Econonomics of Energy and Environmental Policy

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On the Techno-economic Benefits of a Global Energy Interconnection

Abstract:
The discussion about the benefits of a global energy interconnection is gaining momentum in recent years. The techno-economic benefits of this integration are broadly discussed for the major regions around the world. While there has not been substantial research on the techno-economic benefits, however, some initial results of the global energy interconnection are presented in this paper. Benefits achieved on the global scale are lower than the interconnections within the national and sub-national level. The world is divided into 9 major regions and the major regions comprise of 23 regions. When all the considered regions are interconnected globally, the overall estimated levelized cost of electricity is 52.5 €/MWh for year 2030 assumptions, which is 4% lower than an isolated global energy system. Further, the required installed capacities decrease by 4% for the fully interconnected system. Nevertheless, a more holistic view on the entire energy system will progress research on global energy interconnection as, synthetic power-to-X fuels and chemicals emerge as an important feature of the future sustainable global energy system with strong interactions of the power system not only to the supply, in energy fuel and chemicals trading globally, but also to the demand side. Global energy interconnection will be part of the solution to achieve the targets of the Paris Agreement and more research will help to better understand its impact and additional value.
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Keywords: Global energy interconnection, 100% renewable energy, Solar energy, Wind energy, Synthetic fuels

DOI: 10.5547/2160-5890.9.1.cbre


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Published in Volume 9, Number 1 of The Quarterly Journal of the IAEE's Energy Economics Education Foundation.


 

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