492

Voltage Source Converter (VSC) HVDC for

Power Transmission – Economic Aspects and
Comparison with other AC and DC
Technologies

Working Group B4.46

April 2012
 Voltage Source Converter (VSC) HVDC for Power
Transmission – Economic Aspects and Comparison
with other AC and DC Technologies

Working Group B4.46

Copyright © 2012

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ISBN: 978-2-85873-184-8

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Working Group B4.46

Voltage Source Converter (VSC) HVDC for Power Trans-

mission – Economic Aspects and Comparison with other
AC and DC Technologies

Contributing Members in random order:

Dirk Westermannn (convenor) Alexander Küster

TU Ilmenau, Germany Swissgrid, Switzerland

Dirk van Hertem Dag Soerangr

KU Leuven, Belgium Siemens, Germany

Geraldine Real Gunnar Asplund

RTE France, France ABB, Sweden

Magne Meisingset Masahiro Takasaki

Stattnett, Norway Criepri, Japan

Tuomas Rauhala Bernd Klöckl

Fingrid, Finland Austrian Power Grid

Michael Kurra, Benjamin Deppe Murray Bennett

TU Braunschweig, Germany Teshmont, Canada

Rao Atmuri Kurt Friedrich

RBJ Engineering, Canada Siemens, Germany

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Table of Contents

1 Introduction...................................................................................................................7

2 Technology Overview .................................................................................................10

2.1 Introduction .......................................................................................................10

2.2 Bulk power transmission..................................................................................11
2.3 HVAC power transmission ...............................................................................11
2.4 Line commutated HVDC ...................................................................................12
2.4.1 Introduction to LCC-HVDC ......................................................................12
2.4.2 LCC-HVDC basic setup ...........................................................................13
2.4.3 Power control principles [5]......................................................................16
2.4.4 LCC-HVDC Reliability ..............................................................................18
2.4.5 Summary LCC-HVDC transmission .........................................................18
2.5 Voltage Sourced Converter based HVDC ........................................................ 19
2.5.1 Power control principles and PWM-VSC-HVDC basics ...........................20
2.5.2 Modular Multilevel Converter Topology – MMC-VSC-HVDC ....................24
2.5.3 Hybrid Multilevel Technology – HML-VSC-HVDC [11] .............................28
2.5.4 Cascaded two-level converter – CTL-VSC-HVDC [12] ............................31
2.5.5 VSC-HVDC Reliability .............................................................................34
2.5.6 Summary of VSC-HVDC transmission .....................................................35

3 Operational Properties ...............................................................................................38

3.1 Ancillary services .............................................................................................38

3.2 Differences between HVAC and HVDC in system operation .......................... 40
3.3 The value of VSC from a TSO perspective ...................................................... 46

4 Economic Assessment Process ................................................................................51

4.1 Process description ..........................................................................................51

4.1.1 Phase I – Case study analysis .................................................................52
4.1.2 Phase II – Cost estimation .......................................................................53
4.1.3 Phase III – Functional benefit ..................................................................53
4.1.4 Phase IV – Cash flow analysis.................................................................54

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 4.2 Economic figures of HVAC and HVDC ............................................................ 55
4.2.1 Substation costs ......................................................................................55
4.2.2 Transmission line costs ...........................................................................56
4.2.3 Reactive power compensation .................................................................57
4.2.4 Operation and Maintenance ....................................................................58
4.2.5 Loss evaluation - Examples .....................................................................58
4.2.6 Right of way.............................................................................................59
4.3 Economic evaluation ........................................................................................61
4.3.1 Fast reactive power control - Voltage support ..........................................61
4.3.2 Fast power flow control ............................................................................63
4.3.3 Market coupling .......................................................................................64
4.3.4 Loss reduction .........................................................................................65
4.3.5 Environmental impact ..............................................................................65
4.3.6 Black-start and Island supply ...................................................................66
4.4 Additional comments on the cost factors ....................................................... 66
4.5 Summary of Assessment Process................................................................... 68

5 Case Studies ...............................................................................................................70

5.1 Randstad 380 Project Feasibility of VSC HVDC Application in a

Meshed Grid .....................................................................................................70
5.1.1 Problem definition ....................................................................................70
5.1.2 Technical analysis ...................................................................................72
5.1.3 Present Load and Generation as of 2006 ................................................73
5.1.4 Future scenarios ......................................................................................74
5.1.5 Economic assessment .............................................................................78
5.1.6 Summary and conclusions Randstad.......................................................79
5.2 VSC-HVDC as alternative to ac in German TSO-Grid – Wahle Mecklar
case study ........................................................................................................79
5.2.1 Network model ........................................................................................80
5.2.2 Loss consideration...................................................................................82
5.2.3 Reactive power balance ..........................................................................87
5.2.4 Controllability ...........................................................................................87
5.2.5 Economic consideration...........................................................................89

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 5.2.6 Conclusion ..............................................................................................90
5.3 An Intra-European Interconnection ................................................................. 90
5.3.1 Assumptions ............................................................................................91
5.3.2 Analysis on technical criteria ...................................................................91
5.3.3 Cost Analysis...........................................................................................92
5.3.4 Conclusion ..............................................................................................93
5.4 Generic Case: Cross Border Interconnection ................................................. 93
5.4.1 Case study analysis.................................................................................94
5.4.2 Cost analysis ...........................................................................................94
5.4.3 Functional benefits ..................................................................................95
5.4.4 Cash flow analysis ...................................................................................97
5.4.5 Case summary ......................................................................................102

6 Summary and Conclusions......................................................................................104

7 References ................................................................................................................106

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Acronyms
ac .............Alternating Current AC-E ............ AC and Auxiliary Equipment

ACE ........Area Control Error AGC ............. Automatic Generation Control

CC ...........Constant Current CV ................ Constant Voltage

CEA ........Constant Extinction Angle CIA............... Constant Ignition Angle

C&P ........Control and Protection CP................. Constant Power

CSC .........Current Source Converter CTL .............. Cascaded Two Level

dc.............Direct Current DF ................ discount factor

DCF .........Discounted Cash Flow DR ................ Discount Rate

EA ...........Energy Availability EHV ............. Extra High Voltage

EMF ........Electromagnetic Field EOH ............. Equivalent Outage Hours

FACTS ....Flexible AC Transmission Systems FEU .............. Forced Energy Unavailability

GDP ........Gross Domestic Product HML............. Hybrid Multi Level

HVAC .....High Voltage Alternating Current HVDC .......... High Voltage Direct Current

IGBT .......Insulated Gate Bipolar Transistor ISO ............... Independent System Operator

LCC .........Line Commutated Converter LFC .............. Load Frequency Control

MI............Mass Impregnated MMC ............ Modular Multi Level Converter

MTF ........Merchant Transmission Facility MTO............. Merchant Transmission Operator

NERC ......North Am. Electric Reliability Council NPV ............. Net Present Value

NTC ........Net Transfer Capacity OHTL ........... Over Head Transmission Line

PFC .........Power Flow Control PPL-MI ........ Paper Polypropylene Laminated MI

PSS ..........Power System Stabilizer PST............... Phase Shifting Transformer

PWM .......Puls Width Modulation SEU .............. Scheduled Energy Unavailability

SM ...........Sub Module SSR .............. Sub Synchronous Resonance

TCSC ......Thyristor Controlled Series Comp. STATCOM .. Static Compensator

TL............Transmission Line (and cable) TRM ............. Transfer Reliability Margin

TSO .........Transmission System Operator TTC .............. Total Transfer Capacity

UHV ........Ultra High Voltage V................... Valve

VSC .........Voltage Sourced Converter

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1 Introduction

Throughout the world power industry is experiencing a major change due to the process of liberaliza-
tion and deregulation. For decades, power industry sector has consisted of large vertically integrated
utilities, comprising the entire value-added chain of power generation, transmission, distribution, trad-
ing and resale. Deregulation of the natural monopolies created a competitive market structure. The
former vertically integrated utilities typically evolved into separate horizontally integrated entities for
generation, transmission/distribution, trading and resale. The transmission and distribution networks
typically remain as natural monopolies, whereas generation, trading and resale form competitive mar-
kets.

The power transmission system is a key component in the value-added power supply chain and is sub-
ject to its inherent physical limits. As a consequence of liberalization process, transmission systems
and their operation have been pushed closer towards their physical limits. As part of an interconnected
system, transmission system operation has therefore become a more complex and challenging task as
it must consider the increasing cross-border trades and system stability issues. Innovative and new
technology equipment may help handle crucial system conditions successfully and maintain reliable
power supply.

Minimizing the costs of transmission system and simultaneously maximizing the available capacity
challenges transmission system operators (TSOs) to find economical network solutions. The develop-
ments of power electronics equipment for transmission system applications offer new innovative
equipment for power system planners and operators. New Flexible AC Transmission Systems
(FACTS) and High Voltage Direct Current (HVDC) systems facilitate flexible and reliable power
system operation during normal and abnormal conditions. FACTS and HVDC systems open up a wide
range of new applications and can improve power system stability and controllability. HVDC and
FACTS offer new services for system operation and can be an attractive solution for power transmis-
sion. Bulk power transmission for market coupling and distant offshore wind-farm connection are
recent applications craving for new efficient transmission technology.

To satisfy the needs for a reliable power system, the process of transmission planning has to be fast,
accurate and efficient. However, the availability of new power electronic transmission equipment
makes transmission planning more complex. As a consequence, there is a huge demand by TSOs, reg-
ulators and decision-makers for information and advisory services to assist with finding the best over-
all solution. This Technical Brochure provides a contribution towards this need.

High Voltage Direct Current (HVDC) has been a viable technology since 1954 and has played a vital
role in both long distance transmission and in interconnection of ac systems. Due to recent develop-
ments of power electronic devices Voltage Sourced Converter (VSC) based HVDC schemes have
been available since year 2000 for power transmission applications. These VSC based HVDC systems

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provide some functional advantages over Line Commutated Converter (LCC) based HVDC schemes
and conventional high voltage alternating current (HVAC). The economic value of functional advan-
tages of VSC-HVDC applications for bulk power transmission has to be evaluated.

With respect to the wide range of technologies, available for bulk power transmission, there is a need
for information to enable an economic assessment of all transmission technologies, to enable TSOs,
regulators and independent power producers (IPP) to determine the optimal transmission solution for
transmission system expansion projects.

The main objectives of this report are to provide:

• Comprehensive description of existing transmission technologies in order to derive

certain operational and control characteristics for ac and dc technology based trans-
mission schemes.
• Analysis of advanced transmission characteristics and power/reactive power control
properties that could have a monetary value in a deregulated and liberalized power
market.
• Since VSC based HVDC for bulk power transmission is not yet well known, the plan-
ning uncertainty for this technology appears to be higher than for other established
technologies. Consequently, the focus in this Working Group was focused on this par-
ticular HVDC technology.
• Development of an assessment process, that allows for an economic comparison of
different transmission technologies in the first stage of the network expansion plan-
ning process.
• Demonstration of the planning process with respect to two typical transmission expan-
sion situations: Network interconnection and network expansion.
Since the main objective is to provide a general aid for network planners to support the first step of a
regular planning process, the technological focus is on the general operational characteristics.

This report will start with outlining the basic technical characteristics of power transmission. Back-
ground information on HVDC transmission concepts is given with a focus on the technical aspects,
performance, limitations and requirements to environmental and economic conditions. Chapter 2 con-
tains all mentioned aspects of the different transmission technologies and gives a summary of availa-
ble functions offered by each of these.

Chapter 3 presents the differences in power system operation today and before the process of deregu-
lation are pointed out. Especially the provision and acquisition of ancillary services is introduced to
identify the beneficial impact of new controllable power transmission equipment within a market envi-
ronment. The diverse applications of HVAC and HVDC systems and their advantages and constraints
for power system operation are described. An assessment process for transmission projects is outlined
in chapter 3, regarding available transmission technology concepts suitable for bulk power transmis-
sion. The ideal process should present the optimal transmission solution for a considered project and

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act as a connector between transmission system planning and investment decision. In this report no
“Supergrid” considerations have been made. Only point-to-point connections have been considered.
The proposed figures and process for economic evaluation do not include reliability figures.

Examples for application of the proposed method are given in chapter 4. The overall results and con-
clusion to assessment process and a final case study remark is given in chapter 5. A comprehensive
review of the assessment process and the executed example case studies are presented. The report
finishes with an outlook and proposals of further investigations related to the topic.

All eco nomic figures g iven i n t his r eport h ave b een d erived from p ublicly a vailable so urces.
These figures represent a snapshot of the actual situation of the power industry in 2010 and may
significantly vary from one project to another.

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2 Technology Overview

2.1 Introduction

Although electrical power systems vary in size, structure and performance they all have some key
attributes described below:

• A three phase ac system facilitates power transmission between generation, transmis-

sion and distribution utilities. Industrial loads are supplied by a three phase connec-
tion. Typically residential loads are split up equally into several one phase connections
and form a virtually balanced three phase connection.
• The bulk part of power is generated by synchronous machines. Prime movers convert
the primary source of energy to mechanical energy that is converted into electrical
energy by synchronous generators.
• The power transmission system has a centralized structure. Power is generated in large
power plants and may be transmitted over long distances before it is distributed at
lower voltage levels via the distribution system. Even though the trend is towards a
more dispersed power generation, bulk power transmission in connection with rene-
wables becomes reality.
The major task of the high voltage transmission grid is to transmit the power generated by power
plants to substations which are the interface between transmission and distribution system. For exam-
ple in Germany high voltage transmission grid is operated at voltage levels of 110 kV and above (e.g.
220 and 380 kV), and a voltage level of 10 and 20 kV at the distribution system is used to supply in-
dustrial loads and feed the 0.4 kV low voltage grid.

With further growth and development of wind generation, solar panels and combined heat and power
devices more and more small scale energy producers will be connected directly to the low voltage
distribution grid. These devices are known as dispersed or distributed generation. In the long run the
proliferation of distributed generation will significantly change the structure of the power system. This
evolution will have a perceptible impact on the function and safe operation of the power transmission
system.

The main task of a power system is to deliver electrical energy wherever and whenever it is required.
Due to the fact that electrical energy cannot be stored in sufficient quantities, the electric energy gen-
eration has to instantly meet the changing load. Therefore adequate spinning reserve has to be main-
tained and applied to ensure safe and reliable system operation to keep a certain level of power quality
regarding the following factors: constant system frequency, constant system voltage and an acceptable
level of system reliability/security.

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2.2 Bulk power transmission

As described above power systems are mostly organized as top-down supply structure. This report
focuses on the high voltage grids for large-scale power transmission of large blocks of power. In this
report power ratings of 1000 MW and above are considered as bulk power transmission. The intercon-
nection of different power systems for market coupling and grid connection of large aggregated off-
shore wind-farms are typical application scenarios which can be referred to as bulk power transmis-
sion projects. Table 2.1 illustrates the range of power transmission circuit ratings. As already men-
tioned, the continuing development of VSC-HVDC technology is making it capable of typical bulk
power applications with higher voltage and power rating.

Table 2.1: Bulk power Transmission

Power Range AC LCC HVDC VSC HVDC

5.000 MW… 7.500 MW - UHVDC Bulk (Bipole DC 800 kV) -

2.500 MW… 5.000 MW UHV Bulk UHVDC Bulk (Bipole DC 800 kV) -

1.800 MW… 3.500 MW EHV Bulk HVDC Classic (Bipole DC 500 kV) Bulk power VSC HVDC
(Overhead line)

700 MW .. 2.000 MW EHV Grid HVDC Classic High power VSC HVDC
(Bipole DC 400kV .. 500kV)

300 MW .. 800 MW HV Grid HVDC Classic Medium power VSC HVDC

(Monopole DC 300kV .. 500kV)

< 300 MW HV Grid HVDC Classic Low power VSC HVDC

(Monopole DC< 300kV)

2.3 HVAC power transmission

This chapter outlines some key technology aspects influencing the economical characteristics of
HVAC transmission. The most important aspects directly affecting performance of power transmission
are summarized to provide a basis for comparison with LCC-HVDC and VSC-HVDC transmission.

The power flow across an HVAC transmission line is governed by the system conditions at the ter-
minals. The amount of active power flow across the HVAC is proportional to the voltage angle differ-
ence between the terminals, whereas the reactive power flow is affected by the voltage magnitude. The
transmission distance of HVAC lines is constrained by their thermal limits, the voltage regulation
caused by the reactive power flow along the line and steady state stability issues, which leads to an
overall transmission distance limitation.

HVAC transmission lines feature a load dependent reactive power demand which may impact on the
active current rating, and may require reactive power compensation at the terminals, and at points
along the line, to ensure the desired voltage level and adequate active power transfer capability. A
brief overview is illustrated in Table 2.2.

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Table 2.2: HVAC transmission summary

Property / Function HVAC (without extra equipment like PSTs or FACTS)

Power transmission OHTL Cable

Maximum voltage level
Maximum power rating
Maximum transmission distance
Footprint
Active power flow control
Reactive power demand
Voltage control
Power reversal
Necessary filter equipment
Grid connection requirements
Black-start / island supply
Ability to insert future nodes in the
line
> 1.000 kV < 600 kV
> 5 GW < 1.5 GW 1
> 1.000 km << 100 km
Only right of way – no special equipment needed - For line longer
than 400 km space for compensation needs to be included
Extra equipment needed
depending on loading reactive charging current
Line reactors – no special equipment needed
Inherent to technology
Not needed
Conventional substations as network nodes or intermediate tapping
without bulk substation arrangements
Inherent to technology
Inherent to technology

2.4 Line commutated HVDC

The two basic converter technologies used for high voltage direct current transmission are convention-
al line commutated converters (LCC) and self-commutated or voltage sourced converter (VSC) devic-
es. This section presents a basic overview of LCC-HVDC transmission. The basic characteristic and
technical setup are described to highlight the differences between the two transmission technologies.
This report focuses on self-commutated converters and their benefit for power system operation, hen-
ceforth only a brief summary of LCC-HVDC technology is presented.

2.4.1 Introduction to LCC-HVDC

HVDC transmission became commercially available with the advent of mercury-arc valves in the
1950’s. Thyristor based valves entered the commercial market in 1972 with the commissioning of the
Eel River HVDC system. The thyristor valve technology facilitated simpler and scalable converter

1
2.500 Cu, direct buried with spacing 0.35 m

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station designs with lower operating and maintenance costs than could be obtained with mercury arc
valves [1]. Since that time LCC-HVDC based power transmission systems have been based on thyris-
tor technology. LCC-HVDC has been applied to the following types of power transmission:

• Submarine and underground cable transmission

• Asynchronous link between ac systems
• Long distance bulk power transmission using overhead lines
Its technical capability, combined with its economic advantage and low operating losses, make
LCC-HVDC a practical solution for enlarging or enhancing power system interconnections. Only 2
LCC-HVDC schemes with 3 terminals have been designed, all other schemes have only 2 terminals.

2.4.2 LCC-HVDC basic setup

An LCC converter has a modular design and is based on a building block of six-pulse bridges which
are made up of six thyristor valves that produce a characteristic harmonic ripple of six times the fun-
damental frequency in the dc voltage. Due to the relatively low blocking voltage of a single thyristor,
each valve consists of a suitable number of series connected thyristors to achieve the rated dc voltage.
The normal configuration is to operate with 12-pulse bridges by connecting two six-pulse bridges in
series with a 30° phase shift between the two bridges achieved by feeding one six-pulse converter by a
star winding and the second six-pulse bridge by a delta winding. This connection has the advantage of
reducing ac harmonic currents and dc harmonic voltages. The basic converter station setup is illu-
strated in Figure 2.1.

DC-Reactor

AC-Filter

Y/Y

Y/Δ

AC-Switchyard Converter DC-Filter

Figure 2.1: Typical LCC-HVDC configuration with a single 12-pulse converter, [2]

LCC-HVDC converters require a relatively strong synchronous voltage for the process of commuta-
tion. Commutation is the change of current flow from one valve to another in a synchronized firing
sequence of the thyristor valves during operation. The available short circuit ratio, which is the ratio of
three phase ac short circuit capacity to the power rating of the converter, at the connection point

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should be two or greater for LCC-HVDC. Line commutated converters require reactive power, which
has to be provided by additional switched capacitors, filter equipment or other reactive compensation
sources, as shown in Figure 2.1. Due to the higher harmonic stress and additional dc voltage compo-
nent at the secondary winding, special transformers have to be used for an LCC-HVDC converter sta-
tion. dc smoothing reactors are used to avoid current interruption at minimum load and limit overcur-
rents during a dc fault [3]. The major LCC-HVDC station equipment includes:

• Converter valves
• Converter transformers
• AC filters
• Reactive compensation equipment
• Smoothing reactor
• DC filters
• Controls
• Valve cooling systems
In planning an LCC station, space must be allowed for the ac filter and compensation equipment as
shown in Figure 2.2 , which illustrates a typical LCC-HVDC substation footprint for a bipole with a
power rating of 1000 MW each pole.

150 m
DC-Voltage: +/- 500 kV
AC-Voltage: 400kV
150 m

DC-Yard

Converters
115 m

AC Reactors
AC Filters and Shunt Capacitor Banks

Installed capacitive and inductive components:

Capacitors: 1160 MVAr
Reactors: 240 MVAr

Figure 2.2: Typical LCC-HVDC footprint (ABB)

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The basic configurations of HVDC links available include back-to-back ties, bipolar, monopolar and
multi terminal systems, are shown in Figure 2.3.

Back-to-back HVDC solutions are used for the connection of two asynchronous systems. With back-
to-back converter stations there is no dc transmission line as both converters are located within one
converter building. A back-to-back scheme typically consists of two valve groups and a smoothing
reactor on the dc side. The HVDC supplier selects the optimum dc voltage and current ratings to give
the lowest converter cost. Usually the dc voltage rating will be low and the dc current rating high to
make full use of the thyristor current rating.

Figure 2.3: HVDC configuration alternatives [4]

A bipolar arrangement is usually used for long distance transmission. For power flow in one direction,
one pole has a positive polarity and the other pole has a negative polarity. To reverse the power flow,
the polarities are reversed. Both terminal stations are normally grounded. The current flowing in the
poles is essentially balanced and the unbalance current in the ground is usually less than 1-2% of rated
current.

Bipolar systems are designed to maintain independence between the poles to ensure that a forced out-
age on one transmission line pole or a station pole does not affect the healthy pole. When a pole is out
of service, the other pole should be capable of monopolar operation with the ground providing the
return path for the dc current. Monopolar operation provides 50% of the nominal bipolar power rating.
Some systems are rated for overload operation to minimize the initial loss of power caused by a pole
outage.

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For schemes with ground electrodes, long-term operation with ground return current may be undesira-
ble due to corrosion and other interference effects. In most situations where a pole is out of service, the
transmission line pole conductor will still be available for operation in metallic return. To switch to
metallic return operation, converter pole equipment is first isolated by opening switches and then pole
switches are closed to connect the line pole to the neutral bus. This results in the metallic return con-
ductor being in parallel with the ground path. The ground current is interrupted by opening a switch in
the path to the electrode at one station, causing the entire pole current to flow in the metallic return
conductor. The simplest connection configuration is a monopolar link, which consists of a high vol-
tage dc conductor and a ground electrode as return path.

2.4.3 Power control principles [5]

The control system in an LCC-HVDC converter station generally has a hierarchical structure with
three layers. From the uppermost, these three layers are bipole control, pole control, and converter unit
control. The bipole control coordinates the power orders of the poles and distributes the power order to
the pole control. Supplementary controls, such as automatic frequency control and power modulation
to improve ac system stability are also implemented in the bipole control, and these control signals are
added to the power order to the pole control. The bipole control may also include station control,
which looks after the switching of harmonic filters and shunt capacitors in accordance with operating
conditions.

The pole control calculates a firing angle order of each converter to follow a power order or a dc vol-
tage order. Finally, the converter unit control arranges firing pulse signals for switching devices, cor-
responding to the given firing angle order.

An LCC-HVDC system is usually operated so as to maintain constant dc current and dc voltage. The
pole control produces control characteristics, which includes constant current (CC), constant voltage
(CV), constant firing angle (CFA) control and constant extinction angle (CEA) controls. Typical sim-
plified control characteristics are shown in Figure 2.4. Extinction angle control is needed to avoid
commutation failures in inverter operation, which occur if the commutation process between phases
does not complete a certain time before the thyristor becomes forward biased. A commutation failure
causes a brief disturbance to the ac network, but is typically cleared within a few power frequency
cycles. It is usually caused by single phase faults in the ac network which results in a voltage drop at
the converter station of >10%. In the event of a disturbance in the ac network, e.g., as a consequence
of a remote fault, a commutation failure may still occur. The two characteristics of a rectifier and an
inverter are symmetrical with respect to the horizontal axis of dc current. The dc current order of the
inverter is smaller than that of the rectifier by the current margin, thereby ensuring stable dc current
control. The intersection A in Figure 2.4 indicates an operating point in steady-state condition. Usual-
ly, a rectifier sets dc current and an inverter sets dc voltage. The actual operating points of the respec-
tive converters, however, differ in dc voltage due to the voltage drop of the dc line. Current control is

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generally required to have a quick response, and voltage control consequently has a comparably slow
response to avoid unstable control interaction.

The setting value of power to be transferred by the HVDC system is ordered from a dispatching cen-
ter. At any time, only one terminal can control the dc power in a two-terminal system. The converter
station that has been assigned the dc power regulation role activates constant power control (CP). This
power control is integrated in parallel with dc current control loop and corrects the current order set-
ting so as to adjust actual dc power to the setting value. Power reversal, or an interchange of the rec-
tifier and inverter operations, can be done by changing the converter that subtracts the current margin
from the current order setting, such that the characteristics become as shown in the dotted lines. The
new operating point B with reversed dc power is the intersection of the two dotted lines in Figure 2.4.
In a LCC-HVDC system, the power reversal action changes dc voltage polarity and the dc current
direction remains the same as before.

Figure 2.4: Simplified typical converter control characteristic

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2.4.4 LCC-HVDC Reliability

HVDC System Energy Unavailability is the key factor for analysing HVDC performance. Energy
Unavailability is the sum of Forced Energy Unavailability (FEU) and Scheduled Energy Unavailabil-
ity (SEU).

FEU is the amount of energy that could not have been transmitted over the dc system due to forced
outages. FEU together with the number and duration of outage events by category are considered to be
the most useful measurements of system performance for operation evaluation and planning of future
systems.

SEU is derived from scheduled outages and has less significance on the reliability performance than
FEU since scheduled outages may be taken during reduced system loading conditions or when some
reduction in power transfer capability is acceptable. SEU is intended to be used mainly by owners over
a long period of time for general comparison or for comparisons of their own needs, and not intended
to be used for evaluating reliability or availability performance.

CIGRÉ Study Committee B4, Advisory Group B4.04 has assembled and published data on the reli-
ability and operational experience of HVDC systems in service around the world since 1968 [6]. Ref-
erence [7] calculates the frequency and duration values of forced and scheduled outages by component
by specific percentiles from all reports received by CIGRE from 1983 through to 2004 for thyristor
valve systems. Table 2.3 shows the calculated values for FEU and SEU for the 50% percentile and
80% percentile for monopole and bipole schemes on an annual basis. The data in Table 2.3 demon-
strates that LCC -HVDC systems are mature and reliable by having median FEU of less than 1.0%

Table 2.3: FEU and SEU for Monopole and Bipole Systems

50% Percentile 80% Percentile

FEU [%] SEU [%] FEU [%] SEU [%]

Monopole 0.45 2.7 0.17 2.3

Bipole 0.83 4.9 0.24 3.3

2.4.5 Summary LCC-HVDC transmission

The key characteristic of LCC-HVDC is governed by the attributes of the switching thyristors. The
power flow controllability is provided by the control of the firing of the thyristor valves. As a conse-
quence of their basic physical structure thyristor switches can only be switched on but require a cur-
rent zero in order to switch off. The switching process is responsible for the harmonic distortion and
the demand for reactive power dependent on the firing angle. LCC converters can only absorb reactive
power. Harmonics and reactive power have to be compensated at the station to prevent negative im-
pacts on the ac transmission system. The ac filters and shunt compensation banks occupy a large area

- 18 -
in the switchyard. Black-start capability is not easily available with LCC converters. The key facts
important for power system operation duties are summarized in Table 2.4.

Table 2.4: LCC-HVDC summary

LCC-HVDC
Power Transmission OHTL Cable
Maximum voltage level 800 kV dc 500 kV dc
(600 kVdc with PPL MI)
Maximum power rating <7500 MW
Maximum transmission distance Unlimited
Footprint 200 x 120 x 20 m (600 MW)
Active power flow control Continuous, min. 10% load
Reactive power demand 50% .. 60% of converter power rating
Compensated by breaker switched ac harmonic filters and reactive
power banks
AC Voltage control Slow, transformer tap change
Power Reversal DC voltage reversal
Necessary filter equipment High demand
Grid connection requirements SCR> 2 x power rating
Black start / island supply Not inherently available
Typical Power Loss in the two conver- 1.7%
ter stations at full power

2.5 Voltage Sourced Converter based HVDC

The development in power electronics which led to the introduction of insulated gate bipolar transistor
(IGBT) based switching valves in the 1980s made a new HVDC technology feasible [4]. Voltage
sourced converters (VSC) are also referred to as self-commutated converters. The fundamental differ-
ence between the voltage sourced converter technology and conventional line commutated technology
is that VSC-HVDC uses IGBTs, which are able to switch off current (q.v. Figure 2.5). Hence there is
no demand for a synchronous voltage for the commutation process. An additional advantage of VSC-
HVDC technology is its ability to control the reactive power at both converter stations independent of
active power flow and with the only constraint being the maximum apparent power and output vol-
tage, which is limited by the rating of the VSC valves.

Thus the VSC-HVDC can be placed anywhere in the ac network without concerns about the available
short circuit ratio. The performance and characteristics of self-commutated converters depends strong-

- 19 -
ly on the arrangement of the converter valves and switching devices. An overview of available VSC
topologies and their impact on the converter performance is described in chapter 2.5.1 to 2.5.3.

Figure 2.5: LCC-HVDC compared to self-commutated VSC-HVDC [5]

Different manufacturers of HVDC systems have different technologies. Today, the following technol-
ogical principles can be differentiated:

• Pulse width modulated (PWM) two level or three level VSC converters which was in-
troduced first by ABB in the 1990s. (PWM-VSC-HVDC, short: PWM-VSC). This
technology is known under the brand “HVDC Light”
• Multilevel modular converters (MMC-VSC-HVDC, short: MMC-VSC) which has
been introduced around 2006 by SIEMENS and is known under the brand “Plus-
Technology”
• Hybrid multilevel approach (HML-VSC-HVDC, short: HML-VSC) which has been
announced by Alstom Grid in 2010 to be under development. Technology wise this
approach is a combination of the other technologies mentioned above.
• Cascaded two level converters which have been introduced by ABB in 2010 (CTL-
VSC-HVDC, short: CTL-VSC). This approach is a further development of the two-
level resp. three-level PWM-VSC technology which will be marketed under the same
brand: “Light-Technology”.
VSC-HVDC stations do not require the large amount of reactive compensation and ac filter equipment
as LCC-HVDC stations do. Hence VSC-HVDC converter stations require fewer footprints (q.v. Figure
2.7). Necessary VSC-HVDC equipment: Transformer, ac filters, Converter valves, converter reactors,
Smoothing capacitor, Controls and Cooling.

2.5.1 Power control principles and PWM-VSC-HVDC basics

Due to the different power electronic switches, the VSC features a completely different characteristic.
The single line diagram below should serve as an example to describe the power flow control. This
qualitative arrangement consists of two switching devices which can provide two voltage levels for ac
voltage generation that is ± vDC . Hence this topology is referred to as two-level converter.

- 20 -
Figure 2.6: VSC-HVDC station setup

Figure 2.7: Typical VSC-HVDC layout – 1000 MW [8]

The apparent power at the converter filter bus is given by

s fi =p + jq = 3 v fi i R
*
(2.1)

The active and reactive power is given by the same equations as are used for ac transmission:

v fi vconv
p= sin δ (2.2)
xR
v fi (v fi − vconv cos δ )
q= (2.3)
xR

- 21 -
The angle δ is the phase angle difference between the filter bus voltage v fi and the converter voltage
vconv while assuming a lossless phase reactor xR . According to (2.2) and (2.3) the active power flow
into the grid depends strongly on the phase angle, whereas the reactive power flow is controlled by
adjusting the voltage amplitude difference between converter and filter bus.

The availability of fast switching IGBTs facilitates the active and reactive power flow control by use
of pulse width modulation (PWM), which will determine the phase angle and amplitude of the conver-
ter ac voltage. Depending on the IGBTs the switching frequency can be up to 2 kHz [2]. The high
switching frequency reduces significantly the generated harmonics, but on the other side increases the
total power losses. With PWM it is possible to create an ac converter output voltage with any phase
angle and amplitude, below certain maximum values, determined by the rating of the converter and the
VSC valves. The converter voltage profile is determined by the fundamental mode used for PWM. A
qualitative example is given below. If vconv is in phase-lag, the active power flows from ac to dc side.
Vice versa if vconv is in phase-lead.

Figure 2.8: VSC-HVDC converter voltage profile

If v fi exceeds vconv the converter is demanding reactive power, whereas the converter will provide reac-

tive power if vconv exceeds v fi . The active and reactive power can be adjusted independently of each
other, subject to the maximum apparent power capability of the converter, caused by the converter and
thermal limits. Hence, different control modes have to be defined to clarify what control parameter has
top priority. For example, priorities must be determined between reactive power control, voltage con-
trol, active power control and frequency control.

The basic two or three level converter topology described above represents the majority of VSC-
HVDC facilities commissioned today.

The blocking voltage of semiconductors is limited to a relatively low level and multiple power elec-
tronic switches are connected in series to achieve the dc voltages required for bulk power transmis-

- 22 -
sion. Depending on the required dc voltage, several hundreds of IGBTs per converter arm are neces-
sary to provide the high blocking voltage. To ensure a unique voltage distribution, all IGBTs con-
nected in series in one converter arm have to switch simultaneously with accuracy in the microsecond
range [9]. The ac converter terminals will see high and steep voltage steps as shown by Figure 2.8.
This converter topology will require ac filters to reduce the harmonics generated by the pulse-width
modulation.

Figure 2.9: VSC-HVDC – active power flow control

Figure 2.10: VSC-HVDC – reactive power flow control

- 23 -
2.5.2 Modular Multilevel Converter Topology – MMC-VSC-HVDC

Basic Principle

The large voltage steps associated with PWM operation can be reduced by generating the ac voltage
from a large number of smaller voltage steps. This approach is utilized by multi-level converter de-
signs. The higher the number of voltage steps, the smaller is the proportion of harmonics generated by
the switching process. The basic topology is outlined in Figure 2.11.

Figure 2.11: VSC-HVDC multi-level topology [9]

Each sub-module provides a voltage step, which can be applied, together with a multitude of further
sub-modules connected in series, to the ac converter bus. With the possibility to control each
sub-module separately and selectively the two converter modules in each phase unit appear as control-
lable voltage source within each phase unit. In this arrangement the total voltage of the two converter
modules in each phase unit equals the dc voltage. As depicted in Figure 2.12 the ac bus voltage is con-
trolled by the ratio of converter modules which are bypassed in each phase unit.

Instead of switching all semiconductors per phase simultaneously with high frequency, the desired ac
bus voltage is achieved only by adjusting the ratio between two voltage levels. This requires fewer
switching operations per equal time step as compared to conventional two or three level converters
using pulse-width modulation. Hence, there is no need for snubber circuits to sustain a simultaneous
switching operation of all semiconductors per phase. Based on the concept of this topology, the con-
verter arms act as a controllable voltage source with a high number of possible discrete voltage steps,
which allow forming an approximate sine wave with adjustable magnitude and phase angle of the vol-
tage to the ac terminal. Each of these variable voltage sources is designed with a number of identical
but individually controllable sub-modules. Each sub-module is a two-terminal component which can

- 24 -
be switched between a state with full module voltage and a state with zero module voltage in both
current directions. Dependent on the current direction, the capacitor can be charged or discharged.

Figure 2.12: VSC-HVDC multi-level voltage control [9]

Besides auxiliary components and electronics, each sub-module consists of an IGBT half bridge and a
capacitor unit. By serially connecting many modules an elegant multilevel topology can be con-
structed. It is possible to individually and selectively control each of the individual sub-modules in a
converter arm. The total voltage of the two converter arms in one phase unit equals the dc voltage.

Figure 2.13: AC and dc voltages generated by converter module voltages [10]

With this approach there is a significant converter loss reduction, compared with the PWM VSC-
HVDC system, due to lower switching frequency per IGBT, absence of snubber circuits and reduced
ac filter equipment. The total power loss of the two MMC-VSC-HVDC converter stations is estimated
to have fewer losses when operating at rated power.

At the time of writing the first MMC-VSC-HVDC scheme has been commissioned (the Transbay
project [10]). Other MMC-VSC-HVDC schemes are expected to enter service during soon. Thus there
is no practically approved performance data available. Consequently the VSC-HVDC characteristics
discussed later in this report are completely based on two and three-level converter design.

- 25 -
System Engineering Approach of MMC [10]

The described MMC topology is a symmetric monopole, and in a point-to-point HVDC transmission
scheme two converter stations of same design are interconnected with two High Voltage dc conduc-
tors, all forming the dc system part. The ac system interfaces of the HVDC link are Power Transfor-
mers, which adjust the ac system voltages to the converter system voltages on the AC- and the DC-
side of the converters. The appropriate voltage values are a result of basic system design calculations.
Each converter is designed and rated to meet the performance requirements of the HVDC transmission
system, and is protected to withstand over-current and over-voltage stresses due to faults occurring in
various parts of the station.

A series resistor that is used during energizing of converters is by-passed in normal operation. In such
a symmetrical configuration the dc circuit potential to ground is floating. If dc side voltages to ground
are symmetrical, a dc off-set on the transformer secondary side is avoided, hence allowing the use of
ac power transformers. Special grounding devices are installed between transformer secondary side
and AC-side of converter arms to provide a reference to ground in one station. The converter of this
station will then control the voltage grading to ground in the dc circuit. In case of an open dc circuit an
optional connection can be made to ground also in the other converter station, to allow for independent
reactive power exchange in both stations in this case.

Optional tertiary windings in the power transformers can directly feed auxiliary power supply from the
ac systems. A secondary side ac circuit breaker can be added (also as an option) to cut off persistent
fault currents. This system engineering approach for the converter stations is shown in the functional
scheme in Figure 2.14.

M M

Figure 2.14: Functional scheme of a MMC VSC HVDC transmission system in monopolar configu-
ration

- 26 -
MMC converter arrangement [10]

With reference to the principles of concept (see above) following definitions are introduced for MMC-
VSC-HVDC modular multilevel converters:

• Converter arm: assembly of one (1) converter module plus one (1) converter reactor,
with connection to the transformer secondary windings on its AC-side and to dc
cables on the DC-side (either “+” or “-“).
• Converter module: a row of sub-modules connected in series.
• Converter tower: mechanical assembly of several sub-modules designed to withstand
over-current and overvoltage stresses.
• Sub-module: assembly, which comprises of power module and power capacitor.
• Power Module: assembly, which comprises of the Insulated Gate Bipolar Transistors
(IGBT), diodes, resistors, gate interface board (Power Module Electronics), bypass
switch and protection thyristor.
Sub-modules are pre-assembled into racks of suitable transportation size in a specialized HVDC
Valves factory. The factory tested units are then installed on site to form Converter Towers, and inter-
connected to form Converter Modules inside of the Converter Hall.

= = = = = =

~ ~ ~ ~ ~ ~

= = = = = =

n
PM electronics Main components of a Power Module:
 Power semiconductors: IGBTs, Diodes
1  Resistors
2  Heat Sink, Housing
+  Protective Thyristor, By-Pass Switch
n  Power Capacitor
 Power Module Electronics (PME)
 Fiber Optic Interface to the control system

Figure 2.15: Main components of MMC-VSC-HVDC

The heat sinks of the Power Modules are connected to the Converter Cooling system. Beside the
Transformer Cooling system it is the major auxiliary system. The Power Module Electronics (PME)
are connected to the PLUSCONTROL system via fibre-optics. Main tasks of this MMC-VSC control
system are current control and module management.

- 27 -
2.5.3 Hybrid Multilevel Technology – HML-VSC-HVDC [11]

A new family of VSC circuits combining both semiconductor switches and multilevel converter ele-
ments consisting of half-bridge or full-bridge cells is under development. The basic concept is to use
the multilevel converter cells to provide a voltage wave-shaping function and this is “directed” to the
appropriate ac or dc network using the semiconductor switches. Using the approach shown in Figure
2.16, it is possible to derive numerous practical converter configurations.

Figure 2.16: Hybrid switch-cell concept

Basic principle

The simplest example of single-phase ac to dc conversion is shown in Figure 2.17. In this case, paral-
lel and series arrangements are shown to illustrate the flexibility of this design approach. In the two
examples shown in Figure 2.17, the semiconductor switches are arranged to form an H-bridge conver-
ter and the multilevel cells are used to synthesize a desired voltage waveform to satisfy the require-
ments of either the ac or dc Network. As shown, a fully offset rectified sinusoidal waveform is pro-
duced in both cases, but the parallel arrangement at the top of Figure 2.17 could produce a more con-
stant voltage at the dc network if required. It can be seen that the multilevel converter is behaving like
an active dc capacitor with voltage wave-shaping functionality.

This synthesized waveform is directed to the AC-side of the circuit by switching the H-bridge switch-
es at the frequency of the ac supply (50 Hz or 60 Hz), but also at near zero voltage. This is an impor-
tant benefit because it enables “soft-switching” of the series IGBT valves at low frequency. This offers
minimal switching losses and simple dynamic voltage sharing along the series string of semiconduc-
tors forming the H-bridge switches.

Figure 2.18 shows how three single-phase VSC circuits can be connected in series to form a 3-phase
converter. This uses a connection of half-bridge cells to form the wave-shaping converter as shown in
the upper part of Figure 2.17 which is applied across the dc terminals of each H-bridge. By connecting
the three units directly in series and operating them 120 electrical degrees apart, many of the DC-side
voltage harmonics (e.g. 2nd, 4th etc) appearing across each H-bridge cancel when added and thus do
not appear in the summed dc voltage. Although not shown here, the three single phase units of Figure
2.18 can be connected in parallel although this approach would require significant dc side inductance
or inter-phase transformers to be used to decouple the three phases. Such a parallel arrangement would

- 28 -
be better suited to the use of the 1-phase converters shown in the lower half of Figure 2.17 where the
series cells provide the decoupling.

Figure 2.17: Singe phase hybrid ac to dc conversion

A converter constructed in this manner has great flexibility because the wave-shaping converters are
able to control the quality of the waveforms appearing on both sides of the VSC and offer both AC-
and DC-side active filtering opportunities. There is also an advantage in that the multilevel converters
are not directly in the main power (current) path and therefore require lower rated components and
experience lower losses than some other known arrangements.

It is important to note that the DC-side wave-shapers in Figure 2.18 traverse an offset sinusoidal vol-
tage waveform and each passes through a zero condition separately but spaced 120 electrical degrees
apart. When one of the wave-shapers is at zero voltage (bypassed), the other two converters must sup-
port the dc network voltage and this sets their rating. This means the voltage across each director H-
bridge can be controlled to zero at a separate time and enables soft-switching of the series IGBT string
to be maintained on all 3 phases, albeit on a staggered basis. This is an important feature used during
depressions of AC-side voltage to produce a controlled reduction in the converter ac terminal voltage
by PWM switching of the series IGBT valves whilst simultaneously maintaining soft switching using
the wave-shaping converters. Using this approach, the VSC can ride through AC-side faults and pro-
vide useful reactive power to the network.

Other 2-phase arrangements

Constructing a VSC from three separate 1-phase converters as shown in Figure 2.18 requires the use
of a transformer with isolated secondary windings or for very high ratings it may be preferable to use
three single phase transformers to ease manufacture and shipment to site. However, there are alterna-

- 29 -
tive embodiments of hybrid VSC circuits that use a standard 3-winding transformer as illustrated in
Figure 2.19. This builds on the series connection of multilevel cells, but arranged in a more traditional
3-phase bridge configuration.

Figure 2.18: Three phase VSC employing 1-phase units

This VSC operates in a similar manner to a conventional 3-phase converter with each upper and lower
limb nominally conducting for 180 electrical degrees each cycle. While the switch in each limb is on,
the associated series multilevel converter adds or subtracts finite voltage steps to or from the voltage at
the dc network to construct a half sinusoidal voltage which is directed to the ac network and forms the
main power path. Again the converter may be operated such that each series strings of semiconductors
are switched at near zero voltage.

Clearly the multilevel converter cells are important in controlling the power flow in the active limb
and moving it between the ac and dc networks. However, the cells in the inactive limb also have an
important part to play during their off-state period. Since these cells are able to generate an “opposing”
voltage, this may be used to reduce the voltage applied to the off-state series IGBT switch which in
turn reduces its voltage rating and therefore the number of series connected devices required. The
offstate opposing voltage is possible with half-bridge or full bridge cells since in both cases the cells
produce a voltage that opposes the dc network. This not only reduces the cost of the equipment, it also
has an important impact on converter losses since fewer devices are required.

In all types of multilevel converter, it is important to maintain zero energy exchange over a defined
period of operation in order to prevent the net charging or discharging of the dc capacitors present in
each cell. When this condition is met, it is possible to actively control the average voltage at each cell
simply by rotating its position in the waveform being constructed. In general there is a fixed operating
point where there is zero net energy exchanged with the multilevel converter cells which defines a
fixed ratio between the DC- and AC-side voltage magnitudes.

- 30 -
Figure 2.19: 3-phase hybrid VSC

There are a number of practical methods available for de-coupling the AC- and DC-side voltage mag-
nitudes in order to control reactive power whilst maintaining cell capacitor voltage balancing. The
traditional method is to alter the conduction time of the switches used to form the director circuit and
is available here too. However in some arrangements it is also possible to temporarily connect some
(or all) of the cell capacitors directly in parallel with the dc network at strategic times in each cycle in
order to correct for any voltage drift.

Another powerful technology is to introduce a small amount of zero phase sequence 3rd harmonic
voltage or current locally to the VSC (which is not seen by the ac network) by actively controlling the
multilevel wave-shaping converters. The multilevel converter circuits described here are generally
required to operate over each half cycle of the ac supply. Therefore any 3rd harmonic component pro-
vides a useful compensating direct component of voltage or current over each half cycle of operation.
It has been demonstrated that this additional component can be controlled to be positive or negative
and used to restore the energy balance.

2.5.4 Cascaded two-level converter – CTL-VSC-HVDC [12]

In principle, the cascaded two-level (CTL) converter has a topology similar to that of modular multile-
vel converter. A different name has been selected by the manufacturer to highlight the fact that series-
connected press-pack IGBTs are used in the valves, thus extending a technology which successfully
has been used for high voltage two-level VSCs to multilevel VSCs through cascade connection. Each
phase leg of the CTL converter is divided in two arms: positive and negative, which respectively con-
nect the positive and negative poles of the dc bus to the converter’s bus. Each arm is built as a cascade
of N two-level-converter cells. For a bus voltage level of ±320 kV, N=38 cells per arm are typically
required. The cascaded two-level cells in each arm are controlled to provide fundamental-frequency
output voltage, related to the desired active- and reactive-power output, through switching of the indi-
vidual cells, as will be described momentarily.

- 31 -
Cell Topology and Operating Principle

As seen in Figure 2.20, each cell consists of a half-bridge two-level converter with two valves, which
in turn consist of IGBTs T1 and T2 and diodes D1 and D2. The valves can be switched in three differ-
ent ways:

• By turning on T2 and turning off T1, the cell is said to be inserted and the cell output
voltage equals the capacitor voltage. The capacitor then charges when the arm current
is positive and discharges otherwise.
• By switching the valves vice versa, i.e., T1 is turned on and T2 is turned off, the cell
will give zero output voltage. The capacitor is then bypassed and its voltage remains
constant.
• If both valves are turned off, the cell becomes blocked, and current is conducted only
through the diodes. The capacitor will then charge only when the arm current is posi-
tive. It will (ideally) not discharge.
Each cell is switched at a low switching frequency, typically about fswc =150 Hz, i.e., a pulse number
about 3 for a fundamental frequency of 50 Hz. During normal operation, the cells are switched in a
staggered fashion, as is further described below. Consequently, the effective switching frequency per
phase leg becomes fsw =2N fswc = 11.4 kHz for N=38 cells per arm. This is in the range of 10 times the
aforementioned switching frequency of a two-level VSC, which indicates that the dynamic response of
a CTL converter is excellent. Figure 2.21 (a) shows the converter-voltage waveform with less than
half the aforementioned voltage range, and consequently only N=17 cells per arm. Added to the sinu-
soidal modulation reference is a 3rd harmonic for extension of the voltage range to its maximum (this
harmonic vanishes in the transformer and does not enter the grid). In the corresponding frequency
spectrum in Figure 2.21 (b) it is seen that all harmonic magnitudes (except the added 3rd) are below –
40 dB, i.e., 1% of the fundamental.

Cell Capacitor and Cell-Voltage Ripple

The cell capacitor is a fundamental component of the CTL converter. It is integrated in the valve de-
sign, with the main purpose of serving as energy storage. The sum cell voltages of the two arms should
each have a mean value of twice the pole-to-neutral DC-bus voltage, in order to allow converter output
voltages with maximum amplitude.

Since the cell capacitor is subjected to a fundamental-frequency current, there will be ripple superim-
posed on each cell voltage. The cell capacitance is selected as a trade-off between valve voltage re-
quirements and capacitor size. Typically, the total cell capacitance corresponds to a stored energy of
30–40 kJ/MVA (where MVA refers to the converter rating), giving ripple in the range of 10%. The
cell-voltage ripples are shown in Figure 2.22):

- 32 -
Figure 2.20: Single line diagram of the converter

Figure 2.21: (a) one period of the converter voltage for fundamental frequency 50 Hz pulse num-
ber 3..37, 17 cells/arms, and nominal cell voltage 17.6 kV.
(b) Corresponding frequency spectrum.

- 33 -
Figure 2.22: (a) Sum cell voltages for positive (solid) and negative (dashed) arms as well as two
times the mean direct voltage (noisy due to switching harmonics)
(b) Voltage of cell 1 in the positive arm with the mean cell voltage overlaid (dashed)
(c) Differential-mode sum cell voltage
(d) Common-mode sum cell voltage

Losses

Because of low switching frequency per cell, the IGBT switching losses and the harmonic losses in the
reactors are significantly reduced as compared to a two-level converter. Furthermore, the conduction
losses are reduced through use of state-of-the-art 4.5-kV SPT+ IGBT technology. The total converter
station losses are in the range of 1% of rated power transfer at operation with rated power.

2.5.5 VSC-HVDC Reliability

VSC-HVDC systems have not reported reliability performance data to AG B4.04 to date and pub-
lished data on the performance of these systems is limited. Reference [13] provides some data on the
operation of the Cross Sound Cable project and the Murraylink project. Table 2.5 shows the average
and median FEU and SEU for these systems for seven years operation from 2003 through to 2009.

- 34 -
Table 2.5: Reliability Performance of two VSC-HVDC Systems

FEU SEU

Average % Median % Average % Median %

Cross Sound 1.16 0.93 1.92 1.17

Murraylink 2.35 1.88 1.73 1.61

2.5.6 Summary of VSC-HVDC transmission

Self-commutated converters used for VSC-HVDC are based on IGBT valves that facilitate fast-on-
and fast-offswitching operations. The active and reactive power flow can be continuously controlled
independently of each other. PWM VSC-HVDC still generates harmonics caused by the switching
process that have to be filtered at the converter station. The level of the harmonics generated by the
PWM voltage source converters is only a fraction of that generated by LCC converters and the size
and required space for ac filter equipment is reduced significantly. No shunt capacitors or reactors are
required. In fact, the VSC-HVDC station may act as static reactive compensation device. VSC-HVDC
converters also provide black-start capability and can also supply passive networks. The black-start
capability of a VSC depends on the auxiliary power supplies. For a 1000MW scheme, approximately
1MW of auxiliary power is needed for black-start (Table 2.6).

Table 2.6: VSC-HVDC summary

VSC-HVDC
Power Transmission OHTL Cable
Maximum voltage level ≤ 640 kV ≤ 600 kV 2
Maximum power rating < 1600 MW
Maximum transmission distance Theoretically unlimited (voltage drop over line)
Space requirements (examples) 120 x 50 x 11 m (550 MW); 48 x 25 x 27 m (500 MW) [w x l x h]
Active power flow control fast continuous
Reactive power demand Can provide or consume controlled reactive power as required
AC Voltage control Continuous, full response in < 100 ms
Power Reversal DC current reversal
Necessary filter equipment Low demand (PWM); Not necessary with other topologies

2 The VSC scheme can work with mass-impregnated cables; mass impregnated PPL (paper polypropylene
laminated) are available up to 600 kV. VSC had been used with extruded cables (XLPE) up to 200 kV at the
time of writing.

- 35 -
 VSC-HVDC
Grid connection requirements Can supply power to a passive network
Black start / island supply Black-start capability and island supply requires an aux. power system to
initially energize the cooling system (e.g. by means of a diesel generator)

Figure 2.23 further outlines the different rating limitations of dc technologies. The factors limiting the
current through the VSC converter are current rating of semiconductors and thermal rating of conver-
ter components. The voltage limitation mainly comes from the transmission medium (technology of dc
circuit).

For overhead lines there are almost no limitations for the VSC technology. Here the converter rating
limits the voltage level. This is not only due to high voltage equipment ratings but also due to the
“computing” power of VSC controller. Each level of modules in all VSC technologies except the
PWM-VSC needs a certain amount of computing power in order to generate the switching signals for
IGBTs. The “numbers” in Figure 2.23 represent the rating of some commercial projects which are
listed in Table 2.7.

Table 2.7: Examples of projects in different dc technologies in order to derive the actual state of
the art in terms of rating and dc circuit technologies

DC Vol-
# Name Type Rated Power DC-Circuit Commissioning
tage

1 Caprivi Link VSC 350 kV 300 MW OHTL 2009

2 BorWin 1 VSC ± 150 kV 400 MW Sea Cable 2009

3 Estlink VSC ± 150 kV 350 MW Sea Cable 2006

4 Murraylink VSC ± 150 kV 220 MW Land Cable 2002

5 Transbay VSC ± 200 kV 400 MW Sea Cable 2010

6 Inelfe VSC ± 320 kV 2 x 1000 MW Land Cable 2013

7 NorNed LCC ± 450 kV 700 MW Sea Cable 2007

8 BritNed LCC ± 450 kV 1.000 MW Sea Cable 2011

9 Ballia-Bhiwadi LCC ± 500 kV 2.500 MW OHTL 2010

10 Hukunbeir-Liaonin LCC ± 500 kV 3.000 MW OHTL 2009

11 Yunnan-Guangdong LCC ± 800 kV 5.000 MW OHTL 2010

12 Xiangjiaba-Shanghai LCC ± 800 kV 6.400 MW OHTL 2010

- 36 -
 ±Ud 7200 MW

800 11 12

LCC with OHTL

6400 MW
700

600 2250 MW

500 9 10

2500 MW 3000 MW
400

1 LCC with OHTL

300
300 MW Max. Current VSC (1,4 .. 1,875 kA)
200 per today’s available moduls
VSC &
100 OHTL
Max current LCC
(4,5 kA, 6" Thyristor)

1000 2000 3000 4000 IDC [A]

±Ud
600
1600 MW - MI MI Kabel (500 kV)
Predominantly sea cable
500
7 8
LCC with 4500 MW
400
landcable 1 GW 1200 MW
6
XLPE Cable (320 kV)
300
LCC
with parallel
200 5
cable
4 3 2
Theor. max.current XLPE (1875 A),
100 with Cu conductor and opt. cooling
VSC with
cable

IDC [A]
1000 2000 3000 4000
Max.current land cable (XLPE, 1500 A) Max. current MI sea cable (1600 A)

Figure 2.23: Visualization of presently envisaged ratings available with different dc technologies
including with overhead transmission lines and dc cables (end of 2010)

- 37 -
3 Operational Properties

Recently there has been a world-wide trend towards restructuring and deregulation of power industry.
The main objective of this process is an increase in market competition both on the wholesale and on
the retail market together with an open access to the power transmission system. Typically, the re-
structuring process results in a clear separation between production and sale and network operations
like transmission and distribution.

Figure 3.1: Restructured energy supply process

The generation and sale markets generally become fully competitive, with many market participants,
who sell their energy or participate in demand side management. The transmission system typically
remains as a natural monopoly, with regulatory supervision, with the function to allow open, non-
discriminatory and comparable access to all market participants. Therefore, the Transmission System
Operator (TSO) has to be independent from other market participants.

3.1 Ancillary services

With restructuring and deregulation of power systems, some services such as voltage control, frequen-
cy control and generator spinning reserve etc., which are essential for operation of the power system in
addition to the basic energy delivery services, were identified. These additional and essential services
are commonly referred to as Ancillary Services or Interconnected Operation Services by the North
American Electric Reliability Council (NERC) [14].

Within deregulated power systems the ancillary services are no longer an integrated part of power
generation but are unbundled and priced separately. As a consequence, system operators have to pur-
chase ancillary services from ancillary service providers, which might be conventional generation
utilities or new third-party contractors. Typically ancillary services are automatically or remote con-
trolled functions that allow safe and reliable power supply within an ever-changing environment and
thus ensure a certain quality of power supply. Whereas individual market participants may purchase a
certain quantity they are not able to purchase an individual power quality from the system operator.

- 38 -
The quality dimension of power supply is a collective commodity and is tied to certain system parame-
ters listed as follows:

• System frequency level and stability

• Voltage level and stability
• Availability/Security of supply
A completely free energy market within a deregulated environment could never provide the commodi-
ty of power quality, but it has to be provided by a responsible institution [15]. Consequently the provi-
sion of a certain power quality and thus an adequate acquisition of ancillary services on behalf of the
power consumers have to be assured by the system operator, which acts as single-buyer on the ancil-
lary service market. In the absence of such an ancillary service market the system operator has to de-
fine the requirement of ancillary services and put obligations on the participants, primarily the generat-
ing utilities, to cover their requirements, and any such requirements are generally defined within the
terms and condition of grid connections.

The principal types of ancillary services will be introduced in the next sections, but exact classification
of what functions belong to ancillary services will always depend on the specific transmission system
market environment. In this document the ancillary services are determined in the context of the Euro-
pean interconnected power grid (ENTSO-E).

Frequency Control

Load Frequency Control is the regulation of system frequency by maintaining equilibrium between
generation and demand. To achieve this equilibrium a certain amount of active power, usually referred
to as control reserve, has to be kept available to perform this control. Otherwise the power imbalance
would cause a frequency deviation from its set-point value at the various frequencies (e.g. 50 Hz).
Flexible control of power generation in real-time is indispensable in handling outages in generation
and changes in demand, without impairing the consumers supply. The generation control, the technical
reserves and the corresponding performance measurement are essential to allow TSOs to perform their
daily operational business. Active power control actions are performed in different successive steps,
each with different characteristics and qualities, and all dependent on each other.

Reactive power - Voltage control

The problem of maintaining all node voltages within appointed limits is complicated by the fact that
the power system supplies a vast amount of consumers and is fed by many generating units. To mi-
nimize reactive power flows over the transmission grid voltage control needs to adjust the node vol-
tage accordingly. Reactive power and voltage control is sometimes organized in three successive steps
[16], [17]. Primary voltage control is a local automatic control, which maintains the voltage at a given
node at its set point value. In case of a synchronous generating machine this task is performed by au-
tomatic voltage regulators which adjust the excitation voltage and thus influence the generated reac-
tive power and the voltage at the grid connection point, respectively. A similar function can be per-

- 39 -
formed by a SVC or STATCOM. A coarse control can be achieved by the use of breaker switched
reactive power banks.

Secondary voltage control refers to an automatic centralized control which coordinates the local reac-
tive power injection, typically breaker switched reactive power banks, within a defined regional zone.
Although this corresponds to the reactive power characteristic of the transmission grid this control is
applied only in France and Italy, [17], [18].

Tertiary voltage control is the manual optimization of reactive power flows across the transmission
grid which is performed by the supervising transmission system operator switching reactive power
equipment and adjusting settings across the system.

Black-start capability

After a large scale collapse within the power system, also known as black-out, a set of actions is re-
quired to restore the power system. Restoration of the system consists of a very complex series of
coordinated actions, studied and prepared in advance. A key requirement is the availability of generat-
ing units that are able to start-up without any external power supply. These generating units are re-
ferred to as black-start capable power plants, and are used to re-power the grid and facilitate recovery
of additional power plants by feeding their auxiliaries. The TSO has to ensure that a sufficient amount
of power plants available within their control area have this capability.

Whereas the restoration of power system requires joint coordination of available power plants, active
and reactive power reserves, and loads to be energized, the term black-start capability as ancillary
service focuses solely on the ability of generating units to start-up without external power supply and
then to provide active power and/or reactive power support.

3.2 Differences between HVAC and HVDC in system operation

The system performance and available functions provided by HVAC or HVDC transmission technolo-
gy are completely different because of their different basic setup. Whereas HVAC transmission lines
require no additional equipment beside the associated switchgear, and line reactors where necessary,
HVDC transmission will always require converter stations to connect to an existing HVAC transmis-
sion system. From a system view a HVAC transmission line without FACTS devices or PSTs appears
as passive component, whereas the HVDC link is a highly controllable active part within the system.
The controllability of the HVDC link can provide added value and supplementary functionality for
transmission system operation which will be considered in this chapter.

VSC-HVDC links typically feature a wide range of functions, but a few will interact or even counte-
ract other functions and thus control modes have to be defined. The different control modes should be
prioritized as defined by the operator to handle changing system conditions including transmission
system disturbances.

- 40 -
Some basic control modes could be the following ranked in the order from the lowest to the highest
priority level:

• Active power flow control mode – to meet an exact active power transfer demanded
by a market agreement or system boundary conditions
• Frequency control mode – can only be activated in one station at a time to control the
system frequency within the system requiring frequency control.
• Reactive Power/voltage control mode – maximized HVAC voltage support indepen-
dent of active power transfer
• Transient Stability Improvement, Damping control – improved inter-area damping
The listed control modes are based on priority schemes comprising a set of functions provided by
VSC-HVDC links which will be highlighted in detail in the next sections.

The control system of a VSC-HVDC link makes it possible to create a voltage of nearly any phase
angle or amplitude almost instantaneously [19]. This offers control of the active power flow indepen-
dent of the reactive power flow. The reactive exchange with the grid can be controlled at both termin-
als relatively independent from each other.

Contrary to line commutated converters (LCC-HVDC), which are limited to a minimum active power
transfer, voltage source converters (VSC-HVDC) can operate at approximately zero active power
transfer while providing full reactive power support. This capability is illustrated in the PQ diagram
below. Dependent on the operating objective active power flow control offers the ability to define the
exact line loading which allows a high utilization if considered as inter-tie. Hence by coupling differ-
ent market structures the available merchant transfer capacity is maximized and system operators ob-
tain the opportunity for active congestion management.

The active power flow controllability of HVDC links can be used to support system stability as can be
done by other network controllers that control active power transfer. Consider the case where a smaller
network is interconnected to a larger one only by an HVDC link. Provided that the HVDC station
within the smaller network is operated in frequency control the local system frequency can be sup-
ported by balancing active power from the larger system provided some voltage support. An example
of this arrangement is represented by the SACOI HVDC link where, at the time of planning process
both the Sardinian and Corsican dc link had a power rating comparable with or even greater than the
power rating of the running generators within the ac system to which the lines were connected [20],
[21]. Thus the HVDC link is able to assure frequency regulation, even without support from the gene-
rating units. It should be noted that a controllable ac connection, e.g. one with a TCSC, may be able to
provide the same controllable power support.

Usually there will be a combination of control modes to satisfy the transmission system operation
requirements, as for example applied for the GRITA link interconnecting the southern Italian and
western Greek network [22]. When the system frequency remains within predefined limits the control

- 41 -
signal attached to the HVDC controller is normally power flow. When, e.g. during emergency cir-
cumstances, the frequency moves outside the limits the HVDC link assists the islanded network.

Figure 3.2: VSC-HVDC active and reactive power capability

Fast reactive power control – Voltage control

Voltage Source Converter stations are able to provide reactive power support and thus voltage control
relatively independently of their active power output, within their apparent power limit. While the
active power transfer is kept constant, and when the active power transfer varies, the reactive power
controller can automatically adjust the ac voltage in the grid connection point. If the VSC-HVDC
transmission line or cable is out of operation the two converter stations can contribute to reactive pow-
er and voltage control of the connected ac systems and thus act like STATCOM systems. Such a vol-
tage control can also be used to improve the power quality by reducing flicker and eventually harmon-
ics injected by for example wind power generation system [23]. The fast voltage control capability
might help grid operators to avert the types of voltage instability or collapse which has lead to several
major system failures in the last several years, and which was caused by inadequate reactive power
support from generators [24], [25]. HVAC transmission lines generate or absorb reactive power de-
pendent on their active power loading and thus require appropriate reactive power management from
the TSO to keep the node voltages within the established limits. Unlike HVAC transmission lines the
VSC HVDC link provides the system operator with the opportunity to manage the mentioned reactive
power flows. It should be noted that the reactive power support capability of VSC stations is actually
maximized while the voltage at the grid connection point is low, unlike conventional reactive shunt
compensation equipment like synchronous condensers [26].

- 42 -
Transient stability improvement

Transient stability defines the ability of a power system to maintain synchronism when subjected to a
severe transient disturbance [24]. An HVDC connection between an islanded group of generators and
the main grid would not feature such angle stability limit and could in conjunction with fast active
power flow control dampen the machine oscillations by dissipating the excessive energy after restor-
ing connection to the main grid. The simulator case studies arrived at the conclusion that the critical
clearing time in some cases could be significantly increased by the application of a VSC-HVDC link.
Consequently the transient stability of the power transmission system can be improved by the applica-
tion of VSC HVDC interconnectors. [19]

Damping control

By virtue of the mentioned fast active and reactive power controllability of VSC-HVDC links they are
capable of counteracting oscillations within the transmission grid. If two control areas are linked by ac
tie lines and a VSC-HVDC in parallel, the HVDC can be used to mitigate the existing inter-area oscil-
lations by power flow control. However, this can be done by a LCC based HVDC by means of power
modulation as well. VSC-HVDC have three control options (degrees of freedom) which can be used
more effectively for damping control then the ones LCC-HVDC has.

If two control areas are connected only by a single VSC-HVDC link no electro-mechanical inter-area
oscillation can occur between these asynchronous connected systems. However there might be power
oscillations within an ac system between groups of generating units. In this particular case the HVDC
station might be used to provide positive damping whereupon the impact is maximized if the converter
station is electrically close to one of the oscillating generator groups [27]. In this situation the HVDC
station has to be operated with a mode prioritizing oscillation damping. In order to avoid continuous
operation in this mode for minor fluctuations and unintentional active power transfer a dead-band has
to be defined [28].

Both scenarios are illustrated in Figure 3.3 where part A represents the parallel tie line connection
between control area G1 and G2. Figure 3.3-B shows the asynchronous connected systems G1-2 and
G3 in which G1 and G2 are generating groups oscillating against each other. The active power transfer
between bus 3 and 4 is depicted in Figure 3.3-C with activated power damping functionality (solid
line) and without (dashed line) [26]. Whereas Figure 3.3-C shows the damping capability by active
power modulation, a VSC-HVDC scheme also provides the ability to mitigate power oscillations by
reactive power modulation. A so-called lead-lag controller provides a 90° leading phase shift on the
perturbing frequency range. The 90° leading phase is required for reactive power damping to assure a
positive damping impact in phase with the speed of generating units [26].

A scenario, similar to active power damping, is used to demonstrate the reactive power oscillation
damping capability in Figure 3.4. The VSC-HVDC is connected between two groups of generating
units oscillating against each other. Again Figure 3.4-B illustrates the active power flow between bus 3

- 43 -
and 4 with reactive damping functionality (solid line) and without (dashed line). It should be noted
that SVS and STATCOMs can provide the same damping as illustrated here.

Figure 3.3: Power oscillation damping by active power modulation [26]

The inter-area oscillation damping capability of VSC-HVDC links has been presented above. Howev-
er HVDC links themselves can cause power system oscillations. Within pure HVAC power transmis-
sion systems the interaction between torsional oscillation modes of steam turbine generators and sys-
tem oscillation modes of the power transmission system is governed by a synchronizing component
with relatively small negative damping caused by the HVAC transmission line. The stable operation is
assured by a relatively large positive damping component on the torsional modes of vibration of the
steam turbine generator shaft which is impressed by damping windings, steam circuit and mechanical
friction [26].

Black-start capability

For system operating purposes it is indispensable to have a certain number of black-start capable pow-
er stations dispersed throughout the system. These are required to re-supply the power system after a
major outage. In contrast to LCC-HVDC, which requires special equipment to provide black start ser-
vices, a VSC-HVDC links inherently offer black-start capability functions which may help during the
system restoration. The black-start capability depends on the application of the VSC-HVDC link, i.e.
black start cannot be provided if both terminals are in the black out area. When a HVDC intertie-line
connects two asynchronous control areas, the HVDC link is often referred to as “firewall” against
disturbances [4]. In case of a total outage of one control area the remaining functional system may be
used to energize the VSC HVDC link in the black network, and can then restore the blacked out sys-
tem. Thus the operator has the chance to either start-up additional power plants without black-start

- 44 -
functionality to restore the power system or at least supply a certain amount of consumers according to
the maximum active power transfer capability. Due to the supplementary frequency and voltage sup-
port, the VSC-HVDC stations facilitate a less complicated and more reliable system restoration, and
this has been proven in a real system test. Provided that one converter station is located within a work-
ing power system only a small generator set is required to start the control and protection equipment of
the converter station within the black-out control area. It should be noted that an ac line between such
two control areas, would also be able to provide a black start capability.

Figure 3.4: Power oscillation damping by reactive power modulation [26]

Similarly to the application as intertie-line the VSC-HVDC link can provide some kind of restoration
support while located within a meshed transmission system. This is due to the fast and superior vol-
tage and reactive power controllability which exceeds synchronous generating machines with respect
to their under- and over-excitation limit and lower control speed. Note that fast reactive power control
could also be provided by SVCs, TCSCs and STATCOMs.

Summary of the Beneficial functions for Power System Operation

HVAC and HVDC transmission technology are based on entirely different system designs and hence
offer completely different functionality for transmission system operation. From system viewpoints,
HVAC transmission lines, without FACTS devices, appear as passive elements providing no control
functions, apart from the freedom to switch the line on or off. LCC-HVDC systems offer active power
flow controllability and thus a power damping capability, which may provide transient stability im-
provement. VSC-HVDC provides superior control functions for power system operation as outlined in
Table 3.1. Active and reactive power flow controllability, transient stability improvement and damp-
ing control can be applied independent of the considered scenario. However, Black-start capability and
system loss reduction are depending on the individual application scenario.

- 45 -
Table 3.1: Technology dependent inherent functionality

HVAC w/o HVAC with FACTS LCC-HVDC VSC-HVDC

FACTS

Fast active power - Available Available Fast control

flow control
Fast reactive power - Available - Fast control
flow control
Transient stability Inherent Available Available Available
improvement
Damping Control - Available Active Power Active and reactive
Modulation power control
Black-start / island - - Full support
supply
System loss reduction - Depending on situation - Depending on situation
by means of reactive by means of reactive
power control power control

3.3 The value of VSC from a TSO perspective

When it comes to bulk power transmission extra costs for a VSC HVDC scheme compared to a
HVAC line with or without FCATS devices have to be carefully analyzed. However the individual
value of each operational property strongly depends on the system needs. Therefore, in each case the
TSO must evaluate the feasibilty of different technologies for different cases of bulk power
tranmission, and then compare the overall life time costs, including the benefits derived from ancillary
services, where relevant. Therefore this document provides:

• a "Guideline to perform economic assessment, applied to typical application areas and

sample applications". This can be used as methodology for any study.
• a Basis for discussion the possible value of extra functionalities/ancillary services
provided by HVDC technology and provide possible references for value evaluation on a
case by case basis.

Since this report cannot cover all the different application cases of HVDC the working group has fo-
cused in the typical focus areas: Interconnection between large systems and Point-to-point connection
within a meshed grid. Following aspects have not been taken into account in the analysis and thus, their
effect must be evaluated case-by-case

• the number and type of parallel connections

• the characteristics of the connection points and systems generally
• distance between the two connected points, strength of the connection point

- 46 -
 • the type of the generation/production within the island and
• the size of the systems to be connected

The following extra functions have been included in the value analysis from a TSO perspective:

Power flow control

• spinning res erve: the decrease in the required amount of spinning reserve may be a
percentage of the HVDC transmission capacity, and must be taken into account (i.e. the
cost benefit should actually be e.g. the difference between the control power and the
general system prices) when independent systems are connected.
• power re versal: This could be valued either based on benefits gained via congestion
management or based on cost of system protection schemes, that provide more or less the
same functionality (e.g. generation or load shedding, line tripping); to gain the same
functionality with power reversal as with generation/load shedding, the direction of power
transfer must be correct, which is worth recognizing in the analysis
• corridor l oading: to gain the full advantage from HVDC systems (or any other device
capable to control the loading of corridors) most of the parallel connections in the corridor
should be controllable otherwise one will create loop flows; additionally, if the corridor
loading control requires operation of HVDCs on low power, the relatively high losses
should be taken into account in the evaluation

Damping control

The effectivity of damping controls implemented as part of HVDC controls is greatly dependent on
following factors

• the location of the two converter stations as compared with the part of the transmission
network that oscillate against each other (observability and controllability of oscillations)
• number of devices (PSS, TCSC, HVDC/SVC damping controls) that already affect the
system damping; the effectivity of damping controls decrease with the number of damping
devices, the coordination of the damping controls may require extensive studies
• High inertia turbogenerator units have very low subsynchronous modes, which greatly
decreases the risk of SSR related to series compensation, but may significantly complicate
the design of HVDC subsynchronous damping controls

Extra functions
• congestion management, network restoration and voltage support
• possibly it may contribute on system stability (i.e. increasing transfer capability...)

The result of analysis is presented in Table 3.2, Table 3.3 and Table 3.4.

- 47 -
Table 3.2: Value matrix for the network case “Interconnection of two large systems”

Function AC HVDC LCC HVDC VSC Comments

Overload capability of HVDC systems is limited as compared to AC line especially. Overload capability
Overload capability ++ + + can generally be considered valuable in connection of severe system faults presuming the operating
conditions can be restored to normal before the allowed overloading period is exceeded.
General

Behavior in case of fundamental frequency

overvoltage
Hardly of any significance if two large systems are connected. May become an issue if other system is
Network connection requirements 0 -/0 0
weak.
Weight offshore apps / Required logistics
++ -- +
for transportation
"Direct" Transmission of Control
0 + ++
Power / Spinning Reserve
Power flow control

The extra functions of HVDC systems may be applied to limit the effect of congestions on system
Congestion Management 0 + +
operation or tranfer capability
Power reversal may be very effective countermeasure for system breakdown. The effectivity of the scheme
Power Reversal 0 + ++ in practice is, however, largely dependent on the two systems to be connected as system may not be
capable to handle very rapid changes in transmitted power...
Typically one corridor that is loaded according to the total loading or consumption of the island; in
General - i.e. Corridor Loading 0 + --/+ connection of HVDC VSC it must be recognized that the relative amount of losses increases significantly
if the loading of the transmission system will be change by power flow controller
The basic assumption is that the negative effect of HVDC systems on subsynchronous damping can be
Damping

SSR Damping +/- 0/+ 0/+ cancelled using special control configuration (SSDC). It's also worth recognizing that connections can
control

improve subsynchronous damping as well…

Small Signal Stability +/- 0/++ 0/++ The effect of damping controls depends greatly on location of the converter stations and number of the
Large Signal Stability +/- 0/++ 0/++ devices already affecting the damping
Voltage control

Q-Support +/- 0 0/++

and voltage

Minimize Q-Flows +/- -/0 0/++

quality

The value of voltage control and quality issues depend greatly on the structures of the network around
Node (AC bus) Voltage "const" control +/- -/0 0/++ connection point. In this case basic assumption is that control and quality issues are of no great
Harmonic Control +/- -/0 0/+ significance.
Flicker Control +/- 0 0/++
HVDC VSC has blackstart capability. It can be performed over AC connection (in exception of long
Blackst. /
Import from other countries/areas + 0 ++ distance connection) presuming that the other system system has remained as an island in connetion of
Restaur.
system breakdown (possible system protection schemes required)
++ : Very good s ui ted; + : Good s ui ted ; 0 : Not s o good, s ometi mes a ddi ti ona l devi ces needed

- 48 -
Table 3.3: Value matrix for the network case “Large system and island interconnection”

Functions AC HVDC LCC HVDC VSC Comments

The connection must anyway be dimensioned so that all the power provided/required by the island can be
Overload capability 0 0 0
transmitted.
Behavior in case of fundamental frequency
Matter of dimensioning.
overvoltage
General

In case of long AC connection fulfilling the grid connection requirements may be difficult due to the stability
issues (e.g. FRT). The posible lack of inertia in the island may prevent the connection using HVDC LCC (or
Network connection requirements -/0 --/0 -/0
alternatively complex control conficuration may be required). In case of HVDC VSC some control
configuration/coordination between the HVDC VSC and generation controls may also be required.
Weight offshore apps / Required logistics for
++ -- +
transportation
"Direct" Transmission of Control
0 0 0 Depends on the type of the island. If island has both generation and consumption,
Power / Spinning Reserve
Power flow control

Pro annual downtime approx. 7 days for VSC-HVDC and LCC-HVDC. For AC 1-3 days. In this case the
Congestion Management + -- -- maintenance of the generation and/or distribution equipment can possibly be performed simulateneously,
which may decrease the "effective" downtime...
Performance of the connection types should be more or less the same as long as there is no severe stability
Power Reversal 0 0 0
issues present in case of AC connection...
Typically one corridor that is loaded according to the total loading or consumption of the island; in connection
General - i.e. Corridor Loading 0 0 --/0 of HVDC VSC it must be recognized that the relative amount of losses increases significantly if the loading
of the transmission system is low (< ~30 %)
SSR Damping 0 0 0 SSR is hardly an issue in connection of islanded system.
Damping
control

Whether the island improves or decreases the system stability depends on the type of the island and the
Small Signal Stability -/0 -/0/+ -/0/+
length of the connection in case of AC. HVDC schemes may possibly be applied to cancel the possible
Large Signal Stability -/0 -/0/+ -/0/+ negative effect of the island on the system stability or even assist the system to maintain its stability
voltage quality

Q-Support -/0 -/0 +/++ Possible value depends on the nature of the connection type (long or short distance, high or low SCC) as
control and
Voltage

Minimize Q-Flows -/0 -/0 +/++ well as the type of the island (e.g. can the generation support the voltage, how much distortion
Node (AC bus) Voltage "const" control -/0 -/0 +/++ load/generators create?). While evaluating the value of HVDC voltage control and PQ functionalities of
Harmonic Control 0 -/0 +/++ HVDC VSC, it must be recognized how much HVDC VSC actually can control and in how effective manner
(additional losses, unavailable active power transfer capability?) while transmitting full active power.
Flicker Control 0 0 +/++
Blackst. / AC connection has naturally blackstart capability as long as either of the systems is up and running. This is
Import from other countries/areas + 0 ++
Restaur. also true for DC connections.

++ : Very good suited; + : Good suited ; 0 : Not so good, sometimes additional devices needed

- 49 -
Table 3.4: Value matrix for the network case “Point to point interconnection”

Functions AC HVDC LCC HVDC VSC Comments

Overload capability + 0 0
Behavior in case of fundamental frequency
+ 0 0
General

overvoltage

Network connection requirements 0 0 0 Hardly of any significance presuming the networks around the converter stations are strong.

Weight offshore apps / Required logistics

for transportation
"Direct" Transmission of Control Two points within the same synchronous area. HVDCs could provide some benefits in case
0 0 0
Power flow control

Power / Spinning Reserve the distance between the connection points is significant.

Congestion Management 0 + +

Power Reversal 0 0/+ 0/+

Typically one corridor that is loaded according to the total loading or consumption of the
General - i.e. Corridor Loading 0 + + island; in connection of HVDC VSC it must be recognized that the relative amount of losses
increases significantly if the loading of the transmission system is low (< ~30 %)

Presuming that the connection points are in the middle of a strong system, damping of SSR
SSR Damping 0 0 0
Damping
control

should not be a problem (in possible exception of network restauration or N-x contingencies

Small Signal Stability 0 0/(+) 0/(+)

Depends on meshed system structure
Large Signal Stability 0 0/(+) 0/(+)
Q-Support 0 0 0/+ The value of voltage control and quality issues depend greatly on the structures of the
control and
Voltage

voltage

Minimize Q-Flows 0 0 0/+

quality

network around connection point. In case of strong system control and quality issues are of
Node (AC bus) Voltage "const" control 0 0/- 0/+ no great significance, in case point-to-point connection is created between weak and
Harmonic Control 0 0/- 0/+ strong parts of the network, escpecially the voltage control functions of HVDC VSC may
Flicker Control 0 0 0/+ provide some value.

Blackst. / Two points within the same synchronous area. HVDC VSC could contribute if in connection
Import from other countries/areas 0 0 0
Restaur. of system breakdown an island can be created around the other converter station.

++ : Very good suited; + : Good suited ; 0 : Not so good, sometimes additional devices needed

- 50 -
4 Economic Assessment Process

The assessment process shall determine the best transmission solution for a considered transmission
case with respect to recent available transmission technology and potential market utilization. The
proposed process focuses on the comparison of alternatives. This chapter does not consider reliability
calculations since the necessary data of VSC for bulk power transmission do not exist so far. Basic
reliability numbers for LCC HVDC can be seen in section 2.4.4.

4.1 Process description

The approach discussed in this chapter will attempt to strike a balance between a detailed examination
of all relevant factors influencing the planning process and a transparent straightforward assessment
process which satisfies the reliability and efficiency requirements for planning of actual transmission
planning projects in a competitive environment. The process introduced in this paper is intended to
supplement the long-term network expansion planning procedures for transmission bottleneck, as a
tool for analysis of alternatives available to mitigate the bottleneck. Feasibility studies and load flow
analysis provided by utilities will be used as input parameter to determine the basic performance con-
straints. The overall process consists of four major steps (Figure 4.1).

The key aim is to arrive at a final investment recommendation based on the net present value, taking
into account the performance criteria of available technology alternatives, and the relevant market
environment and regulating framework. The particular steps shall be outlined in the next chapters.

Figure 4.1: Assessment process overview

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4.1.1 Phase I – Case study analysis

To provide a suitable basis for a wide range of transmission applications the process is designed to be
modular, but not every module may be applicable to all transmission projects. In fact there might be
some crucial system conditions and exogenous circumstances which have a significant impact on the
valuation process.

Figure 4.2: Assessment process – Phase I

Thus the first phase of assessment process focuses on the objectives of considered transmission
project. The investor objective influences the selection of feasible transmission concepts. There may
be some transmission concepts which can be excluded from further investigations right from the out-
set. Consider a transmission project with a line length of some hundreds of kilometers for connecting
an offshore wind-farm to the grid. For this purpose only HVDC connections would be considered,
because of the high reactive power demand of HVAC cables (q.v. chapter 2.3). In offshore applica-
tions it is difficult to use LCC schemes as the space required by the converter station is large. In this
case VSC is probably the only realistic solution.

In the majority of cases the TSO will also be the investor or at least stakeholder in an investing consor-
tium, and can provide a load flow analysis of the considered transmission project to facilitate further
analysis like system loss calculation etc.. With the results taken from a load flow study in conjunction
with the aspired investor objectives, a basic performance rating of the transmission project can be de-
fined. In other cases, e.g. a merchant power transmission link, no-load flow may be available, and the
main input to the performance requirements will come from the transmission objective, and the con-
nection agreement provided by the TSO. The performance requirements will form the basis for
equipment rating within the considered transmission project and influence the cost estimation to be
used in phase II. Despite the fact that many power systems have been deregulated and liberalized there
might also be transmission projects within conventional markets. The market structure has to be scru-
tinized to assure the appropriate evaluation of the ancillary services which may be either essential or
provided by operation of the considered transmission project. Typically, in a market environment
comprised of vertically integrated utilities there will be no revenue for the provision of ancillary ser-
vices. Beside the technological and economic aspects, environmental regulations have to be taken into
account due to their severe impact on the commissioning time and right of way for example. In sum-
mary the first phase of the assessment process will provide all relevant information at the considered
transmission project and as result it defines the key technical performance parameters and constraints
for transmission alternatives, as well as the value of any functions or ancillary services that could be
provided.

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4.1.2 Phase II – Cost estimation

In phase II the potential transmission solutions are evaluated with respect to the regulatory framework
elaborated within phase I of the assessment process. An outline of the considered cost components is
shown in Figure 4.3.

Figure 4.3: Assessment process – Phase II

The cost estimation process will determine the detailed cost components of the transmission solutions.
They are based either on data provided by manufactures, TSOs or already commissioned projects. The
costs presented in this step may be assumed as power system independent as they are dominated by
the equipment costs which are in large part equal to the world market prices. However geographical
differences have influence on remuneration and thus civil works are listed separately if available. As a
result phase II provides a comparative summary of all expenses which have to be considered for the
transmission project both investment and operational sort of costs.

4.1.3 Phase III – Functional benefit

As outlined in chapter 3.2 there are important differences in operation between conventional HVAC
and HVDC transmission. Whereas part II focuses on the comparative cost evaluation between the con-
sidered transmission alternatives the next step in the assessment process - part III – is used to evaluate
the functional benefit or penalty of HVDC links for power system operation. Therefore the value of
any additional functions need to be worked out and then applied if the necessary system conditions
exist. The assessment framework defined in Phase I will provide the basis for selecting the functions
which may be appraisable for the specific case study. The list of function shown in Figure 4.4 may not
be applied in their entirety for any transmission project assessed, but should outline the most beneficial
functions.

(Fast) voltage control

Determine
appropriate (Fast) power flow control
Phase III

Economic functions to Blackstart / Restoration / Island supply Value

valuation of be appropriate
functional benefits evaluated Market coupling functions
for the Loss reduction
project
Environmental impact

Figure 4.4: Assessment process – Phase III

For example the feature of market coupling may not be applicable if the considered transmission
project is a network expansion within a single control area or market environment. In summary, after

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the valuation of all appropriate functions, there is a clear overview of the achieved benefit in terms of
additional cash flow during the operating time.

4.1.4 Phase IV – Cash flow analysis

Bearing in mind the cost summary provided by phase II and monetary benefit presented in phase III a
discounted cash flow analysis can be performed to compare the considered transmission project alter-
natives based on their overall financial characteristic. The net present value (NPV) based on a prede-
fined rate of interest will in this analysis serve as decision criterion for the investment. Discounted
cash flow (DCF) analysis uses future net cash flow projections and discounts them to arrive at a
present value, which here is used to evaluate the investment costs.
T
Ct
NPV = ∑ (4.1)
t =1 (1 + DR)t

• Ct is the net cash flow within the period t

• DR is the discount rate, which equals the rate of return that could be earned on an in-
vestment in the financial markets with similar risk
• T is the period of consideration
If the NPV turns out to be negative, the considered project is going to degenerate value. A positive
value implies a profitable project. The key input parameters can be defined as fixed values or a certain
range for a scenario analysis and are listed as follows:

• Power rating
• Transmission distance
• Rate of interest
• Project lifetime
• Active power utilization
• Reactive power utilization
• Price difference between the markets
• Environmental sensitivity
• Application Black-start / island supply
Despite the fact that VSC-HVDC provides a wide range of additional operational benefit, there are
some functions and performance aspects which cannot be easily evaluated on a monetary basis, damp-
ing control for example. Anyway they may be interesting for decision-makers or system operators
even if not associated with financial revenue. Thus all non-financial benefit of the considered trans-
mission alternatives shall be pointed noted, and may be applied as a tie breaker, if two solutions have
near identical NPVs.

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 Phase IV
Cash Flow Qualitative
DCF
analysis benefit

Figure 4.5: Assessment process – Phase IV

4.2 Economic figures of HVAC and HVDC

This chapter provides a summary of specific costs for typical standard-sized bulk power transmission
assets taking into account all investment and operational costs. This facilitates a fast and reliable cost
assessment when making a first pass of the considered transmission project options.

All cost figures represent a snap-shot from recent publications. However, since components and sys-
tems for bulk power transmission are not “off-the-shelf-products”, and costs are inherently strongly
case sensitive, the provided cost figures are rough estimates, even though they have been taken
from public sources such as newspaper articles and network extension studies. The accuracy of the
station costs can be estimated to be around +/- 30%.

Generic values of costs of high voltage power transmission are of very limited use and may easily
become misleading and thus, their use should be avoided. A more reliable method for comparing
HVAC and HVDC costs on a case by case basis is achieved by sending out a call for quotation to dif-
ferent manufactures. Even such values may be subject to an uncertainty of +/- 15%. Therefore, it is
strongly recommended that estimated for the costs of HVAC and HVDC for a specific project must be
calculated and the weighed against the advantages and disadvantages of each option.

4.2.1 Substation costs

The costs referred to as stations costs comprise all necessary equipment installation investments which
have to be applied for a sustainable point-to-point connection excluding the high voltage transmission
line. While considering an HVAC transmission this would include the switchgear equipment and a
transformer at both connection ends if required. An HVDC transmission will require a couple of con-
verter stations which include all necessary components like transformers, cooling stations, filter bays,
converter housing and protection devices, as well as the circuit breaker(s) to be added in the ac substa-
tion to which it is connected. For Europe the HVAC investments can be obtained from the so called
“Dena” study [29]. The costs for a 380 kV switching field are 1.85 M€ whereas the specific transfor-
mer costs amount to 12 k€ per MVA. This is without any kind of redundancies.

Because of the modular setup of HVDC converter stations the investment costs for bulk power trans-
mission may be assumed to increase linearly with the power rating as very rough estimate. There are
several other factors which can have an influence on the costs. Due to the fact that there is little exact

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information on already commissioned projects the specific VSC-HVDC converter costs are taken from
earlier studies. The specific costs of 0.102 M€/MVA are used for all power ratings and voltage levels
[30], [31], [32]. The 500 MW Italy-Greece HVDC link shall serve as reference project for LCC-
HVDC station costs of 40 M€ [30], [22]. The summary of investment costs is given in Table 4.1.

Table 4.1: Station investment costs per station

Rating HVAC LCC-HVDC VSC-HVDC

500 MW 16 M€ 40 M€ 51 M€

1000 MW 28 M€ 90 M€ 110 M€ 3

1500 MW 40 M€ 120 M€ 153 M€

4.2.2 Transmission line costs

The costs for a point-to-point connection depend strongly on the considered political and environmen-
tal framework and the cost for the rights-of-way. Especially the geographical conditions have impact
on the costs. For example a double circuit transmission line in the Swiss Alps would be 4 times more
expensive than a transmission line in Finland or Sweden [1]. In addition to the construction cost, there
are payments for environmental impact, labour costs and indemnifications for right of way usage. In
this chapter the construction costs are the central point. Environmental impact and right of way are
considered in later chapters.

The costs for HVAC overhead transmission lines are given for flat land construction of a 220 kV
double circuit, 380 kV single circuit and 380 kV double circuit with bundled conductors. The given
costs comprise payments for project handling and permission process which are estimate to 80 – 90
k€/km [33]. The HVAC cable costs are based on a single 380 kV (500 MW) and double 380 kV XLPE
cable system and include payments for cable testing, project handling and permission of 250 k€/km
[33].

The HVDC overhead transmission line costs are estimated based on the HVAC cost with respect to
lower conductor costs and equal payments for civil works project planning etc. Thus the HVDC over-
head transmission line to HVAC cost ratio is 0.75. The loadability of HVAC overhead transmission
lines depends strongly on the considered transmission length. Thus the presented HVAC transmission
costs are valid for distances until 320 km. To remain steady-state stability for longer transmission dis-
tances additional 380 kV circuits may be required. Adding an extra bundle of conductors will demand
additional costs of 0.12 M€/km. When considering coastal or hilly surrounding a supplement of 20%
has to be applied [1], [29].

3
For the VSC, the 1000MW can be considered on 2 configurations: 2 x 500 MW and 1 x 1000 MW. In the
first case, 110M€ is a good value. In the second case, this cost might be lowered to 90M€.

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HVDC cable costs are provided by earlier studies [1], [30]. As pointed out in [32] the material cost of
an 1100 MW cable connection may be approximated to 0.8 M€/km. Thus a double system cable solu-
tion can be approximated for the 1500 MW power rating. Details about the scheme and layout of the
line arrangements can be found in the corresponding references. Table 4.2 summarizes some of the
cost figures and also shows the spread among the costs for different arrangements.

Table 4.2: Transmission line costs- Examples from various sources

HVAC HVDC

Rating Cable OHTL Cable OHTL

500 MW 0.92 M€/km 0.35 M€/km 0.8 M€/km 0.26 M€/km

1000 MW 1.67 M€/km 0.33 M€/km 1.6 M€/km 0.25 M€/km

1500 MW 1.67 M€/km 0.45 M€/km 2.4 M€/km 0.34 M€/km

Another example which demonstrates the variation of cost in different countries comes from the Scan-
dinavian region. The example is about a new 100 km 420 kV overhead transmission line between cen-
tral Norway and Sweden. The following calculation shows the incurred costs for 25 km of the 420 kV
transmission line:

• Project management and administration: 320 k€ (excluding licensing phase)

• Engineering: 860 k€ (including land measurement)
• Procurements including apparatus and material, procurement process, management
and control of manufacturing at suppliers, onsite management and control of civil and
installation works: 10.900 k€
• Right of Way (incl. lodging and comp.): 1.100 k€
This results in cost of 530 k€ per km of transmission line. It can be discussed whether Right of Way
should be included in these cost figures as it varies greatly from country to country. This is a ”stan-
dard” 420 kV overhead transmission line with duplex Parrot line and one of the two top (ground) con-
ductors is OPGW. The line is classified as “medium difficult”. The unit cost is considered relatively
high since the transmission line is short, only 25 km. Fixed costs (independent of line length), such as
administration, management and control gives a larger contribution to the unit cost for a short line
compared to a long line.

4.2.3 Reactive power compensation

HVAC transmission lines and especially HVAC cables produce reactive power dependent on their
load and line length. HVAC overhead transmission lines can be operated close to their natural load
and would then require no compensation within normal operation. Nevertheless in very low or high
load system operation overhead transmission lines need to be compensated to avoid severe impact on

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the voltage level in the grid. HVAC cables have a far higher demand for reactive compensation, as
they cannot be operated close to their natural load restricted by thermal limitation.

To ensure safe and reliable system operation sufficient reactive power compensation is required at the
line connection points of HVAC transmission lines. The superimposed reactive power current on the
HVAC transmission line will also cause additional losses [33]. Generally the overall reactive power
demand is compensated one half each at the receiving and sending end of the line. The reactive power
demand of HVAC transmission systems is shown in Table 4.9 for a single 380 kV overhead transmis-
sion line and a 380 kV cable solution [33]. Both the cable solution and the overhead transmission line
have to be compensated by mechanically switched reactors and capacitors, respectively. This requires
an additional investment of 7 k€/MVar. Large HVAC cable transmission lines in conjunction with the
compensation equipment may form an oscillatory system of low resonance frequency. Therefore, stu-
dies have to be performed to ensure that the transmission line does not amplify harmonics within the
power system beyond acceptable limits, which would further increase the installation costs by addi-
tional investments into filter equipment.

Table 4.3: Reactive power compensation

380 kV HVAC cable 380 kV HVAC OHTL

compensation demand 8 .. 10 MVar/km 0 .. 3 MVar/km

investment cost 56 .. 70 k€/km 0 .. 21 k€/km

4.2.4 Operation and Maintenance

Overhead transmission lines require maintenance like coating renewal, laser scanning etc. Cable
transmission solution will demand less maintenance. The operation and maintenance costs should be
outlined as a percentage of the capital costs per year [30]. HVAC Operation and maintenance cost are
rated by the capital transmission cost, whereas HVDC O&M costs comprise of both a converter station
component and the estimated transmission solution expenses.

Table 4.4: Operation and Maintenance costs

OHTL Underground cable HVDC stations

% of capital cost 2% 0.4 % 0.5 %

4.2.5 Loss evaluation - Examples

There is much information regarding the standby as well as load losses of transmission equipment
provided by manufactures, also transmission losses as function of the actual load of transmission lines.
However, no generally applicable loss evaluation for system operation is available. In this section a
predefined example case will outline the differences in loss characteristic between the transmission

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technologies for connecting a 500 – 1000 MW offshore wind-park to the grid. Secondly a general loss
rating depending on the line length will be presented.
The specific utilization scenario is derived from a loss evaluation of HVDC and HVAC transmission
systems for large offshore wind farms based on a simulation comprising of a wind farm model provid-
ing the necessary utilization data for the HVAC/HVDC link [34]. The wind farm model is based on a
multi-machine power curve approach by Holttinen and Norgaard [35]:

• wind farm size: 500 MW or 1000 MW

• standard 5 MW turbine
• average wind speed of 9 m/s represented by Raleigh distribution
• 100 km line length
The simulation considered off-shore and on-shore transformers, submarine cable, filter equipment for
HVDC applications and compensating devices for HVAC transmission solution. The VSC-HVDC
converter loss values are given for a typical PWM-modulation setup and do not reflect a multilevel
converter architecture which tends to have lower converter losses. Table 4.5 shows the losses obtained
from a simulative utilization and recent publications on expected losses [12] , [19], [34].

Table 4.5: Station losses per converter station at full load figures

Rating LCC-HVDC VSC-HVDC (MMC .. PWM)

500 MW 0.85% 1.00 % .. 2.00%

1000 MW 0.75% 0.9 % .. 1.75%

Line length dependent loss values had been calculated by a real system setup. However, one can also
make a first estimation by the following two rules of thumbs:

• 25 W/m per cable for a dc cable

• 17 W/m per cable for an ac cable (tight laying)
• Both are the maximum losses – the maximum system loss is limited by the thermal
conductivity of the soil which is in the range of 0.1 W/mK to 5 W/mK
• Losses of ac overhead transmission lines are slightly higher
The overall cost of transmission losses can be calculated with respect to the transmission length and
the average intraday spot market price.

4.2.6 Right of way

The overall required right of way depends strongly on the considered transmission system solution
whether the power is transferred through overhead transmission lines or cables. Independent of the
examined transmission technology there is a significant higher space requirement during the construc-
tion process due to extensive earthwork. Nevertheless only the space requirement during operation

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shall be considered in this assessment, since only for the permanently occupied space remuneration
has to be paid to the owners.

While considering an overhead transmission line there is the width of the tower construction as well as
a safety margin on both sides which has to be accounted. The required right of way for HVAC 500
MW power rating is assumed to be 51 m and 75 m for a power rating of 1000 and 1500 MW [33]. A
tower distance of 300 m for 500 MW and 400 m for power ratings above 1000 MW are adopted.
HVDC overhead transmission lines will demand 50 m right of way for power ratings of 500 to 1500
MW. Tower distances are equal to large HVAC overhead transmission lines with 400 m. Due to the
fact that the required space of overhead transmission lines may be used furthermore by the owner, for
agriculture for example, the registration of easements is sufficient, and the acreage doesn’t need to be
acquired. As advised by a German TSO the typical costs amount to 0.5 to 1 €/m² and 3000 € per tower
position as a single payment. Compensation payments may add to this.

In case of a cable solution there is less space required but the right of way of cable lines must not be
used for agriculture. One HVAC cable system is considered for 500 MW power rating and 2 cable
systems for 1000 – 1500 MW. The 500 and 1000 MW HVDC power ratings are one cable systems.
However, the 1500 MW solution will demand 2 systems. In addition to the cable trench there is a 3.5
m wide heavy duty roadway along the transmission route required for construction and maintenance
duties. For each HVAC cable system a trench of approximately 3 m is assumed. Thus the overall
width is given by 6.5 m for a single cable system to 9.5 m for solution comprising of 2 cable systems.
The presented numbers equal those which can be found in connection with HVDC cables, except the
trench width per cable system is reduced to approximately 2 m. Hence the required HVDC right of
way is 5.5 m and 7.5 m. Although in case of HVAC cables additional housings for cross-bonding are
required. This will not be considered in this chapter, because no additional right of way is occupied.
Because a lower level of remaining usability the remuneration costs are assumed to be 2 €/m² for all
cable solutions. Extra provisions which are needed to fulfill special requirements on maximum mag-
netic field strength on the surface may increase these specific cost as well (e.g. 0,4 µT rule in the
Netherlands).

Table 4.6: Right of way evaluation (highly populated industrial countries)

HVAC HVDC
Rating
OHTL cable OHTL cable

500 MW 35.5 .. 61 k€/km 13 k€/km 32.5 .. 57.5 k€/km 11 k€/km

1000 MW 45 .. 82.5 k€/km 19 k€/km 32.5 .. 57.5 k€/km 11 k€/km

1500 MW 45 .. 82.5 k€/km 19 k€/km 32.5 .. 57.5 k€/km 15 k€/km

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4.3 Economic evaluation

As outlined in chapter 3.2, VSC-HVDC applications provide a range of performance improvements

which may lead to additionally applicable functions for transmission system operation. With respect to
the considered market and regulatory framework an in-depth case study analysis has to be performed
to outline the available functions that might be included in the assessment procedure. Generally it can
be mentioned that liberalized and deregulated markets tend to offer a better base of operations in
which the extra functionality like the provision of ancillary services can be utilized. The following
chapters will describe and valuate key functions which can be assessed within a competitive market
environment. However some aspects depend on the considered network expansion project.

4.3.1 Fast reactive power control - Voltage support

Ensuring a reliable and economic power supply during normal and abnormal load situations is a key
task of system operation. Especially unexpectedly high system loads will demand sufficient reactive
power capability within the transmission grid to avoid voltage stability issues. During low load opera-
tion reactive power absorption is needed. Thus adequate reactive resources dispersed in the grid have
to be available. This may be either assured by regulatory assignments or by economic incentives to-
wards reactive power providers.

The pricing of reactive power capabilities and proposed market structures have been discussed exten-
sively [14], [18], [36], [37]. Within this report no detailed market design study will be carried out. The
focus lies on an approach for reactive power pricing which is generally applicable. Therefore a loca-
tion dependent price component, which is usually implemented to ensure a sufficient dispersal of reac-
tive resources, will not be applied. Reactive power is mostly provided by synchronous machines, but
can also be supplied by compensation equipment like shunt capacitor banks or power electronic devic-
es as SVC, STATCOM and VSC-HVDC stations. A reactive power pricing method according to the
physical constraints of synchronous machines will be described as follows.

Within normal operation the working point of generating units depends on the contractual agreed ac-
tive power output. The amount of reactive power is controlled by either the local voltage regulator or a
preset value remotely appointed by the TSO (or ISO). Additional losses, equipment stress and aging
can be summarized to a compensation payment which shall be referred to as basic reactive power
payment. These costs can be assumed to be 0.3 – 0.5 €/MVar per hour availability [36]. Reactive pow-
er support beyond Q0 has to be rewarded by an opportunity payment which equals the reduced active
power utilization.

Other typical compensation costs may be obtained from the reactive power market in the United
Kingdom. Whereas a price of 4.52 €/MVarh is paid by utilization beyond a power factor 0.95 leading
and 0.85 lagging respectively [38]. Due to the fact that the majority of reactive power and voltage
support is provided by synchronous machines, a generally applicable valuation of reactive power sup-
port can be based on this characteristic.

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Table 4.7: Reactive power support

Basic reactive power support Enhanced reactive power support

Power factor above 0.95 lead & 0.85 lag below 0.95 lead & 0.85 lag

Availability payment 0.3 .. 0.5 €/MVar/h 0.3 .. 0.5 €/MVar/h

Utilization payment 0 4.52 €/MVar/h

Example for a compensation model for reactive power support from hydropower generation units

The Norwegian TSO, Statnett established a mandatory compensation model for reactive power ex-
change from power generators. The domestic power generation in Norway is close to 100 % based on
hydropower. The compensation model has been in service since January 1st 2010. Statnett has decided
to use the same compensation model also in year 2011.

The model is designed to compensate only incurred costs associated with exchange of reactive power
exchange for generators in normal operation. Hence, compensation for reactive power exchange for
generators operating as synchronous condensers (no active power generation) will be managed by
bilateral agreements. According to the regulations the generators are compensated only for additional
operating costs, and not for any investment costs. The following table below shows the average market
spot price from year 2000 to 2008:

Table 4.8: Average market spot price [www.nordpool.com]

Year 2000 2001 2002 2003 2004 2005 2006 2007 2008

NOK/MWh 103.33 186.49 201.03 290.61 242.04 234.81 391.44 223.56 369.38

Euro/MWh 12.75 23.15 26.91 36.69 28.92 29.33 48.59 27.93 44.73

Compensation model for Lista VSC in STATCOM operation

A new HVDC transmission system will supply electric power from shore to the Valhall gas field in the
North Sea. The HVDC transmission system is based on voltage sourced converters (VSC) rated at 78
MW and includes onshore and offshore converter stations connected by a 292 km submarine dc cable.
The HVDC transmission system will convert ac power from the 300 kV substation at Lista to dc pow-
er at 150 kV, transmit it through the submarine dc cable and convert it back to ac at 11 kV at the off-
shore converter at Valhall. The HVDC transmission scheme was commissioned in 2010.

The onshore VSC converter station at Lista was commissioned in spring of 2009. Statnett has entered
into a bilateral agreement with BP to operate the onshore converter station at Lista in STATCOM op-
eration until the complete HVDC transmission to Valhall is commissioned. This will provide fast-

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acting voltage support of roughly 80 Mvar both in the inductive and in the capacitive direction. Lista
VSC converter station is located 25 km south of NorNed converter station at Feda substation.

The main principle for the compensation model for STATCOM operation of Lista VSC converter
station is to cover all operating cost and provide a markup (profit) for BP:

• All maintenance costs

• Cost for all active power losses
• Markup (profit) for BP
Statnett is pleased with the operation experiences for the VSC converter at Lista. The converter has
been providing valuable fast-acting voltage support to the transmission grid and has been mainly been
operating in the capacitive mode. The converter has been in service for approximately 5000 operating
hours in 2009. The converter has been operating for 75600 MVarh in the capacitive mode and for
10700 MVarh in the inductive mode. In 2010 including week 17, the converter has been 37500 MVarh
in capacitive operation and 9100 MVarh in inductive operation.

4.3.2 Fast power flow control

One of the most attractive features of HVDC transmission technology is the fast and continuous con-
trollability of active power flow at any level within the power rating. The active power transfer
through an HVDC line is controlled only by the adjustment of the power electronic devices and with-
out the necessity of mechanical switching. When considering a HVAC solution FACTS devices like
Thyristor Controlled Series Compensation (TCSC) or phase shifting transformers can offer power
flow controllability, if this is required. The power flow controllability of phase shifting transformers is
associated with mechanical tap changers, and consequently, they are not able to adjust the power flow
continuously and as fast as power electronic devices.

Since there is no evaluation method concerning the power flow controllability itself an asset-based
approach is needed. If the operator determines that power flow controllability is required, e.g. to pre-
vent line overloading, to prevent bottle necks, to prevent system collapse etc., then the cost of a power
electronic solution should be compared with the cost of other solutions, including additional ac trans-
mission line or line upgrades, PSTs etc.. Depending on the application and operators’ needs there can
be a range of solutions, from relatively slow and successive active power flow control achieved by
mechanical switched devices (phase shifting transformer, switched series compensation) to fast and
continuous active power flow control provided by power electronic series compensators.

The specific costs of series compensation devices are listed in Table 4.9 [29]. While considering the
additional investment costs the HVAC transmission solution may become more comparable to the
HVDC solution depending on the actual needs for active power flow controllability. It should be noted
that in some cases a lower rated device with fast response can be used in place of a slower and higher
rated device.

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Table 4.9: active power flow control – equipment costs

active power flow control HVAC HVDC

slow successive 12 k€/MVA available by design

fast continuous 40 k€/MVA available by design

It's worth recognizing that as long as there is only a single component controlling active power flow
within a large meshed transmission network, active power flow control can be applied in a rather
straightforward manner not only to control the power transfer through the dedicated corridor but it
may also be used for assisting the parallel ac network during congestions. However, as the number of
components controlling active power flow increases, it may become necessary at some stage to pro-
vide an automatic centralized control system for coordination of the power flowing through the con-
trolled as well as the uncontrolled transmission paths AC. The performance and reliability require-
ments set for such systems needs to be very high to ensure that the overall robustness of the system is
maintained.

4.3.3 Market coupling

Within large interconnected systems there may be transmission constraints which separate local mar-
kets from each other. Relieving those transmission bottlenecks by adding supplemental transfer capac-
ity may provide an opportunity to earn revenue/profit due to the price differential between the sepa-
rated markets. Independent of the market procedure itself the profit is made by cheap energy acquisi-
tion within the low priced market and simultaneously selling at the market with higher price level.
Cross-border transmission projects, especially with active power flow controllability like HVDC links,
may be operated as merchant transmission facilities [39]. Within liberalized markets the Merchant
Transmission Owner (MTO) may be the transmission operator or an independent investor consortium
which is referred to as Independent Power Producer (IPP).

The active power flow controllability will increase significantly the transfer capability of cross-border
transmission projects [40], [41]. This additional capacity will directly increase the amount of energy
which can be traded and thus provides a certain profit in comparison to conventional HVAC cross-
border connections without active power flow control. However, increasing the transfer capacity and
hence the amount of energy which is traded between the markets will have noticeable impact on the
price difference in turn. This effect is negligible if the interconnection capacity is very small against
the total amount of energy production within both markets but has to be taken into account by large
interconnections [42].

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4.3.4 Loss reduction

HVDC transmission lines feature neither skin nor proximity effects, nor screen losses. Thus the trans-
mission line losses of HVDC technology are lower as compared to HVAC transmission and increase
proportional to the line length. But the overall losses of HVDC technology comprise of an additional
converter loss component which is independent of the line length. There is a so called break-even dis-
tance system cost whereas the HVDC solution will provide lower losses than an HVAC solution with
equal transmission capabilities. Thus it would be advantageous to relieve parallel HVAC lines to re-
duce the overall system losses.

VSC-HVDC stations can also provide reactive power compensation to minimize reactive power flows
and improve the voltage level within the ac network, particularly during high load situations. There
have been several studies on the Dutch transmission network and IEEE 118 bus system to quantify the
loss reduction of VSC-HVDC within meshed grids [31], [43]. In these studies, it could be shown that
the VSC-HVDC can reduce the overall system losses only by an amount of approximately 1 .. 2 %,
with respect to certain system conditions like very high system loading, only few reactive power pro-
viders and VSC-HVDC is operated with top priority to system loss reduction. However, this finding
cannot be generalized as such and must be investigated on a case by case basis. It seems that the re-
duction in overall system losses may be negligible while operating under normal system conditions.
With respect to further HVDC multilevel converter development the converter losses may be de-
creased in the future, and this would reduce the break even distance for the power loss, and increase
the power loss reduction in the study case. However, because the first multilevel converter HVDC
project has limited service experience at the time of writing, there is no real data verifying the de-
creased converter losses within practical operation. Consequently the loss reduction of VSC-HVDC
has to be studied again, when data on the new multilevel HVDC setup is available.

4.3.5 Environmental impact

Power transmission projects will always have an impairment of nature and landscape due to optical
impact during operation and construction and land usage. Furthermore power lines emit electro-
magnetic fields (see also [44]). A general perception among people is that there is a correlation be-
tween the incidence of disease and exposure to electro-magnetic fields. Notwithstanding that there are
legal guidelines regarding the limitation of electro-magnetic field intensity, power transmission
projects is often met with public opposition. Due to the vast right of way demand of bulk power
transmission projects, nature protection and landscape conservation becomes a serious issue, which
has to be considered during the planning process. Thus public opposition against new transmission
assets, especially overhead transmission lines, has risen in the last years. This often results in tenacious
legal procedures with environmental organizations and legal committees causing significant delays or
even abandonment of the project. The potential for delays should be considered in the discounted cash
flow analysis by lengthening the time span between the initial project investment and commissioning.

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It is assumed that the permission process of cable projects takes 2-3 years, whereas overhead transmis-
sion lines will take 3-6 years [45] or even longer.

Despite the lower visual impact of cable solutions they also may influence wildlife habitats and bio-
topes because of trenching through the landscape. Within ecologically sensitive countries like Germa-
ny transmission planning utilities will face resistance by nature protectionists and environmental activ-
ists. In certain cases transmission utilities will have to rearrange the transmission route to avoid envi-
ronmental sensitive areas and biotopes or apply ecological mitigation measures. For example the de-
siccation in the area of cable trenches has to be considered. According to a German TSO the costs
arising from these ecological requirements are referred to as nature reconciliation payment and may be
accounted as 6 .. 10 % of the total transmission capital costs for cable. This payment may include re-
quirements like the necessary route exploration process prior to submarine cable projects within Ger-
man North Sea and Baltic Sea. This 2 year enduring exploration process shall investigate the environ-
mental impact of the submarine cable.

4.3.6 Black-start and Island supply

The analysis provided in this section is based on gross domestic product (GDP) impacts. This is one
approach under a certain variety of methods to estimate the value of black-start capability and island
supply capability. Another approach would be the actual contract value for existing black-start capa-
bility provisions.

HVDC transmission links facilitate the connection of asynchronous transmission systems. Such an
asynchronous connection is often referred to as a firewall against grid disturbances, because minor and
major grid disturbances may be kept within the affected system. Furthermore the HVDC transmission
system provides the ability to supply a certain area within the disturbed system by power import from
the healthy power system. Black-start capability and island supply are very beneficial functions for
power system operation and traditionally, black-start capability has been offered by gas-turbine gene-
rators and hydro units that have been specially equipped to be capable to start against network without
voltage. Also, HVAC-connections between two large ac networks are often equipped with system
protection schemes (SPS) that are designed to separate the two ac networks from each other before
possible instabilities occurring in one network spread also to the other network. In case the SPS oper-
ates successfully, only one of the networks suffers a black-out and the other can provide the black-start
capability by supplying voltage by reconnection the ac line disconnected by SPS.

4.4 Additional comments on the cost factors

Additional comments on the cost factors are summarized in Table 4.10.

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Table 4.10: Additional aspects impacting the economic value
Aspects that should be taken into account while
the investment cost is evaluated
Location of the station
Soil and topology of station area
Station
Requirements set for audible noise level
Busbar arrangement
Possible requirements set by environmental aspects
Land topology on the line route
Existence of transmission corridor
Transmission lines
Soil on the line route
Location of the line route
Life-time of the chosen transmission alternative
Available voltage levels at the two stations
Possible requirements set by environmental aspects
Vicinity of inherent source of reactive power
Reactive power
compensation
Approach to control voltage in transmission network
Availability of market mechanism for reactive power
Type of compensation equipment required
O&M
Local O&M requirements
Location of area
ROW
Availability of ROW "normal use" after the line is built
Vicinity of inherent source of reactive power
Fast reactive power
control
Approach to control voltage in transmission network
Availability of market mechanism for reactive power
Level of power flow control required
Fast power flow control
Are there existing measures to control power flow?
Effect of transfer capability (new connection, PODs vs.
system protection schemes)
reduction
Loss
Structure of the system...
Availability of parallel connections between the
Black network
new connection
start-up
Availability of other sources of black network start-up
Location of the new connection
Description Comments
Area required by the equipment significantly more
Land cost
expensive on densely populated areas
Extent of land works required (foundings) Sand vs. solid rock vs. swamp vs. clay
Need for measures to limit the level of noise Noise barriers, indoor equipment,
Amount of breaker arrangements 1, 1.5 or 2 per bay (AC vs. DC should not make a diff.)
Effect on land scape Need for landscaping
Plains, hills, swamps, lake area, mountains
May be easier in case of existing corridor, parallel AC and
Permitting
DC may arise interaction issues
Extent of land works required (foundings, cable ducts)
Land cost, availability of access using heavy vechiles
HV OH-lines 70 years, HV cables 50 years(?), DC
converters 50 years (ctrl. upgr. required after 20+
Are transformers required in case of AC solution to
reach the optimal transfer voltage?
Effect on land scape Need to limit height of the tower or landscape towers
Affected also by local grid connection requirements (are
Vicinity of generators, reactors, capacitors
producers oblidged to participate voltage control)
E.g. in FI down regulation of voltage is taken care by MV
Cost of compensation equipment may vary dependin
reactors connected at tertiarys of power xformers -> low
applied approach
cost of reactors, somewhat increased cost of xformers
Availability of straightforward approach to value
reactive power capacity
E.g. space or audible noise requirements Air-core reactors vs oil-filled reactors
E.g. vegetation control has significantly higher cost effect
Vegatation management, pollution removal in Brazil that in Iceland. Pollution removal on lines of sea
shore vs. line on mountains.
Densely populated area vs. farmland vs. waste land vs.
Land cost
commercial forest --> large variations in land cost
To which extent the land can be applied
Grazing ground vs. farm land vs. commercial forest
for its orignal use
Affected also by local grid connection requirements (are
Vicinity of generators, reactors, capacitors, SVCs
producers oblidged to participate voltage control and in
what extent?). Added value gets evidently smaller the
Cost of compensation equipment may vary dependin
applied approach more there are devices with similar capacity
Availability of straightforward approach to value Otherwise comparison with cost of SVCs and
reactive power capacity STATCOMs what, however, may be difficult to justify
Power control can be conducted on different levels Line control vs. system level control, full control vs. partial
using different devices control
The coordination between the controlling component
Coordination between control measures required to
may become costly and added value typically decreases
get full advantage out of control functions
along the amount of available measures.
Addition of new connection may have even adverse
effects on transfer capability (or basically new
This must be evaluated on transmission system level
connections may require reinforcements in existing
network)
New line (any kind) can be considered to always
The level losses in the system before the new line is
decrease the system losses if its location is well planned.
evidently fundamental factor behind the achievable
How much more e.g. HVDC SVC can provide, depends
loss reduction
totally on system topology and operation
Evidently the type of parallel connections is critical, in
Black netwrok start-up can be basically conducted
case of AC connection system protection schemes are
using both HVDC VSC and AC connection
required
# and usability of existing black-network start-up
Defines the additional value provided by new connection
scenarios
Is the connection close to infrastructure that suffers
This may affect significantly the added value
greatly from long black-out
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4.5 Summary of Assessment Process

Newly available transmission equipment provides additional possible solutions for the system planner
and hence increases the complexity of the planning process. A straightforward assessment process has
been proposed. The key intension is to assess the economic value of available technological functions.
The overall process is divided into four different phases, each comprising of individual modules which
are applied dependent on the actual application scenario.

Within the first phase key information has to be gathered for sustaining a precise choice of feasible
technology concepts and power ratings. The environmental and political framework and market struc-
ture of the considered case have significant impact on the process and serve as input parameters for the
second and third phase of the assessment process.

The economic figures used in phase II may be derived from publicly available information but should
be modified taking into account project specific environmental and country information. Typical costs
have been presented in chapter 4.2 for different power ratings. However, cost estimation is a complex
task and sensitive to a number of input parameters, and therefore a generally applicable comparison of
costs of the transmission technology alternatives cannot be provided. The detailed costs for a consi-
dered transmission technology can only be provided for a definite case with a known set of input pa-
rameters.

An overview of the functional evaluation of key transmission technology functions is provided by

Table 4.11, which summarizes the information presented in chapter 4.3. It is strongly recommended to
review this chapter, and the references provided, for further information. The given values are sensi-
tive to the actual considered market and system environment.

Table 4.11: Economic evaluation of beneficial functions – Examples from the findings above

Functionality Economic value

Fast active power flow control 40 k€/MVAr

Basic reactive power support 0.3 .. 0.5 €/MVAr/h

Enhanced reactive power support 0.3 .. 0.5 €/MVAr/h + 4.52 €/MVArh

Transient stability improvement Case dependent (e.g. 15% more NTC)

Damping control -

Black-start / Island supply 0.86 k€ per year and MW capacity

Varies from case to case – reported 6 .. 10% of

Environmental impact
transmission investments in one examples

System loss reduction 1..2% of overall system losses

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With the existence of a detailed utilization scenario providing all information regarding the case study
environment, a detailed cost estimation and functional valuation is done to provide all necessary input
parameters for an extensive cash flow analysis as transmission technology benchmark.

The overall assessment process is illustrated in Figure 4.6. The key aim is the presentation of a trans-
mission solution featuring the most beneficial impact on power system operation from a given invest-
ment proposal.

Investment proposal

Economic & Outline

Phase I

Gather Local system

Case study Performance Environ- feasible
investor conditions
analysis objectives load flow
rating mental technology
framework concepts
Phase II

Cost
Cost estimation of
breakdown Station cost Line cost Right of
available O&M cost Line losses
of feasible Assessment Assessment way
technology concepts

(Fast) voltage control

Determine
appropriate (Fast) power flow control
Phase III

Economic functions to Blackstart / Restoration / Island supply Value

valuation of be appropriate
functional benefits evaluated Market coupling functions
for the Loss reduction
project
Environmental impact
Phase IV

Cash flow analysis

Qualitative
for solution DCF
benefit
compariosn

Investment decision

Figure 4.6: Overall assessment process

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5 Case Studies

In this chapter, 4 case studies are presented in order to give some practical examples of network stu-
dies with economic considerations. Some of the cases have been taken from real network expansion
projects. The last study case is a “generic” case where the economic evaluation process has been ap-
plied to typical network situations.

5.1 Randstad 380 Project Feasibility of VSC HVDC Application in a Meshed Grid

A technical study was performed to investigate the feasibility of using Voltage Source Converter High
Voltage Direct Current (VSC HVDC) technology for the Beverwijk to Bleiswijk connection, 60 km
transmission scheme in Northern Holland. The study was performed in 2006 and presented at the CI-
GRE Regional Meeting, Tallinn, Estonia, June 18-20, 2007. The complete report can be found at the
following website: http://www.esat.kuleuven.be/electa/vsc-hvDC/

The Randstad 380 project is the transmission system expansion plan of TenneT, the Dutch TSO, to
meet the system growth requirements. The project includes the construction of new 380 kV and
150 kV lines, and the construction of new substations as well as upgrading existing ones.

The planning was based on the assumptions that all new high voltage connections would be built as
double circuit overhead lines rated at 2 x 1650 MVA or 2 x 1900 MVA. However, it was envisaged
that various regulatory, environmental and permitting procedures could delay or even cancel the
project, especially, if it comprised overhead lines. For these reasons part of the southern transmission
ring had to be built as an underground scheme. Due to the sensitive routing, the northern ring, Bever-
wijk to Bleiswijk, was expected to face even more problems. A technical study was performed to in-
vestigate the possible application of VSC HVDC technology for the Beverwijk to Bleiswijk 60 km
route, without compromising grid stability, flexibility and reliability.

5.1.1 Problem definition

The Dutch TSO TenneT planned to upgrade the transmission system to meet the needs for increasing
energy consumption in the southern region of Holland. The transmission routing of the Randstad 380
project comprises of the following six substations: Maasvlakte, Westerlee, Wateringen, Bleiswijk,
Beverwijk and Diemen. Upon completion of the Randstad 380 project, the structure of the 380 kV grid
in the provinces Noord-Holland and Zuid-Holland will resemble two rings as shown in Figure 5.1:

• a southern, Maasvlakte-Westerlee-Wateringen-Bleiswijk-Krimpen, and

• a northern, Beverwijk-Bleiswijk-Krimpen-Diemen
This study concerns mainly with the Beverwijk to Bleiswijk route as the other parts are less favorable
for the VSC HVDC alternative.

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Figure 5.1: Randstad 380 project. The dotted lines represent the trajectories of the Randstad 380
project

When new transmission capacity investments are considered, the traditional, and often technically and
economically most sound solution is the installation of overhead lines. Once the approval for the
transmission routing is obtained, the TSO often resorts to over dimensioning the overhead lines be-
cause it could be even more difficult to obtain permits in the future. It is also generally acknowledged
that underground transmission schemes face far less hurdles in obtaining permits. Because over di-
mensioning of an HVDC link is neither necessary nor desirable, the maximum power flow through the
line has to be calculated accurately in order to provide an adequate VSC HVDC solution. Additional
upgrades can easily be added at a future date, as and when the needed.

A 2 x 1650 MVA or 2 x 1900 MVA double circuit is used as current standard practice for investments
in the Dutch transmission system. Part of the Randstad 380 project, the 60 km connection Beverwijk
to Bleiswijk, calls for special attention because of the following specific issues as can also be seen in
Figure 5.1:

• Randstad area is very densely populated;

• the transmission routing passes through the so-called “Groene Hart”, a protected natural land-
scape;

- 71 -
 • the High Speed Line (HSL) train passes through this region for which an 8 km underground
tunnel is built. This requires that the electrical transmission scheme has also to be under-
ground.

• the transmission line passes nearby the Amsterdam Airport Schiphol. Regulation prohibits the
construction of overhead power lines nearby airports, making it necessary to underground the
380 kV line at least partially.

The upgrade of the transmission system should ensure security of supply for the distant future assum-
ing any reasonable contingencies. For instance, if both circuits of Beverwijk-Oostzaan-Diemen are not
available, large flows pass through the weak 150 kV network of Noord-Holland. This causes voltage
instability issues in that area. A new connection between Beverwijk and Bleiswijk would support this
region. Furthermore, the load and generation profile for that region are very uncertain and are not un-
der the control of the TSO TenneT. One probable generation scenario is the installation of an offshore
wind park connected to the planned Beverwijk substation. Because of these uncertain load and genera-
tion patterns in the area, safe operation of the power system cannot be guaranteed in 2012 and beyond.
The estimations of the future electricity profile in the Netherlands are published by the Dutch TSO
TenneT in the so-called Capacity Plan [46].

Another factor that needs to be considered in the Dutch transmission system near the Randstad area, is
the installation of the BritNed cable, an HVDC link connecting the UK with the Netherlands, planned
for operation in 2012. This HVDC link will have a rating of approximately 1320 MW, and the connec-
tion to the Dutch power system will be made at Maasvlakte substation.

5.1.2 Technical analysis

Network model

A network model was prepared based on publicly available data of the Dutch transmission grid com-
prising of the high voltage grid (220 kV and 380 kV). All the Randstad 380 upgrades were included in
this model. As this study concentrates on the northern part of the Randstad 380 project, the upgrades
of the southern ring are already included in the model, although the connection between Maasvlakte
and Bleiswijk was not included. The 2005 maximum load scenario was used as a starting point. This
load scenario can be found in the “Transportbalans”, published by TenneT [47]. The generation con-
nected to the 220/380 kV system, was not included in the “Transportbalans”, and was manually in-
serted in the model. This base case is a representation of the current electrical grid. It was considered
to be a starting point that can be adapted in order to represent future load and generation patterns.

Simulations

Starting from the 2005 base case, the 2012 system data was generated based on the assumptions in the
various scenarios in the Capacity Plan to provide an adequate representation of the 220/380 kV grid.

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This allows verifying the problems foreseen in the Randstad area. For each case, variables were de-
fined, such as the exchanges with Norway and the UK via possible future HVDC links, and exchanges
with Belgium and Germany.

In all three scenarios of the Capacity Plan, the Beverwijk connection causes problems if both lines
between Beverwijk to Diemen (Beverwijk-Oostzaan-Diemen) are out of service. It was verified that a
new transmission between Beverwijk and Bleiswijk, such as that proposed by TenneT, solves this
problem. The construction of the line is intended by 2010. Pending the realization of this transmission,
special operational requirements are imposed on the Diemen-Oostzaan-Beverwijk line.

From the viewpoint of this study, the time horizon 2012 is chosen as time reference, as load and grid
data of that year are given by the Capacity Plan. By then the upgrade of the transmission grid becomes
indispensable. Also by that time an off-shore wind park of 750 MW will be installed. It might be ap-
propriate to install the connection earlier, but this has no impact on the analysis. The data used in load
flow calculations refer to those of the year 2012. All power flow calculations were performed using
Matpower [48], a Matlab power system simulation package.

Criteria

Three N-1 contingencies are described in the Dutch Netcode and are described below:

• ‘Criterion a’ is a standard N-1 contingency;

• ‘Criterion b’ states that N-1 has to be guaranteed during maintenance;

• ‘Criterion c’ is the N-1 contingency during maintenance, at maximum load, with optimal
dispatch.

A flow in a line or a transformer is considered to be acceptable if it is less than 110% of the rated ca-
pacity. For the voltages, the maximum allowed deviation from rated is 10%.

5.1.3 Present Load and Generation as of 2006

The data provided by TenneT assumes a 2700 MW load in the region of Noord-Holland, out of which
about 1700 MW is generated locally and 1000 MW is imported from TenneT. Once the new substa-
tion at Beverwijk is completed, this 1000 MW will be divided among the three 380 kV buses, Diemen,
Oostzaan and Beverwijk. According to TenneT, 400 MW will be imported to the 380 kV grid in Oost-
zaan from generation, but 1400 MW will be transferred equally from the 380 kV grid to the lower
voltage grids. This means there is a 700 MW load at each of the two Beverwijk and Diemen substa-
tions in 2006 (Fig.5.2 ).

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Figure 5.2: Current situation in Noord-Holland region

It should be noted that in the future, the distribution among the three substations can change signifi-
cantly because of investments in new generation units or decommissioning of existing ones. It is the
task of the TSO to facilitate the market by accommodating every realistically possible future scenario
as far as possible. Two extreme scenarios are: a combined increase in wind power and local genera-
tion, and the disappearance of all local generation. The proposed solution has to be able to facilitate
both scenarios. In case a double fault occurs on the line Beverwijk-Oostzaan-Diemen, both scenarios
result in high stress on the Bleiswijk-Beverwijk connection. In case all local generation disappears, the
line has to provide 2000 MW (minus wind power) to Noord-Holland.

In previous sections the worst case from the Capacity Plan is used. Local generation is assumed to be
1700 MW, and different schemes for the construction of wind energy generation are calculated. Note
that this methodology also implicitly comprises changes in local generation as it does not matter what
the origin of generation is. Thus a wide variety of cases are presented, and of course other variations
are possible.

5.1.4 Future scenarios

2006 - 2012

In the Capacity Plan, various scenarios for the future are defined. The scenario that puts the highest
stresses on the connection, and thus represents the worst case is used. The injections in the lower grids
are linearly increased per region in order to obtain values for 2012 and onwards. According to the
Capacity Plan, in the worst case, there will be an exchange of 1640 MW between the transmission
system and the Noord-Holland region in 2012. It is assumed that the increased interchange with the
underlying grid will spread among the three nodes. This leads to the following power exchanges by
2012: 913 MW load at Beverwijk and Diemen and 187 MW injection from the lower voltage level
into the 380 kV grid in Oostzaan for the c criterion, as defined in section 0 above. This methodology is

- 74 -
used throughout the entire Dutch grid and for all criteria. Note that the distribution of the extra load
over the different nodes is difficult to assess and subject to interpretation.

It is expected that by 2012 a double circuit overhead line connection between Diemen – Oostzaan –
Beverwijk would be in operation. The grid situation in 2012, with interaction between Continuon
Noord-Holland, the local DSO, and TenneT, is given in Fig. 5.4 (data of criterion c, high scenario).
The requirements for the connection were determined by contingency tests, as described in the Dutch
grid code.

Criterion a (N-1 criterion)

Using the data presented in the Capacity Plan, and applying an equal distribution over nodes Bever-
wijk, Oostzaan and Diemen, the following exchanges between the region Noord Holland and the Ten-
neT transmission system are found: Beverwijk and Diemen represent 896 MW load at each bus, and
204 MW is injected into the transmission system at Oostzaan. This load condition can be supported by
one Diemen-Oostzaan-Beverwijk circuit.

Criterion b (N-1 during maintenance)

The exchange from the lower grid to TenneT according to criterion b is the same as for criterion a
(896 MW load at Diemen and Beverwijk, and 204 MW injectionat Oostzaan, using the high variant).
Upon opening of both lines between Oostzaan and Beverwijk, the connection between Beverwijk and
Bleiswijk has to be able to deliver 896 MW to Beverwijk in order to maintain secure operation. The
line connecting Beverwijk and Bleiswijk thus needs a capacity above 900 MW. Furthermore, when
there is wind generation, the net load at Beverwijk reduces and the effective active power that has to
be transported to Beverwijk varies between 146 and 896 MW, assuming 750 MW wind generation by
2012 (Figure 5.3).

Figure 5.3: Criterion a and b

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Criterion c: N-1 contingency during maintenance, at maximum load, and optimal dispatch.

The maximum estimated load under the data of criterion c amounts to 913 MW in 2012 (with
1700 MW generation in that area, and 2800 MW available). This situation is similar to the one in crite-
rion b, and the connection between Beverwijk and Bleiswijk should be able to transfer up to 913 MW.

Based on this scenario, load flow calculations showed that by 2012, the line Beverwijk-Bleiswijk must
be able to transfer about 900 MW of active power, in the case both circuits between Oostzaan and
Diemen are unavailable. Hence one VSC HVDC link rated at 1100 MW would be sufficient (Figure
5.4). This is an important conclusion because any future upgrades can be postponed until after 2012,
thus delaying investments and avoiding overinvestment.

Figure 5.4: Criterion c

2012 - 2020

According to Connect II, a study of the Dutch Ministry of Economic Affairs to assess the viability of
connecting large-scale offshore wind energy, there will be a large increase of offshore wind energy, to
the extent of 6 GW, in the Netherlands by 2020. Most of it will be connected to the Dutch grid at 380
kV substations in Beverwijk and Maasvlakte.

By 2020, the load at Beverwijk will be approximately 1050 MW (2% rise per year starting from
± 900 MW in 2012). Under this assumption the solution of one VSC HVDC rated at 1100 MW is
found to be adequate up to 2 GW of wind connection at Beverwijk. Higher wind generation in Bever-
wijk calls for more connection capacity between Beverwijk and Bleiswijk.

Connection of wind in Beverwijk up to 3 GW

The 6 GW planned offshore wind energy will not entirely be connected to one high voltage substation.
In the Connect II document, several configurations for connecting wind to the mainland are consi-

- 76 -
dered. These configurations split the offshore power to two substations, Maasvlakte 4 and Beverwijk,
evenly. The Connect II report estimates a 3500/2500 distribution. The same report also outlines 4 sce-
narios where only in one case the wind generation is above 3.5 GW by 2020 [49]. Both aforemen-
tioned reasons allow to safely assume that there will not be more than 3.5 GW of wind power con-
nected to Beverwijk between 2020 – 2030.

Figure 5.5: Scenario's for development of offshore wind energy [49]

Considering the general increase in demand it is assumed that the load in Beverwijk will increase,
resulting in the transfer from the TenneT grid increasing up to roughly 1050 MW. The dc link has to
provide sufficient power to the Beverwijk region when there is no wind power, and it has to export the
excess amount of wind power if there is full wind power.

For the first case, this means that the dc link will have to carry 1050 MW to the Beverwijk region. For
the second case, with full wind power, 3000 MW – 1050 MW will have to be withdrawn from Bever-
wijk. The connection therefore has to be able to carry 1950 MW. This power transfer can be reached
by the installation of two 1100 MW VSC HVDC lines by 2020, fulfilling the needs of the local grid
according to the rules set in the Capacity Plan (Figure 5.6).

The amount of excess wind power that has to be exported depends on the amount of load at Bever-
wijk. In the calculation above, 1050 MW was assumed, and it is valid as long as the load at maximum
wind generation does not drop below 800 MW. For a more in depth evaluation, data of the load pattern
at the Beverwijk connection is needed.

4 The Maasvlakte alternative can (partly or fully) be taken over by Wateringen and/or Westerlee, two new
substations on the trajectory Maasvlakte – Bleiswijk.

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Figure 5.6: 0-3000 MW offshore wind energy connected to Beverwijk

5.1.5 Economic assessment

Different alternatives for the reinforcement of the Randstad region are compared on an economic ba-
sis. For the analysis, the net present value method is used, with interest rates of 5, 7.5 and 10 %. A
summary of the economic analysis is presented here and further details are covered in [50] and [51].

The dc solutions proposed in the technical study are compared to a solution using overhead lines and a
solution using an underground ac connection. The cost estimates, based on 1 M€/km for double circuit
overhead line and 7 M€/km for a double circuit underground cable, result in 60M€ and 420 M€ re-
spectively. The cost of one VSC HVDC link rated at 1100 MW is estimated at 163 M€ 5. In this study
staged development is not taken into account for underground ac cables because the available cost
estimates are too rough. When detailed cost information is available for the underground option, the
influence of staged development should be taken into account. Exactly the same investment scheme as
VSC HVDC can be used for underground ac cable.

The comparison of different investment strategies for a 2 x 1100 MW VSC HVDC link by 2020, has a
net present value between 239 and 297 M€ dependent on the investment in the needed line. This
would make the dc connection 4 to 5 times more expensive than the ac overhead line option, and 1.45
to 1.75 times cheaper than the ac cable connection. The dc connection becomes the most economic
underground option when more than 30 km of underground cable is used (or more than 40 km in the
297 M€ case). These estimates do not take into account the extra cost for the ac overhead line option
related to bypassing Schiphol international airport.

5
Price given by manufacturer of 1100 MW VSC HVDC

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The cost of the VSC HVDC solution is found to be in between that for an all underground ac solution
and an all overhead line ac solution. When a significant part of the transmission routing can be over-
head, VSC HVDC is not economically competitive. When a significant part needs to be underground,
VSC HVDC offers a valid technical and economical alternative.

5.1.6 Summary and conclusions Randstad

Load flow calculations showed that it sufficed to install one 1100 MW VSC HVDC link by 2012. It
was verified that this solution satisfies the N-1 contingency criterion. The option of one VSC HVDC
also supported the Beverwijk region when both connections between Beverwijk and Oostzaan (or Di-
emen) were out of service. When this occurred, the dc link had to carry about 900 MW. This solution
would also accommodate the installation of the planned 750 MW wind power park at Beverwijk.

For the period 2012-2020, an increase in load at the Beverwijk region is assumed. A further increase
of offshore wind power is planned. The maximum installed wind power connected to Beverwijk in
2020 is assumed not to be greater than 3 GW. By then, an additional VSC HVDC circuit of 1100 MW
would be needed.

Although initially deemed only suitable for very specific applications, at low power applications, it is
shown that VSC HVDC can also be a possible contender for bulk transmission of power in meshed
grids for relatively short distances, especially with sizable amount of underground transmission.

5.2 VSC-HVDC as alternative to ac in German TSO-Grid – Wahle Mecklar case study

This study was conducted in 2008. The technical and economic calculations are based on the TSO
supplied 2008 data. Within the scope of the Dena Grid Study different areas were identified in which
an upgrade of the grid was necessary to ensure the transport of onshore wind power. Especially in
lower Saxony, alternatives to the conventional 380 kV ac overhead lines were researched. From this
discussion, under certain circumstances, underground high voltage transmission in Lower Saxony has
emerged as a viable option [52]. The Dena Grid Study identified the transmission line Wahle-Mecklar
to be upgraded. In this context in 2008 a new study was set up, in order to find out whether an HVDC
underground transmission would be a possible alternative to the ac overhead line option. Within the
scope of this study a comparison of the HVDC underground transmission based on VSC technology
and an ac overhead line was made. An ac underground cable option or partial underground cabling
was not investigated. Figure 5.7 shows the 190 km transmission scheme.

At present, between Wahle and Mecklar exists no direct transmission line, and the planned line would
be a new construction. The Wahle and Mecklar stations are interconnected through double circuit lines
in the east and west as shown in Figure 4-8. At Wahle and Mecklar the HVDC transmission line
would be connected to the 380 kV grid. The integration of the HVDC scheme was analysed under two
different scenarios. Scenario one describes a Point-to-Point connection between Wahle and Mecklar,
scenario two describes a three point connection Wahle–Göttingen–Mecklar. In both scenarios two

- 79 -
VSC-HVDC transmission systems were planned in order to fulfil the required 1100 MW transmission
capacity under (n-1) contingency. In Wahle and in Mecklar two 1100 MW stations would be built,
Göttingen would be connected via two 400 MW stations.

6
Figure 5.7: Possible transmission lines Wahle – Mecklar

This section presents the findings of the investigations; starting with network modelling followed by
loss considerations and the reactive power balance. Finally the possibility of load flow control will be
explained and an economic comparison between an ac overhead line and a HVDC transmission line
will be drawn.

5.2.1 Network model

The integration of the HVDC transmission scheme into the existing grid was examined using power
system simulations. The performance of the transmission system was analysed based on system behav-
iour and system inherent factors of influence. The system behaviour was based on the following:

• Analysis of load flow in the (n-1) case

• Examination of the active and reactive power balance in undisturbed operation
• Examination of controllability of the HVDC transmission system

6
Dena Network Study: Energiewirtschaftliche Planung für die Netzintegration von Windenergie in Deutsch-
land an Land und Offshore bis zum Jahr 2020, Köln, February 2005

- 80 -
For the network simulations, the 2012 planned network was assumed to represent the network 2015
Wahle – Mecklar upgrade. Figure 5.8 shows the underlying network model. The HVDC transmission
line is shown in green colour, the surrounding ac system is shown in blue colour.

Figure 5.8: Simplified network model of the surroundings of Wahle - Mecklar

The parameters used for network calculations are summarized in Table 5.1. In the network model
HVDC stations are shown as PQ nodes.

The network simulation is performed in several stages. At first the network solution is analysed under
steady-state conditions without any outages. Thereafter, an analysis of the following (n-1) conditions
is undertaken:

• Grid without the connection Wahle – Mecklar

• Grid with AC-connection scenario 1
• Grid with HVDC-connection scenario 1
• Grid with AC-connection scenario 2
• Grid with HVDC-connection scenario 2

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In the existing grid, without the Wahle – Mecklar connection, in case of (n-1) contingency, at heavy
wind and heavy load the maximum current exceeds the set criteria. Without the contingency the capac-
ity utilisation is 93 %. By adding the transmission line Wahle – Mecklar, the (n-1) security was re-
established and capacity utilisation decreased to 72 %. All four considered extensions handle the (n-1)
case considered here satisfactorily. This means all variants provide the required capacity.

Table 5.1: Simulation assumptions

Category Assumptions
AC-Grid expansion Plan 2012
• AC-Double circuit Wahle – Mecklar with ampacity of 4 200
A/circuit
• AC- Double circuit Wahle – Göttingen – Mecklar with ampacity of
4 200 A/circuit
Variation of grid expansion
• Two VSC-HVDC-Systems Wahle – Mecklar each with transmis-
sion power of 1100 MW/System
• Two VSC-HVDC-Systems Wahle – Göttingen – Mecklar each with
transmission power of 1100 MW/System
• Wahle: 2 x 1100 MW
HVDV Transmission Power • Mecklar: 2 x 1100 MW
• Göttingen: 2 x 200 MW
Load Case Strong load at strong wind
Ampacity of existing electrical lines 3150 A with overhead line monitoring at strong wind
Emulation of HVDC-System Converter is PQ-Node
Method of computing Extended Newton-Raphson
(n-1) Only electrical line faults.
In the following losses and reactive power balance of the different extensions will be examined and
compared.

5.2.2 Loss consideration

Within the scope of loss consideration the transmission losses of the ac overhead line and the HVDC
transmission of the line Wahle – Mecklar are examined. At first the ac losses will be identified, next
the dc losses and finally the results will be summarized and rated. The ac losses are divided into
“losses dependent on current” and “losses dependent on voltage”. Current losses depend on the
amount of transmitted power. At first we calculate the maximum of power loss that occurs if the sys-
tem is transmitting the rated power all the time. Next, using the expected value, the energy loss per
year is identified. Losses dependent on voltage are independent of the transmitted power. The HVDC
system is loaded in the same manner as the alternative ac transmission line without load flow control
elements. Forecast for possible loss optimisation by the use of flow control is given in the part “Con-

- 82 -
trollability”. The results of loss calculation are shown in Table 5.2. The losses in scenario 2 at the
380/110 kV substation are neglected. Because the length of the transmission line is the same in both
scenarios the statements made for the AC-model are valid for both scenarios.

Table 5.2: AC-power losses

Scenario 1 Scenario 2

Conductor cross-section in mm² 2 546 2 546

Resistance in mΩ/km at 40°C 13,9 13,9
Conductance nS/km 17 17
Transmission power in MVA 2 x 1 100 Wahle  Göttingen: 2 x 1 100
Göttingen: 2 x 200
Göttingen  Mecklar: 2 x 900
Length of line in km 190 Wahle  Göttingen: 120
Göttingen  Mecklar: 70
Voltage rating in kV 380 380
Current dependent losses in MW 44 35
Voltage dependent losses in MW 0.934 0.934
Total power loss at transmission power in MW 44.9 35.9
For identification of dc losses, besides the pure losses dependent on current of the cable, one must also
consider the losses of the converters. This is shown in Figure 5.9. The losses of the HVDC stations are
calculated with the use of percentage values taken from literature and the rated power value.

DC-Losses
DC-Verluste

Converter
Cable losses
Kabelverluste Stationsverluste
losses

Leerlaufverluste Operatin losses

Betriebsverluste
Losses Idling losses
Spannngsabhängig Dependent upon
Stromabhängig
Stromabhängig Dependent
0,18 % derupon 1,54 % der
current
dependent voltage Bemessungsleistung pro
Bemessungs-leistung 1.54 % power rating
upon current 0.18 % of power
pro Station Station
rating

Figure 5.9: Representation of the considered dc losses

- 83 -
A Comparison with manufactures' loss data for a VSC technology 7 and loss reports of the Cross
Sound Cable project verify the values at rated power. 8 For these calculations we assumed the losses to
be linear. Table 5.3 describes the technical parameters used for the HVDC-connection. These are
based on manufactures' and TSO's data. Scenario 1 depicts the point to point connection, Scenario 2
the three point connection.

Table 5.3: DC-power losses

Scenario 1 Scenario 2
Conductor cross-section in mm² 2 800 2 800
Resistance in mΩ/km 11.3 11.3
Specific resistance in Ω*mm²/m at 20°C 0.027 0.027
Transmission power in MW 2 x 1100 Wahle  Göttingen: 2 x 1100
Göttingen: 2 x 200
Göttingen  Mecklar: 2 x 900
Number of DC-Stations 4 6
Length of line in km 190 Wahle  Göttingen: 120
Göttingen  Mecklar: 70
Voltage rating in kV ± 300 ± 300
Maximum Current in A 1 800 1 800
No load losses in % of max. transmission
0.18 0.18
power per DC-Station
Load losses in % of operating transmission
1.54 1.54
power per DC-Station
Line losses in MW 29 25
No load losses in MW 7.9 8.6
Station Load losses in MW 68 68
Total power loss at transmission power in 104.9 101.6
MW

The power losses obtained from the case of full load can be determined using the expected load factor
of the connection, which is expected to be 0.3. Therefore, the annual energy losses are shown in Table
5.4 yield from following calculation.

Energylosses = Powerlosses x 8760 h x 0,3 (5.1)

7
It’s time to connect [online]. 10/2007. Internet: http://search.abb.com/library/ABBLibrary.asp?DocumentID=
1JNL100105-122&LanguageCode=en&DocumentPartID=&Action=Launch [29.01.2008]; p. 30.
8
Cross Sound Cable Project Second Generation VSC Technology for HVDC. In: Cigré, Working Group B4-
102, 2004,.p. 5.

- 84 -
Table 5.4: Annual losses

Used Technology AC DC
Scenario 1 2 1 2
Losses dependent upon voltage GWh 8 8 - -
Losses at load factor of 0.3 in GWh 116 92 76 76
Reactive losses of converter in GWh - - 69 76
Converter losses at 0.3 load factor in GWh - - 178 178
Total losses in GWh 124 100 323 320
Cost of losses per annum in M€ 7.7 6.2 20.1 19.8

Table 5.4 makes clear that losses of Scenario 2 are less than the losses of a two point connection. The
results show, as expected, that the HVDC-connection leads to higher total system losses than the im-
plementation of an ac overhead connection. Figure 5.10 summarises the results.

350

300

250
Losses in GWh

200
Verluste

150

100

50

0
AC Szenario 1 AC Szenario 2 DC Szenario 1 DC Szenario 2

Transmission losses
Übertragungsverluste No-load/voltage
Leerlauf-/ dependent Verluste
Spannungsabhängige losses Operating losses
Betriebsverluste

Figure 5.10: Results for the evaluation of losses

The smaller losses of the line cannot compensate the converter losses because of the short transmis-
sion line distance of 190 km and the double circuit construction. For the transmission line the losses of
the HVDC-technology are up to 40 GWh below the transmission losses of the ac solution. However,
because of the converter station losses the total HVDC system losses are higher than the transmission
losses of the ac overhead line. The annual energy losses for the three point connection of 320 GWh is
a bit less than that of the two-terminal losses of 323 GWh. However, these losses are about three times
higher than those of ac transmission line with 124 GWh for a point to point connection and 100 GWh

- 85 -
for including Göttingen. With the best available technology, the losses today are lower than the losses,
which were identified in this case study in the year 2008.

1,40%

1,20%

1,00%
Power rating

0,80%
Power loss

0,60%

0,40%

0,20%

0,00%
0 110 220 330 440 550 660 770 880 990 1100

Transmission Power

Figure 5.11: Circuit losses

5,00%
4,50%
4,00%
3,50%
3,00%
Power rating
Power loss

2,50%
2,00%
1,50%
1,00%
0,50%
0,00%
0 110 220 330 440 550 660 770 880 990 1100
Transmission Power

Figure 5.12: HVDC total losses

The diagrams only describe one system. In the extension discussed here two systems are run parallel.
This leads to twice the losses compared with an extension with one system. The losses of the HVDC
alternative are high in comparison to an ac overhead line. In order to evaluate the influence of the al-
ternatives to the surrounding grid the reactive power balance was examined. The results are shown
below.

- 86 -
5.2.3 Reactive power balance

With the use of VSC HVDC transmission reactive power compensation can be added to the system.
This advantage turns out to be bigger with a three-terminal option rather than with the two-terminal
option. High power losses occur at times of heavy wind power infeed and heavy load. In order to study
this effect in detail extensive network analysis with the annual load profile is needed.

The ac extension reduces active power losses compared to the existing grid. This means that not only
the grid operation under (n-1) contingency is possible but also the active power loss can be reduced.
On the contrary the HVDC option results in an increase of active power losses in the range of 6 % to
10 % compared to the existing grid. Comparing the extensions with respect to the integration of the
station Göttingen into the new route, one can see that with the use of an ac connection of the station
Göttingen the network losses decreases from 381MW to 358MW compared to the direct connection
Wahle – Mecklar. However, using the HVDC technology, the network losses increases because of
additional station losses.

Comparing the reactive power balances of the different grid extensions it becomes clear that a reduc-
tion of reactive power demand due to the extension is possible. An ac connection from Wahle to
Mecklar can reduce reactive power demand by about 13%, the integration of the station Göttingen can
reduce it by about 24%.

The VSC HVDC technology offers a higher potential in respect of reduction of reactive power. In the
case of operating the stations below their rated power points in the four-quadrant operation the poten-
tial is the biggest. Hence one can see the potential clearest at the three point connection because the
station Mecklar is not run at the rated power point. Here the reactive power balance for the total
transmission route can be reduced from 2596 MVar to 230 MVar. Implementing the HVDC system as
a two point connection and operating the stations Wahle and Mecklar at their rated power points the
reactive power demand decreases to 1257 MVar.

This investigation shows, that the operation of a VSC HVDC connection in the grid has a high poten-
tial for reactive power control but for a distance of 200 km it has higher active power losses than an ac
connection because of station losses. It has to be examined whether there are more system advantages
by the use of a HVDC connection, which can be used in the meshed ac network. Therefore the possi-
bility of load flow control was examined. The results are shown below.

5.2.4 Controllability

Controlling the ac system load flow is not possible without extra network elements such as series or
shunt regulators. The controlling function of the HVDC technology can be used for setting up the op-
timal operating point to minimise the line losses (or system losses) and utilise its reserve capacity in
case of faults. VSC HVDC systems make load flow controlling in the ac grid possibly by the use of
the four-quadrant operation of the converter stations.

- 87 -
A change of the transmitted dc power will change the power losses of the HVDC system. This charac-
teristic was analysed in the normal operating state of heavy wind and heavy load condition. By reduc-
ing the transmitted power of the HVDC system, the load flow is shifted to the ac overhead lines. With
this method one can regulate transmission losses of the total system. At a two point connection from
Wahle to Mecklar load flow on the HVDC system can be reduced to a minimum of 630 MW without
violating the (n-1) criteria. This reduction of the transmission power will change the reactive power
demands at the HVDC station. A transmission power of 630 MW allows a reactive power supply of
770 MVar (capacitive) at the inverter station ac busbar. This means that the reactive load balance can
be obtained with part load operation of the HVDC stations. The HVDC system losses, at a partial load
operating point, are 2.43 % of the rated power. The optimal operating point for a HVDC three-
terminal transmission system is reached with a reduction of transmission power at the stations in
Wahle from 1100 MW to 890 MW at Wahle and to 690MW at Mecklar while maintaining constant
power exchange at the Göttingen substation. With this transmission adjustment the Wahle converter
can supply a maximum reactive load of 715 MVar (capacitive). That applies to Mecklar too. The
maximum reactive load supply at Göttingen is 20 MVar. Figure 5.13 shows the comparison between
the total system losses of the HVDC system operating at the rated values and operating at the loss
optimal operation point – separately for a two point transmission system and a three point transmission
system.

It becomes clear that a change of the VSC HVDC transmission power can result in a reduction of the
total system losses. The change of the power loss and the original system losses of a transmission
power are illustrated in Figure 5.13, which shows that the network losses of a HVDC two point system
decrease by 11 % and of a HVDC three terminal system by 9 %.

470
460
450
power losses in MW

440
430
420
Netzverlustleistung

410
400
390
380
370
´Grid

360
HGÜ-Dreipunkt-Verbindung
HVDC Multi-terminal HGÜ-Zweipunkt-Verbindung
HVDC Point to Point
Übertragungssystem
Transmission System

Volllastbetrieb
Full load operating verlustoptimaler Betrieb
Losses optimized operating

Figure 5.13: Grid losses against HVDC-Transmission power

Controlling the power transmission quickly is important especially in case of faults. The possibility to
maintain the voltage by making reactive power available has to be stressed. For this, a response time

- 88 -
of a few hundred milliseconds is needed. The ac overhead line has no controlling elements that sup-
port maintaining the voltage. From a technical point of view, the positive influences on the ac grid
through the reactive power support and the controllability encourage the application of a HVDC
transmission line. However, the total system losses are still higher with the VSC HVDC in loss-
optimal operation, than for the ac transmission solution. These technical differences will be evaluated
economically in the following sub-section.

5.2.5 Economic consideration

An economic evaluation can be done for specific projects only. Thus, these results are not applicable
to other cases. Within the scope of this case study, the economic evaluation was done for two trans-
mission lines in each scenario. For the ac double-circuit overhead line the systems are installed on one
route of masts for overhead wiring. For scenario one, each dc transmission line consists of two con-
verter stations and two cables. In total this requires for scenario four converter stations and four cables.
In scenario two, for each transmission line one converter station is added. This requires three converter
stations per system and six converter stations in total.

To compare the life time cost of the investigated alternatives, a comparison of the following key data
is necessary:

• Investment
• Maintenance costs
• Costs of power losses
For the power loss calculation 60 €/MWh was used. The maintenance costs for both ac scenarios were
estimated at 0.57 m€/a, for the dc scenario 1 at 1.5 m€/a, and for scenario 2 at 1.75 m€/a. For the in-
vestment costs the following data was taken as a basis. All costs are provided by the client of this case
study as shown in Table 4.7

Table 5.5: Investment in AC-Overhead lines 9

Scenario 1 Scenario 2
AC-Overhead line in M€/km 0.9 0.9
200 MVar in M€ 10 4.0 4.0
Transformer station Göttingen in M€ --- 15

Total investment in M€ 175 190

9
Information by E.ON Netz GmbH.
10
According to Oswald, B. (2005) S. 63.

- 89 -
Table 5.6 shows the investments and costs of operation for the considered route of 190 km.

Table 5.6: Overview of investment and operation cost

Technology AC DC
Scenario 1 2 1 2
Investment in M€ 175 190 680 730
Losses in M€/a 7.70 6.2 20.10 19.80
Maintenance in M€/a 0.57 0.57 1.50 1.75

One can see that the costs of operation of the HVDC transmission system are 2.6 to 3.2 times higher
than those of the ac overhead line; this is the result of the 3.8 times higher investment costs of the
HVDC options. Within the scope of this study the influences of controllability and reactive load bal-
ance on the economics of the project were not examined. However, the HVDC option could be a vi-
able choice if the system’s operational advantages are taken into consideration, or in case the system
needs (partial) undergrounding.

5.2.6 Conclusion

In this section the application of an HVDC transmission line within an ac grid was examined. Clearly
for the considered project Wahle – Mecklar the 190 km ac overhead line was cheaper. For the HVDC
connection two systems with corresponding losses at the converter station has to be considered. Com-
pared with the conductors of a typical ac overhead line network the HVDC cables have lower power
loss. Nevertheless, for the considered route and the given conditions the dc transmission line option
generates 2.8 times higher losses than the comparative ac connection, and as a consequence the active
power loss of the total grid increases.

The VSC HVDC transmission technology is technically advantageous because of its ability to control
power flow and reactive power at the converter stations, which means that the load flow can be con-
trolled through the ac routes. In order to consider the loss optimal operation further examinations are
needed. Furthermore, the cost of application and operation of the HVDC system are higher.

5.3 An Intra-European Interconnection

This study case deals with an interconnection between two European countries (A and B) studied in
2009 to assess the difference between the VSC-HVDC and the LCC-HVDC solutions under specific
condition. The HVAC solution is not addressed as the length of the link is 190 km and the use of
overhead lines is not permitted.

- 90 -
5.3.1 Assumptions

The data given in the following are based on an estimate for an interconnection between two European
countries (A and B). The choice of the two TSO’s relies on three points:

• Main requirements/constraints for this project

• Phase of the project
• Economic assessment and choice of the technical criteria
The main requirements that were taken into account by the two TSO’s are listed below:

• Underground cables and rated power of 1000 MW

• 190 km between the 2 converter stations and four cables maximum
• Single-phase transformer
• No overload capability
• Recovery of 500 MW in 15 min
• Restricted area for the converter station
• VSC-HVDC solution considered as well as the LCC-HVDC solution
• Commissioning in 2016
For the two countries, the project is divided into the following phases:

1) Exploratory study to sum up all the knowledge of the utilities about HVDC: the accuracy of
the assumed costs at this stage are in a range of +/-30%
2) Feasibility study to get the suppliers involved and to better understand what they are able to
propose
3) Decision about the technology of the link and the configuration: the accuracy of the assumed
costs at this stage are in a range of +/- 15%
4) Writing of the specifications
5) Tender stage

5.3.2 Analysis on technical criteria

During the different phases, the knowledge on the technologies (VSC-HVDC/LCC-HVDC) and a
better definition of the constraints may change the requirements. As a result, after phase 1, the recov-
ery of 500 MW in 15 minutes after a fault and the restricted area for the converter stations was no
longer considered as constraints. It also appeared that four solutions were well fitted for the project
depending on the technology (VSC-HVDC or LCC-HVDC) and the configuration (1*1000 MW and
2*500 MW). The dc voltage chosen for the VSC is based on the maximum voltage that was proposed
by the cable suppliers. The dc voltage chosen for the LCC is based on the voltage used for this dc
power.

- 91 -
Table 5.8 provides the criteria that were taken into account depending on the requirements of the pro-
ject. There is no cost comparison in these cases; only technical criteria. This table shows the usual
advantages/drawbacks of a VSC-HVDC compared to a LCC-HVDC: Good ac network functionalities
but new cables to be qualified as well as an easier design of the converter transformer but higher losses
in old technology.

5.3.3 Cost Analysis

For phase 3, some technical criteria were economically assessed. The following table provides the cost
breakdown that was used for each technology and configuration (2 x 500 and 1 x 1000):

Table 5.7: Economic assessment

VSC-HVDC LCC-HVDC- 500 kV

1 x 1000 MW 2 x 500 MW 1 x 1000 MW 2 x 500 MW
+/- 320 kV +/- 320 kV Symm. Monopole Bipole
Invest. cost of the conv. station 220 M€ 220 M€ 180 M€ 220 M€
Investment cost of the cables 180 M€ 155 M€ 160 M€ 170 M€
Civil works/laying cables 430 M€ 520 M€ 438M€ 510M€
Total cost of investment 830 M€ 895 M€ 778 M€ 900 M€
Capitalized cost of losses 150.2 M€ 145.4 M€ 67.8 M€ 89.6 M€
SVC solution 11 46 M€ 46 M€
Total cost with the capitalised
980.2 M€ 1040.4 M€ 891.8 M€ 1035.6 M€
cost of losses 12

It appears that:

• The costs of the converter stations for the LCC-HVDC solutions are lower than the VSC-
HVDC ones.
• The total costs of the losses of the LCC-HVDC link are lower than the VSC-HVDC ones.
• The sum of all these items makes the cost of all solutions comparable within a range of ±8%

All the costs are assumed to have an accuracy of ± 30%.

Technical criteria for different solution options

11
It was not possible to estimate the cost of the System service capabilities. Therefore, the investment for an
SVC was added to the LCC-HVDC solution and was assumed to be 46 M€.
12
The link is assumed to run at full power for 57% of the time and at no-load for the rest of the time over 30
years.

- 92 -
Table 5.8: Technical criteria for different solution options

5.3.4 Conclusion

At this phase the costs are not used to choose the solution for the project. As all the solutions are
equivalent for the costs (cf. the accuracy), the technical criteria lead to the selection of the VSC-
HVDC solution with 2 x 500 MW configuration. This is done with regards to the availability of the
link and the HVAC network functions. This case study shows that the cost analysis is not always the
major criteria for making the choice between LCC-HVDC and VSC-HVDC technology. Other criteria
must be taken into account to make a decision.

5.4 Generic Case: Cross Border Interconnection

This study was conducted in 2009. A typical bulk power application is the connection of 2 distant
power systems with large interconnection capacity. This will be evaluated in this example case. The
cross-border connection is assumed to facilitate energy transmission between Germany and an East-
ern-European market. The parameters for the study system, cost analysis, functional benefits and cash
flow analysis are presented in the following sub-sections.

- 93 -
In this case study HVDC has been compared with conventional ac lines without any additional control
equipment. It should be stated here, that many control functions like active power flow control, reac-
tive power support and voltage control can be achieved by power electronic based ac devices as well
(FACTS). However, it was not the intention to benchmark ac and dc technology. The study has been
prepared in order to demonstrate the general principle of the process and highlight the built in HVDC
capabilities in contrast to the built in ac capabilities.

5.4.1 Case study analysis

This example reflects a bulk power transmission project between two large power systems. The inves-
tor objective may be transmission capacity extension due to reliability issues or just revenue driven
objective. The latter would describe a typical merchant transmission facility.

The basic performance aspects are not derived from a load flow analysis but defined only as an exam-
ple case. The cross-border transmission project is assumed to offer 1500 MW transmission capacity
for a 1000 km distance. The grid connection points are located in different markets both liberalized
and deregulated. For the ac alternative a not optimized solution with four 380 kV overhead lines are
assumed.

5.4.2 Cost analysis

Asset investments, right of way and environmental costs are due at the beginning of the project, whe-
reas the costs for operation and maintenance and loss expenses are regarded as yearly cash flow. The
costs for operation and maintenance are considered a fraction of transmission investments as shown in
the following tables. The specific cost of losses provided earlier in this document is calculated for a
typical load situation within a meshed grid. For this case study they are doubled and compensated by
an average spot market price of 65 €/MWh. A yearly availability of 8300 h is assumed for this case.

The investment capital costs for the 5 alternatives are summed up in Table 5.9. The right of way and
environmental impact costs are listed separately to allow a worst/best case scenario analysis. From an
investor point of view a worst case scenario describes the situation within an environmental sensitive
and densely populated area, whereas the best scenario refers to rural areas with less environmental
regulations. For the best case scenario environmental costs are neglected. For the worst case scenario
the environmental costs are assumed 10 % of the transmission investments.

Table 5.9: Case study - overall investment costs

HVAC OHTL LCC-HVDC (M€) VSC-HVDC (M€)

(M€) Cable OHTL Cable OHTL
Station 39.7 120 153

Transmission 700 2400 340 2400 340

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 Compensation 40 - -

Total Cost 769.7 2520 460 2553 493

Table 5.10: Case study - right of way cost

LCC-HVDC (M€) VSC-HVDC (M€)

HVAC OHTL (M€)
Cable OHTL Cable OHTL
right of way (best) 45 15 32.5 15 32.5

right of way (base) 63.75 15 45 15 45

right of way (worst) 82.5 15 57.5 15 57.5

Table 5.11: Case study - environmental cost

LCC-HVDC (M€) VSC-HVDC (M€)

HVAC OHTL (M€)
Cable OHTL Cable OHTL

environmental cost(best) - - - - -

environmental cost(base) 35 120 17 120 17

environmental cost(worst) 70 240 34 240 34

Table 5.12: Case study – Cost of operation and maintenance, and losses

LCC-HVDC (M€) VSC-HVDC (M€)

cost per year HVAC OHTL (M€)
Cable OHTL Cable OHTL

O&M transmission 14 9.6 6.8 9.6 6.8

O&M converter - 0.6 0.6 0.8 0.8

Line losses 49.7 33.4 33.4 33.4 33.4

Station losses 6.1 12.5 28.4

Remark: The study has been conducted with “old” (before 2010) VSC converter technology. If
this study would be performed with current TLC / MMC technology the cost for the
VSC HVDC station losses are expected to be only 50% of the figures given here.

5.4.3 Functional benefits

With respect to the forecast uncertainty of price development and changes in market environment the
utilization will be given as a worst/best margin. The best case scenario supposes high merchant expec-

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tations which lead to an extensive market coupling utilization, whereas the worst case assumes less
active power trading across the transmission link. According to section 4.3.3 the HVAC transmission
solution comprises a transfer reliability margin of 15% and thus has a reduced utilization of 15% com-
pared to the HVDC solutions.

The active power utilization assumed in this study for market coupling is 80%, 85% and 90% at 8300
hours during each year for the different cases. The two connected markets are assumed to have a price
difference of 15 €/MWh. The loop back effect of intense power trading is accounted within the cash
flow analysis.

Reactive power capability of the VSC-HVDC is linked to the active power load and constrained by the
maximum apparent power converter output. Hence the reactive power capability amounts to ±900
MVar in the worst case scenario, and ±650 MVar in the best case. An average availability payment of
0.4 €/MVar/h is assumed. The Enhanced reactive power capability as defined in chapter 4.3.1 is not
applicable due to the envisaged heavy active power utilization. In case of a major disturbance or
blackout the VSC-HVDC connections can provide supply to the isolated area connected to the cross-
border line within Germany. Further benefits are summed up in Table 5.13

Table 5.13: Case study – annual value of functional benefit

revenue per year HVAC OHTL LCC-HVDC VSC-HVDC

Market coupling (best) 142.9 M€ 168.1 M€ 168.1 M€

Market coupling (base) 135.0 M€ 158.8 M€ 158.8 M€

Market coupling (worst) 127.0 M€ 149.4 M€ 149.4 M€

Voltage support (best) - - 13.2 M€

Voltage support (base) - - 4.6 M€

Voltage support (worst) - - 0 M€

Black-start/island supply - - 1.3 M€

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5.4.4 Cash flow analysis

The cash flow is done using the parameters provided in chapter 5.4.2. The key input parameters for the
cash flow analysis of the first example case study are summarized as follows:

• Discount rate: 8%
• Power rating: 1500 MW
• Transmission distance: 1000 km
• Market price difference: 15 €/MWh
• Loss compensation price: 65 €/MWh
• Availability: 8300 h
• Active power utilization 80 - 90%
• Reactive power utilization: max. ±650 – ±900 MVar
• Black-start / Island-supply applicable: yes
• Asset lifetime: 40 years
• Period of consideration: 25 years in operation – After 25 years it can be expected that
major investments in the scheme will be necessary to retrofit the functionality
With respect to the uncertainty of some values and costs presented above there are worst, base and
best case scenarios defined for some values. Accordingly the base scenario presents the most likely
expected costs as an average value of worst and best case.

The information regarding the time which is required to bring the transmission expansion projects into
operation will differ widely and depend strongly on the considered environmental framework of the
project. Hence the case study has been executed for different time frames. At first, a project environ-
ment with less civil opposition may be considered to allow a fast approval process with a short con-
struction period. This results in a time frame of 2 years for cable projects, and 3 years for overhead
transmission line projects, until commissioning. A second cycle is done while taking into account an
increased approval and construction period. This reflects a more environmental sensitive situation and
results in a delayed commissioning. Cable projects will demand 3 years until commissioning, whereas
overhead transmission line projects are extended to 6 years.

As an example a detailed analysis of the discounted cash flow is presented in Figure 5.14. The cash
flow analysis is executed for an operation period of 25 years. After 25 years of operation the dis-
counted yearly cash flow has decreased to a 10 % value of the discounted cash flow within the first
year of operation. This is generally appointed as end of the analysis period. Because there will be no
significant change in net present value during a longer period of consideration.

The initial investment costs are depreciated over 40 years with a 5% rate of interest. This is due to the
fact that TSOs are taking into account these depreciation costs within the transfer fees, negotiated with
the regulator. Hence the depreciation costs are listed as positive yearly cash-flows.

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Figure 5.14: Case study A - HVAC OHTL base case - discounted cash flow

The revenues generated by market coupling and excessive power trading are decreasing by a fixed
percentage within the first years of operation. This is caused by loop back effect discussed in chapter
4.3.3. A cumulative revenue decrease shall be assumed as 5% in the first year 3.5% in the second 2%
in the third and 1% in the fifth year of the initial market coupling revenues.

Figure 5.15: Case study A - HVAC OHTL base case – cumulated cash flow

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The cumulated discounted cash flow shows the summary of discounted yearly cash summarized until
the considered year. If the cumulated cash flows turn from a negative into a positive value the projects
get profitable. This point is called break-even and reached 19 years after project start (see. Figure
5.15) for the considered HVAC OHTL base case.

For the sake of clarity, only the accumulated cash flows of the HVAC OHTL and VSC-HVDC OHTL
alternatives are compared at this point. The VSC-HVDC OHTL base case is shown in Figure 5.16.
Due to lower initial investments and higher positive cash flows, arising from enhanced transmission
capacity, voltage support and island supply, the VSC-HVDC overhead transmission alternative fea-
tures a higher net present value than the HVAC overhead transmission solution. The detailed cumu-
lated cash flow is shown in Figure 5.17.

As seen above the VSC-HVDC OHTL solution reaches break-even nine years after commissioning.
The cash flow analysis is executed for all five transmission alternatives. The net present value is sum-
marized in Table 5.14. As mentioned under case study analysis the HVAC cable solution is not consi-
dered to be a real alternative for this case and thus excluded from the assessment process.

Table 5.14: Case study – Net present value in M€

LCC-HVDC- LCC-HVDC- VSC-HVDC- VSC-HVDC-

NPV in M€ HVAC - OHTL
OHTL Cable OHTL Cable
Worst -106.64 355.09 -625.07 333.00 -773.48
Base -27.90 428.13 -464.58 394.92 -624.98
Best 117.53 606.47 -190.36 529.24 -398.31

Figure 5.16: Case study A - VSC-HVDC OHTL base case – discounted cash flow

For the sake of better comparability, net present values have been related to the HVAC overhead
transmission solution as overall base case for this case study.

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Figure 5.17: Case study A - VSC-HVDC OHTL base case – cumulated cash flow

Table 5.15: Case study – Net present value in %

LCC-HVDC- LCC-HVDC- VSC-HVDC- VSC-HVDC-

NPV in % HVAC - OHTL
OHTL Cable OHTL Cable
Worst -282.2 % 1372.6 % -2140.1 % 1293.4 % -2672.0 %
Base 100.0 % 1634.3 % -1565.0 % 1515.3 % -2139.8 %
Best 521.2 % 2273.5 % -582.2 % 1996.7 % -1327.5 %
The net present values, given above, are calculated with a commissioning period of 2 years for cable
alternatives and 3 years for overhead transmission alternatives. The process of approval and construc-
tion may be delayed by civil opposition and environmental constraints. Therefore all transmission
alternatives are calculated again for a commissioning duration of 3 years for cable projects and 6 for
all overhead transmission line alternatives. The absolute net present values are given in Table 5.16.

Table 5.16: Case study – delayed - Net present value in M€

LCC-HVDC- LCC-HVDC- VSC-HVDC- VSC-HVDC-

NPV in M€ HVAC - OHTL
OHTL Cable OHTL Cable
Worst -149.88 216.20 -684.06 153.56 -822.01
Base -80.80 277.79 -527.23 206.32 -676.28
Best 41.22 422.97 -265.09 316.55 -458.17

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To illustrate the effect of delayed commissioning the absolute net present values are normalized to the
overall HVAC base case with faster commissioning (q.v. Table 5.14). The normalized values are
shown in Table 5.17.

Table 5.17: Case study – delayed - Net present value in % of fast commissioned HVAC OHTL

LCC-HVDC- LCC-HVDC- VSC-HVDC- VSC-HVDC-

NPV in M€ HVAC - OHTL
OHTL Cable OHTL Cable
Worst -437.1 % 874.8 % -2351.5 % 650.3 % -2845.9 %
Base -189.6 % 1095.5 % -1789.5 % 839.4 % -2323.7 %
Best 247.7 % 1615.8 % -850.0 % 1234.5 % -1542.0 %
The impact on the economic performance by a decelerated commissioning is illustrated in detail by the
cumulated cash flow of the HVAC OHTL and VSC-HVDC OHTL below.

In case of the HVAC OHTL solution, the prolonged process of approval and construction turns the
HVAC transmission solution into a loss investment in the period of consideration. As shown above the
break-even of the VSC-HVDC is deferred by 5 years in comparison to the faster commissioned
project. Figure 5.19 illustrates the impact of a 1 year delay in commissioning of cable projects and 3
year delay in commissioning overhead transmission projects.

Figure 5.18: Case study A - HVAC OHTL base case – cumulated cash flow with delay in commis-
sioning

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Figure 5.19: Case study A - VSC-HVDC OHTL base case – cumulated cash flow with delay in
commissioning

5.4.5 Case summary

This particular case represents merchant power transmission facility. In this case the prime objective
of an investor or independent power producer is not related to the most reliable operation of the whole
transmission system, but to maximum profit of this single transmission facility. The investor profit can
be outlined as net present value of the considered transmission solution. Independent of the considered
transmission solution a delay in the approval or construction period has a vast impact on the overall
economic performance. It is outlined that, in the case of a HVAC OHTL solution, an extended ap-
proval or construction period may lead to a deficit when facing high costs for right of way.

HVDC cable solutions will comprise very low net present values and are generating high losses. This
is due to the very high construction costs for the HVDC cable.

The cash flow analysis has shown that both HVDC overhead transmission solutions outperform the
proposed HVAC overhead transmission line by far. The costs for four HVAC overhead transmission
lines are higher compared to the proposed HVDC systems. The use of four ac transmission lines is
dictated by stability issues which results in a reduction in the transfer capability below the natural
loading at transmission distances of 1000 km. Hence the transmission costs are significantly higher in
case of an HVAC solution. The HVDC converter cost play only a minor role for very high transmis-
sion distances as considered in this case.

The difference between VSC-HVDC and LCC-HVDC in net present value is caused by the higher
losses of the VSC-HVDC solution. The value generated by island-supply and reactive power support,

- 102 -
provided by the VSC-HVDC transmission system, is not enough for compensating the higher losses
compared to an LCC-HVDC under the provided assumptions.

However, the VSC-HVDC solution features an economic performance far beyond a HVAC solution.
Besides the already valuated functions within the cash flow analysis there are some additional qualita-
tive benefits not yet taken into account. Large interconnected power systems often have to deal with
low frequency power oscillations. Though this may not be an investor objective in this case, the
HVDC transmission solution will facilitate both, power oscillation damping between the two intercon-
nected areas and power oscillation damping within each connected system.

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6 Summary and Conclusions

Continuing development in power electronic devices has opened the way for new power transmission
system solutions. A new type of HVDC technology based on voltages source converters is expected to
enter the bulk power transmission market segment. Today, there is only limited operational experience
with transmission schemes based on VSC-HVDC technology. Hence, there is a need for a quantitative
assessment of the additional functions provided by VSC-HVDC devices for transmission operation
purposes. The objective of this report is to develop an assessment process to evaluate the beneficial
impact of VSC-HVDC on power system operation on a functional basis in order to support technology
decisions in the first stage of network expansion projects. The proposed methodology includes a
straightforward analysis of important environmental facts that have to be taken into account for an
appropriate assessment. A techno-ecological benchmark of available transmission technologies is car-
ried out to highlight the most beneficial transmission solution for power system operation purposes.
The focus lies on a fast and clear economic evaluation of a VSC-HVDC transmission solution against
conventional HVAC and LCC-HVDC alternatives with respect to functional benefit provided for
power system operation. This is relevant to transmission utilities, as there is the need for a business
case demonstrating the economic justification for major system investments. The results of the cash
flow analysis may also be used for an investment estimate for independent power producers.

The adaptability and flexibility of the process is assured by a well-chosen set of input parameters,
which facilitate the process execution for a wide range of applications. The proposed assessment
process is divided into major successive steps, each comprising of separate valuation sections, which
are applied depending on the individual case. The developed process will bring out the best transmis-
sion solution within a proposed transmission extension scenario. Without extensive background know-
ledge in technical details and functions, provided by the individual transmission technologies, inves-
tors and TSOs will be able to compare what transmission technology meets the best economic perfor-
mance, only by providing some basic input parameters of the considered transmission project. A step-
wise application of the process with cost figures, which are available from public resources, are has
been given. The proposed assessment procedure is not intended to replace long term transmission ex-
tension planning or optimization procedures to highlight necessary grid extension projects. An invest-
ment appraisal has been developed in determine a discounted cash flow analysis as an integrated part
of assessment process. This tool provides the financial characteristics of the considered transmission
solutions for a definite set of input parameters. The assessment process has been executed for the fol-
lowing five entirely different application scenarios.

The Randstad project is an ambitious project of the Dutch system operator TenneT to reinforce the
power system. Part of this plan consists of the introduction of a new connection between the 380 kV
substations of Beverwijk and Bleiswijk (distance roughly 60 km). These two substations are located in
the Randstad area (region Amsterdam, The Hague, Rotterdam, Utrecht), one of the most densely popu-

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lated area's in Europe. The Randstad HVDC study investigated the feasibility of the installation of a
VSC HVDC link between these two substations as an alternative to 380kV overhead lines. The study
was performed by K.U. Leuven in 2006. The study has been presented to and reviewed by the Dutch
TSO TenneT. The final decision led to the installation of partly underground, partly overhead ac lines
with the main reasons for not installing DC: limited experience at those power ratings, price uncertain-
ty and final cost price.

The second case study is related to a network extension in Germany. The aim of this case study per-
formed in 2008 was the comparison between a 200 km long ac overhead line and a dc land cable con-
nection between Wahle and Mecklar in Germany. This study was defined by a German TSO. The case
study compares the economic and technical benefit of both transmission technologies.

The third case is related to another intra-European project. The assessment process shows that the cost
analysis does not necessarily provide all the information necessary to make a choice between HVAC,
LCC-HVDC and VSC-HVDC solutions. As stated before, the first step of any assessment process is to
determine the major input parameters required to either to check that the cost analysis will have little
impact on the decision, or to be able to do an efficient cost analysis.

The last study investigates the best transmission solution for a typical merchant transmission facility.
The study shows that the value of the benefit of VSC-HVDC transmission solutions strongly depends
on the desired utilization scenario and the environmental framework. The proposed assessment
process also illustrates the issues and uncertainties that network planners often face when comparing
different technologies for network expansion. On the one hand a period of 25 – 30 years is necessary
to investigate the value of large transmission investments with an expected lifetime of more than 40
years. But on the other hand a market development estimate for the same period is impossible. Even a
period of 10 years seems to be only a rough approximation. There is a discrepancy by design, between
valuing a tremendous long-term investment project and the unpredictable market development in the
period of consideration. In addition, beside the changing economic framework, there is a heavy influ-
ence of political and environmental circumstances on the economical assessment. A scenario analysis
is used to identify the effect of forecast error. However, it must be clear that this assessment process
can only provide an estimation of potential outcomes given unknown circumstances. A change of the
interest rate or the cost of fuel may also occur during such a long time period, and could have a signif-
icant impact on the outcome of the analysis. Even a comparison among different alternatives, while
facing altering system conditions, may not remain constant.

Power electronic solutions are still undergoing rapid development, with increasing ratings becoming
available each year, new technical features becoming available, power losses being reduced, and
equipment costs changing with raw material costs and new market players providing additional com-
petition. So, this report gives a snapshot on the current technology, application areas and economic
values. With the ongoing developments it can be well expected that VSC-HVDC will become even
more attractive for bulk power transmission and might become an economic feasible alternative to
other technologies.

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