Impact of Adriatic submarine HVDC cables to South East European Electricity Market Perspectives
Authors: Majstrović Goran , Jakšić Dražen , Mikulić Martina , Bajs Davor , Polen William , Doub Albert 
Published: June 2022

The ultimate goal in today’s electricity business in Europe is market integration on pan-European level that will introduce transparency and competition between market players, incentives to clean energy development, as well as high quality of supply to the end-customers. To achieve these goals, in South-East Europe (SEE) there are number of barriers and uncertainties, one of which is linked with the possible new undersea HVDC connections between SEE and Italy. With the support of the United States Agency for International Development (USAID) and coordination of the United States Energy Association (USEA), within the framework of the Southeast Europe Transmission System Planning Project (SECI), a detailed analysis has been accomplished on the impact of one or more undersea HVDC cables between Italy and SEE on power system operation and electricity market development [1]. Special emphasis to this analysis is given by the fact that SECI has been one of the longest running projects in the region. It started in 2001 with active participation of all regional TSOs, including continuous updating of power system and electricity market models and its harmonization of constant changes in power system planning. It is of utmost importance in the environment of constant changes of national power system development plans and needed further steps for full market opening and integration in the region. SEE power systems and market1 were modelled using the most relevant power system and market simulation and optimization softwares. Both system and market comprehensive models have been verified by all SEE TSOs. Study analyses were divided in two parts: 1) market analysis and 2) network analysis. The market study investigated expected generation pattern, power exchanges and wholesale prices in SEE, taking into account regional market synergy, the new links with Italy, and high level of RES integration. Bulgaria and Romania are currently the main exporters in SEE. Significant power exchanges in the North-South/Southeast direction are related to the fact that the GR, MK, ME, HR and AL are mainly importing, plus the influence of Italy importing over new potential HVDC cable(s). Network analysis dealt with power flows, network bottlenecks and voltage profiles in given market scenarios. Finally, the results of this comprehensive market simulation comprised of the following:

Countries electricity balance (production, consumption and exchanges)
Electricity prices for each country
Cross-border power exchanges (MWh/h) for each border in the region on hourly basis
HVDC link loadings (MWh/h) for each HVDC submarine cable on hourly basis
Location and frequency of market congestions in SEE (NTCs full between areas with price difference)

All those analyses have been performed in two different transmission network development scenarios:

Base case scenario: with planned HVDC ME-IT
Alternative scenario: with planned HVDC ME-IT, and HVDC HR-IT, and HVDC AL-IT

In this way one of the most important uncertainties (new HVDC links SEE – Italy) for future power system and market operation in SEE, have been evaluated both in technical and market sense, using the most relevant inputs and model.