The Benefit of Collaboration in the North European Electricity System Transition—System and Sector Perspectives

Abstract

This work investigates the connection between electrification of the industry, transport, and heat sector and the integration of wind and solar power in the electricity system. The impact of combining electrification of the steel industry, passenger vehicles, and residential heat supply with flexibility provision is evaluated from a systems and sector perspective. Deploying a parallel computing approach to the capacity expansion problem, the impact of flexibility provision throughout the north European electricity system transition is investigated. It is found that a strategic collaboration between the electricity system, an electrified steel industry, an electrified transport sector in the form of passenger electric vehicles (EVs) and residential heat supply can reduce total system cost by 8% in the north European electricity system compared to if no collaboration is achieved. The flexibility provision by new electricity consumers enables a faster transition from fossil fuels in the European electricity system and reduces thermal generation. From a sector perspective, strategic consumption of electricity for hydrogen production and EV charging and discharging to the grid reduces the number of hours with very high electricity prices resulting in a reduction in annual electricity prices by up to 20%.