Microsoft Scourge Mario Monti and Volunteer Mediators Break Through Europe's Transmission Bottlenecks

22 December 2008—Could a set of energetic volunteers deputized by the European Commission (EC) break through Europe’s most stubborn power-grid bottlenecks? A quick start this year by one of these high-profile interconnection coordinators for priority energy projects suggests they might. In just six months, Mario Monti, best known for challenging Microsoft as Europe’s competition czar in the 1990s, negotiated a new transmission line between Spain and France that had been stalled for 15 years.

But some observers—including one of Monti’s fellow EC grid mediators—say the volunteers’ role is at best just a transition toward more robust European institutions with the expertise and the mandate to coordinate transmission planning.

Hanging in the balance is far more than the EC’s long-standing dream of a unified and competitive European electricity market. Grid experts say that the bold energy plan approved by European leaders this month—a doubling of renewable energy by 2020 to slash greenhouse-gas emissions to 20 percent of 1990 levels—cannot be achieved without major new investments in regional transmission capacity.

France and Spain’s constrained electrical interconnection is a case in point. Spain has Europe’s second-largest wind-power capacity and is aggressively adding solar power, such as the solar thermal plant that started up last month in Andalucía. Accommodating wind and solar, which produce fluctuating amounts of power, would be considerably easier if more of it could flow north to France. But at present, the power-exchange capacity over the Pyrenees is less than 3 percent of peak power consumption—far below the EC’s 10 percent target.

The problem is so severe that in 2002, after already a decade of inaction on the France-Spain interconnection, European energy ministers declared the need for new lines across the Pyrenees to be at ”maximum priority level.” A year later, however, French authorities rejected a proposal for a 400-kilovolt line over the Eastern Pyrenees amid vociferous local opposition.

And that was how the matter stood in September 2007, when the EC appointed Monti and three other interconnection coordinators. Deputizing mediators like Monti is a diplomatic strategy that had already been successfully used in Europe to forge new road and rail links but had yet to be tested for energy. Nine months later, the French and Spanish presidents signed off on a new line, and the local opponents, while vowing to monitor construction carefully, had stepped aside.

In his final report to the EC, Monti writes that he worked hard to address opponents’ doubts that the line was needed and their concern that it would affect the region’s ecology and tourism-based economy. Independent technical advice commissioned from Centro Elettrotecnico Sperimentale Italiano (CESI), an electrical-systems research institute in Milan, justified the line in part by quantifying its impact on development of renewable energy. CESI estimated that a 400-kV line would avoid the production of 1.5 million metric tons of carbon dioxide annually—equal to roughly the pollution from 600 000 cars.

Monti addressed opponents’ environmental and ecological concerns with a pragmatic, if costly, technical shift: he proposed that the transmission-system operators, rather than building an overhead AC transmission line, instead use an underground cable carrying high-voltage DC (HVDC) power. It would be the longest underground HVDC cable to date, but CESI confirmed that it was feasible. The heads of state agreed to share the cost—up to 10 times more than the 90 million (US $120 million) conventional AC line originally proposed.

Ferran Tarradellas, spokesman for the EU Energy Commissioner, Andris Piebalgs, says Monti showed bravery and creativity in his negotiations with both the budget-conscious transmission operators and what he describes as the ”very belligerent” Catalan opposition. ”Undergrounding the line looks very obvious now, but when Mr. Monti proposed it, it was not at all evident,” says Tarradellas.

Still, Monti’s job in selling a line from a point in France to a point in Spain looks straightforward compared with the tasks assigned to the other two EC interconnection coordinators working on electricity issues (the fourth appointed by the EC works on natural gas). Georg Wilhelm Adamowitsch, who until 2006 ran Germany’s ministry of economics and labor, is supposed to coordinate offshore power grids for massive wind farms planned for the North Sea and Baltic Sea.

Meanwhile, WÅ'adysÅ'aw Mielczarski, professor in electric power engineering at the Technical University of Lodz and an architect of Poland’s power market, is supposed to help unstick projects involving Poland, Lithuania, and Germany. Uncertainty over the fate of Lithuania’s Chernobyl-style design nuclear reactors and weak links inside Poland’s grid complicate the northern project, while legal uncertainties and Germany’s unruly wind-power flows complicate expansion to that country.

Progress toward Adamowitsch’s and Mielczarski’s tasks is incremental at best. Both have organized a series of cross-border meetings among power-industry players to begin the planning process and build mutual understanding. Mielczarski also used his political connections to convince Poland’s system operator to push forward with designing a link with Lithuania, rather than waiting to see if the EU approves a rebuild of the Ignalina nuclear station, without which there will be no surplus power for the link to carry. ”We will not lose another year simply waiting for the decision,” says Mielczarski. (The link requires HVDC because Poland’s and Lithuania’s grids are not synchronous: while the Baltic states joined the EU and NATO in 2004, their power systems remain tied to the Russian grid rather than Europe’s.)

Mielczarski is feeling the limits of his volunteer post. ”We can use our credibility to talk to the parties, but our credit is limited,” he says. ”I foresee that in one year my credit will be discharged completely!” What the EC needs to do to make real progress on complex planning problems, says Mielczarski, is to hire full-time professionals in Brussels: ”If we’re going to do a professional job on interconnection, we must have professional people working full time, and we must have more support from the commission.”

Christian Kjaer, CEO of the European Wind Energy Association, agrees. He says the EC is working in parallel with Adamowitsch to support coordinated international planning for offshore wind farms. For example, he points to the EC’s call for the construction of offshore HVDC supergrids in a strategic energy review issued last month. But he bets that it will ultimately take European institutions, rather than coordination of national organizations, to design and efficiently operate an offshore grid.