Environmental Engineering Reference
In-Depth Information
2. The cost of the renewable portfolios just described would be unchanged if
biomass
(com-
bustible refuse and agricultural products) is co-fired with coal. The utility system would
then rely on renewables for over 90 percent of its energy.
3. A utility meeting 50 percent of its loads from intermittent renewable resources would
cost 10 percent more to operate than a system using intermittent sources for 30 percent of
its loads. At lower renewable energy penetration levels the actual increases in operating
costs are much less, typically below $5/MWh (See Table 4-10).
4. The three conclusions just described are based on the assumption of a 6 percent real dis-
count rate (which is typical of regulated utilities in industrialized nations) and equipment
costs that appear to be reasonable for the first quarter of the next century. If a 12 percent
real rate of return is used (or if all capital costs are increased by two-thirds) the annual
cost of operating the utility would be approximately 20 percent higher.
5. Generating equipment that is relatively small and can be located close to demand centers
can reduce transmission and distribution costs. This can reduce the annual operating cost
of a utility with 30 percent of its power from intermittent sources to well within 5 percent
of one using advanced fossil-fuel generators. Again, the discount rate is 6 percent.
6. Advanced gas turbines using natural gas as a fuel provide an excellent complement to
a utility portfolio that contains a significant percentage of renewable power sources.
These advanced turbines operate efficiently while following load variations and they can
be quickly added to and dropped from the line. Their relatively low cost makes them an
excellent way to satisfy near-term demand while a utility determines its best investment
strategy for the future.
7. Hydroelectric sites with large reservoirs also provide an excellent match for intermittent re-
newable technologies. The output of a hydroelectric system can be adjusted (within limits)
to fill in the production gaps caused by the intermittent nature of the renewable source.
8. Electric storage equipment is not needed to achieve the high levels of penetration by
intermittent renewable sources just described (
i.e.
, 30 percent to 50 percent). In fact, the
value of storage to a utility is decreased if wind, photovoltaic, or solar-thermal equip-
ment is added to a utility system.
It is important to recognize that these evaluations were made under the assumption that utili-
ties are free to optimize their investments to minimize costs based on new investments. No
attempt was made to develop a detailed schedule of plant additions and retirements.
Grid Interconnection
Wind power stations are dispatched and operated like other electricity generating plants.
As such, transmission grid connection, line capacity, access priority, and operations are util-
ity issues that must be addressed. When the wind blows, the station feeds electricity to the
grid, so other generating plants can be curtailed or throttled back. Improved forecasting of
the output from a wind power plant and distributing wind turbines over a large geographic
area help to minimize the potential impact on the utility system. Grid integration studies have
concluded that large-scale wind deployment does not have negative impacts at penetration
levels up to 25 percent energy and 35 percent capacity [IEEE 2007]. The
New York State
Energy Research and Development Authority
(NYSERDA) supported analysis of potential im-
pacts on the existing grid system and concluded, “New York Bulk Power System can reliably
accommodate at least 10 percent penetration, 3,300 MW of wind generation with only minor
adjustments to its existing planning, operational and reliability practices” [Piwko 2005].
The cost of connecting wind plants (and any other renewable power source) to the grid
is an issue that can be solved in several ways. In the United States, some states have estab-
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