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The cost of decoupled planning: Co-optimising transmission, batteries and hydrogen under demand-side participation in a European power system

E. F. Álvarez, L. Olmos, A. Ramos

Sustainable Energy, Grids and Networks Vol. 48, pp. 102550

Summary:

High shares of renewable energy sources require transmission expansion planning (TEP) to account for flexibility resources that substitute for lines. This paper quantifies the cost of planning those resources separately from the network. National and cross-border transmission, battery energy storage systems (BESS) and hydrogen (H2) subsystems are co-optimised across 15 pathways and 12 scenarios on an 84-node European network, with demand-side management (DSM) at three participation levels and a fixed generation fleet. Storage and transmission substitute for one another in 45 of 48 paired comparisons, and in every one where national lines can be built: BESS reduce annualised network investment by a median of 3.5–7.8% and grid capacity needs by up to 12.4%, and hydrogen by at most 1.3%. The transmission scope reverses the curtailment effect of hydrogen: the H2 turbine reduces curtailment in all 24 comparisons restricted to cross-border lines and increases it in 22 of 24 comparisons that admit national lines. Physical and economic criteria rank storage technologies in opposite orders. Pathways without BESS require 5.4 times more grid capacity per unit of storage, whereas hydrogen returns 62–73% against 13–17% for BESS, excluding avoided scarcity costs; on the same basis, cross-border lines return 31% and national lines 56%. Planning storage and transmission separately costs 0.18–1.67% of annual system cost. DSM improves adequacy and defers capital without lowering operating cost: investment falls by 5.8–10.7% while the cost of building and operating the system rises by 1.2–4.6%. National reinforcement, not cross-border lines, serves all demand; without it, 5–24 TWh/year are unserved.


Keywords: Demand-side management; Energy storage systems; Hydrogen subsystems; Flexibility resources; Transmission expansion planning; Storage co-optimisation


JCR-JIF Impact Factor and WoS quartile: 5,700 - Q1 (2025)

DOI reference: DOI icon https://doi.org/10.1016/j.segan.2026.102550

Published on paper: December 2026.

Published on-line: October 2026.



Citation:
E. F. Álvarez, L. Olmos, A. Ramos, "The cost of decoupled planning: Co-optimising transmission, batteries and hydrogen under demand-side participation in a European power system", Sustainable Energy, Grids and Networks, Vol. 48, pp. 102550, December 2026. [Online: October 2026] doi: 10.1016/j.segan.2026.102550

    Research groups:
  • Instituto de Investigación Tecnológica (IIT)