The Future Expansion of HVDC Power Transmission in Brazil: A Scenario-Based Economic Evaluation
FCN Working Paper No. 14/2015
47 Pages Posted: 5 Oct 2016
Date Written: September 2016
We discuss the expected future needs of the Brazilian electric grid operators for High Voltage Direct Current (HVDC) transmission lines against the background of a changing electricity sector in Brazil. On account of the spatial mismatch between the additional generation potential and the expected future electricity demand, a need for investments in long-distance transmission capacity is postulated. Due to the low losses incurred, HVDC technology is particularly suitable for this. For the analysis, we use different expansion scenarios for the year 2035 that are mainly based on hydropower or alternative renewable energy sources (primarily wind and solar power). Linear optimization is used to determine the optimal HVDC transmission lines to connect regions. The results show that large investments in HVDC transmission are needed, especially in the case of hydropower expansion, and that transmission capacity is a critical factor in the process of expanding the renewable energy generation capacity in Brazil.
Keywords: HVDC transmission lines, Grid planning, Energy transition, Spatial mismatch
JEL Classification: Q4, A41, L94, C64, H54
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