THE CROWN ESTATE Round 3 Offshore Wind Farm Connection Study Version 1.0 Danielle Lane The Crown Estate Prepared for 16 New Burlington Place London W1S 2HX Executive Summary This investigation presents an indicative set of optimum offshore and onshore electricity transmission network reinforcements required for the connection of up to 25GW of offshore wind generation as part of the Round 3 leasing process. It has been carried out by Senergy Econnect and National Grid for the Crown Estate to aid in the development of the potential Round 3 development zones published earlier in the year. The final location of these zones is subject to the outcome of the Strategic Environmental Assessment currently being undertaken by the Department for Energy and Climate Change (DECC; formerly BERR) and further work with project developers. As the aim of this study was to identify the extent and costs of the works necessary to provide optimised transmission connections for all of the Round 3 offshore wind farms, an analysis was undertaken by Senergy Econnect as an annex to this report to ascertain at a high level the optimal ratio between the installed generating capacity offshore and the transmission capacity of the offshore transmission assets. This optimal utilisation ratio was determined to be 112%. In practice the offshore transmission asset designs provided in this report have a range of utilisation ratios from 81% to 112% because of the zonal capacities identified by The Crown Estate and the modular nature of the transmission assets themselves (with each additional cable providing a fixed increase in transmission capacity). National Grid are in the process of leading a review of the security standards for offshore generation connections to include projects of the size and distance form shore associated with Round 3, at the request of Ofgem. This review will culminate in a set of security recommendations including offshore transmission circuit capacity, which will be consulted upon and incorporated as revised text in the GB SQSS. In order to provide as accurate a cost model as possible a number of high voltage power equipment manufacturers and installers were consulted for the current costs of the equipment that would be required to realize the offshore connection designs described in this report. The offshore connection designs have been based around indicative zonal capacities provided by The Crown Estate. The location and installed capacities of the wind farms located within the zones as identified in this report have been determined by Senergy Econnect based on the principle of minimising the offshore transmission assets required for connection and identifying the associated costs. As such these designs may not provide the optimal solutions for the actual Round 3 wind farms, as the location, installed capacity, and offshore transmission technology and utilisation factor for the actual wind farms will be determined by the zonal developer and offshore transmission owner in collaboration with the selected technology provider. These solutions are designed to comply with the offshore GB SQSS proposals, except where expressly stated. The following Table summarises the optimal cost of connections resulting from this analysis. 1845 Crown Estate Round 3 OWF connection study v1.0 (FINAL).doc Page 3 of 94 Total TOTAL Connection Connection Point TOTAL ZONE OWF Installed COST technologies (s) COST Capacity Per MW New substation on Moray Firth C 500MW AC £193m* £386k coast Firth of Forth G 500MW AC Torness £150m* £300k H1 1237.5MW DC Creyke Beck £5,910m £477k H3 1237.5MW DC Creyke Beck J 1240MW DC Creyke Beck H2 1237.5MW DC Keadby Dogger Bank H4 1237.5MW DC Keadby H5 1237.5MW DC Killingholme I1 1240MW DC Killingholme I2 1240MW DC Killingholme M 1237.5MW DC New substation on Lincolnshire coast Hornsea N 1240MW DC New substation on Lincolnshire coast T 1240MW AC Sizewell £1,728m £349k Norfolk Z2 1240MW DC Sizewell (without U 1237.5MW DC Norwich Sizewell C) Z1 1237.5MW DC Norwich Hastings AA 500MW AC Bolney £184m £368k West Isle of DA 500MW AC Chickerell £175m £350k Wight Bristol EA 1500MW AC New substation on £430m £287k Channel Torridge Estuary IA 1237.5MW DC Deeside £1,632m £329k LA 1240MW DC Deeside Irish Sea JA 1237.5MW AC Wylfa NA 1240MW DC Stanah TOTALS 25,795MW £10,402m £403k Table 1: Optimal Connection Costs broken down by Zone *Total reinforcement costs dependent on GB transmission owner study currently in progress The total cost for connecting the round 3 wind farm projects, assuming no inclusion of Sizewell C, and the optimal design solutions identified in this report is £10,402 million. Note that this Figure is based on 2008 price levels for the equipment required and does not allow for the additional equipment such as Static Var Compensation that may need to be installed at the onshore connection point of the HVAC connection solutions in order for the Offshore Transmission Owners to meet the reactive capability requirement of the System Operator/Transmission Owner code (e.g. an SVC sufficient to provide dynamic reactive capability for a 300MW wind farm would cost in the order of £12m). 1845 Crown Estate Round 3 OWF connection study v1.0 (FINAL).doc Page 4 of 94 Sensitivities were also investigated in some areas where new nuclear developments could occur in the same region and within the same timescales as the Round 3 development. If transmission reinforcement was not undertaken in an optimised manner on a strategic basis then offshore transmission asset costs could increase as a result of having to find alternative more distant connection points. An example of this is the Norfolk zone where the inclusion of Sizewell C increases the offshore transmission asset cost by £245m. As a function of these designs, the total installed generating capacity connected for round 3 is 25,295MW (with a connection capacity of 22,980MW) with a £/MW cost ranging from £287k to £477k. In undertaking this work it became clear that, from a purely economic perspective, minimising the length of the offshore transmission network as much as possible is desirable. Typically the cost of the offshore network comprised roughly 90% of the total reinforcement cost. However, the need for significant onshore reinforcement, and the consenting risk that accompanies this reinforcement, was also identified. This was particularly the case for connection of the Dogger Bank, Hornsea and Norfolk development zones as well as areas with the potential for connection of new nuclear generation. Nevertheless, National Grid is confident that the network can be developed in an economic and efficient manner to facilitate renewable targets. In order to achieve this aim, work will need to occur in a timely manner, which implies that some of it may have to occur before specific individual projects materialise. The possible need for investment on an anticipatory ‘no regret’ basis and the pressure to meet renewables targets places further emphasis on the importance of a coordinated approach to the design of an optimum offshore and onshore specific solution. Where onshore reinforcement options have been identified through this study, no environmental impact assessment of these reinforcements has been undertaken at this stage. Prior to undertaking any onshore reinforcement’s environmental impact assessments will be undertaken in accordance with best practice against a range of possible solutions. Some of the identified reinforcements will require planning consent and for this reason the Planning Bill, which received Royal Assent on 26 November, is seen as an essential process to enable significant energy infrastructure projects to be constructed, while enabling local communities and stakeholders to fully engage in the process . Identification of specific onshore reinforcements and the timing of these reinforcements are subject to the frameworks that currently govern the development of the transmission system such as the transmission access regime and the Great Britain Security and Quality of Supply Standards (GB SQSS). The onshore transmission owners are currently in the process of a fundamental review of these frameworks to ensure that they are fit for purpose for a GB electricity system that incorporates large volumes of variable generation from renewable sources. The power transfer capabilities of the HVAC and HVDC technologies available coupled with the potential installed capacity of the Round 3 OWF have to a large part dictated the offshore transmission designs presented in this report and determined that in the primary solution each OWF is connected directly to an onshore connection point, with no interconnection between the OWF in a particular zone. Applying an HVAC and HVDC solution to the same OWF has indicated that the choice of technologies used for the offshore transmission designs will be dictated by the transmission distance and that the cable route length at which HVDC Voltage Source Converter solutions become more economic than an equivalent HVAC solution is between 60km and 80km. Aggregated solutions, where multiple OWF are interconnected have been considered and costed, although these solutions do not compare favourably with the individual offshore transmission designs for the same OWFs in terms of cost per MW installed, except where solutions have been considered that utilise dual bipole HVDC overhead lines as opposed to underground cable to traverse the long distance overland routes from the coast to Norwich and Drax substations. 1845 Crown Estate Round 3 OWF connection study v1.0 (FINAL).doc Page 5 of 94 The challenges posed in delivering the Round 3 offshore connections, regardless of design pursued, will be significant. Investment will be required by existing suppliers in expanding manufacturing facilities for HV cables, and in particular subsea cables. The HVDC VSC market is still at an embryonic stage, with the converter/bipole ratings used in this report yet to be deployed in the field. Hence there will be a technology risk as well as cost premium to be borne by the ‘first comer’ offshore transmission owner to specify this technology.