By Adrian Varga and Brian Myers
Last summer we had the opportunity to travel to Denmark as a part of an intensive NYU field-research program. During the course of our trip we were deeply impressed by the degree to which sustainability or reflections on the energy transition permeate everyday Danish thinking and behavior. Compared to the US, where consideration for the impact our individual and collective behaviors can have on climate change remains a relatively fringe concept, Denmark seems to have gone all in on rousing its citizens to action. We were inspired by resident-initiatives being implemented in Copenhagen to encourage waste reduction and reuse, the eagerness to lower electricity consumption, community buy-in for large-scale incineration facilities, and the lack of NIMBY-ism surrounding wind development. Undoubtedly, sustainable policy making in Denmark is made easier by its smaller size relative to the US but the openness with which it was discussed in everyday life has stuck with us.
Our interests center around wholesale electricity market trends–we have spent much of our graduate careers studying them. In the US, energy storage is the critical technology that will facilitate a higher share of renewable energy in the power mix. Though not yet scalable, energy storage nonetheless represents the classic American disposition towards problem-solving through technological innovation. It has convinced us that we need fleets of expensive small-scale batteries to store wind and solar energy to be used not when it is produced but rather when it is needed. We brought this assumption with us to Denmark and we were surprised to learn that not only are batteries unimportant in the Danish clean energy vision but that they are also widely considered unsustainable because of the natural resources needed to build them (cobalt, lithium, aluminum) and their limited lifespan. The Danes, and the Nordics writ large, have invested in a technology that obviates the need for wide-scale battery deployment and helps achieve the goal of higher renewable energy penetration: transmission.
The primary hurdle to a 100% renewable grid is the intermittency of wind and solar. The challenge for grid planners is to develop a system to transmit renewable generation when and where it is needed; batteries solve the when, transmission solves the where. However, when a grid is heavily interconnected, transmission can solve both. Denmark is a member of the NordPool electricity market, an interconnected wholesale electricity market that consists of Norway, Sweden, Finland, Lithuania and Estonia. The high degree of transmission interconnection allows them to trade electricity freely and with limited congestion. Renewable resources are abundant in different locations at different times. When large wind farms in the North Sea are producing power at night when demand is low, grid operators can send it throughout the NordPool system to another market, increasing renewables’ share of the power mix in other countries. The idea behind increased interconnection is that somewhere at some time there is demand that can be met by overproduction, someplace else. By connecting these places, renewable energy projects can supply more clean energy to disparate markets. What’s more, you can anticipate a small amount of generation throughout the day from a single generator with a high degree of accuracy. Now while that single generator may not produce anywhere near its nameplate capacity at a given moment, overbuilding the generator capacity in a single location will allow for sufficient generation within a region. Expand this concept across a geographically sizeable market and you can reasonably expect enough renewable energy at a given time to meet demand wherever it may be.
The NordPool members have embraced this idea and as a result, eschewed battery technology as a means to reach higher renewable energy penetration. It is important to note that Danish ideas regarding the benefits of interconnection are informed by their resources or more accurately, the resources of their neighbors. As a member of the NordPool energy market, Denmark is able to utilize Norwegian, and to a lesser extent Swedish hydropower. In 2018, hydro made up 0% of Danish electricity generation but more than 95% of Norwegian and almost 40% of Swedish generation according to the IEA. Hydro is considered a renewable resource, although that designation may change over the coming decades as climate change affects seasonal weather patterns. For now, it functions much like batteries, it makes renewable energy dispatchable when it is needed and the NordPool interconnection transmits it to where it is needed.
While you no longer hear concerns about traditional baseload as a serious obstacle to renewable penetration given the increase in both wind and solar capacity factors, what was especially interesting for us was the Danish vision for future inversion of baseload supply. That is to say that with an overbuild of renewables and transmission allowing large amounts of electricity to flow from underutilized generators across the NordPool, wind and solar would be able to meet baseload demand while hydro and other dispatchable generation will be utilized to meet peak demand. The intermittent resources, which generated so much concern about reliability in the past, would be operating with such consistency that they will be supplying power for much of the day.
While these concepts may not be wholly applicable to the US, the approach to problem solving at work could provide a significant boost to achieving a cleaner and more sustainable power mix. The US has the advantage of diverse and sizable energy resources. But Danish solutions demonstrate that the renewable energy problem can be solved not just by technological innovation but by creative and critical application of those technological innovations. At the very least exposure to current Danish thinking around the energy transition could help spark new design thinking in the US and create applications for energy technology that might be applied on a wider, global scale.
Adrian Varga is an alumna and Brian Myers is a current student of the MS in Global Affairs program at NYU SPS.