EXTERNAL

— 15TH INTERNATIONAL CONFERENCE ON THE EUROPEAN ENERGY MARKET, 27-29 JUNE 2018, LODZ, High-Voltage Direct Current transmission Enabling single EU energy market — Electricity interconnection targets Recommendations for development of additional interconnections

Motivation Indicator Indicative Further recommendations: threshold Interconnectors helping reach any of the 30% thresholds should Minimising price Price difference between >€2/MWh be included in the TYNDP and future lists of PCI differentials countries, regions or bidding Countries above the 30% but below 60% thresholds should zones investigate regularly possible options of further interconnectors Ensuring that ratio between nominal <30% electricity demand transmission capacity of can be met interconnectors and peak load Enabling export Ratio between nominal <30% potential of excess transmission capacity of renewable interconnectors to production renewable installed generation capacity

Source: Report of the Commission Expert Group on electricity interconnection targets, November 2017

June 1, 2018 Slide 2 — Electricity interconnection targets Projects of Common Interest (PCI)

Background Benefits

According to the , a PCI should: – Accelerated planning and permit-granting procedures, including – Significantly affect the energy markets of at least two EU a three-and-a-half-year time limit for granting permits countries – One national permitting authority – Increase energy market competition – Lower administrative costs for project promoters and – Enhance the EU’s security of supply by allowing countries to authorities receive energy from more sources – Streamlined environmental assessment – Contribute to the EU’s energy and climate goals, for example, by – More transparency and public participation integrating renewable energy into the grid – More visibility for investors – Possibility of financial support -5.35 b€ total from 2014 to 2020- under the Connecting Europe Facility (CEF)

Projects of Common Interest expedite the fulfiment of the interconnection targets

June 1, 2018 Slide 3 — Electricity interconnection targets Third list of Projects of Common Interest (2017)

90 PCIs related to transmission network expansion – 50% interconnectors (between countries) – 50% internal projects Share of HVDC projects among them: – 1/3 among all projects (internal and interconnectors) – >55% for interconnectors (between countries)

Source: European Comission, Annex VII to Regulation (EU) No 347/2013, 23.11.2017

HVDC transmission is a key enabler of the emerging single energy market

June 1, 2018 Slide 4 — entso-e Ten Year Network Development Plan Key boundaries identified in the system needs analysis of the TYNDP 2016

Transmission network expansion projects in TYNDP New overhead lines, underground/subsea cables 143 projects in permitting, under construction or commissioned – >20% HVDC projects (32 in total) – 24 subsea HVDC cables – 7 underground HVDC cables – 1 HVDC OHL 136 projects under consideration or planned, but not permitted – >25% HVDC projects (37 in total) – 30 subsea HVDC cables – 3 underground HVDC cables – 3 HVDC OHL

Source: entso-e Ten Year Network Development Plan 2018

June 1, 2018 Slide 5 — What is an HVDC transmission system?

HVDC converter station HVDC converter station > 300 MW, Classic > 300 MW, Classic

Submarine cables

Customer’s Grid Customer’s Overhead lines Grid Customer’s Two conductors

HVDC converter station HVDC converter station < 3,600 MW, Light < 3,600 MW, Light

Land or submarine cables Customer’s Grid Customer’s Grid Customer’s Power / energy direction

June 1, 2018 Slide 6 — HVDC technologies

What makes HVDC special? What makes HVDC Light special?

– Lower investment and – Underground cables lower losses – Easy permits for bulk power transmission – Costs close to overhead lines – Asynchronous interconnections – Connection to passive loads – Improved transmission in – Enhancement of parallel AC circuits connected AC networks – Instant and precise power flow control – Independent control of active and reactive – 3 times more power in power flow a ROW than AC – Short delivery times

June 1, 2018 Slide 7 — HVDC technologies

HVDC Classic 300 – 10,000 MW HVDC Light 50 – 3,600 MW

controlled – Transistor (IGBT) – Switched reactive controlled power control – Continuous reactive – Typical design: valve power control building plus – Easily expandable to switchyard more terminals – Overhead lines or – Dynamic voltage mass impregnated regulation cables – Black start capability – Typical design: more equipment in compact building – Extruded cables

June 1, 2018 Slide 8 — Installed base Over 120 projects and over 60 years experience America Europe CU Upgrade 2019 Outaouais 2009 Chateauguay 1984 North-sea Link 2021 Nordbalt 2015 Swepol 2000 Maritime Link 2017 Sharyland 2007 Cu-project 1979 Nordlink 2021 Litpol Link 2015 Gotland Light 1999 Quebec – New England Rapic City 2003 Nelson River 2 1978 IFA2 2020 Skagerrak 4 2014 Hällsjön 1997 Upgrade 2016 Cross Sound 2002 Square Butte 1977 Kriegers Flak Cgs 2019 East West Kontek 1995 Madawaska Upgrade 2016 Eagle Pass 2000 Eel River 1972 Johan Svedrup 2019 Interconnector 2013 1994 Celilo Upgrade 2016 Quebec – New England 1990 Pacific Intertie 1970 Gotland Upgrade 2018 Sapei 2011 Fennoskan 1 & 2 1989 Railroad DC Tile 2014 Pacific Intertie Expansion 1989 Vancouver Island Pole 1 1968 Caithness – Moray 2018 Valhall 2011 Dürnohr 1983 Oklaunion 2014 Intermountain 1986 Kontek Upgrade 2016 Norned 2008 Skagerrak 1-3 1976 Mackinac 2014 Pacific Intertie Upgrade 1985 Troll 1 & 2, 3 & 4 2015 2006 Gotland 1-3 1970 IPP Upgrade 2010 Madawaska 1985 Borwin 1 2015 Italy – Greece 2001 Konti-skan 1965 Blackwater 2009 Highgate 1985 Dolwin 1, 2 2015 Tjæreborg 2000 English Channel 1955 Åland 2015 Asia Changji-Guquan 2019 Raigarh-Pugalur 2019 North East Agra 2016 Jinping - Sunan 2013 South America Mülünbeir – Liaoning 2010 Rio Madeira Back-to-back 2013 Lingboa li Extension 2010 Rio Madeira 2013 Xiangjiba – Shanghai 2010 Brazil – Argentina Three Gorges – Shanghai 2006 Interconnection I & II 1999 Vizag Li 2005 Itaipu 1984 Three Gorges – Guangdong 2004 Three Gorges – Changzhou 2002 Chapad 1999 Rihand-Delhi 1990 Gezhouba – Shanghai 1989 Vindyachai 1989 Sakuma 1965 Africa Inga – Kolwezi Upgrade 2016 , Songo 2015 Australia and Oceania Caprivi Link 2010 Broken Hill 2013 Apollo Upgrade 2008 Murraylink 2013 Inga – Kolwezi 1982 Directlink Cahora Bassa 1977 Leyte-Luzon 1999 NewZealand 1 & 2 1984 — VSC HVDC Light ABB supplied 70% of all VSC links in the world

VSC-HVDC projects commissioned

In construction

*VSC: Voltage sourced converter — HVDC technologies Transmission capacity

600 10000 Udc (kV) 1,100 Voltage (kV) 500 Power (MW) 1,000 1000 900 400 800 HVDC Light with overhead lines 300 100 700 HVDC Classic with overhead 600 200 lines 500 HVDC 10 HVDC Classic 400 Light Power (MW) Power Voltage (kV) 100 with with mass 300 extruded impregnated cable 0 1 200 cable 100

0 1 2 3 4 5 6 7 8 9 10 Commissioning Power (GW)

June 1, 2018 Slide 11 — Evolution of HVDC Light 20 years of HVDC Light development

How is it done? – Increased voltage rating – Cutting-edge, bi-mode insulated gate transistor (BIGT) – Optimized switching – Modular multi-level converter (MMC) technology – Very low no-load losses

June 1, 2018 Slide 12 — HVDC Light Plant Design (symmetric monopole)

Climate system DC yard Valve hall

Diesel generator MVS building Converter reactors Service building Coolers

Optional harmonic filters

June 1, 2018 Slide 13 — HVDC Light Value proposition with new offering

Values Features Benefits high availability increased service intervals increased utilization

low losses improved converter valves reduced OPEX

small footprint optimized mechanical design reduced environmental impact

highly modularized simplified project adaption proven technical solutions

higher ratings higher voltage and current ratings technology suitable in more applications

reduced delivery time base design and standardized delivery lower project and capital cost model

HVDC Light able to cover all market demands

June 1, 2018 Slide 14 — Introduction to HVDC Light System configuration

Symmetric monopole Asymmetric monopole Bipole

~ ~ ~ ~ ~ ~ ======

= = ~ ~

Positive Positive Positive Low cost Only one high voltage cable High Availability for half power Low transmission losses Bipole enabled Negative Negative Negative Temporary ground current (can be avoided at Loss of 100 % power at trip Less compact the expense of a metallic return conductor)

June 1, 2018 Slide 15 — Introduction to HVDC Light System configuration

Rigid Bipole Back-to-Back Multi-terminal

~ ~ ~ ~ ~ ======

= = ~ ~ ~ =

Positive Positive Positive Half power at converter outage Low Cost Converters at different locations on one line Lower stress on cable compared to sym. Low losses Negative monopole Simpler permitting Complex control system Negative Compact station Loss of 100 % power at line trip Negative Less compact, higher cost than sym. Limited suitable locations monopole

June 1, 2018 Slide 16 — Power transmission with HVDC Light Independant active and reactive power control

, Voltage source converter valve 𝑃𝑃 𝑄𝑄 𝑣𝑣 Output voltage at AC valve terminals can be freely adjusted in X 𝑈𝑈 ∠𝜑𝜑 both magnitude and phase angle 2-level,3-level − Active power control via phase angle n-level 𝑈𝑈𝑑𝑑 − Reactive power control via magnitude 𝑈𝑈𝑐𝑐∠𝜃𝜃 − Control in dq coordinates 3PWM Power and current control common for all valve topologies OPWM sin = 𝑈𝑈𝑣𝑣 𝑈𝑈𝑣𝑣 � 𝑈𝑈𝑐𝑐 � 𝜑𝜑 − 𝜃𝜃 , 𝑃𝑃 𝑐𝑐 cos𝑋𝑋 𝑈𝑈𝑣𝑣 𝑟𝑟𝑟𝑟𝑟𝑟 𝑈𝑈 Q = 𝑟𝑟𝑟𝑟𝑟𝑟 𝑃𝑃 𝑈𝑈𝑐𝑐 � 𝑈𝑈𝑣𝑣 � 𝜑𝜑 − 𝜃𝜃 − 𝑈𝑈𝑐𝑐 𝑄𝑄𝑟𝑟𝑟𝑟𝑟𝑟 𝑋𝑋

June 1, 2018 Slide 17 — Power transmission with HVDC Light Independant active and reactive power control

Example: step change of active power Active power (MW) Step decrease of transmitted power by 10% No change in reactive power exchange with the AC network Reactive power Transient change in DC voltage, quickly regulated to reference (MVAr) value by remote station New load flow results in decreased direct current flow -100% to +100% power without changing the DC polarity AC voltage (%)

DC voltage (kV)

Direct current (A)

June 1, 2018 Slide 18 — Operational flexibility Enhanced system resiliency – black start with HVDC Light

June 1, 2018 Slide 19 — Operational flexibility Field experience from reference projects

Caprivi Link Interconnector Fenno-Skan Pacific Intertie

“The field experience in Caprivi link Stationary load flow optimization The ability to damp depends on the project shows that HVDC Light can not between Sweden and Finland converter station location and the feedback only operate in extremely weak AC system POD control for small-signal stability control signals used with SCR below one and down to zero, In operation for over 20 years Most favorable with parallel connection of but also enhance the stability of the weak AC ties with an HVDC link AC system significantly.”

“Stability enhancement and blackout prevention by VSC based HVDC”, Cigré Symposium, Bologna

June 1, 2018 Slide 20