presentation by mr auke lont statnett norge at #nlc olos 26.11.2014

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Arctic power grid development – issues and opportunities Auke Lont, CEO Statnett Northern Lights Corridor Seminar, 26 th November 2014

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Page 1: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

Arctic power grid development – issues and opportunitiesAuke Lont, CEO StatnettNorthern Lights Corridor Seminar, 26th November 2014

Page 2: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

The role of Statnett

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Owner of high voltage grid

• Operator• Maintenance• Construction

System operator

• Maintain balance between generation and consumption

• Security of supply

Page 3: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

Responsible for a stable and secure power supply

• Statnett operating about11.000 km of high-voltage power lines, 150 stations and 4 HVDC interconnections

• Responsible for maintaining balance between supply and demand at any time

• Security of supply reliability: 99,96 %

• Max production: 26.167 MW

• ≈ 100 % renewable

A service provider with duty to connect3

Page 4: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

Statnett has been through huge changes

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Increased efficiency

2012 2013 2014 20152009 2016 2017 2018

Increased capacity

Third energy package – Statnett have to acquire the last parts of the central grid in Norway

Elhub, AMS (advanced meter- and steering system) and fast changes in technology

1990 2005

Increased utilisation

2025

Increased costs. Increased external requests on focus on cost efficiency.

Safe and efficient operation

Page 5: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

Our strategy 2014-2018

Safe and efficient operations

We will help developing next generation power system

In 2018, Statnett will be a safe, efficient and attractive company,

which owns and operate all central grid in Norway

Page 6: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

Massive investments in the power sector 2010-2025

Our annual investments: 5.000-7.000 MNOK

Statnett's ongoing projects Historic and expected inv estments in generation, transmission, distribution

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Generation

Distribution

Transmission

Consumption(TWh)

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Page 7: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

More than tripled investment level since 2010

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mill.kr

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Employees Investments

Page 8: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

We are active in the Northern area

• Ofoten-Balsfjord• Ongoing constructions• Cost estimate 3200-3700 MNOK

• Balsfjord-Skaidi• Investment decided September 2014 • Cost estimate 4000-6000 MNOK• Concession expected in 2015

• Skaidi-Hammerfest• Awaiting concession from the Government• Realization depended on petroleum industry

• Other reinvestments and stations works

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Page 9: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

Ofoten

Kvandal

Bardufoss

Balsfjord

Alta

Hammerfest

Skaidi

Step 1:Started

construction in 2014

Step 2:Development adapted to the development of

the demand

Step 3: Construction starts when the industry sees need for new

capacity and increased security of supply

Ofoten-Balsfjord-Skaidi-(Hammerfest) 420 kV

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Page 10: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

Grid layout after Ofoten-Skaidi

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Red = 420 kVGreen = 220 kVBlack = 132 kVBlue = 110 kV.

Page 11: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

Extensive plans and large potential for increased consumption and production

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Eastern FinnmarkOil- and mining industry.Wind powerFurther demand growth depends on new oil field discoveriesSpecific plans for new wind power, large potential for further development

Grid operates close to capacity limit both summer and winter. Satisfactory security of supply when Finland line is operational

Western FinnmarkOil- and mining industry.Wind power

Expect strained operating conditions after 2014 due to demand growth and weak existing grid

Page 12: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

Scenarios for consumption development in Finnmark

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2014 2019 2024 2029 2034 2039 2044 2049

MW

Change in consumption in Finnmark

Electrification of all

new oil fields, all mines

and ports

Gas pipe line to

Hammerfest

Likely projects

N-1 with Balsfjord-

Skaidi

Certain (Goliat)

Current max consumption: 300-350 MW

Page 13: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

Concept selection study in the North

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Red = 420 kVGreen = 220 kVBlack = 132 kVBlue = 110 kV

• Unsure demand side development

• A broad involvement and political anchoring is necessary

• Analysis completes in 2015

Page 14: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

A process involving both internal analysis and external interested parties• To ensure that we find the right concept to meet future demand

and obtain acceptance, we will, in addition to our own analysis, discuss the analysis externally

• Assessment of the needs• Objectives & framework• Feasibility study• Analysis of alternatives• Establish guidelines for the

project phase

Concept selection studyTechnical assessmentsKnowledge base

• Condition of existing stations and lines

• Feasibility of upgrading and rebuilding

• Assessment of new corridors

• Knowledge based on internal and external analyses

• Datasets for several models for current system and expected development

• Experience from operations and markets

Page 15: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

The concept selection study (KVU north) will be our compass for further development

Identify demand

Choice of concept

Application for

concession

Kick off 16th December

KVU finished in 2015

Political process

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Page 16: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

Strategic supplier development

2007 2016

field/y

field/y C

EPC

Increased outsourcing

Station

2007 2016

300 km/y

20 km/y

Several contractors

Line

Sima-Samnanger

Page 17: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

Statnett arranges for local creation of value• We normally use 15-25 % of total costs on local

deliverances and services for our line and station projects.

• We give local business opportunities through our projects: • SHA-training• Information meetings• Facilitating cooperation between suppliers

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Ground works and concrete

Office, storage, accommodation

and food

Transport Forest cleaning and road

Page 18: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

Contractor arrangement August 2015

• Related to our Balsfjord-Skaidi project, we will have a contractor arrangement in August next year

• Both large and local contractors and supplier can participate

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From speed dating with large international and local suppliers in Tromsø 18th June 2013

Page 19: Presentation by Mr Auke Lont Statnett Norge at #NLC Olos 26.11.2014

The future is electric

The future is electric

uncertain, but

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Statnett's power gird development in the artic area:

• Ongoing project: Ofoten-Balsfjord, 3200-3700 MNOK

• Planned start 2015: Balsfjord-Skaidi, 4000-6000 MNOK, with local suppliers

• Concept selection study for further development in the North in 2015