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August 9, 2022

Is the supergrid dream still alive?

The technology and political will for such a project now exists, but nations are reluctant to rely on partners.

By GlobalData Thematic Research

Europe’s unprecedented gas crisis is a result of its overreliance on Russia. It did not take long after the invasion of Ukraine for people to point out that a long-term solution to these issues is a supergrid that moves cleanly produced electricity across the continent.

Much of the technology and political will for such a project now exists, but nations are more reluctant to rely on partners for this critical resource. With geopolitics standing in the way, is the interconnected energy dream still alive?

Why are we talking about supergrids?

The resulting diversification of energy sources is an immediate benefit of a supergrid and will lessen Europe’s reliance on the Organization of the Petroleum Exporting Countries (OPEC) and Russia for oil.

There is a wide variety of renewable energy sources from a range of countries and geographies at its disposal. With a supergrid spanning several time zones and climate systems, European states could collectively access wind power from the North Sea, solar power from North Africa and hydropower from Norway simultaneously. With this variety of energy sources and appropriate supply buffering in place, one rogue state not playing ball would be less of an issue.

Over time, larger electricity storage facilities will improve countries’ energy independence, as they will be able to rely on stored power when their production is reduced. Microgrids may also add a degree of flexibility, so the whole grid system will not come crashing down in the face of supply volatility.

China will be a key player

Countries outside of Europe should also take note of the situation. Any country that consumes more fossil fuels than it produces should consider a supergrid. Notable examples include India and China. In fact, China will benefit greatly as more countries construct renewable energy projects and supergrids. It is rapidly diversifying its energy sources to ensure energy sovereignty, and it can help enable other countries’ renewable energy efforts through its world-leading solar panel and lithium-ion battery production.

For China, it is not just about producing enough electricity, it is also about creating the means to produce more energy. Arguably then, supergrid efforts may increase reliance on countries like China for key equipment and technology. While this may not lead to the same cut-throat diplomacy that we are seeing now, governments will have to be weary of China’s dominance. Western nations must step up their production of renewable energy systems to counter this, and improved recycling of key materials is vital.

Geopolitical objections will be challenging to solve

The current objections to a supergrid stem from geopolitical issues. Many European states believed that mutual trade and reliance with Russia would prevent future conflicts, though this was not enough. To overcome this, new supergrids need to go further than just ensuring a mutual benefit. For starters, there cannot be an over-reliance on one country. This will prevent a dominant producer from leveraging its position for political or strategic purposes.

It is not only concerns regarding intimidation and direct conflict that may slow the implementation of supergrids. The increasing number of cyberattacks on critical national infrastructure will worry any policymaker. Long-distance power lines are also more susceptible to the effects of climate change. It is clear that a highly centralised and interdependent system is too vulnerable, and any future supergrid must address this through suitable buffers and intelligent automation.

The loser: the climate

During times of geopolitical uncertainty, it is easy to forget why renewables are so important. Polarisation and energy fragmentation will only act to the detriment of the climate. Pragmatism and intelligent policy must drive decarbonisation efforts, as well as widen electrification and bring down costs. Supergrids are an answer, but whether countries around the world can accept partnerships with their sometimes less-than-friendly neighbours remains to be seen.

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