T&D Grid Integration

For obvious geographical reasons, the Northern part of Europe started the process of integration of their national systems later but it became the most significant model was Nordel, combining international exchange in a free international market. In this relatively small region there is a huge diversity of power sources. In the early 1990s Norway was and still is almost 100% reliant on hydro power, while its neighbor Sweden used hydro power for approximately half of its generation, the rest being split between thermal and nuclear power. Finland’s generation was 60% thermal, with the rest split about evenly between hydro and nuclear power, while Denmark relied on thermal power for 90% of its electricity.

In the hydro dependent countries, when water levels were low it made sense for Norway and Sweden to be able to draw on cheap thermal power from Denmark and Finland, and when water levels were high it was equally sensible to sell cheap hydro power to Denmark and Finland. And so Nordel was born, to facilitate the exchange of cheap power across national borders. It involved a change in mind set, from perceiving electricity as a closely guarded strategic national resource, to an international commodity to be bought and sold in the market place

The demise of the Soviet Union, together with European liberalization of electricity markets has prompted expansion of the co-operation between the networks of different regions and the development of new interconnecting trans-national networks in Europe, giving an impetus to the growth of cross border interconnections and regionalization of markets. In the last few years international power exchanges have been established to service these networks, in addition to the national exchanges which have been set up to service national deregulated markets.

A major priority of the EU is to encourage the expansion of cross border transmission capacity and interconnections.