Evaluating the Cost of Renewable Energy Integration

Intertek has extensive knowledge and insights into the challenges of adding variable alternative energy generation resources to the electric grid.

With more than 20 years of experience studying the cost of cycling of power plants, Intertek is ready to provide solutions posed by the addition of renewable energy to the electrical grid.

Wind and Solar renewable generation adds variability to the electric grid requiring back up generation from traditional coal, gas, or nuclear power to provide reliable around the clock electric service.  In 2009, the U.S. added 10GW in Wind power capacity with about $20 billion in investments. This pace of growing renewable energy is going to continue for several years. State and Federal mandates, Renewable Portfolio Standards (RPS), the Smart Grid and the growing need for energy will ensure increased investments in renewable generation, adding unique new challenges for utilities, regulators, policy makers and the end consumers.

While the value of renewable energy resources is well understood, the strain of the variability of these resources on system planning is still being researched. Regulators and utilities alike are running several present day and future scenario cases to understand the cost associated with these resources to ensure system reliability. Intertek seeks to assist our clients in determining the “true” costs of cycling that the traditional non renewable, thermal resources are subjected to, due to the variable nature of renewable resources like wind and solar.

Wind & Solar Integration - Understanding the Costs

With its vast experience, proprietary tools, services and resources Intertek provides an integrated solution to evaluate the cost of cycling of traditional non renewable energy resources. We assist regulators in developing rate cases and developing policy decisions as well as help utilities in their integrated resource plans and in evaluating their capacity expansion plans – renewable or thermal. We assist decision makers in understanding true costs of their resource technology mix by evaluating the economic value of small/large hydro, pump storage units, energy storage units in combination with traditional thermal energy resources.

Wind and Solar are non-dispatchable resources and their variability will cause increased cycling for almost all traditional resources from base loaded coal units to intermediate and possibly peaking gas units. It is common to see power plants, built for base loaded operation, now running in cycling mode (load following) with steep ramp rates and on/off cycling. Moreover, current dispatch systems with a growing mix of variable generation resources are not-optimized in terms of minimizing steady state heat rates and realizing long-term costs of operation. Not determining these true costs to cycle will likely result in the operator bidding the incorrect marginal unit, directly impacting the operating revenues of the power plant owner.

Reliability is also an issue because increased cycle results in more component failures at the power plant and long downtimes. Intertek assists our clients in determining not only increases in the cost of operation (due to ramping and start/stop cycling), but also the increases in cost of maintenance, cost of capital maintenance, and cost of forced outage and derate effects and the cost of long term heat rate effects. This thorough examination of operating costs results in understanding and implementing the true O&M costs associated with cycling of power plants.

Intertek’s proprietary unit commitment model - Cycling AdviserTM is capable of optimizing dispatch, using very small time intervals (minute by minute) to economically dispatch a power plant fleet. Our Cost Communication software COSTCOM® allows operators at the power plants to track and assess costs in the variable generation environment. Intertek also realizes the unique nature of different power plants and understands that the costs associated with cycling at one plant differ from the others. These costs are only increasing with the addition of variable generation and to underestimate the true costs of cycling can jeopardize both system reliability and future investments in renewable resources. Our approach and technical expertise has been recognized not only by regulators and utilities, but also by national laboratories which are at the cutting edge of evaluating and understanding the challenges the electric grid faces today and in the future.

 
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