Lynch, M., O'Malley, M. and Tol, R. (2012). Optimal interconnection and renewable targets for Northwest Europe Energy Policy, 51:605--612.

We present a mixed-integer, linear programming model for determining optimal interconnection for a given level of renewable generation using a cost minimisation approach. Optimal interconnection and capacity investment decisions are determined under various targets for renewable penetration. The model is applied to a test system for eight regions in Northern Europe. It is found that considerations on the supply side dominate demand side considerations when determining optimal interconnection investment: interconnection is found to decrease generation capacity investment and total costs only when there is a target for renewable generation. Higher wind integration costs see a concentration of wind in high-wind regions with interconnection to other regions. {\textcopyright} 2012 Elsevier Ltd.