Dermot Byrne, Chief Executive, EirGrid plc

ESI Seminar 18th June 2010

Transforming Ireland’s

Electric Power System

Transforming the Power System

Deregulation

Competition and

Customer Choice

Smart Grids

Renewables Integration

and Grid Development

Carbon Neutrality

Electrification of Transport

and Heating Sectors

Time

Industry Value Chain

Generation Distribution Suppliers/

Customers

Evolution of Value Chain:

1. Competition in generation and supply

2. Introduction of Independent Regulatory Authority

3. Network Businesses remain as „natural monopolies‟, but regulated

4. Independence of Transmission System Operators

5. Evolution of Wholesale Power Markets

6. Strategic push towards regional markets (EU)

Transmission

EirGrid

– Ireland’s Independent Transmission System Operator and Operator of the Wholesale Power Market

– Commercial State owned Company

– Separate from all parties in the electricity market

– Established by statute as TSO and licensed by Commission for Energy Regulation

– Annual turnover of approximately €300m

EirGrid’s Role

• To develop, maintain and operate a safe, secure, reliable, economical and efficient transmission system for the benefit of our customers

• To deliver quality transmission and market services

• To advise the Regulator (CER) in relation to security of supply

EirGrid’s Role in the Value Chain (Now)

Generation

Transmission

System Operator

Distribution Suppliers/

Customers

Wholesale Electricity Market

Key Elements of Role:

1. Grid Development

2. Power System Operation

3. Transmission Access

4. Power Market Settlement

EirGrid’s independence from all

market participants is critical

Transmission

Asset Owner

EirGrid’s Role in the Value Chain (Future)

Generation Transmission

Grid CompanyDistribution Suppliers/

Customers

Wholesale Electricity Market

Key Elements of Role:

1. Grid Development

2. Power System Operation

3. Transmission Access

4. Power Market Settlement

EirGrid’s independence from all

market participants is critical

Transmission Grid

• High capacity, efficient,

reliable link between

– Generation

– Demand centres

– Interconnections to other

systems

• Equivalent to “broadband”

power or motorways

400 kV 220 kV 110 kV440 km 4000 km1830 km

2,250

2,750

3,250

3,750

4,250

00:00 06:00 12:00 18:00 00:00

Time

MW

Typical Saturday in February

Ireland v England - 24 February 2007

THE IRELAND V ENGLAND RUGBY MATCH ALTERED THE USAGE OF

ELECTRICITY ACROSS THE WHOLE COUNTRY

The anthems

Ireland England

Croke Park, 24 February 2007

43 : 13

Full time

23 : 3

Half time

43 : 13

EirGrid – An All-Island Energy Company

Transmission Projects in Progress

400 kV / 220 kV/ 110 kV

No. of New Stations 16

Overhead Line 610 km

Underground Cable 33.1 km

No. of New Transformers 17

No. of New Capacitor Banks 12

Uprates 582 km

Refurbishments 83 km

Transforming the Power System

Deregulation

Competition and

Customer Choice

Smart Grids

Renewables Integration

and Grid Development

Carbon Neutrality

Electrification of Transport

and Heating Sectors

Time

Power System Transformation – Two Dimensions

Investment Dimension

The major Infrastructural Building Blocks

The ‘Hardware’

1

2 Operational Dimension Policies, procedures, controls etc

The ‘Software’

Ireland’s Renewable Policy Target

0% 5% 10% 15% 20% 25% 30% 35% 40%

Slovenia

Czech Republic

Hungary

Estonia

Belgium

Cyprus

Finland

Italy

Slovak Republic

Austria

Netherlands

France

Bulgaria

Sweden

Malta

Poland

Spain

UK

Greece

Germany

Portugal

Denmark

Ireland

Wind as a Percentage of Total Electricity (2020 Target) - Select EU Countries

1 Investment Dimension – the ‘Hardware’

ON TARGET FOR 2012

2,200 km Upgrades

1,150 km New Build

€4 billion

€4 bn

Developing the Grid - Grid25

Dublin Area

Cork Area

Planned

Transmission

System

400kV, 220kV &

110 kV

GH

COOKSTOWN

MACETOWNRB

275kV

CATHALEEN'S

FALL CLIFF

SLIGO

TAWNAGHMORE

MOY

CASTLEBAR

PLATIN

NAVAN

MULLINGAR

ATHLONE

CASHLA

GALWAY

ENNIS

DALLOW

TURLOUGH

HILL

ARKLOWSHELTON

ABBEYCARLOW

KILKENNY

THURLES

CAHIR

DOON

ANNERBALLYDINE

GREAT ISLAND

BARRYMORE

MALLOW

CHARLEVILLE

BANDON

DUNMANWAY

MACROOM

KNOCKEARAGH

RATHKEALE

MONEYPOINT

TARBERT

CARRICK

-ON-

SHANNON

LANESBORO

BRINNY

THORNSBERRY

KELLIS

TO TANDRAGEE

TO STRABANE

BUTLERSTOWN

DUNGARVAN

DRYBRIDGE

BLAKE

SHANKILL

LISDRUM

LOUTH

DUNDALK

BELLACORICK

TULLABRACK

MUNGRET

MONETEEN

GRANGE

MAYNOOTH

FASSAROE

AUGHINISH

POLLAPHUCA

CLOON

TO ENNISKILLEN

KNOCKRAHA

KILBARRY

SOMERSET

RAFFEEN

AGHADA

GOLAGH

WATERFORD

GILRA

IKERRIN

NORTHERN

IRELAND

NORTH WALL

POOLBEG

SHELLYBANKS

KILTEEL

LISHEEN

GORTAWEE

OUGHTRAGH

CUSHALING

ARVA

MULLAGHARLIN

SHANNONBRIDGE

ARIGNA

TRILLICK

IRISHTOWN

CARRIGADROHID

COOLROE

TRABEG

INNISCARRA

MARINA

DUNFIRTH

STRATFORD

KINNEGAD

BALLYLICKEY

DALTON

CORRACLASSY

OLDSTREET

CLASHAVOON

BALLYBEG

CUNGHILL

KILLOTERANCULLENAGH

TIPPERARY

HUNTSTOWN

GLENLARA

ARDNACRUSHA

KILMORE

FINGLASCOLLEGE

PARKDERRYIRON

SEE

DUBLIN

AREA

TRALEE

TRIEN

PROSPECT

DRUMLINE

GLASMORE

AHANE

WOODLAND

CASTLEFARM

SEALROCK

CORDERRY

BALLYWATER

GORMAN

DERRYBRIEN

AGANNYGAL

CLONKEEN

COOMAGEARLAHY

BOOLTIAGH

SORNE

HILL

RATRUSSAN

GLANLEE

Transmission System400 kV, 220 kV and 110 kV

January 2008

BARODANEWBRIDGE

MONREAD

CORDUFF

CRANE

KILTOY

LETTERKENNY

MEENTYCAT

DRUMKEEN

BINBANE

TYNAGH

LIMERICK

PORTLAOISE

DUNSTOWN

RINAWADE

INCHICORE

CARRICKMINES

WEXFORD

KILLONAN

KNOCKUMBER

MEATH

HILLTONROE

FLAGFORD

RICHMOND

WHITEGATE

Existing Transmission Network in South

GH

COOKSTOWN

MACETOWNRB

275kV

CATHALEEN'S

FALL CLIFF

SLIGO

TAWNAGHMORE

MOY

CASTLEBAR

PLATIN

NAVAN

MULLINGAR

ATHLONE

CASHLA

GALWAY

ENNIS

DALLOW

TURLOUGH

HILL

ARKLOWSHELTON

ABBEYCARLOW

KILKENNY

THURLES

CAHIR

DOON

ANNERBALLYDINE

GREAT ISLAND

BARRYMORE

MALLOW

CHARLEVILLE

BANDON

DUNMANWAY

MACROOM

KNOCKEARAGH

RATHKEALE

MONEYPOINT

TARBERT

CARRICK

-ON-

SHANNON

LANESBORO

BRINNY

THORNSBERRY

KELLIS

TO TANDRAGEE

TO STRABANE

BUTLERSTOWN

DUNGARVAN

DRYBRIDGE

BLAKE

SHANKILL

LISDRUM

LOUTH

DUNDALK

BELLACORICK

TULLABRACK

MUNGRET

MONETEEN

GRANGE

MAYNOOTH

FASSAROE

AUGHINISH

POLLAPHUCA

CLOON

TO ENNISKILLEN

KNOCKRAHA

KILBARRY

SOMERSET

RAFFEEN

AGHADA

GOLAGH

WATERFORD

GILRA

IKERRIN

NORTHERN

IRELAND

NORTH WALL

POOLBEG

SHELLYBANKS

KILTEEL

LISHEEN

GORTAWEE

OUGHTRAGH

CUSHALING

ARVA

MULLAGHARLIN

SHANNONBRIDGE

ARIGNA

TRILLICK

IRISHTOWN

CARRIGADROHID

COOLROE

TRABEG

INNISCARRA

MARINA

DUNFIRTH

STRATFORD

KINNEGAD

BALLYLICKEY

DALTON

CORRACLASSY

OLDSTREET

CLASHAVOON

BALLYBEG

CUNGHILL

KILLOTERANCULLENAGH

TIPPERARY

HUNTSTOWN

GLENLARA

ARDNACRUSHA

KILMORE

FINGLASCOLLEGE

PARKDERRYIRON

SEE

DUBLIN

AREA

TRALEE

TRIEN

PROSPECT

DRUMLINE

GLASMORE

AHANE

WOODLAND

CASTLEFARM

SEALROCK

CORDERRY

BALLYWATER

GORMAN

DERRYBRIEN

AGANNYGAL

CLONKEEN

COOMAGEARLAHY

BOOLTIAGH

SORNE

HILL

RATRUSSAN

GLANLEE

Transmission System400 kV, 220 kV and 110 kV

January 2008

BARODANEWBRIDGE

MONREAD

CORDUFF

CRANE

KILTOY

LETTERKENNY

MEENTYCAT

DRUMKEEN

BINBANE

TYNAGH

LIMERICK

PORTLAOISE

DUNSTOWN

RINAWADE

INCHICORE

CARRICKMINES

WEXFORD

KILLONAN

KNOCKUMBER

MEATH

HILLTONROE

FLAGFORD

RICHMOND

WHITEGATE

Ballyvouskil

Kishkeam

Knockanure

CORDAL

KNOCKACUMMER

GARROW

KILGARVAN

KERRY

CLAHANE

BARNADEVINE

CLOUGHBOOLA

ATHEA

KIPPALOCK

TOEM

BOGGERAGH

700MW

305MW

520MW

280MW

DROMADA

Kilpaddogue

GRID25 Network Development South

*

Primary Corridors for ReinforcementInvestigation

Construction Challenge

Getting the Balance Right:

• Reliability

• Cost

• Impact

0

100

200

300

400

500

600

700

800

900

1 25 49 73 97 121 145

MW

Hours

Hourly Average Wind (MW) over 1

week (week ending March 15th 2009)

Hourly Average Wind (MW) over 1 week (week ending March 15th 2009)

0

100

200

300

400

500

600

700

800

900

1 25 49 73 97 121 145

Hours

MW

Challenges

• Resource Intermittency

• System Stability

• Uncertainty

• Complexity

• Portfolio Performance

Smart GridResponses

• ICT

• Customer responsiveness

• Decision support tools

• Codes / Protocols

• Smart Meters

Operational Dimension – the ‘Software’2

TSO Renewable Facilitation Studies

Objectives:

• Increase our understanding of the behaviour of the power system with large amounts of renewable generation

• Identify any potential technical issues

• Develop mitigation measures

• Wrap it all up in a comprehensive strategy for the operation of the power system with large amounts of renewables

Studies:

• 4000 Frequency response studies 5000 Transient Stability studies

• 1000 Short Circuit Level studies Analysis of Wind patterns

First comprehensive study of its kind in the World

Transforming the Power System

Deregulation

Competition and

Customer Choice

Smart Grids

Renewables Integration

and Grid Development

Carbon Neutrality

Electrification of Transport

and Heating Sectors

Time

Case for further interconnection

• This confirms the very strong economic case for the

East-West Interconnector.

• Further interconnection between AI and GB is

economically attractive.

• Interconnection from Ireland to France also appears

beneficial, but further detailed work is required to verify

this and evaluate this against Ireland – Great Britain

interconnectors.

• Interconnection assists in integration of more wind on

the system, particularly for export.

EirGrid Off-Shore Grid Study

Study Objectives:

•Develop optimised off-shore grid

development strategies

•Utilise that strategy to inform the TSO

offshore functional designs and policies

Scenarios:

•3/5/7GW off-shore.

•Study Period out to 2030

•Part A: off-shore Ireland only

•Part B: incorporating links to rest of

Europe

Will feed into other broader-based

studies (ENTSO-E, SEI etc.)

Future Generation Portfolio Options

Objectives:

• Dramatic reduction in Carbon Intensity

• Identify technology options

• Contribute to informed debate

Study:

• Year 2035 selected

• Six Balanced Portfolios identified

• Detailed modelling performed

• Results presented

3

Context

• Moneypoint, peat and oil plants set to close: fuel diversity issue.

• Debate should now progress to longer term policy

• Goal will be a transition to a low carbon electricity system.

• Wide range of options have development potential in this timeframe.

Summary

• Significant emissions reductions can be achieved in all portfolios

• All portfolios have higher capital costs and lower running costs relative to today.

• Under current policies the gas portfolio is the most likely outcome and could be viewed as a transitional step towards carbon neutrality by 2050.

• Coal CCS, nuclear, high renewables, storage and interconnection are all able to further reduce emission levels, however a number of technical, environmental and cost issues would need to be overcome

Conclusion

• The purpose of this report is to contribute to a debate on energy policy.

• It builds on, and is complementary to, the Joint Committee’s previous consultation and report on Electricity Needs post 2020.

• There are no simple or easy choices in this complex area.

Transforming the Power System

Deregulation

Competition and

Customer Choice

Smart Grids

Renewables Integration

and Grid Development

Carbon Neutrality

Electrification of Transport

and Heating Sectors

Time