Design and operation of power systems with large amounts of wind power: State-of-the-art report

High penetration of wind power has impacts that have to be managed through proper plant interconnection, integration, transmission planning, and system and market operations. This report is a summary of case studies addressing concerns about the impact of wind power's variability and uncertainty on power system reliability and costs. The case studies summarized in this report are not easy to compare due to different methodology and data used, as well as different assumptions on the interconnection capacity available. Integration costs of wind power need to be compared to something, like the production costs or market value of wind power, or integration cost of other production forms. There is also benefit when adding wind power to power systems: it reduces the total operating costs and emissions as wind replaces fossil fuels. Several issues that impact on the amount of wind power that can be integrated have been identified. Large balancing areas and aggregation benefits of large areas help in reducing the variability and forecast errors of wind power as well as help in pooling more cost effective balancing resources. System operation and working electricity markets at less than day-ahead time scales help reduce forecast errors of wind power. Transmission is the key to aggregation benefits, electricity markets and larger balancing areas. From the investigated studies it follows that at wind penetrations of up to 20% of gross demand (energy), system operating cost increases arising from wind variability and uncertainty amounted to about 1-4 /MWh. This is 10% or less of the wholesale value of the wind energy. With current technology, wind power plants can be designed to meet industry expectations such as riding through voltage dips, supplying reactive power to the system, controlling terminal voltage, and participating in system operation with output and ramp rate control. The cost of grid reinforcements due to wind power is very dependent on where the wind power plants are located relative to load and grid infrastructure. The grid reinforcement costs from studies in this report vary from 50 /kW to 160 /kW. The costs are not continuous; there can be single very high cost reinforcements, and there can also be differences in how the costs are allocated to wind power. Wind generation will also provide some additional load carrying capability to meet forecasted increases in system demand. This contribution can be up to 40% of installed capacity if wind power production at times of high load is high, and down to 5% in higher penetrations and if local wind characteristics correlate negatively with the system load profile. Aggregating larger areas benefits the capacity credit of wind power. State-of-the-art best practices so far include (i) capturing the smoothed out variability of wind power production time series for the geographic diversity assumed and utilising wind forecasting best practice for the uncertainty of wind power production (ii) examining wind variation in combination with load variations, coupled with actual historic utility load and load forecasts (iii) capturing system characteristics and response through operational simulations and modelling and (iv) examining actual costs independent of tariff design structure.