Application of the Cost – Benefit Analysis to electrical interconnection projects

Abstract

This paper presents the methodology and the main results of the cost-benefit analysis (CBA by abbreviation) applied to a set of electrical interconnection projects within a huge project conducted by the Association the Mediterranean Transmission System Operators Med-TSO, from February 2015 to February 2018, through intensive cooperation of its members and with the collaboration of renowned consultancy firms. The study, designated by the name “The Mediterranean Project”, was funded by the European Commission and more specifically DG NEAR (The Directorate-General for Neighbourhood and Enlargement Negotiations) with the aim of supporting the assessment of electrical projects in the Mediterranean region in view to consolidating a secure and sustainable electricity infrastructure, with a focus on electricity interconnections and the integration of renewables in this region.After a short presentation of the Med-TSO Association, the paper gives an overview of the CBA methodology used in the study, based mainly on the methodology established by ENTSO-E (European Network of Transmission System Operators for Electricity) for the assessment of electricity projects in the European continent, but adapted to the Mediterranean context. A very large set of results are also presented, very briefly, after defining the energy scenarios for 2030 considered in the study. Thus, the CBA results, through many benefit indicators and other residual indicators as well as the cost indicator, will be presented for the fourteen interconnection projects examined and for the four energy scenarios considered.