Status: Submitted
Citation: Bistline, J. E. 2016. Technical and Economic Challenges of Flexible Operations under Large-Scale Renewable Deployment. Submitted to NATURE ENERGY.
Existing studies assessing large-scale integration of wind and solar power generation resources offer conflicting claims about the economic competitiveness of renewable technologies and the appropriate methods to quantify their economic value. This research presents a new innovative framework to estimate the economic value of intermittent capacity, and illustrates how these evaluations depend on the level of renewable deployment, regional resource endowments, generation fleet flexibility, and assumptions about regional electricity trade. To assess the technical and economic impacts of renewable resource integration simultaneously, this research uses a novel modeling platform that links electric sector investments and detailed market operations in EPRI’s US-REGEN framework. The analysis focuses specifically on California and Texas, two states with extensive renewable deployment, but with different policy contexts and technological options. These scenario comparisons elucidate shared challenges and best practices while systematically quantifying the relative importance of factors influencing large-scale renewable integration.
Model results indicate fleet operational constraints affect integration costs, but that the spatial and temporal variability of wind and solar resources play larger roles the resulting economic value of renewables. Restrictions on transmission and regional coordination in capacity planning and dispatch increase costs, which highlights the significance of market design and trade in regional markets. Bulk energy storage is shown to be a valuable balancing asset when renewable penetration levels are high, but the potential revenues from price arbitrage diminish rapidly with increased storage deployment.
Overall, the analysis demonstrates a replicable approach to assess the technical and economic challenges of flexible operations, and to evaluate the robustness of investments under alternate assumptions about fleet flexibility, renewable deployment, trade opportunities, and storage availability. These comparative insights provide more confidence that the challenges and opportunities associated with energy system transformations can be managed proactively using state-of-the-art simulation models.
Link to Publication: Nature Energy.