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ECN publication
Trends in foreign power generation reserves and consequences for the supply security of the Dutch power market
Published by: Publication date:
ECN Policy Studies 1-10-2003
ECN report number: Document type:
ECN-C--03-117 ECN publication
Number of pages: Full text:
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In the Netherlands, in 2001, total net imports amounted to around 16%of the total consumed elec-tricity. As a result of the market liberalisation, the upgrading of interconnectors and lower wholesale prices from surrounding countries - primarily Germany and France - imports displaced more expen-sive generators from the Dutch market. It is expected that in the shorter-term these power plants are mothballed and become available again when prices rise due to an in increase in demand and/or de-crease in supply . However, if in the medium and longer term they remain outside the market, they will most probably be decommissioned. This, combined with only a limited number of new power plants, will reduce the total national generation capacity and increase the country?s dependency on imports. The expected further increase in the interconnector capacity might even exacerbate this trend making the Netherlands even more dependent on foreign imports.

This note investigates two questions put forward by the ministry of Economic Affairs, in relation to the project Electricity for Ever (E4E). More specifically, (1) it investigates the situation in surround-ing countries regarding expected development of production capacity and reserve margins of elec-tricity. Furthermore, (2) it investigates on the consequences of the developments of neighbouring production capacity on the imports to the Netherlands. For answers to these questions three aspects are of importance: (1) the availability of interconnections that allows for electricity imports, (2) for-eign generation capacity excess during peak demand that might be available for exports to the Neth-erlands and (3) the impact of market structures in surrounding countries on the (de)commissioning of power plants and, subsequently, on the reserve margins of national electricity systems.

In this note, first, the current and potential development of interconnection capacity between the Dutch and surrounding power systems is discussed, including the explanation why only countries are investigated that are geographically close to the Netherlands. Second, the generation adequacy is analysed for Belgium, France, Germany and England & Wales, by monitoring reserve margin trends and analysing the market structure of each country. For reasons of comparison also reserve margin trends for the Netherlands will be presented. Finally, some general conclusions are considered.

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