The demand for network capacity is set to increase. The energy transition is causing more distributed (and intermittent) generators (DGs) to be connected to the grid and demand for connection capacity is outpacing increases in the demand for energy. Conditional connection agreements can help to alleviate the resultant challenges for grids and provide significant socio-economic gains by increasing capacity utilisation and enabling earlier connection.
A conditional connection agreement implies that the network company can restrict network use by the connecting party when this becomes necessary to support network operations or prevent network outages. The agreements themselves can be designed in a variety of ways.
To help develop an evidence base for the Swedish Energy Inspectorate’s (Ei's) ongoing work on conditional connections, we conducted a literature review and reached out to regulators in other countries that either use or are planning to introduce conditional grid connections. The survey covers the contractual, socio-economic and technical aspects of conditional connections.
The academic literature focuses almost exclusively on conditional connection of DGs as a means to facilitate earlier connection, and consequently as a temporary measure. Such agreements are voluntary for the DGs, and the alternative is to wait for grid expansion that allows for firm connection. An intermediate solution, where conditional connection is applied until connection charges can be shared among several DGs, is also mentioned.
Last-in-first-out and pro-rata strategies are the most frequently suggested principles for allocating curtailment requirements, although the literature does not identify one optimal strategy. Guiding principles or criteria for the evaluation of different curtailment strategies include transparency, predictability, simplicity, fairness and cost-effectiveness.
To use conditional connections efficiently, DSOs must have tools to assess the efficiency of conditional connection versus grid investment. They must also have systems for the curtailment of DGs in the event the network becomes congested. The systems and tools identified in the literature include optimal flow analysis, active network management, effective network control and contractual arrangements.
Only a few countries have implemented conditional connection schemes and already gained some experience with them. Others have only recently implemented relevant schemes or are in the process of assessing their implementation.
Regulatory processes focus on:
- The impact of distribution-grid-level conditional connections on higher voltage levels and the need for coordination between grid levels
- The use of conditional connection on the TSO level
- The extent to which actors with conditional connection agreements can participate in balancing and flexibility markets
- The inclusion of loads as eligible for conditional connection
- The option to offer mixed firm/non-firm connection agreements or temporary non-firm arrangements
- Exit conditions
- Compensation in the form of grid tariff reductions not limited to connection charges
The UK and Ireland stand out as the countries with the longest experience with non-firm access arrangements. While recent reforms in Great Britain focus on simplification and the strengthening the DSO incentives for continuous grid reinforcement, Ireland is now looking to implement a more sophisticated non-firm connection model.
Compared to the relatively detailed regulations and standards in these countries, Norway’s legal framework leaves the design and details of conditional connection agreements to the individual DSOs and grid users that want to use them. The Netherlands seems to pursue a different strategy to help DSOs manage congestion, favouring instead improvements in the procurement of market-based flexibility.
As experiences with conditional connections are fairly new, quantitative assessments about the potential cost savings have not been conducted. The British regulator Ofgem and a few academic papers hint at substantial savings due to the use of conditional connections.