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1
South Gas Regional Initiative16th Dec 2011
South Gas Regional Initiative16th Dec 2011
2
Index
• GRIP South Region: purpose• Methodology of work• Table of content• Key results• Conclusions and way forward
3
CONVERGENCE and COHERENCE
CONVERGENCE and COHERENCE
EIPEIPEIPEIP
TYNDPTYNDP
GRIP South Region: purpose
GRIPGRIPGRIPGRIP
The South Region GRIP investigates how the cross border projects, 3rd IP Portugal-Spain and the Iberian-French Corridor, will cooperate to achieve the European Energy objectives for 2020 and beyond, stressing their value building the North-South Corridor in Western Europe.
The South Region GRIP investigates how the cross border projects, 3rd IP Portugal-Spain and the Iberian-French Corridor, will cooperate to achieve the European Energy objectives for 2020 and beyond, stressing their value building the North-South Corridor in Western Europe.
4
Methodology of work
Impact of the cross border developments on: Interconnection level, Sustainability, Diversification of Gas Sources, Diversification of Gas Routes, Regional Cooperation to face “Disruptions” Market Integration
Bottom up approach
Bottom up approach
IBERIAN-FRENCH CORRIDOR Western Axis: FID Eastern Axis: non-FID MIBGAS Portugal-Spain IPs: non-FID
IBERIAN-FRENCH CORRIDOR Western Axis: FID Eastern Axis: non-FID MIBGAS Portugal-Spain IPs: non-FID
Top down approachTop down approachConvergence of TYNDP &
GRIP &&
EIP &
PCI
GRIP &&
EIP &
PCI
SUPPLY DEMAND SUSTAINAIBILITY SECURITY of SUPPLY MARKET INTEGRATION
SUPPLY DEMAND SUSTAINAIBILITY SECURITY of SUPPLY MARKET INTEGRATION
5
Table of contents
6
Index
• GRIP South Region: purpose• Methodology of work• Table of content
• Key results• Conclusions and way forward
7
Parallel core network related reinforcements
Already into operationFuture developments
Western Axis specific infraestructures - FIDAlready into operationFuture developments
Eastern Axis specific infraestructures – non FIDFuture developments
Compressor Station
Pipeline
3rd IP Portugal - SpainFuture developments
BOTTOM UP approach: Technical description
3rd IP
Portugal-
Spain
3rd IP
Portugal-
Spain
Iberian-French Corridor
• Western Axis• Eastern Axis
Iberian-French Corridor
• Western Axis• Eastern Axis
8
Capacity bottlenecks at the cross borders
-450
-300
-150
0
150
300
450
GW
h/d
from North to South from South to North
EXTRA POTENTIAL FLOWin the Spanish-French border
-450
-300
-150
0
150
300
450
2011 2020GWh/d
from North to South from South to North
ENTRY -EXIT BALANCEPeak day
* Intermediate development
Extra potential flow in the Spanish-French border
Extra potential flow in the Spanish-French border
Eastern Axis planned capacity
Eastern Axis planned capacity
The development of the Eastern Axis will contribute to removing these bottlenecks and allows the utilization of the facilities in both
directions
Extra potential flow in the Spanish-French border
Extra potential flow in the Spanish-French border
Extra potential flow in the Spanish-French border
Extra potential flow in the Spanish-French border
9
The South Region will contribute to providing diversification of Supply sources into the Union improving the internal security in facing a lack of
supply crisis.
SOURCES14 countries
DIVERSIFICATION ofNorway5%
Nigeria33%
Libya1%
Egypt7%
Algeria26%
Oman0%
Yemen1%
USA0%
Other0%
Qatar18%
T&T8%
ALGERIA24% of South Region Supply
Lybia0,4%
Egipt4%
T&T4%
Peru1%
Nigeria17%
Norway22%
Qatar10%
Algeria24%
Netherlands8%
Russia8%
Others2%
Yemen0,3%
ALGERIA24% of South Region Supply
Lybia0,4%
Egipt4%
T&T4%
Peru1%
Nigeria17%
Norway22%
Qatar10%
Algeria24%
Netherlands8%
Russia8%
Others2%
Yemen0,3%
DIVERSIFICATION OF GAS SOURCES: 3RD IP PORTUGAL-SPAIN and the IBERIAN-FRENCH CORRIDOR spreading diversification of Sources into the Union
Diversified portfolio
Diversified portfolio
Diversified SUPPLY portfolio vs Security of Supply
10
DEMAND
Positive synergies would result from increasing interconnection capacity, helping to optimize the use of entry facilities and
providing flexibility to the Gas System.
Gas demand will become more volatile due to the interactions between the electricity market and the gas market.
Source: TYNDP 2011-2020 and own elaboration
EVOLUTION OF LOAD FACTOR
1,70
1,80
1,90
2,00
2,10
2,20
2,30
2,40
2,50
2,60
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
(Pea
k de
man
d/Av
erag
e D
eman
d) FRANCE PORTUGAL
SPAIN SOUTH Region
Source: TYNDP 2011-2020 and own elaboration
202022%
78%
Source: TYNDP 2011-2020 and own elaboration
79%Rest of EUROPESOUTH Region
StableStable
11
SUSTAINABILITY: facilitating Renewable Energy
DAILY ENTRIES MODULATION
0
500
1.000
1.500
2.000
2.500
3.000
3.500
4.000
4.500
5.000
01/1
0
02/1
0
03/1
0
04/1
0
05/1
0
06/1
0
07/1
0
08/1
0
09/1
0
10/1
0
11/1
0
12/1
0
Dai
ly e
ntri
es (G
Wh/
d)
0,00%
0,05%
0,10%
0,15%
0,20%
0,25%
0,30%
0,35%
0,40%
0,45%
Dai
ly e
ntri
es /
Ann
ual e
ntri
es (%
)
NP IP EU-IP
LNG UGS
SUSTAINABILITY: 3RD IP PORTUGAL-SPAIN and IBERIAN-FRENCH CORRIDOR providing flexibility facilitating Renewable Energy Integration in Europe
These new IPs will increase free gas flows between countries and allow to
increase short-term deliverability from LNG
Terminals and UGS.
12
DIVERSIFICATION OF GAS ROUTES: 3RD IP PORTUGAL-SPAIN and the IBERIAN-FRENCH CORRIDOR providing diversification of Routes of Gas
Diversification of gas routes
These new IPs make the South Region gas system more reliable and flexible, reducing the risks associated to technical failures of the entry points or to a
lack of supply from external countries.
Diversification of GAS ROUTES2020 FID Capacity2020 FID Capacity
DR Index Diversification of RoutesDR<0,01 HIGHLY diversified0,01<DR<0,15 DIVERSIFIED0,15<DR<0,25 MODERATELY diversifiedDR> 0,25 UNDIVERSIFIED
Undiversified
DIVERSIFIEDDIVERSIFIED
DIVERSIFIED
2020 FID + Eastern Axis+ 3rd IP Portugal-Spain
DIVERSIFIED
DIVERSIFIED
EU EU IPsIPs
Import PointImport PointLNG TerminalLNG Terminal
13
The GRIP South Region includes a resilience network assessment
considering the special characteristics of the Region and under specific risk
scenarios as the following:
1. LNG Disruption
2. North Africa disruption
3. Algerian disruption (NG & LNG)
The modelling of the network: has been done using the ENTSOG tool, and the GLE study “LNG disruption” was taken for granted
The modelling of the network: has been done using the ENTSOG tool, and the GLE study “LNG disruption” was taken for granted
LNG Supply Disruption
Scenarios
LNG Supply Disruption
Scenarios
Annual LNG Volumes
Infrastructure’s Technical Capacity
Winter Load FactorWinter Load Factor
Daily Send-out from LNG Terminal
LNGBALANCE
NET
WO
RK
Sim
ulat
ion feedback
LNGLNGBALANCEBALANCE
QUOTAQUOTAper exporting countryper exporting country
NET
WO
RK
Sim
ulat
ion
LACK of LACK of LNGLNG
Daily Send-out from LNG Terminal
Resilience assessment: Security of Supply
14
Security of Supply – Lack of LNG from Nigeria
>20%>20%
5 5 -- 20% 20% 1 1 -- 5%5%< 1%< 1%
Remaining Flexibility (SoS)
Existing + FID projects +Eastern Axis + 3rd Portugal-Spain
Existing + FID projects +Eastern Axis + 3rd Portugal-Spain
+ rest of non-FID
Existing + FID projects
Regional Cooperation to face disruptions
Regional Cooperation to face disruptions
3rd IP Portugal-Spain removes cross-border congestion providing remaining flexibility to face disruptions.
Security of Supply: lack of LNG from Nigeria
15
Eastern Axis removes cross-border congestion providing remaining flexibility to face disruptions.
Security of Supply: lack of Algerian gas
Regional Cooperation to face disruptions
Regional Cooperation to face disruptions
Security of Supply – Lack of Algerian gas (LNG & NG)
>20%>20%
5 5 -- 20% 20% 1 1 -- 5%5%< 1%< 1%
Remaining Flexibility (SoS)
Existing + FID projects +Eastern Axis + 3rd Portugal-Spain
Existing + FID projects +Eastern Axis + 3rd Portugal-Spain
+ rest of non-FID
Existing + FID projects
16
The GRIP South Region investigates the contribution of the Iberian-France
Corridor to the European internal market focus on:
1. To facilitate the usage of the developed and planned LNG Terminals
2. To Interconnect the Mediterranean area and the Northern supply Corridor
The challenge for the following years are:• a well-meshed network,• enabling the access to different supply sources,• facilitating the establishment of diversified suppliers’ portfolios,• improving its robustness and making it more flexible.
Market integration
Market integration modelling aims at assess how far gas coming from each supply source can flow into the European gas network.
Market integration modelling aims at assess how far gas coming from each supply source can flow into the European gas network.
17
1. To facilitate the usage of the developed and planned LNG Terminals
Market Integration – Year 2020Existing + FID projects +
Eastern Axis + 3rd Portugal-Spain
PTES
FR
1 Country color
ES
FR
PT
ES
FR
Remaining Flexibility (Reference Case)
LNG Terminal Send-Out1
PT
>20%>20%5 5 -- 20% 20% 1 1 -- 5%5%< 1%< 1%
≥≥ 80% 80% 7070--8080%
5050--60% 60% 6060--70%70%
Existing + FID projects +Eastern Axis + 3rd Portugal-Spain
+ rest of non-FID
Existing + FID projects
They increase the competitiveness and liquidity of gas markets providing equal opportunities for shippers, enabling a high level of competition and
contributing to reduce market concentration in Europe
Market integration: the role of the IPs
18
Market integration: the role of the IPs2. To Interconnect the Mediterranean area and the Northern supply Corridor
TYNDP 2011-2020. Evolution of Algerian pipeline gas influence in the European networkTYNDP 2011-2020. Evolution of Algerian pipeline gas influence in the European network
ALG
ERIA
N p
ipel
ine
influ
ence
The effect of the Iberian-French Corridor development: gas from Algeria will flow to central Europe through France reducing the dependence
on the incumbent gas source
19
TYNDP 2011-2020. Evolution of Russian gas influence in the European network
Market integration: the role of the IPs2. To Interconnect the Mediterranean area and the Northern supply Corridor
The effect of the Iberian-French Corridor development: contribute to the development of liquidity of hubs in the South Region
RUSS
IAN
GAS
influ
ence
20
Major efforts are needed to modernise and expand Europe's gas
infrastructure and to interconnect networks across borders to increase
competitiveness, sustainability and security of supply into the Union creating
the European Internal Gas Market.
Enagas, GRTgaz, REN Gasodutos and TIGF understand theirs vital role to play achieving these Energy European objectives assuming the challenge of interconnecting and adapting the gas infrastructure to the new future needs.
Enagas, GRTgaz, REN Gasodutos and TIGF understand theirs vital role to play achieving these Energy European objectives assuming the challenge of interconnecting and adapting the gas infrastructure to the new future needs.
Transmissions System Operators of the South Region wish that this first South Region GRIP provides useful information to all stakeholders and will
support fruitful discussions when assessing the ability of investment projects to answer regional market needs.
CONCLUSIONS AND WAY FORWARD
21
Thank you for your attentionMª Teresa Bravo García
Thank you for your attentionMª Teresa Bravo García
22
Aim of the North-South Corridor in Western Europe
Proposed Way forward…Proposed Way forward…
4.3. From priorities to projects
The above mentioned priorities should translate into concrete projects and lead to the establishment of a rolling programme. First project lists should be ready in the course of 2012 and be subsequently updated every two years, so as to provide input to the regular updating of the TYNDPs.
Projects should be identified and ranked according to agreed andtransparent criteriacriteria leading to a limited number of projects. The Commission proposes to base the work on the following criteria, which should be refined and agreed upon with all relevant stakeholders, notably ACER: …
– GAS:GAS: diversificationdiversification, giving priority to diversification of sourcessources, diversification of supplying counterpartscounterparts and diversification of routesroutes; as well as increase in competition through increase in interconnection levelincrease in interconnection level, , increaseincrease of market integrationmarket integration and reductionreduction of market concentrationmarket concentration
ANNEX 3.2.4 …
At the same time, as the development of electricity from variable sourceselectricity from variable sources is expectedexpectedto be particularly prominent in this corridor, the general shortin this corridor, the general short--term deliverability term deliverability of the gas system needs to be enhanced to respond to the additioof the gas system needs to be enhanced to respond to the additional nal flexibility challenges to balance electricity supply.flexibility challenges to balance electricity supply.The main infrastructure bottlenecksmain infrastructure bottlenecks preventing the correct functioning of the internal market and competition need to be identifiedneed to be identified in this corridor andand stakeholders, Member States, NRAs and TSOs, shall work together to facilitate their implementationto facilitate their implementation.
Secondly, an an integrated analysisintegrated analysis between the between the electricity and gas systemelectricity and gas system ––taking into account both generation and transmission aspects taking into account both generation and transmission aspects –– should lead should lead to the assessment of the gas flexibility needs and the identificto the assessment of the gas flexibility needs and the identification of ation of projects with the objective to backprojects with the objective to back--up variable electricity generation.up variable electricity generation.
ANNEX 3.2.4 …
At the same time, as the development of electricity from variable sourceselectricity from variable sources is expectedexpectedto be particularly prominent in this corridor, the general shortin this corridor, the general short--term deliverability term deliverability of the gas system needs to be enhanced to respond to the additioof the gas system needs to be enhanced to respond to the additional nal flexibility challenges to balance electricity supply.flexibility challenges to balance electricity supply.The main infrastructure bottlenecksmain infrastructure bottlenecks preventing the correct functioning of the internal market and competition need to be identifiedneed to be identified in this corridor andand stakeholders, Member States, NRAs and TSOs, shall work together to facilitate their implementationto facilitate their implementation.
Secondly, an an integrated analysisintegrated analysis between the between the electricity and gas systemelectricity and gas system ––taking into account both generation and transmission aspects taking into account both generation and transmission aspects –– should lead should lead to the assessment of the gas flexibility needs and the identificto the assessment of the gas flexibility needs and the identification of ation of projects with the objective to backprojects with the objective to back--up variable electricity generation.up variable electricity generation.
3. NorthNorth--South Corridor in Western EuropeSouth Corridor in Western Europe to remove internal bottlenecksremove internal bottlenecksand increase shortincrease short--term deliverabilityterm deliverability, thus making full use of possible alternative external supplies, including from Africa, and optimisingoptimising the the existing infrastructure, notably existing LNG plants and storageexisting infrastructure, notably existing LNG plants and storage facilitiesfacilities.O
BJEC
TIVE
By following criteria…By following criteria…
23
CAPACITIES (GWh/d) FRANCE to SPAIN SPAIN to FRANCE
Current Status 100 30 FULL DEVELOPMENT (2Q/2013) 165 165 Current Status 0 5 FULL DEVELOPMENT (1st dec/2015) 60 60 Current Status 325 80 FULL DEVELOPMENT (2Q/2013) 395 255
WESTERN AXIS FULL DEVELOPMENT
Larrau
Biriatou
Guyenne
FRANCE to SPAIN SPAIN to FRANCE
CAPACITIES (GWh/d) FRANCE to SPAIN SPAIN to FRANCE
Current Status 0 0 FULL DEVELOPMENT 80 230
EASTERN AXIS DEVELOPMENT
Le Perthus
FRANCE to SPAIN SPAIN to FRANCE
165165
165165
606060603030
2525
7070134134
EU EU IPsIPs (existing &FID(existing &FID
142142142142
8080
230230
EU EU IPsIPs (non FID)(non FID)
2020 FID + Eastern Axis+ 3rd IP Portugal-Spain
GWh/d
CAPACITIES (GWh/d) FRANCE to SPAIN SPAIN to FRANCE
Current Status 0 0 FIRST STAGE 107 80 FULL DEVELOPMENT 142 142
3rd SPAIN-PORTUGAL IPSPAIN to
PORTUGALPORTUGAL to
SPAIN
IBER
IAN
-FR
EN
CH
CO
RR
IDO
RIB
ER
IAN
-FR
EN
CH
CO
RR
IDO
R
BOTTOM UP approach: Capacities
24
BOTTOM UP approach: IPs creating European internal market
IP Capacity at Spanish-French borderSPAIN to FRANCE
0
50
100
150
200
250
300
350
400
450
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
GWh/d
0%
5%
10%
(% o
f the
cou
ntry
pea
k de
man
d co
vere
d by
IP)
MIDCAT (Non-FID)
Larrau + Biriatou (FID)
% of French peak demand ̀ covered ̀by FID
% of French peak demand ̀ covered ̀by IP
IP Capacity at Spanish-French borderFRANCE to SPAIN
0
50
100
150
200
250
300
350
400
450
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
GWh/d
0%
5%
10%
(% o
f the
cou
ntry
pea
k de
man
d co
vere
d by
IP)
MIDCAT (Non-FID)
Larrau + Biriatou (FID)
% of Spanish peak demand ̀ covered ̀by FID
% of Spanish peak demand ̀ covered ̀by IP
INTERCONNECTION LEVEL: IBERIAN-FRENCH CORRIDOR covering gas Demand creating the European internal Market
The share of peak demand that could be covered developing the Iberian-French Corridor would be increased by more than 10%