JOINT COMMITTEE ON COMMUNICATIONS, NATURAL RESOURCES AND AGRICULTURE debate -
Tuesday, 21 Feb 2012

International Commission of Experts

Chairman

I remind members to turn off their mobile telephones completely. I understand Deputy Ó Cuív will be unavailable for part of the meeting but he will attend as soon as he is able to do so. Deputy Moynihan also sends his apologies.

The purpose of today's meeting is to discuss the Meath-Tyrone interconnector report and the review by the international expert commission. The Minister for Communications, Energy and Natural Resources appointed a international expert commission to review the case for and cost of undergrounding the Meath-Tyrone 400 kV power line. On publishing the report, the Minister forwarded a copy to the committee to facilitate a debate its contents.

On behalf of the committee, I express appreciation to Mr. Bo Normark and Mr. Odd-Håkon Hoelsaeter, members of the international expert commission, for travelling from abroad to meet us. I also acknowledge the presence of other witnesses in the Visitors Gallery, some of whom will be addressing the committee later today.

The purpose of today's meeting is to hear from the witnesses who have been invited to comment on the report. Each witness group should focus on the report and ample opportunity will be given for discussions. If witnesses, having regard to the contributions of other witnesses, wish to make further points subsequent to the conclusion of their engagement with the committee, the Official Report of which will be available on the Oireachtas website in the next day or two, they may do so by writing to the clerk to the committee with their additional points over the coming days. The joint committee will give its consideration to the points raised as part of its final deliberations on the matter.

We have a long day ahead of us and I will briefly outline the format for the meeting. Mr. Normark and Mr. Hoelsaeter will begin by briefing the committee on the report, followed by a question and answer session with members. The two gentlemen will then withdraw from the meeting and I will invite representatives from ESB Networks and EirGrid to make their presentations and comments. We will break for lunch after that session. In the first session after we return from lunch representatives from the North East Pylon Pressure campaign will make their presentation on the report, followed by a question and answer session with members. I will then invite representatives from the Monaghan Anti-Pylon Committee and the Ratheniska action group to make their presentations and comments on the report. A question and answer session will follow.

The international experts have indicated they will withdraw after they make their contributions and will follow the contributions from ESB Network and EirGrid in a room which has been reserved for them. They must follow a schedule and will be leaving this evening but if they wish to respond to a comment of serious note they will return briefly to address the issues arising before we break. Is that agreed? Agreed.

I welcome Mr. Normark and Mr. Hoelsaeter and thank them for attending the meeting. Before I invite them to make their opening presentation, I advise them that witnesses are protected by absolute privilege in respect of the evidence they are to give this committee. However, if they are directed by the committee to cease giving evidence in relation to a particular matter and they continue to so do, they are entitled thereafter only to a qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and they are asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against any persons or entity by name or in such a way as to make him, her or it identifiable. Members are reminded of a long-standing parliamentary practice to the effect that Members should not comment on, criticise or make charges against a person outside the House, or any official by name in such a way as to make him or her identifiable.

Mr. Bo Normark

I thank the Chairman for the opportunity to address the committee. I will briefly introduce the study and then respond to members' questions. On 5 July 2011 the Minister for Communications, Energy and Natural Resources announced that the Cabinet had agreed to his proposal to establish an international commission of experts to review and report within six months on the cost and case for undergrounding all or part of the Meath-Tyrone 400 kV power link. The commission members contacted by the Department agreed to serve on the commission. The three members of the commission, of whom Mr. Odd-Håkon Hoelsaeter and I are two, have extensive professional backgrounds in the electrical supply industry, transmission system operations and academic study of power systems.

The task we were given was to review the expert literature available in Ireland and internationally on the undergrounding of high-voltage power lines, consider the route proposed by EirGrid, examine the case for and cost of undergrounding all or part of the Meath-Tyrone line and consult EirGrid, the North East Pylon Pressure committee, the County Monaghan Anti-Pylon Committee and any other bodies or organisations as we saw fit. However, it was spelled out clearly to us that the permission for the power line was not subject to review. The commission has not dealt with issues related to EMF or the potential impact of the line on property values or landscape devaluation as none of its members possesses the necessary knowledge to comment on these issues. Several studies have already been carried out on the project by persons appointed by organisations representing various aspects and options. The commission has studied these reports carefully and incorporated available elements in our own report where we felt it appropriate to do so.

Furthermore, we have included a detailed examination of recent and ongoing projects in Europe. This approach was deemed to be particularly relevant given the significant changes in technology, supplier opportunities and costs that have occurred in recent years. We expended considerable efforts on collecting data from five reference projects, all of which were relevant to the Meath-Tyrone project. These reference projects have ended up with differing choices of technology, which confirms there is no single correct solution. Each project must be judged on its individual merits and hybrid solutions combining different technologies have been applied in almost all cases, ranging from advanced overhead solutions, through partial undergrounding to use full underground cables.

A specific technical solution must be derived from local conditions. The commission does not give a specific recommendation but general lines of thought can be derived from the examples studied and an examination of the state-of-the-art technologies. We believe that overhead lines can be rendered more acceptable by using new tower designs, conductor types and other measures to reduce visual impact and, in some cases, minimise EMF. Short distances may also be covered by using underground AC cables. Given the distance covered by the Meath-Tyrone project, the commission recommends against a fully underground AC cable solution. If the option is to underground the connection along the whole or main part of the route with today's technology, the best solution is a VSC HVDC solution combined with XLPE cable. The best cable route is most likely following existing infrastructure such as large freeways or railroads, or through farmland as the width of trajectory is far less than is needed for AC cables. In difficult terrain for undergrounding, DC overhead lines might be used.

For cost estimations, values found in real projects under execution are the most reliable source, although high market activity and large fluctuation of key cost parameters such as metal prices have a major influence and they can be different given a different technical solution. The commission finally wants to stress that an overhead line still offers a significantly lower investment cost than any underground alternative.

Chairman

Does Mr. Hoelsaeter wish to add anything?

Mr. Odd-Håkon Hoelsaeter

Mr. Normark has given our initial statement.

Deputy Martin Ferris

I thank the witnesses for their report. The TransGrid report of 2009 commissioned by EirGrid was published prior to the submission of the planning application in 2009. It stated that the VSC HVDC technology was technically feasible and had improved dynamic performance compared with the AC alternative. It continued to state that in their presentation to An Bord Pleanála at the oral hearing regarding technical alternatives they dismissed the HVAC underground option because it was not suitable for the Irish transmission system. The following reasons were given: it would be too complex and costly; electricity losses are higher with DC than AC; and the risk for non-standard control system was deemed to be unacceptably high to security of supply. Given that reasoning, how valid is EirGrid's previous assessment of the use of HVDC with regard to today's state-of-the-art and emerging HDCB technology? It seems to be contradicting the report and using what I would argue are reasons not contained in the initial report and which differ from what Mr. Normark has said this morning.

Are the commission members satisfied that the technical difficulties and barriers mentioned by EirGrid can be totally overcome with regard to the undergrounding of the Meath to Tyrone line? Their report recommends undergrounding in certain areas with other areas going overground. I ask the witnesses to elaborate on the distances involved and the areas in which they believe this is feasible. What is the cost differential between underground versus overground? Some organisations claim it is eight, nine or ten times more expensive and others state it is only two or three times more expensive.

Mr. Bo Normark

Deputy Ferris has asked many questions and I will try to remember them. The report gives an assessment of the potential cost of undergrounding the Meath to Tyrone line based on cost data we have collected from ongoing projects in Europe. We suggest that a full underground solution would be of the order of magnitude of three times more costly. However, we have also spelled out that this is based on favourable installation conditions, which is a very important remark. The reference project found quite low-cost installation solutions following main roads and farmland. With that comment I would say that we have come to a cost factor of roughly three.

We have also said that overhead lines could be used for part of the length. That has nothing to do with the length. If we assume that one might reach an area that is particularly difficult for undergrounding, one could select to go overhead for a limited distance. For this DC solution we would see underground as the main option and going overhead would be the exception. Whereas for AC it is completely the other way around - overhead would be the main option and only in the case where there are specific reasons would one go underground for short distances.

I ask Mr. Hoelsaeter to comment on whether this is feasible.

Mr. Odd-Håkon Hoelsaeter

I will first deal with the cost question. The Deputy asked how long it would be feasible for undergrounding and so on. Obviously, with DC it can be for as long as one needs it. For example, the DC interconnector between Norway and The Netherlands is close to 600 km in length. The North-South interconnector here in Ireland will be 145 km which means that one can even out the converter costs on all of these kilometres. It also makes the cost leverage between AC and DC more favourable. Over a shorter distance there will be a higher price difference with DC. In our opinion it is possible to go by DC up to the North. It is a very small system in Northern Ireland. Still in our review it is possible to go with a DC line also in parallel with an existing AC line. That is done elsewhere in the world with success. We have also seen some examples of that with VSC HVDC technology, which we are discussing here. It is also possible to have a so-called "black start" or having a more or less single source feeding into an area if necessary. That means that with this technology it should be possible to serve all Northern Ireland, in those situations where that is needed, by this HVDC line.

Chairman

As no other members of the committee are offering, I call Senator Byrne.

Senator Thomas Byrne

I reiterate the Chairman's comments about Deputy Ó Cuív, who will be here for a later part of the meeting, but is at our party's frontbench meeting at the moment.

I thank the members of the commission for coming here today. I also thank them for their work. As someone who met them in the course of their work, I was very impressed by their openness and that they wanted to meet us and the other stakeholders in the area. In so far as they could, they have produced a very readable report which the public will be able to understand to some extent even though it might be difficult. It is much more readable than some of the previous reports. It must be acknowledged that there have been at least five reports in this area in recent years in addition to the documentation EirGrid supplied as part of the planning application. A lot of work has gone on.

I have a fairly simple question to which I probably know the answer. Is it fair to say that the technology has changed substantially in recent years and that it continues to change? The witnesses might not answer this question - I know it is outside their terms of reference. If they had to make the decision what would they do? EirGrid carried out a preliminary re-evaluation report for the planning process generally in May 2011, a fair reading of which was to conclude that it completely ruled out high-voltage direct transmission, HVDC, technology as an option. What is the view of the commission on that? I am unsure whether the commission has given much consideration to the report. Will they provide a comment? What the commission has said is clear and I am unsure whether it warrants too much questioning.

Mr. Bo Normark

We will not make a recommendation. It is fair to say that while we have discussed the significant changes in technology in recent years there has also been a significant change in acceptance of more advanced voltage sourced converter, VSC, direct transmission, DC, technology. There are now ten projects under execution which, historically, is a high number. Naturally, from an operational standpoint we recognise that this is more complex and it must be dealt with and one must learn to use the new systems. I offer an example. I should quote the report rather than Mr. Hoelsaeter because of his previous assignment at Statnett. Statnett, the grid company in Sweden, carefully examined connecting Sweden to Norway. The conclusion, which we have spelt out in the report, was that it would be possible to construct the south-west link with alternating current, AC, technology. When conception and solution was decided in 2009 the cost of the VSC solution was estimated to be 25% higher than the AC solution. The reason there was such a small difference was special because only one converter is paid for in Norway. From an operational point of view, the HVDC solution offers benefits in terms of possibilities to control active and reactive power, and it allows for control of power and voltage. This gives more possibilities to support the connected AC grid. A HVDC solution is judged to offer better solution for market support. This is valid both for expected capacity for trading and potential exchange for system balancing and servicing. A downside with the choice of VSC technology is that it is less mature and more complex and this can lead to increased operational risk. Based on an overall assessment of the two alternatives, Statnett decided on a HVDC solution over an AC solution. This is a comprehensive and balanced view on the situation. There is no one right answer because one can have different angles to it. Certainly there is movement towards higher acceptance of the technology.

Mr. Odd-Håkon Hoelsaeter

I fully agree that it is more complex. There are always some pros and cons when one is discussing the various types of technology. In the case of the Norwegian example that Mr. Normark mentioned, my former company opted for a HVDC solution, but that was after I left my position as chief executive.

Chairman

Will you clarify what is meant by "more acceptable". Was it more acceptable to the industry, to the public or more acceptable simply because it is not as cost-prohibitive as it had been.

Mr. Bo Normark

I think it is less cost-prohibitive than in the past because the technology has been scaled up and there are economies of scale. Also, the technical performance has improved. There is an increasing acceptance by utility companies to incorporate these systems. One must learn and this is a new element in transmission system planning.

Deputy Michael Colreavy

The delegation referred to increased operational risk. Is this a risk to continuity of supply or risk to operatives. What operational risk is the delegation referring to?

Mr. Odd-Håkon Hoelsaeter

It is basically a risk that one must involve more technically complex layers such as controllers. One must control the converters in a different way. More complex technical installations are necessary and by this fact alone one increases the risk.

Deputy Michael Colreavy

The risk of what?

Mr. Odd-Håkon Hoelsaeter

The risk of failure of the system. However, it is always a balancing act. Sometimes one should accept increasing risk because there are other benefits which are higher or more valuable than the potential downside associated with these risks.

Deputy Heather Humphreys

I thank the delegation for the presentation. Page 28 of the report states that the HVDC VSC option is viable for the Meath to Tyrone connection. Can the delegation explain further what they mean by "viable"? Does this mean it is capable of working successfully?

Mr. Odd-Håkon Hoelsaeter

Yes.

Deputy Heather Humphreys

Does the commission believe the cost issue will become less of an issue in future as underground technology advances?

Mr. Odd-Håkon Hoelsaeter

It is difficult to foresee exactly what will happen in future but there has been a tendency in recent years such that converter and cable costs have reduced. I agree with the gentleman who suggested that years ago it was eight to ten times more expensive to go by cabling rather than overhead lines. At that time VSC technology was not available. However, the tendency or direction is that the price gap has been reducing all the time. In easy terrain - I emphasise this applies to easy terrain - as far as we can establish, it is approximately three times more expensive to use HVDC VSC technology for long power lines. One can then even out the converter costs on a long distance. I do not believe this tendency will continue at the same speed but at least we can hope that in future we will be able to construct with cheaper cable and so on. In the long run, it will be cheaper to go by overhead lines rather than cables. I do not believe the same costs will arise anytime. There will be some price differences.

Mr. Bo Normark

Since we completed the report there has been some awarding of contracts in this area. These seem to confirm the numbers we have seen in other projects. Perhaps they are somewhat lower but they are of the same order of magnitude as we have used in the report.

Deputy Damien English

I welcome the commission and it was a pleasure to deal with them on this matter. We had the chance to question several issues beforehand and I have no wish to go back over everything but I am keen tease out some issues.

I will work back from the commission's presentation. Reference was made to reliability and the risk of failure. We are led to believe that this would be a major disaster. I get the impression from the commission that risk of failure is something that can be addressed or fixed afterwards. Is this the case? Let us suppose a decision was made to go underground. We have been told there are major concerns about joining together the systems of the South and North. I do not buy into this but that is what we have been told. Let us suppose it is built and a reliability issue arises. I presume it would be adjustable or fixable and that it is simply a case of thinking about it some more. Is there a larger issue? What is the major concern?

Mr. Odd-Håkon Hoelsaeter

The main concern in the case of most failure is in the converter areas. Such failure will be reasonably easy to address. We could fix it in a few hours or a day or two. It would take more or less the same time as with an AC situation.

The other more complex failure problem would be if there was failure of the cable. That takes more time. If the cable is underground, it would probably take a week or two or something like that. That is our experience. On the other hand, it is very rare to have a failure of the cable itself, unless somebody digging causes some external impact to the cable. These are just the different aspects of talking about failure in DC insulation compared to AC insulation. In my view, DC interconnectors are just as reliable as AC interconnectors.

Mr. Bo Normark

I would like to point out also that the base alternatives we have proposed here incorporate double DC circuits, two parallel circuits that can run independently. I do not wish to confuse the Deputy further by talking about system failure that can be more problematic, but there are also system conditions that one can mitigate with DC cable that one cannot do with AC cable. That is another side of the issue.

Deputy Damien English

I have four or five more questions and while I do not wish to hog this meeting, I would like to go through them. What has been said clarifies that when we are talking about reliability, we are talking about temporary failure that is fixable quickly, not permanent and unfixable failure although we have been given that impression.

The expert commission report talks about the losses relating to the two alternatives. I am aware the report mentioned five, but I will stick to the two, AC and DC. There has been great improvement with regard to these, but will the witnesses elaborate a little more on the losses? They have spoken about a possible 60-year lifetime of a project such as this and I welcome that because I have always believed we should look at 60, 80 or 100 years for these projects. However, we were led to believe previously that 40 years was the maximum we should consider. What have the witnesses to say on that? With regard to the converter costs and converter stations, we have been advised that one is better to have AC in the north east so that one can tap in and out of it as much as one likes. I cannot see why it is necessary to have so many converter stations. Is it acceptable to have one at each end of the line if necessary and to use the existing network to distribute our electricity or do we need to allow for more converter stations along the route? They add difficulty and raise costs and I am not convinced of the need for them.

The witnesses have been very generous in saying there have been great changes in the past couple of years that lead to these new possibilities. I believe the changes had already taken place before we started this project. While that is not the expert commission's problem, I believe the evidence was there but was bypassed, overlooked and not given a fair assessment. I am sure it is being assessed fairly now. I know the expert commission cannot pick one project or option, but is it correct to say that if tenders were sought, contractors would or could tender for all of these alternatives or that they would be willing to tender for whichever option we select?

My last question relates to the supply of cable. Is it fair to say that there is no shortage of cable and that if we decide to go this route, we will not have to wait years for the cable, as we were led to believe in the past? Is it correct that it is possible and we can get the cable on the market? I have some other questions, but I can come back to them at the end.

Mr. Bo Normark

I hope I can remember all of Deputy English's questions. I will deal with the loss issue first. The most significant technological change in recent years is that losses have gone down in converters. However, the details for losses for both overhead alternatives and for the DC comes with the final designs. Therefore, we have made a ball park estimation. We estimate that for low and medium load levels, the AC would have low losses, whereas the DC would have lower losses for very high loads or power. It comes back then to making an evaluation and to what the utilisation would be. We would and could not have an opinion on that. Therefore, it is a matter of the expected utilisation and the cost for power.

The Deputy also asked about tapping in and out. Based on the re-evaluation of the project in 2009 by EirGrid, there was no intermediate sub station. If there was to be a need for such an intermediate sub station in the future, that would add further cost and we have indicated the type of cost that would be involved. Therefore, tapping into and out of the system was not considered in our report. However, it is technically possible.

On supply of cable, I can only note that capacity or cable production is increasing rapidly due to the rapid change in markets. To a large extent, it is the same factories that are producing land cable and sea cable, so the more sea cable that is ordered, the greater the pressure on the capacity to produce land cable. The Deputy may have heard the announcement last week that a cable was to be laid from Scotland to England, a distance of 420 km by two, which is 840 km of cable. We cannot give any information on the availability of cable. One must go to manufacturers to find out the how long one must wait for cable.

Mr. Odd-Håkon Hoelsaeter

I agree. In the past, oil impregnated cable was used for sub-sea cable and oil cables with insulation were used for land cable. That was the normal practice. Today, plastic insulated cables are normally installed, even for high-voltage DC. There has been some development of cable technology in that direction. These plastic insulated cables are cheaper to produce and provide greater capacity. Therefore, the potential delay when ordering a cable today is much less than a few years ago.

Deputy Damien English

What is the lifetime of these cables? We have oil cables that are 60 years old. Could these new cables last longer than 60 years or how long will they last?

Mr. Odd-Håkon Hoelsaeter

Sixty years for a cable is a long life. The normal standard when one is looking for cable is to look for cable that will last at least 40 years. It should last that length without any significant problem.

Chairman

There was also a question with regard to tenders. Could a tender be submitted for the different options?

Deputy Damien English

Could someone bid on any of the options we pick? Are the witnesses confident they would bid on any of the options, whichever we select?

Mr. Odd-Håkon Hoelsaeter

Yes.

Deputy Seán Conlan

I welcome the representatives from the expert commission. My first question relates to the report, which includes the cost of the line and the converter station in Northern Ireland. Why was this included when the terms of reference only referred to the line in the Republic? I understand from examination of the report that if one looks at the section of the line in the Republic only, one notes the overhead option would cost €118 million and the most expensive underground option would cost €295 million. The least expensive underground option would cost €173 million. The difference in terms of the gold-plated underground option and the overground option may be €177 million, but in terms of the least expensive underground option, it is only €55 million. Will the witnesses comment on that?

My second question relates to the new technology that has been mentioned for the overhead option. The report refers to modern pylons and new low-sag conductors. This technology is expensive. Has this extra cost been included in the commission's costings for the overhead options? If it has not been, why not, given that the latest technology has been included in the costing of the underground option? I understand that the report mentions that power flow devices might be needed for the overhead option. Is that correct? If so, why have those devices not been costed?

Chairman

Does the Deputy have any more questions?

Deputy Seán Conlan

Yes.

Chairman

We will get the questions and then we will get the answers.

Deputy Seán Conlan

My last question relates to the roll-out of the grid across Europe. I believe it is experiencing massive delays. There is a great deal of community resistance to high-power voltage lines across the EU. I understand that very few projects on greenfield sites, like the Meath-Tyrone project, have been built in the last ten years across Europe. Perhaps I am incorrect in that regard. I refer to the construction of complete overhead lines. Do the delegates share my understanding that there is a great deal of community resistance to these projects?

Chairman

Four questions have been asked.

Mr. Bo Normark

I will begin by answering the question that was asked about costs. We should make it clear that the gold-plated alternative that is mentioned in the report is the only alternative that is fully compatible in capacity with the overhead line option. We have indicated that a project with a smaller capacity can be built more cheaply. If one wants the same capacity, one has to build a full 1400 MW system. We looked at the full project, covering the whole distance from Meath to Tyrone, in our assessment. We did not look at any other option. It is true that there have been significant delays in the construction of many other power line projects across Europe. It is also true to say that there has been a significant acceleration in the last couple of years. More overhead line projects have been commenced and built. Overall, there has been a major increase in the construction of transmission systems. The overview report suggests that approximately one third of what is built today is DC and two thirds is AC. That proportion is roughly correct.

Mr. Odd-Håkon Hoelsaeter

We were asked whether the design tower element or any other element - the conductor, for example - was included in the costings of the overhead line. No such elements were included.

Deputy Seán Conlan

Okay.

Mr. Odd-Håkon Hoelsaeter

If a decision is made to proceed with a different design of the overhead line, it will probably increase the cost somewhat. We have not calculated how much it would increase by in such circumstances. If it is decided to use design towers and lighter conductors, that will add higher costs to the overhead line. That could be an interesting extra cost if it is decided to proceed with an overhead line while reducing the visual impact.

Deputy Seán Conlan

I would like to return to my original question. Why was the cost of the converter station in Northern Ireland included in a report that was supposed to deal with the section of the line in the Republic of Ireland? I believe the cost of the converter station is €155 million, which is a significant amount of money.

Mr. Bo Normark

One cannot build a DC system with a converter at just one end. If one does not put a converter at the Northern end, one will have to put it at the Border, so the cost will be there anyway.

Deputy Seán Conlan

If it is an underground solution, the Northern Ireland Government will be responsible for the cost of the Northern Ireland converter station.

Chairman

In fairness, the cost is the cost. We should be honest about that part of it.

Deputy Michael Colreavy

I ask the witnesses to forgive me if my questions seem naive. Is it possible for cables to occupy multi-service ducts? Could other utilities occupy the ducts that are used for these cables? Are the witnesses aware of roadside ducts being used for multi-utility cables in any location?

Mr. Odd-Håkon Hoelsaeter

It is possible to put more than one cable in a trench. The different owners of these installations are not normally in favour of that. It is more often done in cities with cables of a lower voltage. For example, electricity and telecommunications cables can share the same trench as pipes for hot water and district heating. That is normal in cities. It is less normal in the open landscape between cities.

Deputy Michael Colreavy

The report is very good on the economic and technical options that exist. It is less easy to measure social impact. Is there any authoritative work anywhere which looks at things like the desirability of property in an area where there is an overground line of this nature? Has the resale value of land been examined? Has consideration been given to the impact, if any, on agricultural output? Are the witnesses aware of any authoritative research that would give us some information on the social aspects of this matter, rather than the purely economic and technical aspects of it?

Mr. Odd-Håkon Hoelsaeter

We have chosen not to comment on those aspects of the matter at all. We do not have the proper knowledge of the situation to give a decent answer. We are not willing to comment on them.

Chairman

To be fair to the gentlemen, they outlined the task that was given to them at the beginning. They said specifically that they would not discuss the impact of the line on property values or landscape devaluation. None of the members of the commission has the appropriate knowledge in that field. The Deputy asked whether they are aware of any other studies that may have delved into that area.

Mr. Odd-Håkon Hoelsaeter

We are talking about the EMF. We have seen some studies on a national level in different countries. I am not able to refer to any international studies.

Chairman

Fair enough.

Deputy Shane McEntee

The Meath-Tyrone project is the first part of a larger ongoing project right around the country. I want to refer to the prices that are being quoted. Everything will come down to money. Most things come down to money, at the end of the day. The 3:1 price ratio is based on a 400 kV line carrying the highest possible amount of power, 1,400 MW. Do we need that for the programme we have in place? If its capacity were reduced by half, how much would the cost of putting it underground be reduced by? If we were to provide for 700 MW instead of 1,400 MW, would that 700 MW be enough to justify the project we are undertaking? We have already built an interconnector between Wales and Ireland. That was done and dusted while we continued to talk about this project. Do we need 1,400 MW? Do we need a state-of-the-art line to carry this amount of power? Would we get away with 700 MW? If so, how much would the cost of DC underground be reduced by?

Mr. Bo Normark

We cannot comment on whether a smaller capacity would be sufficient because we do not have a background to comment on that. We have given the table indicating what the single circuit system would cost. Our table shows it would cost approximately 1.7 times more. It could come back to three for two. I should mention also that if one goes to one circuit, there are two effects. One would get less capacity and one would also lose this redundancy one has with the two circuit solution.

Mr. Odd-Håkon Hoelsaeter

If one wanted to do a closer study of that, one would have to do a study of the whole system and make a conclusion on that basis. We have not done that, so we are not able to give a straight answer. It is possible, of course, to do so and to see whether it is possible but it also has that effect which Mr. Bo Normark pointed out. One would not have the redundancy in the HVDC solution. One would also slightly reduce security of supply for that power line.

Deputy Shane McEntee

From 1.7 to three times the cost is quite high. Are we wrong not to look at the national issue?

Mr. Odd-Håkon Hoelsaeter

I do not think we should answer that. It is-----

Deputy Shane McEntee

It is relevant. This is the start of a very ambitious plan which everyone in this House and in this country is behind.

Mr. Odd-Håkon Hoelsaeter

That kind of decision must be up to the Irish community.

Mr. Bo Normark

I would make one comment on cost. We realise there will be a need for more 400 kV lines in Ireland. One consequence of using this DC alternative is that if one expands the system, it could be possible to expand it by building another cable and just one additional terminal. This is the case, for instance, in this product in Sweden. They started by building two converter sites and a third in Norway. In that context, in relative terms, expansion is more favourable than starting.

Chairman

If a decision is taken to use HVDC, initially, one must have two converters. One does not have a choice in that-----

Mr. Bo Normark

Yes.

Chairman

-----but from then on, one can tee off. Depending on the capacity load or what is required, the economics of it improve on the basis that every other destination only needs a further terminal, north or south of one and two. Is that correct?

Mr. Bo Normark

Yes. That is correct.

Deputy Damien English

It is greatly reduced if one wants to go to the west of the country.

Chairman

North west, north east, south and south west. Is it half the cost of the converter? In effect, the converter cost is halved.

Mr. Bo Normark

Yes.

Chairman

Would the two primary converter stations have the capacity? Is that an issue? Would they have the capacity to extend either way? Would that be a factor when considering the ones one would build?

Mr. Odd-Håkon Hoelsaeter

It is difficult answer that directly because it depends on what kind of capacity one wants in these different directions and what kind of capacity is initially built.

Chairman

Would they be compatible with the existing grid system, which is AC in the main?

Mr. Odd-Håkon Hoelsaeter

The AC system will always be the most flexible part of it but, to a greater degree, as in other countries, a DC system could be included in an AC system which would make it more flexible. That is something into which one must look at each step, that is, to see what is the best solution for the next step. To draw some clear conclusion on that today is very difficult.

Mr. Bo Normark

If one expands the system, the voltage needs to be the same but the rating of an additional converter can be different. One does not need the same size. The converter size determines how much power one can feed in and take out.

Chairman

When the system is fed down, it will be AC. It will be a lower voltage but AC will feed the greater system. If DC were to be used, it would be the main artery rather than anything else.

Deputy Damien English

Am I right that no greenfield sites have gone down the route of AC overheads?

Mr. Bo Normark

That is not correct. One of the cases in the report is in Norway and it is totally greenfield and 100% AC overhead. The report also mentions this product in Holland which is high grid with AC and some small portions of it are underground AC cable.

Deputy Damien English

The trend in the past two to three years is towards much more DC. Is that correct?

Mr. Odd-Håkon Hoelsaeter

It is more DC compared to what one had in the past but one should not underestimate the fact that AC and greenfield installations will be built in the future. It depends on the location, the costs, the terrain and so on. For example, the power line in Norway, which Mr. Bo Normark mentioned, is in mountain terrain where cabling would be extremely expensive. They also looked carefully into the different options, such as HVDC, VSC and so on. They concluded with an AC overhead line in pretty nice mountain terrain.

Deputy Damien English

It is very flat here.

Deputy Seán Conlan

The Deutsche Energie grid II study looked at the cost of new underground HVDC grid compared to the traditional AC grid and concluded that the cost was twice as high. That concurs with the witnesses view of 1.7:3. This increased the overall cost of domestic energy by 0.2 cent per kilowatt hour in Germany. In the most expensive case, it was by 0.5 cent per kilowatt hour. Do the witnesses concur with that view given their knowledge of European energy markets?

Mr. Bo Normark

The study to which the Deputy referred, the Dena study, is an overall study. We must recognise that Germany has a very extensive grid. In any context, whether underground or overhead, additional grid is very small compared to the existing grid. That is why the consequences of the tariff is limited because the added grid is very small compared the existing one.

Deputy Seán Conlan

The report mentions that a specific technical solution must be devised for local conditions. What specific local conditions do the witnesses believe are necessary to consider in this project?

Mr. Bo Normark

Local conditions include the kind of landscape one has. That is the most important local condition.

Mr. Odd-Håkon Hoelsaeter

If one has mountain terrain or forest terrain compared to open farmland, the costs involved are totally different.

Deputy Seán Conlan

Is there anything to prevent an underground solution being found to this North-South interconnector route given the specific conditions?

Mr. Odd-Håkon Hoelsaeter

First, they are seeing only half of the routes. On the other hand it would not be right of us to draw too many clear conclusions on what should be done in the future. We have highlighted the approximate price difference with different technical solutions and also underlined the fact that the costs we have mentioned depend on an EC routing which means farm land, a shoulder on a main roadway or something similar to that.

With regard to what should be done on these specific projects, that is not up to us to say. Somebody else should make that conclusion.

Deputy Shane McEntee

It may be an observation but Mr. Normark said earlier that in some cases long lines of some 500 or 600 km were being put underground. As I stated, approximately 600 km of this high voltage line is to be put in around Ireland. In terms of cost would it be better for us to complete the entire project at the one time? Rather than doing it from, say, Batterstown to Tyrone would we be better off doing the entire 600 km at the one time rather than doing one stretch now and applying for applications in three years time? In terms of an overall plan would it be better to do it that way because as the witnesses said earlier it would cut down on the costs?

Mr. Bo Normark

There is another alternative in the report, that is, if a smaller capacity is built consideration could be given to installing a two cable system because if new trenches are opened up the additional cost is very high. Consideration could be given to adding convertors later.

Deputy Damien English

When we met the representatives originally on this report they were clear that the cost of delays should be assessed and that it should be a factor in the decision making process. Do they still hold that view because they mention in their report that many of the overhead projects throughout Europe have experienced considerable delays, similar to the delays here? I accept they said they cannot compute those costs but is it correct that they should be properly assessed and added to that?

Mr. Odd-Håkon Hoelsaeter

Throughout Europe there has been ongoing resistance against overhead lines, which has meant that the process of going with permits to build new overhead lines has been substantially delayed. That is more or less normal throughout Europe, regardless of the countries involved. It is something that has developed in the past ten years at least and is an element that should be taken into consideration here but we have not done anything in that regard.

Deputy Damien English

Yet we should. I thank Mr. Hoelsaeter.

Senator Mary Ann O’Brien

I have one question which might be slightly naive. What is the most cost-effective solution in terms of underground, keeping in mind the words "flexible", "expand" and the phrase "build on for the future"? As the Minster said, it is clear we cannot afford the Rolls Royce but we want to be mindful of the future. I ask the same question in terms of overground. Looking to the next six years, what would be the most cost-effective solution keeping in mind the words "flexibility", "expansion" and "upgrade"?

Mr. Bo Normark

We have partly addressed that question already. We made it clear that AC underground for this kind of distance is not an option. That leaves DC and with DC the two choices to be made concern capacity and redundancy. We cannot recommend anything in that regard. The same discussion has taken place in other countries which probably have the same problems to deal with in terms of where the new generation will be, how much it will cost and even if the generation will be decommissioned. That is more problematic than judging where the load will be.

Senator Mary Ann O’Brien

That is the reason the words "flexible", "expansion" and "upgrade" will be important for our future generation.

Mr. Bo Normark

Yes, I understand.

Senator Mary Ann O’Brien

However, we must be cost effective also. I agree that the social aspect, which we are not supposed to talk about, is a huge consideration in terms of health, agriculture and valuations.

Mr. Odd-Håkon Hoelsaeter

Many different factors have to be taken into account before any direct decision can be taken. I agree with the Senator in terms of some of the elements she mentioned but what we outlined in our report is an overhead line after an HVDC VSC. Those are the two alternatives we have discussed directly. In our opinion there should be flexibility in that regard. It is a different kind of flexibility but they are comparable in our view. Other factors will affect the decision to choose one or the other.

Chairman

That concludes the discussion. I thank both gentlemen for attending to make their presentation and answering the questions put to them. Having gone through this discussion process they will appreciate the importance of having a one-to-one question session on the report. The commission was asked to review the case for and cost of undergrounding all or part of the line, and the witnesses took the default as the standard AC overhead cable. It boils down to an economic evaluation. The different evaluations that must be done were outlined by the members. There is a time line on this process to the extent that the Northern Ireland planning process gets under way in early March. In that regard, what the Republic is planning must be outlined to ensure its process can go ahead in terms of the provision it must make.

I propose to suspend the meeting for two minutes to allow our witnesses withdraw. They will watch the contributions from the EirGrid and ESB Networks representatives on the monitor in another room. I thank the witnesses. I have asked them to review the transcripts of the remainder of this afternoon's proceedings in terms of the other groups who will appear before the committee, and if there is any issue or question posed on which they would like to respond we will forward it to the witnesses for their consideration. Is that agreed?

Mr. Bo Normark

Yes.

Sitting suspended at 1.18 p.m. and resumed at 1.20 p.m.