Bloomberg News

Denmark to Decide on U.K. Power Cable Next Year, Grid Says

November 23, 2012

Grid companies in the U.K. and Denmark are completing studies for the first subsea cable linking the countries, in a bid to boost electricity trading and help integrate a growing share of wind power output.

“Building a first power link to the U.K. looks interesting, though our calculations and analyzes are not yet complete, with a verdict due next year,” Dorthe Vinther, head of planning at Danish grid operator Energinet.dk said today by e-mail. “We will only go ahead if it is socio-economically beneficial.”

Denmark plans to increase links to foreign electricity markets as it prepares for the growing role of intermittent solar and wind sources, helping ship surplus power from countries where the wind blows to others where demand is high. Reduced coal generation is also poised to increase the nation’s reliance on imports during peakload periods, such as cold and dark winter afternoons.

National Grid Plc (NG/) wants to complete a study for the cable by year-end, with routes, landing points, capacity and a possible commissioning timetable still to be decided. The U.K. network operator is still working on its pre-feasibility study, Isobel Rowley, a company spokeswoman, said by e-mail yesterday.

Grid Expansion

“You can’t get all the renewable energy in place without expanding the grid, and we hope the cable will be in place before 2020,” Ulrich Bang, director of EU affairs at the Danish Energy Association, said today by phone from Frederiksberg, Denmark.

The share of wind power in Danish electricity supply is set to almost double from last year’s 26 percent to 50 percent by 2020, according to the government, which plans to replace 50 percent of coal use with renewable energy sources over the next eight years.

“The northern German grid faces huge bottlenecks, so a cable to the U.K. is the obvious solution for Denmark, to avoid putting all our eggs in one basket,” Bang said.

The U.K. has three operational power links with Ireland, France and the Netherlands, and has projects for connections with Norway and Belgium, as well as boosting capacity with France and Ireland. Denmark has cables that connect to Norway, Sweden and Germany, and is increasing capacity toward Norway, while considering a link to the Netherlands.

Baseload power prices in the U.K. are higher than in Denmark, which means a power cable may “marginally” push up costs for Danish consumers, while benefits include a cheaper transition toward a renewable energy infrastructure, according to Energinet.dk.

“Connecting to a high-price market does push up electricity costs, but it will also cut costs for back-up power plants and system balancing, which must be taken into account,” Bang from the Danish Energy Association said.

To contact the reporter on this story: Torsten Fagerholm in Helsinki at tfagerholm@bloomberg.net

To contact the editor responsible for this story: Lars Paulsson at lpaulsson@bloomberg.net


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