HVDC Power Transmission Market Evolution: Electric Transmission Market for Grid Interconnection

The hvdc power transmission market is enabling cross-border power trading. Discover how the electric transmission market uses HVDC to connect asynchronous grids, improve energy security, and integrate renewable sources.

National electricity grids have historically been independent systems, operating at different frequencies and standards. But the growth of renewable energy and the need for energy security are driving grid interconnection. The hvdc power transmission market provides the technology to link these separate grids, allowing power to flow across borders. The broader electric transmission market is being reshaped by international interconnectors, regional supergrids, and the strategic value of sharing resources. This article focuses on the use of HVDC for grid interconnection and cross-border power exchange.

The Value of Interconnection

Connecting separate power systems offers several benefits:

• Energy security: If one region has a generation shortfall (due to a plant outage, drought affecting hydro, or low wind), power can be imported from a neighboring region.

• Renewable integration: When the sun is not shining in one region, it may be shining in another (e.g., East-West interconnection). Wind resources are also complementary over distance.

• Market efficiency: Power can flow from low-price regions to high-price regions, reducing average costs.

• Reduced reserve requirements: A larger, interconnected grid needs less spinning reserve (generators on standby) per unit of load.

• Balancing variable renewable energy: The statistical smoothing of wind and solar over a larger area reduces the need for storage and backup.

The hvdc power transmission market for interconnectors enables these benefits for systems that are not synchronized.

Asynchronous Interconnection via HVDC

AC grids can be connected via AC lines only if they operate at the same frequency and are in phase. If not, AC connection is impossible. HVDC solves this: it converts the AC of one grid to DC, then back to AC at the frequency and phase of the other grid. Thus, HVDC acts as an asynchronous interconnector, “firewalling” the two grids. Most cross-border interconnectors in Europe, Asia, and the Americas are HVDC. Examples:

• NorNed (Norway-Netherlands): 700 MW, ±450 kV, 580 km. Connects Norwegian hydro (flexible) to Dutch load (variable).

• BritNed (UK-Netherlands): 1,000 MW, ±450 kV.

• North Sea Link (Norway-UK): 1,400 MW, ±525 kV, 730 km. Longest submarine HVDC cable.

• East-West Interconnector (Ireland-UK): 500 MW.

• Baltic Cable (Sweden-Germany): 600 MW.

• Cross-Channel (UK-France): 2,000 MW (multiple cables).

• ElecLink (UK-France via Channel Tunnel): 1,000 MW.

The electric transmission market for European interconnectors has been active for decades and is expanding.

Europe’s Target: 15% Interconnection

The European Union aims for each member state to have at least 15% of its electricity generation capacity connected to neighboring countries via interconnectors. This “electricity interconnection target” is intended to integrate renewable energy and improve security. To achieve this, dozens of new HVDC interconnectors are planned. Major projects:

• COBRAcable (Denmark-Netherlands): 700 MW.

• Viking Link (Denmark-UK): 1,400 MW (completed 2023).

• Greenlink (Ireland-UK): 500 MW.

• Gridlink (France-UK) and other UK interconnectors.

• Germany-UK and other North Sea links.

The hvdc power transmission market for European interconnectors is very active, with a pipeline of 20+ GW by 2030.

Asia-Pacific Interconnections

Asia is also building cross-border HVDC links:

• Japan-Korea Interconnector: Proposed 2 GW link connecting Japan’s grid (50/60 Hz) to Korea’s 60 Hz.

• ASEAN Power Grid: A long-standing initiative to interconnect the 10 ASEAN countries. Several HVDC projects are under study, including a Malaysia-Sumatra link.

• China-South Korea subsea link under discussion.

• Bharat-Nepal-India interconnectors (though mostly AC).

The electric transmission market in Asia faces challenges: different national standards, geopolitical tensions, and financing. However, progress is being made.

North America Interconnections

North America has three major synchronous grids: the Eastern Interconnection, Western Interconnection, and Texas Interconnection. These are not synchronized with each other. HVDC interconnectors tie them together:

• Western-Eastern Interconnection links: Several back-to-back HVDC stations.

• Texas-New Mexico link (Tres Amigas): A proposed multi-terminal HVDC hub connecting the three grids (project slowed).

• Canada-US interconnectors: Several HVDC links, including the Québec-New England (2,000 MW) and Nelson River (Manitoba-Minnesota) lines.

The long distance power transmission market within North America also includes HVDC for moving power from remote hydro (e.g., Québec, Manitoba) to load centers.

Back-to-Back HVDC Stations

Where two AC grids meet at a common location (e.g., at a border substation), a back-to-back HVDC station can interconnect them without an HVDC transmission line. The two converters are placed in the same building, with the DC link extremely short. Back-to-back stations are used for asynchronous interconnection and for limiting fault currents. The hvdc power transmission market for back-to-back stations is smaller but steady, particularly in Japan (which has 50 Hz and 60 Hz zones within the country).

Multi-Terminal HVDC Grids

The next step beyond point-to-point interconnectors is the multi-terminal HVDC grid (or “supergrid”). A multi-terminal system has three or more converter stations connected to a common DC transmission line. This would allow power to flow between multiple points, like a DC overlay grid. Europe’s “North Sea Offshore Grid” concept is a multi-terminal HVDC system. Demonstration projects (e.g., Eurobar, DCFC2) have tested multi-terminal control. However, full-scale multi-terminal grids require:

• DC circuit breakers (to isolate faults); these have only recently become commercially available.

• Fast communication and control to coordinate multiple converters.

• Standardized voltage levels and control architectures.

The electric transmission market for multi-terminal HVDC is at an early stage but will grow.

HVDC for Renewable Energy Zones

Some countries are building “renewable energy zones” (REZs) with HVDC collection and transmission. For example, China has built multi-terminal HVDC systems to collect wind and solar from several plants and feed to a single converter station. India has “green energy corridors” using HVDC. The long distance power transmission market for REZs is expanding.

Economics: The Cost of Interconnection

The cost of an HVDC interconnector includes converter stations ($200-400 million per station) and cable or overhead line ($0.5-2 million per km). A 1,000 MW, 500 km subsea interconnector might cost $1.5-2.5 billion. The value is the ability to trade power across the link. Profitability depends on the difference in electricity prices between the two markets (the “spread”) and the utilization rate (hours per year at which power flows). Interconnector developers are typically transmission system operators (TSOs) or independent merchant developers. The hvdc power transmission market for merchant interconnectors is riskier but has been successful in some cases (e.g., NorNed).

Future Outlook: A Global Supergrid?

The ultimate vision is a global electricity grid linking continents via HVDC. For example, solar power from the Sahara could supply Europe; wind power from the North Sea could supply North Africa; and hydropower from the DRC could supply southern Africa. Intercontinental HVDC links have been proposed (e.g., North America-Asia via Bering Strait; Europe-Asia via Russia). The technical challenges are immense, but the potential benefits (renewable resource sharing, 24/7 solar by following the sun) are compelling. The electric transmission market is far from a global supergrid, but the first intercontinental HVDC links may appear by 2040.

Conclusion: Weaving a Stronger Grid

The hvdc power transmission market is the thread that is weaving the world’s grids together. Interconnectors enhance reliability, lower costs, and integrate renewable energy. As the share of variable renewables increases, the value of interconnection will only grow. For policymakers, promoting HVDC interconnectors is a no-regret strategy: they reduce emissions, improve security, and lower consumer bills. The electric transmission market for HVDC is the unsung hero of the energy transition. Explore hvdc power transmission market trends and global interconnection projects here.

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