Underwater electricity transmission is not possible with alternating current (AC), and furthermore, HVDC has potential benefits for the emerging supergrid, as it can mitigate the intermittency effects from increased output from solar and wind power.
Frost & Sullivan’s European Smart Grid Market – Advanced Component, finds the HVDC market earned revenues of €550 million in 2008, and is estimated to reach €973.7m in 2015.
“Harmonisation of electrical grids is a major step in complete grid automation,” says Frost & Sullivan Senior Research Analyst Vikas Ravindran.
“The rise in offshore wind and solar farms has resulted in the logical move of opting for HVDC for electrical power transmission, which is set to become the norm.”
The European electricity market is moving towards homogeneity of its electrical transmission networks with 16 out of 28 announced projects completed.
The problem of cost
Issues such as high cost of technology and the inability to be used for shorter distances are retarding the growth of HVDC, the analyst says.
“Although the lower line construction cost is an advantage, the high costs of the components continue to be a major hurdle,” says Ravindra. “If the cost of the systems is brought down significantly, the demand can be expected to increase.”
Updates needed to existing HVDC
Most of the existing HVDC system is already over 20 years old, and will soon need updating.
“Overhauling is the next big opportunity for market participants and work is already on to replace the existing systems,” Ravindra says. “Recently, there has been a renewed interest in projects that were decommissioned earlier due to lack of funding or inappropriate technology.”