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Balancing Act: PNNL Study Featured in Bulk Power Systems Book

Consolidation of balancing authorities could result in economic and regulatory efficiencies

September 2017
Balancing Act: PNNL Study Featured in Bulk Power Systems Book

A PNNL research team deployed a detailed model and methodology to demonstrate the benefits of consolidating balancing authorities, which could lead to improved balance of energy load and generation.

A recent study by PNNL researchers is part of a new book about integrating renewable energy in bulk power systems.

The study, “Balancing Authority Cooperation Concepts to Reduce Variable Generation Integration Costs in the Western Interconnection: Consolidating Balancing Authorities and Sharing Balancing Reserves,” was published as Chapter 6 in the book Integration of Large-Scale Renewable Energy into Bulk Storage Systems.

Avoiding the Dark

Solar and wind power is affordable and infinite, but also intermittent. As these renewable energy sources increasingly penetrate the power grid, grid operators must be continuously nimble in adjusting operating parameters, as an imbalance of electricity demand (load) and supply (generation) can have repercussions such as widespread blackouts.

This challenge is pervasive especially in large interconnected power systems, such as the Western Interconnection, which stretches from western Canada to Baja California in Mexico and reaches eastward to the Great Plains. Such systems are typically operated by a network of individual balancing authorities who are tasked to make sure that electricity generation, transmission, and distribution systems work reliably within their regions. But, at times balancing authorities find their energy resources limited due to variability of renewable energy. This forces the balancing authority to seek more expensive energy resources to maintain balance of load and generation, or even run out of resources.

Making the Case for Consolidation

The Western Electricity Coordinating Council—responsible for bulk electric system reliability—has been exploring issues surrounding integration of variable generation resources such as wind and solar into the Western Interconnection. PNNL has supported WECC’s effort by developing and deploying a detailed model and methodology to demonstrate the benefits of consolidating balancing authorities—which would result in the ability for neighboring balancing authorities to access and use spare energy resources to manage variations in power. In particular, the team investigated savings in both energy production costs and balancing reserve requirements within the WECC system.

The study assumed two different scenarios of variable generation penetration: 11 percent (8 percent wind and 3 percent solar), and 33 percent (24 percent wind and 9 percent solar) of WECC projected energy demand in 2020. The team used projections from a WECC Transmission Expansion Planning Policy Committee 2020 case to obtain load, wind and solar data as well as hydropower plant, thermal generation, and transmission modeling data and applied that data to three simulated scenarios:

  • Scenario 1: today’s balancing authority structure;
  • Scenario 2: full balancing authority consolidation with the transmission system having infinite capability; and
  • Scenario 3: full balancing authority consolidation with transmission system constraints, such as thermal and security constraints.

Results of the study indicate that diversity of electricity load and renewable generation over a wide area, versus with individual balancing authorities, can result in significant savings as well as smaller reserve requirements, widespread use of inexpensive power resources, and fewer load and renewable resource forecasting errors.

In the 11 percent variable generation penetration case, the study found that annual production cost savings by consolidating balancing authorities (Scenario 3) ranges from $440 million and $610 million, depending on the balancing authority simulation scenario. In addition, Scenario 2 results in an extra savings of $240 million per year.

In the 33 percent case, annual production cost savings by consolidating balancing authorities range from $442 million to $636 million (Scenario 3), with another $980 million in savings achieved in Scenario 2 due to lower curtailment of renewable generation.

The results from the study also show evidence that consolidation can achieve significant savings in regulation and load-following requirements, such as increased ramping—the ability to start and stop energy output on demand—and duration of ramping. Outcomes in this study represent an upper bound of potential benefits of balancing authority cooperation and provide the evidence needed to motivate cooperation to enable higher levels of renewable penetration without significant costs due to integration. Partial benefits can be achieved by other forms of balancing authority cooperation, such as the implementation of an Energy Imbalance Market—a real-time energy supply market that offers electricity generation and transmission services.

This research is based on work funded by the DOE Office of Energy Efficiency and Renewable Energy Wind Program and the DOE Office of Electricity Delivery and Energy Reliability Advanced Grid Modeling Program.

The book is available for purchase on the Springer website.

PNNL Research Team: Nader Samaan, Yuri Makarov, Tony Nguyen, and Ruisheng Diao

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