Croatia: Integration of new wind farms will increase balancing costs

, SEE Energy News

Croatian Energy Regulatory Agency (HERA) has started a public debate on 10-year development plan (2017-2026) of Croatian electricity transmis sion network that will be held between 17 and 31 October.

The document notes that significant integration of wind power into Croatian electricity system implies a significant increase in the cost of ancillary services for secondary and tertiary balancing which are being paid to ancillary services provider HEP by Croatian electricity transmission system operator HOPS.

Greater integration of wind farms will increase the cost of tertiary balancing reserve and these costs will increase its share in the total balancing costs. The total costs of balancing amounted to 36 million euros in 2015, out of which the fixed part of balancing costs (power reserve) amounted to 25.8 million euros (72 %), while the variable part (activation) amounted to 10.2 million euros (28 %). Expected deviations in the future indicate that after the integration of 744 MW in wind farms average absolute forecast error of consumption and wind production would rise from current 43 MWh/h to 78 MWh/h (with the same average forecast error of wind production) or in the range between 65 and 93 MWh/h (with the average wind production forecast error between 8 and 12 %).

After the integration of 744 MW in wind farms, which is the amount that currently has signed contracts on the connection, it is estimated that the total cost of secondary and tertiary balancing will rise to about 50 million euros annually, from current 36 million euros. Given that fact that after 1 January 2017, Croatian electricity market operator HROTE takes the obligation for wind farm production planning, the accuracy of HROTE’s forecasts will be of great importance for the amount of balancing costs, which represent expenses in HOPS’ operation.

According to the document, current forecast of renewable energy production delivered to HOPS by HROTE is of insufficient quality and does not allow the retention of current balancing costs even if no new wind farms are connected to the network. If HROTE’s forecast of wind energy production was used in 2015, the total balancing costs would have been 45 million euros instead of 36 million euros.