Development of electric power cooperation in Northeast Asia

1 Introduction

The establishment of a multipolar world order that has become a global trend in the changing system of international relations had a considerable effect on the integration processes in Europe,North and South America,Southeast Asia,and the Middle East.However,Northeast Asia,being one of the most dynamically developing regions,is lagging in this global trend.Historical contradictions that separate some countries of the region remain an obstacle to building a stable regional system of interstate relations.

Considering the ever-increasing dependence of the NEA countries on energy import and export,we can state that the energy sector of Russia,China,Japan,North and South Korea,and Mongolia can become a driving force in the regional integration of these economies.The interests of Russia include the development of the territories in East Siberia and the Far East of Russia,whereas Asian countries neighboring Russia need energy resources.The necessity to cooperate in these areas can become a driver of the integration,which will enable these countries to overcome their contradictions and start mutually beneficial co-operations.

Despite the apparent coincidence of interests and the obvious importance in the development of energy cooperation among the NEA countries,mechanisms in the region to foster the coordination of energy development and start a multilateral energy dialog remain lacking.This constrains the expansion of regional cooperation and does not allow the implementation of mutually beneficial transnational projects.

Individual countries study the capabilities of a regional power interconnection of NEA countries independently.For example,certain centers and teams engaged in solving the problems of integration in Northeast Asia were established in Japan and the Republic of Korea; Russia attempted to conduct one of the few joint investigations.The Melentiev Energy Systems Institute(ESI SB RAS)jointly with Skolkovo Institute of Science and Technology(Skoltech)and Korea Energy Economics Institute(KEEI)performed a study on the effectiveness of the interstate transmission lines in NEA countries.Some of the results of that study are partly presented in this paper.

2 Directions and projects of interstate electric ties in NEA

Currently,the electric ties in NEA can be considered weak; primarily,they involve border electricity trade(Table 1)[1,2].Their further extension will depend on the rates of expansion in the cooperation and integration of the said countries in different fields of the economy.

Table 1 Existing interstate electric ties in NEA*)

*) Only lines with a voltage of 100 kV and higher.

Countries Transmission line(end points)Voltage[kV]Transfer capability[MW]Power exchanges [GWh/ 2015]Russia-Mongolia Gusinoozersk thermal power plant(TPP) 220 250 283(Mongolia’s import)/54(Russia’s import)Chadan-Khandagayty-Ulaangom 110 90 Russia- China Blagoveshchenskaya-Heihe 220 95 3299(China’s import)Sivaki-Shibazhan 110 90 Blagoveshchensk-Sirius(Aigun) 220 300 Amurskaya-Heihe 500 750 Mongolia-China Oyu Tolgoi-Inner Mongolia 220 n.a.1200(Mongolia’s import)

The key directions of regional electric power cooperation include projects for the development of interstate electric ties and the creation of a regional interstate power grid.These projects differ in their goals(border trade,electricity export,and the interconnection of national and local power systems),electricity sources at the supply end,and the directions and technical implementation of transmission lines between the cooperating countries.

Virtually,in all NEA countries,scientists have an interest to study the effectiveness of the development of interstate electric ties and a grid.The ISG is proposed in several variants.

The experts at Korea Electrotechnology Research Institute(KERI)compared several potential scenarios of electric ties.These ties differed in the degree of integration of the national power systems.Korean scientists concluded that with the construction of the ± 500 kV DC transmission line—“Vladivostok-Pyongyang-Seoul,” the interstate power grid of the Russian Far East and Korea Peninsula—became energy and economically effective [3].

In another South Korean study,researchers focused on interstate electric ties between the Republic of Korea and China [4].The electric ties were supposed to transmit surplus power from renewable sources(wind and solar)and nuclear power plants in China to the electrical load centers in South Korea(Seoul,Incheon).

Another research group of Korean experts presented a vision for the interstate power grid in NEA [5].This vision embraces the Korean Peninsula,Japan,Mongolia,China,and involves partially the Far East of Russia,including Sakhalin Island.In this vision,the Republic of Korea is considered the central part of the entire interstate power grid connecting the rest of the countries.The construction of the power grid in NEA is supposed to not only provide an increase in mutually beneficial electricity trade in the region and an improvement in the reliability of power supply to consumers,but also to create conditions for further economic development of all countries in the NEA; further,it is expected to create peaceful reunification of the Republic of Korea and the Democratic People’s Republic of Korea.

Lately,the other potential directions of interstate electric ties among the NEA countries include electricity transmission from a wind and solar power system in the Gobi Desert(Mongolia).This project includes the construction of a Gobitec system with a total capacity of 100 GW based on wind and solar power plants,and DC transboundary transmission lines to supply power generated from them to China,the Republic of Korea,Japan,and Russia.The construction of these lines will lead to the formation of an interstate power grid,called the “Asian super grid” [6].This project can be implemented in the remote future with a large investment.The estimations indicate that the Gobitec project(with a 100 GW capacity)will require a total investment of up to nearly $ 300 billion [7].Furthermore,most of the proposed tentative schemes for the indicated power grid require serious additional research.

In the studies conducted by Russian scientists,their Korean colleagues and they themselves confirmed the effectiveness of connecting the Interconnected Power System of the East with the power system of the Republic of Korea(Fig.1).This project,compared to other projects for the interstate electric ties in NEA,is the most thoroughly studied project.The studies of ESI SB RAS and KERI proved the appropriateness,effectiveness,and technical capabilities of the creation of this tie [8,9].The economic benefit of this project exceeds $14 billion in terms of the investment and this makes up about $ 2 billion in terms of annualized costs.In this case,the economic benefit for Russia can reach $ 450 million/year [10].

Fig.1 Interstate electric tie “Russia’s Far East - DPRK - RK”(Russia’s research)

The high effectiveness of this project for the Republic of Korea is explained in terms of the potentially considerable power generation capacity saving of 8 GW caused by seasonally different annual load peaks.An important part in the implementation of this project can be played by the Far-Eastern nuclear power plant,which is planned for construction in the Primorye Territory [11].However,to implement the project and ensure security for the transboundary transmission line operation,it is necessary to solve the political problems in the Korean Peninsula and create conditions for close economic and technical partnerships between the Russian Federation,DPRK and the Republic of Korea.

A general idea of the main projects of interstate electric ties between Russia and NEA countries is presented in Table 2.One more project that envisages the electric network passing through the territory of the Korean Peninsula is the interstate electric tie “Russia-China-DPRK-RK-Japan”(Fig.2).The export-oriented power plants considered for power transmission along the indicated routes include the Erkovetskaya and Sakhalin thermal power plants,the hydropower plants in South-Yakutia,the thermal power plants in Transbaikalia,the previously mentioned nuclear power plant in Primorye Territory,and some others.

Table 2 Data on the main projects for interstate electric ties between Russia and NEA countries

*) Generalized project indices.
**) Numerator-total length, denominator-submarine cable length.

Interstate electric tie Length [km] Voltage [kV] Transfer capability [GW]Transmitted power [TWh/year]Tentative cost [$ billion] Russia-China Bratsk-Ulan-Bator-Beijing 2250 ±600 5-6 18 1.8 Bureya HPP-Harbin 700 ±400 1.0 3 2.2 Project of large-scale power export 3400*) ±600 10*) 60*) 18*)Erkovetskaya TPP-Shenyang 1300 ±600 3.6 20 8.8 DC system “Ust-Ilimsk- Khabarovsk” 5000 ±750 10.0 40 16.5 Russia-Korean Peninsula Vladivostok-Chonjin 370 ±500 0.5 3 0.13 Vladivostok-Pyongyang-Seoul 1150 ±500 4.0 7 4.8 South-Yakutian HPPs-Shenyang-Seoul 2400 ±750 5.0 20 10.5 Russia-Japan Sakhalin-Hokkaido-Honshu 1850/1400**) ±600 4/3 24 9.6 Sakhalin-Hokkaido 500/50**) ±500/±400 4.0 24 6.7

Fig.2 Schematic of the interstate electric tie “Russia-China-DPRK-RK-Japan”

The considered examples show that there are several research projects aimed at studying the capabilities of interconnecting electric power systems of individual countries in the region.It is worth noting that,until recently,comprehensive studies on the cost-effectiveness of the interstate power grid to be built in Northeast Asia with the calculation of the integration-related benefits for all countries in the region have not been performed.

The comprehensive assessment of the system effectiveness of the entire NEA interstate power grid formation was carried out by APERC [12].

In the next section,we present the results of ESI and the Skoltech study [13],which considered prospects for the expansion of the NEA-wide grid emphasizing the system benefits of its formation.

3 Prospects for the formation of an interstate power grid in NEA

According to the abovementioned study,for Russia,the most attractive power export destination is Japan.The creation of the interstate electric ties from the exportoriented thermal power plants in Sakhalin Island,and in the future,from hydropower plants in South Yakutia to Japan is also effective.The power from Russia is competitive in the Japanese electricity market as it supersedes the expensive local power plants,particularly under the restricted operation of nuclear power plants after the Fukushima accident.This makes it possible,on the one hand,to reduce the electricity cost in Japan,and on the other hand,to create a flow of export revenues for Russia.Here,it is appropriate to use the output of the Russian power plants not only for exporting power but also for supplying electricity to its local territories.In this case,these power plants are involved in supplying both an annual peak load in Japan,which occurs in summer,and a winter peak load in Russia.Such a use of capacities enhances their effectiveness because they additionally replace competitive capacities from the prospective Russian power balances.In order to simultaneously implement the project of the interstate electric tie “Russia-Japan,” it is first necessary to achieve agreements between the countries at a political level.

For China and countries in the Korean Peninsula,it would be effective to have a time-varying(time of the day,seasons of the year)power and electricity exchange with Russia.In fact,such an exchange would provide a system integration benefit of reduction in generation capacities necessary to supply load in countries involved in the exchange.Moreover,it would be effective for Russia to render system services,which implies levelling out of nonuniform power generation from renewable energy sources(RES)(primarily in China).In this case Russia receives RES power that is not consumed in China owing to a reduction in consumer load and limited regulatory capabilities of the local power plants.The unconsumed power is stored in the reservoirs of Siberian hydropower plants,and it is resupplied during the period of load increase in China.In the absence of system services rendered by Russia to China,part of the RES power can be lost irreversibly.

As for the creation of an interstate power grid in NEA,the calculations,even for a limited interconnection(which considers technical constraints on the transmission of large amounts of power and constraints caused by energy security considerations of the power grid member countries),demonstrate the realization of system benefits.Based on the research,the system benefits from the interstate power grid formation in NEA would result in savings of above $ 24 billion per year in the costs of power grid operation and expansion(considering the costs of electric network infrastructure); above 65 GW for the installed generation capacities; above $77 billion of investment; and about $10 billion per year in fuel costs.A considerable share of the benefits falls on China and Japan.

For Japan,it is cost-effective to replace the expansion of its capacities by power import from China,Russia,and partly from South Korea.This would help decrease not only the expansion of its expensive installed capacities but also the power generation using expensive imported fuel,which would lead to a reduction in the import of hydrocarbon energy resources.China could reduce the expansion of generation capacities,and thus gain the capacity benefit within the interstate power grid.In this case,however,the power generated by the existing thermal power plants would increase,and it would be exported to Japan.

Russia’s role in the creation of system benefits from the interstate power grid is essential:in the event that Russia does not partake in the grid,the effectiveness losses of the NEA interstate power grid make up 30%-40%.

4 Proposals on the development of electric power cooperation in NEA

It is obvious that the implementation of a project for the interconnection of national power systems will foster the normalization of relations in the region.In particular,the power supply interdependence of North and South Korea will reduce tension between the two countries,which in turn meets the interests of other NEA countries that are concerned about the maintenance of stability in the Korean Peninsula.

The development of regional cooperation in the power industry requires governmental support for scientific and information exchanges between the institutions in NEA countries.Until now,the data on power systems of the countries in the region have been collected by scientists independently.In some rare cases,they manage to agree on mutual data exchange.However,as a rule,studies are performed based on generally accessible party incomplete data.It is important both to encourage the scientific exchange among institutions and to agree on performing joint studies and mutual data exchange at a higher,governmental level.A crucial step toward this direction was made by China; in 2016,China initiated the creation of the global energy interconnection development and cooperation organization(GEIDCO),which combines the efforts of hundreds of companies,institutions,and individuals undertaking the research on international interconnection projects.It is also important to establish active international cooperation between the governmental and academic organizations that are involved in long-term planning of the development of the power industry and the energy sector as a whole.

Based on the established international contacts and performed joint research studies,it is important to introduce a concept of providing all countries in the region with energy resources,and based on the concept,to prepare a document as a Charter.The expansion of the regional cooperation is impossible without standards and rules that regulate trade and multilateral cooperation and are recognized by all participants.Today,attempts to become a regional regulator have been made by an International(formerly,European)Energy Charter; however,it is yet to be seen whether the provisions can be easily accepted by all countries in the region.An alternative solution might be the establishment of independent regulating mechanisms on the basis of the same standards as those stipulated by the International Charter; however,with an obligatory adjustment to the regional specific features of the Asian market.The mutual understanding among the countries in the region can be confirmed not only by bilateral state agreements but also by international multilateral documents.Then,it will be easier to agree with countries such as Democratic People’s Republic of Korea,when they feel an important part in this movement and take part in the negotiations as equal partners.Thus,it is critically important to involve all countries in the region in the development of these documents,so that each country participating in the negotiations ensures that the final document meets their interests.The development of the concept of a new Energy Charter can involve not only the countries concerned but also the companies working in this region.

Further,for the development of this project,it is necessary to perform scientific studies aimed at an independent assessment of all proposed routes of the power grid,calculate benefits from its implementation,and fulfill the most effective projects.Additional research is required to determine the effectiveness of participation of each country in the interstate power grid,considering revenues from power export and from system services aimed at smoothing out the nonuniform power output of renewable power plants,to be rendered to the other member countries of the interstate power grid.Further,it is necessary to study the reliability of operation and the technical feasibility of the interstate electric ties and power grid,and the energy security of the countries connected to the power grid.Moreover,the creation of the interstate electric ties and power grid will require cutting-edge technologies for DC power transmission,intelligent control of electric power systems,and measurement and control devices,whose design and manufacture in NEA should be stimulated.Government support for further scientific research in this field is an important step to effectively implement the project.