Consumption-based approach to RES-E quantification: Insights from a Pan-European case study

The nexus between renewable electricity (RES-E) generation and interconnection is likely to play a large part in future de-carbonised power systems. This paper examines whether RES-E shares should be measured based on consumption rather than production with a European case study presented for the year 2030. The case study demonstrates the volume and scale of RES-E transfers and shows how countries have differing RES-E shares when comparing those derived based on the traditional production-based approach to the alternative. The proposed consumption-based approach accounts for RES-E being imported and exported on an hourly basis across 30 European countries and highlights concerns regarding uncoordinated support mechanisms, price distortions and cost inequality. These concerns are caused by cross-border subsidisation of electricity and this work proposes that an agency be appointed to administer regional RES-E affairs. This agency would accurately quantify RES-E shares and remunerate producers from the country that consumed their electricity instead of where it has been produced - policy would be enhanced by enabling more equitable and optimal electricity decarbonisation.