A Utility Perspective of Wind Energy - Wind Turbine Technology: Fundamental Concepts of Wind Turbine Engineering - page 731

transmission operator (RTO) economic dispatch decision making. However, the trend is
for regulators to factor these considerations into Renewable Portfolio Standards (RPS), Re-
newable Energy Credits and Carbon Cap and Trade mechanisms that are discussed in more
detail in Chapter 4. Examples of indirect benefits of wind generation are as follows:
-- reduced use of large quantities of cooling water in fossil fuel plants
-- reduced water pollution from feed water additives
-- reduced atmospheric emissions of carbon, mercury, and other pollutants
-- reduced removal of mountain tops and other impacts of coal and uranium mining
-- reduced water contamination from coal washing
-- reduced security vulnerability through disbursed generation
Selecting an Energy Portfolio
Electricity can be produced from renewable resources in many different ways. This
diversity of options means that most parts of the world have at least one renewable resource
that can be used to generate electricity at competitive prices. But diversity frustrates a simple
assessment of value. Techniques used to evaluate traditional utility investments do not work
well when applied to renewable equipment whose value depends heavily on details of local
conditions, such as
-- local wind or sunlight resources
-- hourly patterns of electric demand in the region
-- characteristics of other equipment operating in the local utility system, such as fuel
costs and atmospheric emissions.
Existing evaluation techniques, however, are also inadequate for evaluating many other
areas open for utility investment. In addition to investments in renewable electric generation
equipment, future utility portfolios are also expected to include interacting investments in
-- thermal generating equipment with characteristics substantially different from those
in place today
-- electric storage systems
-- advanced transmission and distribution systems
-- advanced control systems
In an attempt to better understand these interacting investments, planners at PG&E ana-
lyzed a variety of investment portfolios, concentrating on one simple measure of portfolio
value: the annual cost of meeting the demand for electric service in the utility's region if the
utility receives a fixed rate of return on its capital investments. This measure forces attention
to the complex interactions between different kinds of utility equipment. For simplicity, it
was assumed in this analysis that all cost-effective measures for improving the energy ef-
ficiency of each type of generating equipment had already been taken. Some of the results
of this study for a summer-peaking utility like PG&E are as follows [Weinberg and Kelley
1993]:
1. Utility portfolios that rely on intermittent renewable sources for 30 percent of their elec-
tricity can serve loads at lower costs than utilities using typical new equipment and at
costs about 5 percent higher than those achievable using advanced coal and gas produc-
tion equipment now in development.