Integrating Wind Power into the Electric Power System

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Integrating Wind Power into the Electric Power
System
Ed DeMeo Renewable Energy Consulting Services,
Inc. Technical Advisor Utility Wind Integration
Group
Michigan Public Service Commission Wind
Forum April 25, 2007
Lansing, Michigan
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Key Integration Issues

• Costs (capital, energy, OM)
• Variability Impacts (ancillary services costs)
• Energy (fuel displacement) and Capacity (serving
  demand growth) Contributions
• Environmental Considerations

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Natural Gas Situation

• Todays tight natural gas markets have been a
  long time in coming, and distant futures prices
  suggest that we are not apt to return to earlier
  periods of relative abundance and low prices
  anytime soon.
• Alan Greenspan, Federal Reserve Chairman,
  Testimony at Senate hearing, July 10, 2003

Wellhead gas costs - 2002-2003 3 -
5/MMBTU Current prices and projections exceed
6/MMBTU
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Wind Energy Compared to Conventional Electricity
Generation

• Wind displaces natural gas primarily
• Wind energy costs 4 to 7/kWh total
• Gas fuel only costs 4 to 10/kWh today
• Wind costs stable fuel costs are not
• Wind - gas synergy save gas when wind blowing,
  burn gas when wind calm
• But winds variability complicates power-system
  operation
• Does wind variability compromise reliability?
• Will variability reduce winds value
  substantially?

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gas
7
wind
4
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Minnesota 25 Wind Energy Penetration Study (MN
DOC 2006)

• 3500 to 5700 MW of wind generation delivered to
  Minnesota customers (15 to 25 of retail electric
  energy sales in 2020)
• System Operating Cost Impacts
• Ranged from 0.21 to 0.44 per kWh of wind
• Includes all costs related to wind uncertainty
  and variability
• Similar results from 10 studies nationwide
• Impact generally less than 10 of wholesale value

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Range of System Operating Cost Impacts Studies
Conducted To Date
6 4 2 0
1/2 /kWh
Integration Cost (/MWh)
0 5 10 15 20 25 30
Wind Penetration ( of System Peak Load)
All results to date fall within the crosshatched
area
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Winds Contributions to Electric Power

• Energy displacement of fossil fuels
• In most cases, this is the primary motivation.
  Previously existing power plants run less, but
  continue to be available to ensure system
  reliability.
• Contrary to common lore, addition of a wind plant
  requires NO new conventional backup generation to
  maintain system reliability.
• In many cases, natural gas is saved, reducing
  total system operating costs. In all cases,
  overall emissions are reduced.

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• IEEE Power Engineering Society Magazine,
  November/December 2005
• Utility Wind Integration Group (UWIG) Operating
  Impacts and Integration Studies User Group
• www.uwig.org

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• UWIG Summary Key Points from IEEE Power
  Engineering Society Magazine, Nov/Dec 2005
• www.uwig.org

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Environmental Tradeoffs
We need to evaluate environmental impacts on a
relative basis. No energy-generation approach
is without impacts. The choice is wind vs.
something -- not wind vs. nothing.
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We cant lose sight of the larger benefits of
wind, says Audubon Washingtons Tim Cullinan.
The direct environmental impacts of wind get a
lot of attention, because there are dead bodies
on the ground. But nobody ever finds the bodies
of the birds killed by global warming, or by oil
drilling on the North Slope of Alaska. Theyre
out there, but we dont see them.
Audubon Magazine, September 2006 feature article
on wind power
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Environmental Benefits of Wind

• No emissions of any kind during operation
• No SOx, NOx, particulates or mercury
• No contributions to regional haze
• Hedge against environmental regulations
• No greenhouse gases
• No toxic wastes or health impacts
• Nuclear waste transport and storage unresolved
• Respiratory diseases of growing concern
• No water consumption or use during operation
• Water availability a looming crisis in the
  Western US

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Environmental Benefits of Wind

• Global climate change concerns can no longer be
  ignored by any legitimate political entity
• Most environmental scientists view this as by far
  the most serious environmental issue facing
  society
• Unavoidable evidence mounting
• Very few doubters remain
• Not many arrows in the quiver to address this
  concern
• We need them all
• Wind energy is one of them

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Paul Anderson, CEO of Duke Energy(Southeastern
Utility, Coal/Nuclear)

• Lobbying for tax on carbon dioxide emissions
• Personally, I feel the time has come to act - to
  take steps as a nation to reduce the carbon
  intensity of our economy. And its going to take
  all of us to do it.
• Paul Anderson, quoted in AP press release,
  published April 7, 2005

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The Climate Change Threat Is A Major Business
Opportunity

• Technologies to reduce CO2 emissions are needed
  worldwide
• Industries producing them will provide employment
  and profits
• Countries that produce them will enjoy export
  potential and trade-balance benefits
• Countries that do not may miss out on one of the
  21st Centurys best business opportunities

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Wind Contributions in Europe and the United
States (2006)
Generation Total (MW)
Wind of Electricity
Wind (MW)

• Germany
• Spain
• Ireland
• Denmark
• USA

85,000 50,000 5,500 4,200 900,000
22,000 11,600 600 3,100 11,300
7 8 6 30 0.6
Approximate values
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Contrasting Approaches to Accommodating Wind
Power in Europe and in the U.S.

• Europe Wind power is environmentally preferred.
  How can we best accommodate it within the
  existing power system?
• U.S. OK, well accept wind into the existing
  system, but it will follow our traditional rules
  and procedures.

A change in mindset is needed in the U.S. It
will not come from within the power sector, whose
responsibility is reliability, not change.
Change, and the incentives to enable it, must
originate in the policy sector.
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Bottom Line on Wind Power
Wind power is a very low carbon, affordable,
domestic energy source It can make a large
contribution to the US economy -- 20 of
electricity and more As a responsible society, we
need to use it -- and use our ingenuity to
resolve the tactical issues it presents