Integrating electricity and natural gas planning: linking models and assessment of reciprocal effects

The deployment of Renewable Energy Resources (RES) is affecting the profitability and scheduling of conventional generators (e.g. gas-fired power plants) as well as creating short-term electricity balancing problems. To manage RES variable output, additional flexible power capacity will be needed to cope with peak demand. Gas power plants ability to provide flexibility in a short time period make them especially suitable for fast balancing. Could gas power plants compensate RES fluctuations without creating instability in the gas transmission network? How investments on the gas infrastructure affects the evolution of the electricity sector and vice-versa? To answer these questions and jointly represent electricity-gas energy sectors, this paper presents 1) a methodology on combining cost based optimization models for gas and electricity and 2) the effects of long-term policy targets set to the EU electricity sector and its influence on the gas infrastructure. To address long-term (strategic investments) and short-term (operational) aspects, we model both sectors as multi-horizon stochastic programs. Models results illustrate a strong dependency of the electricity infrastructure on the short-term operations of the gas sector. Under a high RES deployment scenario, gas infrastructure investments declines slightly which increases cross-border electricity capacity needs.