Project Summary
SECURE is fully aligned with:
· Innovation Challenge 3: Improving energy system resilience and robustness - Strengthening whole system resilience and robustness to achieve Net Zero securely
· Scope 2: Strengthening UK’s energy system robustness to support efficient roll out of new infrastructure.
SECURE aims to strengthen the UK’s energy system and support efficient and timely installation of new high voltage direct current (HVDC) infrastructure to realise a Net Zero energy system.
Demand for HVDC connections is growing rapidly across Europe for grid reinforcements such as the Eastern HVDC links, interconnectors and offshore wind connections. Globally, the HVDC Cables Market size exceeded $10billion in 2021 and is anticipated to reach annual deployment of 18,000 km by 2030, with c1,300km for GB grid reinforcements.
The robustness, capability and capacity of the supply chain to support this HVDC infrastructure will be a critical factor in this growth. HVDC supply chains are a complex flow of materials and goods through a global network of suppliers and sub-suppliers. De-risking the HVDC cables supply chain will enable Transmission Owners (TOs) to successfully deliver new HVDC infrastructure whilst reducing delay and costs risks.
Energy network innovation
SECURE will utilise digital solutions that can provide TOs with greater visibility over the HVDC cable supply chain. This is expected to take the form of a Digital Supply Chain Hub (DSCH), giving real time visibility over the supply chain along with competing levels of demand. The DSCH will be developed using XLPE as a use case to bring rapid results in Alpha, extended to the full HVDC cable system in Beta and beyond that, applied to wider HVDC component parts & systems.
Experience and capability
Project SECURE blends the skills of three leading partners:
1. SSEN Transmission (SSEN-T) has practical and technical experience from the deployment of Europe’s first HVDC network, the 113km Caithness-Moray-Shetland Link.
2. Digital Catapult: a Research and Technology Organisation (RTO) at the forefront of digital supply chains and implementation of advanced digital solutions.
3. Carbon Trust: a key industry partner managing joint industry programmes incorporating subsea cables innovation.
SECURE has one sub-contractor:
1 Edinburgh University: providing key expertise in HVDC cable technology.
Users
SECURE’s Digital Supply Chain Hub (DSCH) will support all TO’s. The solutions will be open access so will also benefit offshore wind developers. This will help all developers of new HVDC infrastructure to procure and deliver projects more efficiently.
Innovation Justification
The rapid growth in demand for HVDC cables is creating supply chain pressure presenting a risk to delivery of HVDC projects and jeopardising Net Zero targets. Exemplifying this is the supply of insulation material used in HVDC cables, cross-linked polyethylene (XLPE), being limited to one dominant manufacturer in Europe presenting single source risks to delivery, timeframes, and cost.
All TOs developing HVDC projects are facing this supply chain risk. SECURE will:
1. Undertake a quantitative and qualitative assessment of risk in the HVDC cables supply chain, assessing key demands, supply factors and prioritising areas to be addressed.
2. Assess, develop and trial digital solutions to derisk the supply chain.
Digital supply chains (DSC) are an emerging solution that use collated and analysed data to provide manufacturers and customers with real-time visibility over supply chain processes, aiding competition and decision making. This is a novel application in the energy sector and is expected to de-risk project delivery, increasing supply chain robustness for TOs. SECURE will apply these novel approaches to produce a DSCH for HVDC cables by the end of the Beta phase, see AppendixQ4-Project_Approach.
Supply side knowledge of availability, costs and lead times for HVDC cables are not visible until formal procurement processes commence. A DSCH can be used to derisk the supply chain:
1. Early identification of potential future demand.
2. Identify potential new suppliers and existing capacity/capability.
3. Diversify supply chain by giving insights into the demand for new projects and stimulate new entrants.
The DSCH will collate data from various sources in real-time, eliminating large areas of uncertainty.
Economic Value
1. Decarbonisation of electricity and flexible use of renewables, by enabling grid reinforcements, can lower energy prices.
2. Stimulating investment in supply chain can benefit the economy.
3. A robust supply chain avoids costly delays.
Sustainability Value
1. Accelerates decarbonisation of energy system.
2. Potential to stimulate a local supply chain.
Funding
SIF allows for a whole system approach to tackling the supply chain and sharing results with other TOs. This is the primary reason why SIF is the most applicable funding route to securing benefits across all TOs, not just SSEN-T. RIIO-T2, NIA or BAU are unsuitable because DSC solutions are relatively immature and novel in the energy sector and the development expenditure of a holistic system are anticipated to exceed NIA cost and scalability limits.
Project Benefits
The headline benefits of SECURE are the timely and cost-effective installation of HVDC cables that will:
1. Improve energy security (unlocking the potential of wind resources in the North of Britain).
2. Has the potential to reduce energy costs (or at least make energy costs more stable).
3. Decarbonise the network avoiding environmental harm and helping to achieve Net Zero targets.
4. Establish new supply chains.
Cost savings per annum on energy bills for consumers
Reduction of supply chain risk through improved delivery logistics and increased competition means grid cost savings for consumers and large-scale renewable energy. The UK can build faster its energy security with more domestic low-cost renewable energy and less reliance on imported fossil fuels where their volatile prices affect massively consumer budgets. The investigation will aim to link delays in HVDC connections with the level of curtailment to identify the impact in achieving Net Zero targets.
Cost savings per annum for users of network services
The introduction of more competitive suppliers in the market offering alternative options is expected to drop prices and so allow more HVDC connections to materialise at less cost. According to published analysis by the Electricity Systems Operator, the impact of a one-year delay on the Eastern HVDC link projects may lead to a detriment of approximately £400m and 2-year delay may lead to circa £800m due to increased constraints cost. The project will explore price sensitivities on HVDC cables and the cost impact of delays on the delivery of HVDC cable connections by 2030.
Indirect CO2 savings per annum against a business-as-usual counterfactual
Less delays on delivery of renewable connections could speed up the decarbonisation of the energy sector. The investigation will look to identify the potential of carbon saving from the reduction of delays.
Creation of new revenue streams
Establishing a digital supply chain may also stimulate new entrants and existing companies to grow HVDC cables capacity and capability through increased visibility of demand. This is key to accelerating business growth, supporting the local economy, contributing to gross value added and creating jobs. It can also encourage the commercial development of more innovative and sustainable products by making key risks visible. The methodology is planned to assist the creation of partnerships between suppliers, manufacturers and TOs. It is replicable in other supply chain areas if applicable so benefits could be realised more widely in due course.
