The future - Wind Power Integration: Connection and System Operational Aspects - page 263

8.5 Supply diversity

Power system operators prefer a mix of generation technologies, even if a particular
source may be the cheapest at a particular time. If no one fuel is pre-dominant, the
market and the underlying system is better able to cope with price shocks.
Renewable generation from wind can mitigate market dominance and reduce
electricity price. It was argued in Chapter 5 that the contribution from wind energy
cannot exceed its capacity factor without curtailment or significant extra transmis-
sion. If the capacity factor of wind and equivalent renewable generation that cannot
be dispatched is assumed to be around 30 per cent, then that would be a plausible
target that also enhances supply diversity. The inflexibility of traditional nuclear
power would reduce the headroom for renewable generation. On the other hand,
significant hydro-power capacity would counterbalance the loss of base load. A
generation mix of, say, 20 per cent nuclear, 20 per cent wind and equivalent, 30 per
cent gas, 20 per cent coal and 10 per cent hydro could deliver electricity reliably and
with low CO 2 emissions. Consumers would pay a modest premium for fuel security
as well as an electricity sector that is 50 per cent 'green'. The de-carbonisation
process could be extended by replacing some coal with biomass generation. New
fossil-fuelled generation may employ carbon capture and storage, providing the
flexible generation that all electricity supply systems need.
It is often argued that the cost of de-carbonisation will damage competitive-
ness: countries which ignore the risk of climate change will continue to commission
coal-fired generation, and manufacturing will gravitate towards them. The prime
example is China. However, China now leads the world in wind power deployment,
with over 60 GW installed, as well as investing heavily in nuclear power. Air-quality
has become a concern in its major cities. Improved living standards will enable
China to accept a modest increase in energy cost to pay for a cleaner environment.
Wind energy can and should play a major role in delivering cleaner electricity.
The cost can be modest provided extreme solutions, such as mass energy storage
and interconnection, are avoided. It will need to co-exist with other renewable
sources and probably with nuclear power. It is important to realise that fossil-
fuelled generation will be needed for the foreseeable future to provide flexibility.
The development of shale gas may enable gas to replace coal as the world's main
fuel for electricity generation, as has already happened in the United States. That
would halve CO 2 emissions (Helm, 2012). Provided wind energy is developed
rationally, with respect for economic principles as well as the environment, it can
generate 20-30 per cent of electricity in many developed countries at modest cost.
Apart from a significant reduction in CO 2 emissions, a strong wind energy sector
can improve security of supply and help stabilise electricity costs.