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Compatibility Assessment of Transnational Grid

Interconnections

Pei ZHANG, Xiaoxi LV, Yao LU, Jiateng LI Xiaoling JIN


School of Electrical Engineering, Beijing Jiaotong State Grid Energy Research Institute, Changping District,
University, Haidian District, Beijing 100044, China Beijing 102209, China
2512692577@qq.com jinxiaoling@sgeri.sgcc.com.cn

Abstract—This paper proposes a novel method to assess the complementarity between collaborating countries can we
compatibility of transnational grid interconnections, including promote grid interconnections. In this sense, the compatibility
political, social, economic and environmental aspects. between collaborating countries is an important foundation
Compatibility refers to the degree to which two countries are and prerequisite for transnational grid interconnections.
suitable for grid interconnections. The paper analyzes each
influential factor and proposes a set of compatibility indices to From interconnection of regional grids to interconnection of
quantitively evaluate the compatibility of grid interconnections of national grids, transnational grid interconnection, even global
multiple countries. A scoring-based method is proposed in this grid interconnection, the scale of grid interconnection
paper for comprehensive compatibility assessment, in which the continues to expand during the development process. Previous
weighting factors and scoring criteria are developed. The
proposed compatibility assessment can effectively identify
researches on grid interconnections have been focusing on
opportunities, evaluate the feasibility of transnational engineering studies. Reference [2] investigated low frequency
interconnections between countries and promote accomplishing oscillation due to regional grid interconnection and developed
the vision of Global Energy Interconnections. strategies on improving the dynamic stability of
interconnected grids. Reference [3] proposed coordinative
Keywords—Global Energy Interconnection; transnational grid automatic under-frequency load shedding scheme for regional
interconnection; compatibility assessment; indices system. grid interconnections. Reference [4] developed the parallel
algorithm based on DC optimal power flow model for
I. INTRODUCTION studying power flow distribution after grid interconnections.
Energy is important for social and economic development. Reference [5]-[7] investigated economic evaluation methods
Over the past three hundred years since the industrialization, for transnational interconnections. Reference [5] proposed a
the world energy industry has developed rapidly, which has cost-benefit model for economic assessment of transnational
strongly supported the global economic and social interconnections. Reference [6] established an economic
development. In this process, the use of traditional fossil evaluation framework to analyze economic benefits of the grid
energy has led to serious problems such as resource shortage, interconnection project between China and Korea. Reference
environmental pollution and climate change, which are [7] proposed an economic benefit assessment method of
threatening human survival. In the future, with the rapid transmission projects using chronological production cost
development of global economic and continuing increase of simulation model and developed evaluation indices with
population, energy demand will continue to grow. The energy consideration of generation revenue at energy sending end and
development based on fossil energy is no longer sustainable. load payment at energy receiving end. The transnational
Global Energy Interconnection is an effective way to promote interconnection from China to Arab States was used as a case
the development of clean energy worldwide and provide a study to validate the proposed economic benefit assessment
reliable energy supply. It will provide energy transformation method. Grid interconnection has significant economic and
solutions for all of countries [1]. environmental benefits, so global grid interconnection is
imperative. Reference [8]-[11] introduced the current status
Global Energy Interconnection mainly relies on grid and trends of grid interconnections in Europe, Asia and even
interconnection, since grid is the most complete energy the world. Possible interconnection modes of the grid in the
network in human energy system so far and the transmission future have been studied in these papers. Reference [1] and
and distribution network of grid is extremely malleable. [12] performed research on Global Energy Interconnection.
However, there are differences in political, social, economic Reference [1] proposed vision, goal, and development path of
and environmental aspects among different countries. Global Energy Interconnection. Reference [12] proposed
Therefore, the compatibility in political, social, economic, and backbone network topology of Global Energy Interconnection
environmental aspects between collaborating countries need to and analyzed the comprehensive benefits of Global Energy
be evaluated. Only by achieving political mutual trust, social Interconnection. In the past, the research on grid
friendliness, policy compatibility, and resource interconnection mostly focused on technical aspects of power
This work was supported in part by the State Grid Cooperation of China
scientific project "Research on the Mechanism and Model of Smart Grid Soft-
Connection Considering the Development of Global Energy Interconnection"

978-1-5386-5392-0/18/$31.00 ©2018 IEEE


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system but lack of the study on political, social, economic and energy strategies are important driving force for transnational
environmental compatibility at national aspects. Because there interconnections
are differences in national economic, social development,
1) National sovereignty and security
energy strategy, environmental policy and interest demands
among countries in the world, transnational grid The integrity of national sovereignty and political stability
interconnections are facing a lot of barriers. Hence, the provide a good political environment for the construction and
coordination and unification between collaborating countries operation of transnational interconnections. In the country
are the premise for construction and operation of Global where wars and conflicts have broken out, domestic
Energy Interconnection. Compatibility assessment can infrastructures are destroyed and the investment risks are high,
effectively identify opportunities, evaluate the feasibility of so that the country lack of grid interconnections and electricity
transnational interconnections between countries and promote exchange with neighboring countries. The construction and
accomplishing vision of Global Energy Interconnection. operation of transnational interconnections are not guaranteed
because of political unrest. Therefore, national sovereignty
To evaluate the compatibility of transnational grid
interconnections, this paper proposes compatibility assessment and security are important factors affecting transnational
for transnational interconnections. Compatibility refers to the interconnections.
degree to which two countries are suitable for grid 2) Political mutual trust
interconnections. The paper analyzes factors from political,
social, economic and environmental aspects that influence Transnational interconnections are related to energy
transnational grid interconnections. Based on analyzing security issues. The destruction of power network may cause
influential factors, the paper proposes a set of compatibility serious consequences. Neighboring countries need to eliminate
indices to quantitively evaluate the compatibility of grid barriers and confrontation, enhance political mutual trust, and
interconnections of multiple countries. A scoring-based method strengthen intergovernmental cooperation so that transnational
is proposed in this paper for comprehensive compatibility interconnections can be achieved smoothly.
assessment, in which the weighting factors and scoring criteria
are developed. Firstly, political mutual trust is reflected in diplomacy,
including competitions and conflicts, territorial sovereignty
issues, and historical issues, which will reduce the political
II. INFLUENTIAL FACTORS OF TRANSNATIONAL
mutual trust between collaborating countries. If a country has
INTERCONNECTIONS
very good political relations with others and no obvious
conflicts in history, transnational interconnections will be
Transnational grid interconnections are complex easier. In particular, when the exchange of electricity
undertakings, with varied issues. These issues are multi- continues to increase, supply security will be a top priority.
disciplinary, almost always having political, social, economic Therefore, transnational interconnections require a high degree
and environmental aspects that must be considered [13]. of political mutual trust between collaborating countries.
Therefore, this paper considers the factors including political,
social, economic and environmental four aspects, which Secondly, political mutual trust can be reflected in social
impact transnational grid interconnections at national level. system. Political mutual trust between collaborating countries
Politically, the political factors are the precondition of with different social systems may be reduced, because their
transnational grid interconnections. Socially, society harmony governments, including their legal and economic systems, will
and stability of collaborating countries provide the foundation operate in different ways. Since they have to understand how
for transnational grid interconnections. Economically, other countries’ management systems work, it will be more
economic cooperation and economic development gap difficult to reach an agreement on how to achieve
between collaborating countries have impacts on grid transnational interconnections between collaborating countries
[14]
cooperation. Environmentally, national energy and .
environmental policies of collaborating countries affect 3) Energy strategy
sustainability of transnational grid interconnections.
Energy strategy is an important driving force for
A. Political Factors transnational interconnections. Energy strategy will help
strengthen inter-regional cooperation, develop large-scale clean
The political factors provide preconditions for transnational energy bases and regional networking plans. Besides, energy
interconnections. Therefore, it is indispensable to analyze the strategy will strengthen coordination and communication on
feasibility of transnational interconnections from the political energy, environmental protection laws, clean energy policies,
perspective. Political factors include national sovereignty and grid development policies, carbon emission reduction policies,
security, political mutual trust between collaborating tariffs and fiscal policies, and promote the development of
countries, and national energy strategies. The integrity of green low-carbon framework.
national sovereignty and political stability provide a good
political environment for the construction and operation of
transnational interconnections; political mutual trust can
assure the security of transnational interconnections; national


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B. Social Factors coordination, limit the development of power trade, and hinder
Transnational grid interconnections are basic industries the formation of transnational grid interconnections [15].
related to national economy and people's livelihood. So the
influence of social harmony on transnational grid D. Environmental Factors
interconnections cannot be ignored. Social harmony directly The environmental factors affecting transnational grid
affects the construction of transnational grid interconnections. interconnections include land policy, low carbon policy and
clean energy. Among them, the land policy affects the
1) Social stability
implementation of specific transnational grid interconnection
Social stability includes allotment of social wealth, literacy projects. National low carbon policies are the main starting
levels, and employment levels. When the society of a country points of transnational grid interconnections. Clean energy
is stable, the people can live and work in peace, the economy reflects the potential of energy development, and the
can develop rapidly, and transnational grid interconnections sustainability of transnational grid interconnections.
can be promoted. When the society of a country is turbulent,
the country lacks the motivation to interconnect its grid with 1) Land policy
other countries. Land policy affects the implementation of specific
transnational interconnection projects. To construct
C. Economic Factors transnational interconnections, it is necessary to construct
Economic factors of transnational interconnections include transnational transmission lines. Due to the consideration of
two aspects: national economic policy and national economic ecological environment, the approval time of transmission
foundation. Economic and trade policies affect profitability of lines construction is longer generally. Land acquisition is more
transnational interconnections. Economic base measures the difficult for developed countries such as the United States
long-term stability of a country's investment environment. because of land privatization. The land approval of
1) Economic and trade policy transmission lines and transmission corridors often takes 7-8
years, seriously affecting the progress of grid construction.
The construction of transnational grid interconnections
2) Low carbon policy
involves economic and trade policies of collaborating
countries, including tariff policy, tax policy, subsidy policy, Low carbon policies are the main starting points for the
foreign direct investment policy, trade policy, labour policy. construction of transnational grid interconnections. The 2015
Customs tariff rate and tax policy affect profitability of the Paris Climate Conference determined that “the global
temperature rise in this century should be controlled within
project. Subsidy policy can reduce investment cost of
transnational grid interconnections. Preferential policies for 2ć”. If there are no effective measures, global temperature
foreign investment affect the enthusiasm of investors. Unified rise will exceed 4ć at the end of the 21st century, which will
trade rules for cross-border electricity markets between cause sea level rise, food production cuts, species extinction,
collaborating countries are conducive to the development of seriously threatening human survival and development. The
cross-border electricity trade. National labor policies, Paris Agreement is the third international legal text to address
especially labor cooperation policies, determine workforce climate change in human history, forming a global climate
composition. If collaborating countries appropriately liberalize governance pattern after 2020[16]. The main cause of climate
the restrictions on labor access, the construction of change is carbon emissions from fossil fuel burning.
transnational grid interconnection projects can be finished as According to their national conditions, state parties have
scheduled. formulated different carbon emission reduction targets and
formed strict low carbon policies.
2) National economic base
Transnational grid interconnections meet global electricity
Firstly, when a country’s economy develops rapidly, the demand in a clean and green way by replacing fossil energy
electricity demand of this country is also increasing so that it with clean energy, which will significantly reduce greenhouse
is more likely to interconnect its grids with other countries. gas emissions. Countries with high carbon emissions have to
Secondly, the economic base measures the long-term stability actively seek ways to reduce carbon emissions and meet their
of investment environment. The investment of the project emission quotas. Therefore, their willingness to construct
requires the country to have huge financial resources. If transnational grid interconnections with other countries is
country’s economic strength is not strong, it may cause the stronger.
project to fail during the construction process, or slow down
its progress, which will affect cooperation willingness of 3) Clean energy
collaborating countries. If country’s economic base is good, Clean energy determines the development prospects of the
the investment risk is low. The return benefit and security of country's energy field. It can measure the energy development
the project are higher. Thirdly, economic development gap of potential and determine the sustainability of transnational grid
collaborating countries cannot be too large. Because the interconnections.
imbalance of economic development among various countries
will greatly limit the room for mutual economic policy


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The higher the proportion of clean energy in the country is, Fourth-degree combat readiness: When major emergencies
the greater the potential of generating electricity from clean occur abroad or major anomalies occur in China's surrounding
energy is. The prospects for power development in the future areas, it may greatly impact on China's security and stability.
are also considerable. Transnational interconnections can help
to consume domestic surplus energy and effectively reduce Third-degree combat readiness: Major anomalies in the
abandonment, and turn resource advantages into economic surrounding areas may pose a direct military threat to China.
advantages. The lower the proportion of clean energy in the Second-degree combat readiness: The deteriorating
country, the slower the development of domestic clean energy
situation has already constituted a direct military threat to
industry, the more serious the environmental impact of using
China.
traditional fossil energy to generate electricity. Therefore, in
order to reduce greenhouse gas emissions and improve First-degree combat readiness: The situation is extremely
environmental friendliness, it is necessary to actively seek tense, and the signs of war against China are very obvious.
transnational grid interconnections.
US Department of Homeland Security uses a terrorist attack
grading mechanism, which is shown in Table I. This grading
III. COMPATIBILITY INDICES OF TRANSNATIONAL mechanism measures the risk of terrorist attacks. The system
INTERCONNECTIONS has five grades from high to low.
The research on influencing factors and compatibility TABLE I
indices of transnational grid interconnections can reduce the TERRORIST ATTACK GRADING MECHANISM
cost of the mistakes, which will save the government and Grade Description
enterprises a lot of expenses and improve the correctness of Severe(red) serious risk of terrorist attacks
investment decisions of transnational grid interconnections. High(Orange) high risk of terrorist attacks
Elevated(yellow) significant risk of terrorist attacks
Based on analyzing influential factors, the paper proposes a Guarded(blue) general risk of terrorist attack
set of compatibility indices. The principles that should be Low(green) low risk of terrorist attacks
followed are the following: In combination with the Chinese military's degree of
Aim principle: The purpose of this paper is to evaluate the combat readiness and the terrorist attack grading mechanism
compatibility of transnational grid interconnections between of the United States, when the state’s military readiness
countries. Therefore, all indices should closely around the reaches the third-degree combat readiness and above, or when
compatibility of transnational grid interconnections. the terrorist attack grading mechanism reaches yellow and
above, the national security index will exercise one-vote veto
Integrity principle: The compatibility of transnational grid power on transnational grid interconnections. Only when the
interconnections has many aspects. Therefore, the indices national sovereignty is integral and the political situation is
system should be able to comprehensively reflect the impact stable can transnational grid interconnections have a political
of politics, society, economy and environment on transnational environment for construction and operation.
grid interconnections.
2) Conflicts between collaborating countries
Simplicity principle: The indices should be representative,
typical and concise. When establishing the evaluation index The conflict between collaborating countries refers to wars
system, we should grasp the key elements that reflect the nature and territorial disputes between them in their history. These
of the problem, and succinctly describe the basic characteristics issues affect political mutual trust between collaborating
of the compatibility. countries. If there are no issues above, the score of this index
is 5; if there were wars or territorial disputes in history, the
A. Political Compatibility Evaluation Indices score of this index is 0.
1) National security 3) Society stage consistency
National security is a prerequisite for transnational grid Human society can be categorized into five stages:
interconnections. When there are terrorism, political parties primitive society, slave society, feudal society, capitalist
conflict, or wars with other countries, this country cannot society and communist society (the socialist society is the
construct transnational grid interconnections, which means primary stage of the communist society). If the societies’
that national security has veto power over transnational grid stages of collaborating countries are the same, the score of this
interconnections. Different countries have different definitions index is 5. If they are not the same, the score of this index is 0.
of national security levels.
4) Hierarchy of diplomatic relations
Chinese military's degree of combat readiness can measure
the state of national security. There are four degrees of Table II shows the diplomatic relations between countries.
Chinese military's degree of combat readiness: fourth-degree According to the diplomatic relations, the corresponding score
is developed in this paper.
combat readiness, third-degree combat readiness, second-
degree combat readiness, and first-degree combat readiness.


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TABLE II countries are less than 10%, the score of this index is 10; if
DIPLOMATIC RELATIONS AND THE CORRESPONDING SCORE
only one country's unemployment rate is less than 10%, the
Diplomatic Relations Score
Level 1: Allies 10 score of this index is 5; if the unemployment rates of both
Level 2: Ambassador level 7 countries are greater than 10%, the score of this index is 0.
Level 3: Agency level 3
Level 4: Breaking off 0 C. Economic Compatibility Evaluation Indices
Level 5: State of war One-vote veto
5) Energy strategy consistency 1) Economic Cooperation Organization

If the collaborating countries have formulated energy Economic Cooperation Organization can promote the trade
strategies that are conducive to the development of of collaborating countries. Currently, the collaborating
transnational grid interconnections, it means that the countries of transnational grid interconnections are mostly
collaborating countries attach importance to their energy members of regional economic cooperation organizations. In
development, and the possibility of interconnection increases. the process of promoting regional economic integration, the
The score of this index is 10. If not all of the collaborating transnational grid interconnections and unified power market
countries have developed energy strategies, the score of this construction are simultaneously promoted. If the collaborating
index is 5. If all of the collaborating countries do not have countries belong to the same economic cooperation
energy strategies, the score of this index is 0. organization, the score of this index is 5. Otherwise, the score
of this index is 0.
B. Social Compatibility Evaluation Indices
2) Bilateral Free Trade Agreement
1) Gini coefficient
Bilateral free trade agreements allow trade between the
The Gini coefficient can measure the average degree of parties to be as liberal as possible. The direct reflection of
income distribution of countries. The smaller the Gini trade liberalization is the decline in tariffs, the reduction of
coefficient, the more average the income distribution and the non-tariff measures and other trade restrictions. If two
more harmony the society. Therefore, the Gini coefficient is countries sign a bilateral free trade agreement, it will help
used as an index to measure the degree of social harmony. eliminate trade barriers and allow electricity to flow freely
According to the regulations that have been laid down by between countries. It can also reduce transaction costs and
the relevant organization of UN: when the Gini coefficient is circulation costs, and ensure the maximum economic benefits
under 0.2, the income is absolutely average; when the Gini of the two countries in the transnational grid interconnection.
coefficient is between 0.2 and 0.3, the income distribution is Therefore, if the two countries have signed a free trade
reasonable; when the Gini coefficient is between 0.3 and 0.4, agreement, the score of this index is 10; if they haven’t signed
the income distribution is relatively reasonable; when the Gini a free trade agreement, the score of this index is 0.
coefficient is between 0.4 and 0.5, the income distribution is 3) The compatibility of per capita GDP
larger; when the Gini coefficient is over 0.5, the income gap is
very huge[17]. Internationally, 0.4 is often used as a warning It is generally believed that one of the necessary conditions
line for the gap between the rich and the poor. If the Gini for establishing a high-level economic cooperation is that the
coefficient is greater than this value, social unrest will be per capita GDP levels are similar. When the gap between
easier. Therefore, when the Gini coefficients of the collaborating countries’ per capita GDP is too large, it will be
more difficult to coordinate the interests and explore an
collaborating countries are less than 0.4, the score of this
effective way of cooperation which is conducive to gradually
index is 10; when only one country’s Gini coefficient is
narrow the economic gap [15]. The per capita GDP can measure
greater than 0.4, the score of this index is 5; when both the scale of a country’s economy and the overall level of
countries’ Gini coefficients are greater than 0.4, the score of economic development. If the ratio of per capita GDP (the
this index 0. large one divided by the small one) is between 1 and 2, the
2) Unemployment rate score of this index is 10. If the ratio of per capita GDP (the
large one divided by the small one) is between 2 and 3, the
The unemployment rate can reflect the employment level of score of this index is 9 and so on.
the social labor force and the competition for jobs [18]. The rise
of unemployment in the whole society will bring serious D. Environmental Compatibility Evaluation Indices
problems to the whole society. People's basic rights to work 1) Land policy
and subsistence are threatened, which may cause social unrest
[19]
. If countries’ land policies have positive impacts on the
construction of transmission lines, the score of this index is 5;
According to international practice, when the if countries’ land policies have negative impacts on the
unemployment rate is less than 5%, the society is in a state of construction of transmission lines, the score of this index is 0.
full employment; when the unemployment rate is 5% to 10%,
it may lead to economic problem; when the unemployment 2) Low carbon policy
rate is greater than 10%, it may lead to major social and
political problems [20]. If the unemployment rates of both


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If both the collaborating countries of transnational grid By collecting data and policy information from
interconnections have low carbon policies, the score of this collaborating countries and integrating evaluation indices in
index is 10; if only one country has low-carbon policies, the four aspects, the final evaluation results are obtained. The
score of this index is 5; if neither country has low carbon evaluation results are categorized into three grades according
policies, the score of this index is 0. to the total score. Table IV shows the compatibility ranking
based on score.
3) The Compatibility of Renewable Energy
TABLE IV
When the renewable energy of the electricity seller can THE COMPATIBILITY RANKING BASED ON SCORE
meet the demand of renewable energy of the electricity buyer, Grade Score
the renewable energies of the two countries are A •70
complementary. The score of this index is 10. Otherwise, the B >50 and <70
C ”50
score of this index is 0.
When the transnational grid interconnection is Grade A, it
indicates that the political, social, economic and
E. Comprehensive evaluation results
environmental obstacles faced by the construction and
This paper gives different weights based on the importance operation of the project are relatively small. The project
of each index. National security and political relations are key implementation is not difficult, which means that the
variables in constructing transnational grid interconnections. transnational grid interconnection project is highly feasible;
The total score of political indices is 30. The degree of social When the transnational grid interconnection is Grade B, it
harmony has a long-term impact on transnational grid indicates that although there are some obstacles, the project
interconnections. The total score of social indices is 20. still has certain feasibility as long as the collaborating
Economic and trade policies have affected the profitability of countries make efforts; When the transnational grid
transnational grid interconnections. The economic strength interconnection is Grade C, it indicates that it is difficult to
determines the feasibility of transnational grid interconnect countries’ grids, the economic barriers between
interconnections. The total score of economic indices is 25. the collaborating countries are serious, the political barriers
Environmental factors are the main starting point for are large, society's harmonious degree is not high, and the
transnational grid interconnection. The total score of environmental driving force is not strong. The collaborating
environmental indices is 25. Table III shows all indices and countries have to make great efforts to this end, so the
their weights. project's feasibility is not high. Therefore this paper considers
TABLE III that the collaborating countries are not suitable for
COMPATIBILITY EVALUATION INDICES OF TRANSNATIONAL GRID transnational grid interconnection in this case.
INTERCONNECTIONS

Aspects Compatibility Evaluation Indices IV. CONCLUSION


(weighting) (weighting)
Political National security Transnational grid interconnections are the trend of global
Compatibility (One-vote veto) grids. The global grid interconnection is a “bridge” to achieve
Evaluation Conflicts in collaborating countries world’s peace, prosperity, openness, innovation, and
Indices (5) civilization which has enormous values and benefits.
(30) Social system consistency
(5)
However, as an ambitious vision, transnational grid
Hierarchy of diplomatic relations interconnections will face a lot of challenges. Not only the
(10) technical problems have to be solved, but also the economic,
Energy strategy consistency political, social and environmental issues must be carefully
(10)
addressed.
Social Gini coefficient
Compatibility (10) This paper provided a certain reference value for the
Evaluation Unemployment rate
Indices (10)
planning of transnational grid interconnections by studying the
(20) political, social, economic and environmental compatibility
Economic Economic Cooperation Organization among the countries with interconnection willingness. Based
Compatibility (5) on the analysis of the characteristics of transnational grid
Evaluation Bilateral Free Trade Agreement
Indices
interconnections and influencing factors, this paper proposes
(10)
(25) The compatibility of per capita GDP compatibility assessment for transnational grid
(10) interconnections, which includes political, social, economic
Environmental Land policy and environmental aspects. The compatibility indices of
Compatibility (5) transnational grid interconnections proposed in this paper have
Evaluation Low carbon policy
Indices (10)
general applicability. It can be applied to different economic
(25) The Compatibility of Renewable Energy and political environments of different countries.
(10)
The compatibility assessment proposed in this paper has
profound guiding significance for transnational grid


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