote islands and promotes the introduction of renewable energy as the main power source.

The more detailed outlook of the study:

TEPCO study team collected information on the current situation and issues related to the capabilities of the Baltic States for supply and demand adjustment and frequency control, understanding the needs of the Baltic States and support the establishment of necessary technologies and know-how related to securing the capabilities for operating supply and demand adjustment and frequency control. 

The study team has developed simulation models of a BESS with a synthetic-inertia function and HVDC links, which are considered to be powerful measure for securing inertia response and frequency control. Also, a severe contingency scenario was developed, an evaluation index was assumed, and the required amount of BESS to be installed for stable frequency control was evaluated by dynamic simulation. 

The study has found that the BESS capacity required for improvement measures for Rate of Change of Frequency (RoCoF) and the lowest frequency point (Nadir) is 240MW for the grid forming type and 400 MW for the grid following type. Since the grid forming type has a faster response and is more effective in improving RoCoF, TEPCO experts recommend introducing the grid forming type 240MW for the Baltic States. 

The simulation has also shown that, when the frequency control function was added to the HVDC links, it was possible to ensure permissible RoCoF and Nadir values without introducing the additional BESS, although such solution has certain downsides. Setting the governor gain higher can enhance the effect of the HVDC links for the frequency, an agreement with the TSO in the other system connected by the HVDC links should be needed for that setting since high gain causes a larger impact on the other system.

Moreover, in advance limitation of the market capacities is also necessary in order to reserve enough capacity of HVDC for frequency response control.

According to the study, when the HVDC links are equipped with a frequency control function, it is necessary to coordinate the response of the HVDC links with the response of the BESS when the frequency deviates. This ensures stable system frequency in case of an accident such as generator trip.

For wind and solar power plants to have an inertial response, TEPCO experts recommend the BESS capacity to be 2.8% of the power generation capacity. For power plants with small power generation capacity, it may be difficult to install BESS from an economic point of view. To secure the inertial response with a certain margin, it is desirable to install BESS equivalent to around 5% of the power generation capacity at larger power plants. This number could be increased to 10% if no other measures (e.g., synchronous condensers) are applied. Therefore, a value of 5 to 10% of the power generation capacity should be considered as the best proposals for future study on the best economic value for BESS capacity. 

The cost-benefit analysis results for the case where the required inertia is covered by operating an LNG gas-fired machine and the case where grid forming BESS is used are as follows: Net Present Value (NPV) is equal to EUR 37,8 million (from 2030 to 2050), Internal Rate of Return (IRR) is 11%, while the Cost Benefit Ratio (CBR) is 1.3. 

The introduction of BESS with synthetic inertial response is significant for solving the technical challenges to achieve the ambitious national strategies for expanding renewable energy by the Baltic States. The solution proposed in this study replacing fossil fuel-based thermal power generation with advanced BESS, would help to reduce carbon dioxide emissions and contribute to the realization of a low-carbon society. The socioeconomic analysis shows positive results due to environmental impact and total benefits outweigh incurred investment and operational costs.