Empowering Variable Renewables: Options for Flexible Electricity Systems
"Increasing the share of renewables in energy portfolios is a key tool in the drive to reduce anthropogenic carbon dioxide emissions, as well as other harmful environmental impacts of conventional energy production, as illustrated in the recently released IEA publication, Energy Technology Perspectives (ETP) 2008.
A number of renewable electricity technologies, such as wind, wave, tidal, solar, and run-of-river hydro share a characteristic that distinguishes them from conventional power plants: their output varies according to the availability of the resource. This is commonly perceived to be challenging at high shares, but there is no intrinsic, technical ceiling to variable renewables’ potential. Variability has to be looked at in the context of power system flexibility: if a power system is sufficiently flexible, in terms of power production, load management, interconnection and storage, the importance of the variability aspect is reduced.
A flexible electricity system is one that can respond reliably, and rapidly, to large fluctuations in supply and demand. Flexibility is already present in all power systems, in order to manage fluctuations in demand, and it is crucial for high performance and economic and reliable operation. Consequently, low shares of variable renewables will present little additional impact in all but the least flexible (often the smallest) power systems. With large additions of supply-side variability, as fluctuations in output approach the scale of fluctuations in demand, additional measures must be taken to increase flexibility, in order to maintain reliability.
The net variability in the combined output of many variable renewable electricity plants, based on different resources, at different locations over a wide area, is smoother than the output of individual power plants. This smoothing effect can be taken advantage of if the power plants are connected by adequate transmission capacity, and may reduce the need for additional system flexibility. The flexibility resource of any power system consists of a number of factors. On the supply side, chief among them are quickly dispatchable power plants, interconnection among adjacent power systems, and energy storage. However, a significant flexibility resource is also available on the demand side: changing the “shape” of demand to suit fluctuations in supply. This is as yet under-exploited. Both physical and market access to the flexibility resource are essential to increase the potential for variable renewables. In some countries, electricity is traded at shorter timescales relative to the traditional model of long-term bilateral contracts, through spot markets, and shorter gate closure times within such markets enable faster response to fluctuating supply and demand. An increasingly flexible approach to trading reduces the impact of forecast errors both in supply and demand, and increases access to the existing flexibility resource, reducing the need for additional fast response power plants, interconnection or storage.
Much of existing transmission hardware in OECD countries was built in the middle of the last century, and a new investment cycle is due. This is a rare window of opportunity to improve on their design, bringing benefit not only to variable renewables but to the whole power system. This improvement can be made at three different levels: optimising the use of existing capacity, intelligent network operation, and new transmission technologies. Modification of transmission systems is likely to be a very slow process, and planning needs to begin urgently if potential for additional variable renewables uptake is to be exploited.
The measures to increase flexibility proposed in this paper are available today, but careful cost/ benefit analysis is essential, and specific national and regional circumstances will influence the choice of option(s). Quantification of the associated costs of these measures, and resulting benefits in terms of variable renewable share, will be addressed in a further phase of work."