Solutions for upgrading electricity grids in Central Eastern Europe

The integration of renewable sources into electricity grids is reshaping the way many nations approach sustainability. But Central Eastern European (CEE) countries are grappling with regulatory obstacles, technical challenges, and a lingering reliance on fossil fuels. A new report by CAN Europe presents a roadmap to overcome these barriers.

Europe is swiftly incorporating renewable energy sources like wind and solar into electricity grids. However, Central Eastern European (CEE) countries notably lag behind due to regulatory barriers hindering renewable energy projects, neglect of technical challenges hindering greater integration of renewable power, and a continued heavy reliance on fossil fuels.

A new paper by CAN Europe analyses current challenges in electricity grids in CEE countries by identifying key obstacles and opportunities. The urgency to address bottlenecks is particularly pronounced in the CEE region, given its aging and chronically underinvested electricity generation, transmission, and distribution infrastructure. Outdated infrastructure not only leads to power losses and frequent low-capacity operation but also exhibits a significant lack of flexibility.

The entire European Union faces similar challenges, with aging infrastructure at transmission and distribution levels. The EU Action Plan for Grids, emphasising the removal of bottlenecks and promotion of best practices in planning, permitting, and regulation, provides valuable guidance for CEE to champion future-proof solutions and expedite grid modernisation. While challenges vary across countries, the pressing need for grid modernisation in the region presents an opportunity to address multiple issues. In the evolving landscape of energy distribution, the future grid will intricately weave together residences, offices, public structures, and industries with decentralised photovoltaics, battery storage and heat pumps.

This transformation necessitates the enhancement and expansion of existing infrastructure, coupled with non-infrastructure solutions. To facilitate this shift, Distribution System Operators (DSOs) must be incentivised to develop tools that foster a transparent, digitalised, and decentralised grid. This optimised grid aims to efficiently manage local generation and consumption. Collaboration between DSOs, Transmission System Operators (TSOs), and various stakeholders is paramount. By sharing real-time grid data, these entities can collectively plan the future energy system, optimising resources and addressing congestion issues at both transmission and distribution levels.

The new report showcases inspiring case studies from across the European Union, highlighting successful implementations of these principles.

A useful example is a platform called GOPACS in the Netherlands, which is highlighted as an innovative solution to address grid congestion for operators. This platform uses an algorithm that combines buy and sell orders to manage energy flows in specific areas experiencing congestion. The approach, enabled by capacity-limiting contracts, allows market parties to submit flexibility offers to reduce their power in exchange for agreed compensation. GOPACS is accessed by Dutch network operators, providing a coordinated means to address congestion by leveraging flexible power in the electricity network. The use of data, innovation and transparency in this rapidly changing energy market creates a win-win situation: market parties generate additional income, and operators address system needs.

Promoting sector coupling with renewables is a key driver for integrating the energy system and enhancing overall efficiency. This approach, which involves renewables-based electrification for heat, transport, and industry, contributes to a more sustainable energy system by reducing overall energy demand. As Central Eastern Europe embraces renewables, sector coupling takes on a horizontal perspective, leveraging electricity to systematically decarbonize various sectors of the economy.

A good example of this is in Austria, electric vehicle buyers are incentivized to use only renewable electricity for charging, and the subsidy rate for electric vehicles remained consistent in 2023 compared to the previous year. The Austrian government also offers subsidies for electric vehicle charging stations. Similarly, several EU member countries, including Croatia, the Netherlands, Ireland, and Italy, are adopting policies and enhancing support for the introduction of zero-emission heavy transport in their national plans.

At the transmission level, the flexibility of the power system is crucial for seamlessly integrating variable renewable energy, ensuring a continuous match between demand and supply while promoting efficient expansion. Strategies such as demand-side flexibility, efficiency improvements, and cable pooling enhance grid capacity and optimise existing infrastructure. Incorporating short-duration, long-duration and seasonal storage into grid planning empowers system operators to consistently provide renewable energy, even during periods of reduced renewable generation.

Aligning with climate neutrality targets and intermediate goals, such as the 2030 renewable ambition, is imperative for network development plans and strategies. This shift has significant implications for grid planning, necessitating a focus on capturing and maximising renewable energy potential.

Overcoming grid challenges in the Central and Eastern European (CEE) region requires cross-border cooperation. Increased interconnections between countries serve to stabilise grids, enhance security of supply and reduce reliance on fossil gas peaking plants in the short term, addressing storage needs in the long term. Currently, interconnections within the broader CEE region constitute only 13 percent of the EU’s internal interconnection capacity. Ember Climate modelling indicates that additional interconnection capacity in the region not only lowers power prices but also improves the integration of wind and solar by minimising energy curtailment.

Several transnational energy collaboration projects are already in progress or proposed in the CEE region, including the LitPol link co-developed by Poland and Lithuania, a shared Bulgaria-Romania energy island with offshore wind capacity, the “Black-Sea Corridor” shared grid expansion project, and an energy island concept between Poland, Sweden and Lithuania. These initiatives follow successful examples from Western Europe, such as the Bornholm Energy Island in the Baltic Sea, illustrating a concerted effort towards regional energy integration and sustainability.

Promoting stakeholder engagement in grid planning across various levels is facilitated by transparency, open data availability and data interoperability. Granting stakeholders access to grid capacity and related data fosters trust and instils confidence among investors, encouraging the implementation of new projects. Transparency in planning and utilising the latest methodologies for future grid development not only build public trust but also support the innovation needed in the sector. Embracing open data principles involves making information accessible, fostering innovation and improving interoperability among different providers.

The role of DSOs in the EU energy transition is crucial, and there are examples that some of them are aiming to be more transparency about grid capacity and connection procedures. The Czech DSO, EG.D, set an example by launching an online “grid capacity map” in early 2023. This map enables customers to assess the feasibility of installing photovoltaic panels at specific locations, providing indicative information before project initiation. Furthermore, the obligation for DSOs to transparently inform customers about grid capacity is now a legal requirement, as per an amendment to the Czech Energy Act passed by the Czech Parliament at the end of 2023.

Digitalisation marks a significant shift in the management of energy systems, emphasising increased dynamism and decentralisation. Digital solutions play a crucial role in enabling real-time monitoring and control of energy flows, ensuring grid stability and efficiency amid the growing variability and decentralisation introduced by Distributed Energy Resources (DERs) like electric vehicles, small-scale renewable installations (e.g., solar panels, wind turbines), and electric heat pumps.

Smart meters enhance understanding of electricity consumption patterns for households, light commercial and industrial consumers, improving load visibility at the low-voltage level within the distribution grid. This, in turn, allows the introduction of dynamic pricing and time-of-use tariffs in markets. Sub-meters further track individual electricity usage, including electric heating and electric vehicle charging. Mobile applications assist consumers in receiving notifications, enabling them to plan activities such as heating and cooling homes, operating large appliances, and charging electric vehicles based on shifts in electricity prices. Automation features relieve consumers from the need to actively track market signals or prices, contributing to bill reduction. Looking ahead, innovative approaches that reward demand-side flexibility may emerge as the energy landscape continues to evolve.

An example exists in Poland, where the existing monitoring smart meters are set to be replaced with a new generation of devices. Specifically, 17 million new remote-reading electricity meters (ROCs) are set to be installed by the end of 2028. These upgraded meters will help electricity suppliers to remotely monitor energy consumption without requiring customer involvement. Additionally, once demand-side flexibility systems are implemented, consumers will have the capability to manage their current consumption. The anticipated outcome is an encouragement of positive habits, potentially resulting in a 10 percent energy savings. By 2025, it is projected that the new metering system will encompass 25 percent of consumers.

Based on “Future-Proofing Central Eastern European Grids for Tomorrow’s Energy System “ Published in February 2024 by Climate Action Network (CAN) Europe