  The resource quality and the temporal generation pattern of variable
renewable energy sources vary significantly across Europe. In this paper
spatial distributions of renewable assets are explored which exploit this
heterogeneity to lower the total system costs for a high level of renewable
electricity in Europe. Several intuitive heuristic algorithms, optimal
portfolio theory and a local search algorithm are used to find optimal
distributions of renewable generation capacities that minimise the total costs
of backup, transmission and renewable capacity simultaneously. Using current
cost projections, an optimal heterogeneous distribution favours onshore wind,
particularly in countries bordering the North Sea, which results in average
electricity costs that are up to 11% lower than for a homogeneous reference
distribution of renewables proportional to each country's mean load. The
reduction becomes even larger, namely 18%, once the transmission capacities are
put to zero in the homogeneous reference distribution. Heuristic algorithms to
distribute renewable capacity based on each country's wind and solar capacity
factors are shown to provide a satisfactory approximation to fully optimised
renewable distributions, while maintaining the benefits of transparency and
comprehensibility. The sensitivities of the results to changing costs of solar
generation and gas supply as well as to the possible cross-sectoral usage of
unavoidable curtailment energy are also examined.
