4. Electricity network
10.4 Action plan
In this section, we set out specific actions that the BEMIP group could undertake in support of the roadmap described in the previous section. The actions are grouped by different work streams according to how we envisage that the work can be organized.
1. Work to identify national and regional offshore wind power ambitions and identify candidates for PCI and cross-border RES projects
2. Work on creating favourable market and support frameworks for offshore grid 3. Work on licensing of offshore wind power projects
4. Work on grid development needs and conditions 5. Cooperation to establish common standards
Under each work stream we propose different activities that the BEMIP group could undertake.
These activities should be seen as options and examples, and the list is not exhaustive.
The proposed actions could be carried out in parallel but to some extent reflect a natural sequence: In order to develop the cooperation on offshore wind power in the BSA and identify candidates for cross-border RES projects, an overview and common understanding of the ambitions should be established. Based on this, candidates for projects of common interest and/or joint offshore wind power projects can be identified. In parallel, work on market and support frameworks can start with a mapping of barriers to offshore wind power and a plan to remove them, followed by work to facilitate licensing procedures and develop common standards. The identified candidates may then be used as pilots by which support frameworks, licensing, and grid cooperation can be explored. Work to establish cooperation on the improvement of data can be done in parallel and independent of other actions.
Many of the activities can draw on work already carried out by the North Sea Group (NSG) and for some cooperation with the NSG would provide mutually beneficial. Several of the issues are common to multilateral cooperation on the development of offshore wind power, be it in the Baltic Sea or the North Sea. Moreover, the projects affect and are affected by the same market, and features such as licensing, data, standards, and grid issues should be aligned over a larger area than the Baltic Sea Region. We mention such activities under each work stream and also provide a summary section at the end of this chapter.
10.4.1 Work to identify national and regional offshore wind power ambitions and identify candidates for PCI and cross-border RES projects
Establish a common statement on national and regional ambition levels for offshore wind power
Working with the NECP authors and the offshore wind industry, the BEMIP RES working group should develop a clear, explicit and common articulation of what is expected in terms of the level of offshore wind power deployment per Member State and for the Baltic Sea Area. In
particular, the BEMIP RES working group should work to ensure that a common articulation of coordinated national and regional offshore wind development objectives is included in a joint chapter of the NECPs of the BEMIP Member States.
The aim of this process would be to produce a “statement of common understanding” that sets out the range of offshore wind deployment expected in the region within the framework of the NECPs. The aim would not be to push for ambition beyond that in the NECPs but to explore and clarify the expected role for offshore wind power, which would provide a basis for the regional cooperation on offshore wind power planning and inform network and investment planning.
As a next step, the BEMIP working group could work to secure political commitment to the statement so that national governments would certify that the description is an accurate expression of expected development.
BEMIP should regularly review progress against the common statement and update the statement as necessary to reflect new information that is developed as part of other work streams. A time plan for such reviews, e.g. every 3rd year, including a plan for stakeholder involvement and information exchange with relevant parties, such as TSOs, should be set up by the BEMIP working group.
Initiate work to identify projects of common interest and cross-border RES projects
Drawing on the expected deployment of offshore wind power in the NECPs’ “statement of common understanding” and on the identification of favourable sites and areas for offshore wind power provided in this and other studies, the BEMIP working group could create an initial list of candidates for support either as PCIs or cross-border RES projects or ideally both.
Candidate projects should be selected for further assessment, for example regarding the mapping of wind speeds, spatial planning challenges, etc. The aim would be to develop a short- list of possible pilot projects that could be developed further as PCIs and/or cross-border RES projects. The BEMIP RES working group could thereby play an important role in preparing such projects for inclusion in the list of cross-border RES projects under the new CEF RES window and help ensure that these projects are coordinated with the TYNDP electricity grid PCIs, which ideally should go hand-in-hand with any planned cross-border offshore wind project investment.
We expect that cross-border RES projects would be promising wind power sites with simple connections to shore that can be developed in cooperation between two or more BEMIP Member States, while PCI projects would be hub projects, including interconnection to two or more Member States. Hub projects could also be developed as cross-border RES projects, where even Member States that are not connected to the hub participate to gain the wider benefits, such as less internal congestion in their national grids and new trading opportunities.
The aim of this work item should be to provide a basis for the selection of pilot projects that can be used to elaborate and demonstrate the licensing, grid, financing and other issues identified as barriers. An initial assessment of the pros and cons of each project would also be valuable as part of this work.
10.4.2 Work to improve the support framework for offshore wind power in the Baltic Sea Area
Work to improve the support framework for offshore wind power in the Baltic Sea Area can be carried out along the following avenues:
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Remove barriers in national support frameworks›
Coordinate tendering processes across national support schemes›
Identify the potentially relevant funding mechanisms for projects of interest›
Develop regional support mechanisms open to offshore windExplore how national support mechanisms can be made more favourable to offshore wind power
Building on the identified barriers in current support systems for renewable electricity identified in this study, an early action for the BEMIP working group could be to review national renewable energy support schemes and flag barriers to offshore wind power.
A natural next step would be to map and explore options to address the identified barriers, and to develop a common approach to their removal. The focus should be not only to remove barriers for support to offshore wind power, but also to identify differences among national support schemes that may distort the efficient utilization of offshore wind power from a regional point of view.
Such a review and assessment will provide valuable input to the process of selecting candidates for regional PCI and cross-border offshore wind power projects in the BSA.
A document outlining emerging best practices in the North Sea cooperation might serve as a good starting point for the discussion of support incentives. Building on the work done by NSEC in this regard could enable BEMIP to propose tried-and-tested pathways to more efficient subsidy schemes to support offshore wind.
Coordinate tendering processes across national support schemes
BEMIP could act as a forum for the exchange of information on tendering processes and, where appropriate, help establish separate multilateral channels for the sharing of information among relevant national agencies and regulators.
By exchanging information on tendering processes, the BEMIP countries may cooperate on the timing of tenders and on the specification of tenders. Creating such a forum for exchange of information and eventually for coordination of tendering processes, would provide valuable input to the creation of regional support mechanisms or tenders open to cross-border RES projects.
Again, the North Seas Energy Cooperation’s work can provide some input on how to structure concerted tenders in the Baltic Sea. A review of the first results that have been published by NSEC and establishing contact with the working group on the design of the support framework would constitute a first step that could be followed up by collaboration. Since Germany, Denmark and Sweden are part of both, BEMIP and NSEC, coordinated tendering across the regions could be discussed as later step in the cooperative work.
Identify the potentially relevant funding mechanisms for projects of interest
Having identified possible candidates for cooperation on offshore wind power projects, the BEMIP group could help explore the available funding sources that could be used to develop these. The group could take on work to outline a possible high-level funding plan for each of the projects, noting the potential, where applicable, to use third-party or EU financing to cover some or all the expected cost.
Develop proposals for a regional support mechanism open to offshore wind
The BEMIP working group should follow efforts to open national support mechanisms to foreign projects and develop one or more proposals for how a regional support mechanism for offshore wind could be designed, including principles for equitable sharing of costs and benefits associated with offshore winds development.
A report outlining one or more possible regional support mechanisms for offshore wind should be published. The report should include an explanation of how national policy frameworks can be realistically adapted to create and work alongside the proposed mechanisms. It should also consider the role of financial support for cross-border RES projects under the Connecting Europe Facility.
10.4.3 Work on licensing of offshore wind power projects
In order to make the licensing of offshore wind more efficient and transparent, the BEMIP group could initiate the following activities:
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Establish national forums to identify and eliminate the most serious barriers in national licencing regimes›
Create a network of national fora for the sharing of best practice on offshore wind licencing in the BSA›
Develop principles and processes for licencing of multinational projects›
Review template licencing process in view of pilot experienceEliminate the most serious barriers present in national licensing regimes (e.g.
failure to identify pivotal objections early, repetitious processes)
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Instigate the creation of national forums between industry and the relevant national agencies to identify specific issues and develop reform proposals›
Share best practice on offshore wind licensingThe BEMIP group could instigate the creation of a network of national forums to consider the barriers to offshore wind development present in national licensing regimes through its contacts in the relevant national agencies and industry bodies. Relevant stakeholders in the offshore wind industry should be invited to participate in or provide input to such a network. The BEMIP group could arrange stakeholder consultations to map the barriers as seen from the developers’ side.
BEMIP should also work with industry, the North Seas Energy Cooperation group and the licensing agencies in the BEMIP region with experience from offshore licensing to identify the components of best practice and the approaches used to achieve these in practice. This information should then be compiled into an information pack and presented to the national forums established in the step up.
The learning resources developed through this process should be published as part of a standalone information pack that can be used as reference material on the effective licensing of offshore wind.
Develop principles and a process for licensing of multinational projects and review template licencing process
In addition to the work on barriers in national licensing regimes, the BEMIP group could, building on the best practices identified in the barrier study (above), start work to develop licensing procedures for common projects and offshore wind power hubs located in multiple jurisdictions. This work could start with a preliminary assessment of barriers related to the identified pilot projects and continue with development of common principles.
BEMIP should initially engage with the North Seas Energy Cooperation group to explore whether and, if so, how they may wish to cooperate on this work. In the event that co-working is not considered appropriate, BEMIP should seek to develop an initial proposal for the principles and processes to be used based on a review of any earlier work conducted by the North Seas Energy Cooperation group and the Baltic InteGrid project. The establishment of a working committee including representation from the national planning authorities may be needed for this purpose.
This proposal should then be workshopped with the national authorities and industry to ensure its feasibility and acceptability and to identify what further action might be useful in terms of formalising its use.
BEMIP should conduct a review of the licensing procedures used as part of any multinational offshore wind pilot project to identify lessons for future projects. This review should ideally be included in the initial specification of the pilot(s) to ensure that relevant information is captured throughout the pilot. The group could commission and publish a report covering the experience of the project(s) and the lessons learned.
The aim of this work would be to develop a proposal setting out the expected licensing process to be applied to generic multinational offshore wind projects, such as a hub connected to an interconnector. The proposal may be accompanied by a statement of principles to help determine the appropriate licensing approach for problem cases. The proposal should clarify for any potential developers of multinational projects the licensing process that they will be subject to.
10.4.4 Work on grid development needs and conditions
In order to efficiently develop offshore wind power resources in the Baltic Sea Area, it is necessary to integrate ambitions in the grid planning, and to establish cooperation on grid development and the sharing of costs and benefits of associated grid development, applying to offshore as well as onshore grids.
The BEMIP working group work related to grid issues could include
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Work proactively to support ENTSO-E’s inclusion of Baltic offshore wind power development in its regional grid planning processes and follow up on Baltic InteGrid’s recommendations regarding the TYNDP›
Coordination of connection charging regimes for offshore wind power›
Develop template contractual arrangements for hub projects›
Agree principles and publish guidance on cost sharing arrangements for network investmentSupport ENTSO-E’s inclusion of Baltic offshore wind development in its regional grid planning processes
BEMIP should proactively engage with ENTSO-E to supply it with the inputs it requires to undertake a thorough consideration of the needs of offshore wind development as part of the regional grid planning process. This will include discussing with ENTSO-E how and when the BEMIP group can usefully engage. The development of a clear statement on regional offshore wind capacity expectations, discussed above, is likely to form one element of this work. The results of the work to identify projects of common interest and cross-border RES projects (described above) are also likely to be useful inputs to the scenario building and infrastructure needs assessment tasks that occur early on in the TYNDP process.
One outcome of this work could be the creation of a list of contributions that BEMIP can realistically and usefully make to the network planning process.
BEMIP could make steps so that Baltic InteGrid’s recommendations with regard to the TYNDP plan62 are reflected in subsequent regional network planning exercises. For example, in cooperation with the Baltic Offshore Grid Forum, BEMIP could review and assess ENTSO-E’s next TYNDP process and, if appropriate, engage with ENTSO-E to ensure that the recommendations are in line with the outcomes of previously conducted studies by the initiatives.
Coordinate connection charging regimes for offshore wind
BEMIP could instigate the creation of a forum on the alignment of offshore wind connection charging. Work on connection charging is expected to be led by regional TSOs and NRAs.
However, BEMIP could play an important role in setting up a forum among the relevant actors and elevating the issue internally within these organisations.
BEMIP could initially reach out to the North Seas Energy Cooperation group and explore the scope for a broader regional cooperation on the alignment of connection charges. In cooperation with the North Seas Energy Cooperation group and the European Commission, regional TSOs and NRAs could be engaged and supported in forming a working group capable of considering possible solutions for connection charging.
62 http://www.baltic-
integrid.eu/index.php/download.html?file=files/baltic_integrid/Work%20packages/WP%205%20 Recommendations/5.1%20-
%20Recommendations%20to%20the%20Ten%20Year%20Network%20Development%20Plan/
BIG_5.1_%20Recommendations%20to%20the%20TEN%20YEAR%20NETWORK%20DEVEL OPMENT%20PLAN%20%28TYNDP%29_final.pdf
Develop template contractual arrangements for hub projects
BEMIP should, in close cooperation with the North Seas Energy Cooperation group, work to develop contractual arrangements to support the creation and operation of a multinational offshore wind hub.
BEMIP could contribute to the development of common principles and a template contractual arrangement for hub projects, by conducting an in-depth review of the lessons learned from the Kriegers Flak combined grid solution project. This work should also draw on earlier thinking undertaken as part of the North Seas Countries Offshore Grid Initiative. The review of experience from Kriegers Flak would focus on the contractual and regulatory arrangements used for the Kriegers Flak project, the challenges experienced in the process, and how these were solved.
The specific goal should be to identify and propose useful templates for future multinational cooperation, including regulatory solutions, that may have wider applicability in the region.
The high-level contractual framework developed through this work should explain the key features of the proposed arrangement and the rationale underlying the selected framework.
The ultimate objective of the work should be to provide a solid jumping off point for practical discussion in relation to possible pilot projects. In particular, the report should make clear the key stakeholders involved and how they would be expected to contract with one another.
Agree principles and publish guidance on cost sharing arrangements for network investment
The uneven distribution of costs and benefits could prove to be an important obstacle to the efficient realization of advanced hubs and cross-border offshore wind power projects in the Baltic Sea Area. This obstacle is not particular to the Baltic Sea, and development of cost sharing arrangements for network investments is expected to be led by ENTSO-E.
BEMIP could nevertheless take an active role to contribute to the reduction of this barrier. For example, BEMIP could instigate the creation of a forum appropriate for developing solutions for the cooperative financing of network projects. This forum will need to include not just the TSOs and BEMIP, but also the North Seas Energy Cooperation group and NRAs.
Here, BEMIP should work with ENTSO-E to identify the relevant stakeholders and, as needed, push the participants to deliberate and propose a set of cost-sharing principles for those network investments necessary to enable offshore wind deployment.
10.4.5 Cooperation to improve data quality and availability, and establish common standards on industry practices
Finally, BEMIP could play a role in activities related to making available data necessary for developers of offshore wind power in the BSA, and to common industry standards for offshore wind power in the area, specifically: