Renewable energy and the National Electricity Market: Issues & Challenges© CEEM, 23 November 2005

Integrating renewable energy in the NEM: Technical issues

2Integrating renewable energy in the NEM: technical issues © CEEM 2005

OutlineWind energy as intermittent generationIntermittent generation- definition & issuesTrends in wind farm installations in AustraliaNetwork-related issues:– Connection & security issues

Power variability issues– Forecasting, ancillary services & power system security

3Integrating renewable energy in the NEM: technical issues © CEEM 2005

Energy service delivery in the stationary energy sector

Primaryenergyformse.g:

coal, gas, nuclear,

renewable

energy losses & external impacts

generation transmission distribution

The electricity supply industryend-use

equipment delivering

energy serviceseg: light,

heat,motivepower

transmission distributiontreatment

The natural gas supply industry

Energy service companies focus on end-use options, eg:efficiency, CHP, solar

Equipment providers

4Integrating renewable energy in the NEM: technical issues © CEEM 2005

Key issues for the electricity industryPart of the stationary energy sector:– In competition with other energy vectors to deliver

end-use energy servicesSignificant externalities:– Environmental (eg climate change)– Social (eg “essential good”)

Characteristics of electrical energy:– A high quality, secondary energy form:

Expensive to make but easy to use

– Flows at the speed of light from generators through the network to end-use equipment:

Can be difficult to maintain continuous energy flow

5Integrating renewable energy in the NEM: technical issues © CEEM 2005

Specific properties of electrical energy:– No cost-effective storage of AC electricity– Instantaneous transmission & distribution– Energy flows according to network laws:

From all generators to all consumers

Implications:– Supply & demand balance physically at all times:

A flow industry that benefits from active demand-side participation

– Electrical continuum - power station to end-useCannot assign energy from a particular power station to a particular consumer:

– ‘pool’ rather than ‘bilateral’ physical trade

– Wholesale & retail trading activities not easily separated

6Integrating renewable energy in the NEM: technical issues © CEEM 2005

An electricity trading framework

transmissionnetwork

distributionnetwork

Interchange to other

wholesale market regions

WholesaleMarket region

distributionnetwork

distributionnetwork Retail

Market 3RetailMarket 1

Retail Market 2large consumer

• Wholesale & retail market designs should be compatible• Both should include network models

Primary energy markets

• Small consumers, embedded generators & storage should be supported by energy service advisers

risks to end-useenergy service

delivery

most consumers

large generators

embedded generators

7Integrating renewable energy in the NEM: technical issues © CEEM 2005

Australian wind resource(Estimate of background wind (m/s) – AGO)

8Integrating renewable energy in the NEM: technical issues © CEEM 2005

Comparing AusWEA prediction (www.auswea.com.au)& readily acceptable (RA) wind capacity for Australia (www.ceem.unsw.edu.au)

8900500500(?)500220031002100RA MW

2240160280127029621713Total MW

1370402157201922000ApprovedMW

870120675501041713Inst MW

AusWATasSAVicNSWQld

9Integrating renewable energy in the NEM: technical issues © CEEM 2005

Wind penetration in SA & Eleswhere

10Integrating renewable energy in the NEM: technical issues © CEEM 2005

Physical context for wind - power system integration (photo courtesy AusWEA)

Shared,distributed,time-varying,non-storablewind energyflux

Independentlyowned wind farms

Sharedelectricitynetwork

&Powerstationsof other

types

End-useequipmentproviding

energyservices

11Integrating renewable energy in the NEM: technical issues © CEEM 2005

Key issues for wind energy integrationPhysical complexity:– Shared, non-storable, time-varying wind energy flux– Shared, non-storable, time-varying electrical energy flow

Commercial complexity:– Electricity industry infused with short- to long-term risks that are

difficult to commercialise (correctly allocate to industry participants)

Institutional complexity:– Shared issues in wind farm approvals, grid connection &

management of power system security

High wind energy penetration tests design adequacy of electricity industry restructuring

12Integrating renewable energy in the NEM: technical issues © CEEM 2005

Illustration of complexity: managing supply-demand balance in the electricity industry

Frequency is a measure of supply-demand balance:– always varying due to fluctuations in the power flows

associated with particular devices– Wind energy is only one of many fluctuating power flows

Thermalpower stations

Wind farms

Hydrogenerators

Industrial

Commercial

Residential

Generator input power Load electrical powerplus network losses

+ _

13Integrating renewable energy in the NEM: technical issues © CEEM 2005

Demand forecast errorsSouth Australia,2004 Q4 (NECA, 04Q4 Stats, 2005)

14Integrating renewable energy in the NEM: technical issues © CEEM 2005

Timeline for electricity trading in NEM(requires locational detail & active demand-side participation)

Financial instrument (derivative) trading &

spot market projections

ancillary service“actuation markets”

for period tforward-looking ancillary service

(AS) “acquisition markets” & security assessment

ancillary service“actuation markets”

for period t+1

Spot marketfor period t

Spot marketfor period t+1

time

spotperiod t

spotperiod t+1

uncertainty increases looking forward

Physical issues(centralised)

Commercial issues(decentralised)

15Integrating renewable energy in the NEM: technical issues © CEEM 2005

Dispatch, Pre-dispatch, PASA, SOO & ANTS(source: NEMMCO)

0 day 1 day 2 week 1 month 1 year 1 year 2

Medium Term PASA (2 yr, daily peak)

Pre-dispatch, re-bid & final dispatch schedule

Short Term PASA (7 days, 30 min res, 2hr update)

SOO & ANTS (10 yr)

• ST & MT Projected Assessment of System Adequacy support reserve assessment & participant operating decisions. ST PASA projects region demand & reserve for 7 days @ 30 min resolution, updated every 2 hours. MT PASA projects region daily peak demand & reserve for 2 yrs, updated weekly.

• Statement of Opportunities (SOO) & Annual National Transmission Statement (ANTS) are intended to inform generation, demand & network investment decisions (10 year horizon, issued annually)

16Integrating renewable energy in the NEM: technical issues © CEEM 2005

Managing variability in supply or demand

Commitment of slow-start plant1-2 days

Commitment of fast-start plant10-300 min

Central dispatch & spot pricing process5-10 min

Ancillary services< 5 min

Voltage & frequency perturbations moderated by system inertia & passive damping

<4 sec

Issue Time period

17Integrating renewable energy in the NEM: technical issues © CEEM 2005

Predicted 1% probability change in output for 1000 MW wind in SA (www.esipc.sa.gov.au)

18Integrating renewable energy in the NEM: technical issues © CEEM 2005

Simulated 6-day dispatch of gen’n in SA with 1000 MW of wind (www.esipc.sa.gov.au)

19Integrating renewable energy in the NEM: technical issues © CEEM 2005

NEMMCO concerns about wind energy (NEMMCO, 2003)

Frequency control in normal operation:– Frequency regulating service costs ~5 $/MWH

Security control - largest single contingency– Will wind farms ride-through disturbances?– Adequacy of wind farm dynamic models

Interconnection flow fluctuations:– Exceeding flow limit may cause high spot price

Forecast errors due to wind resource uncertainty:– Five minute dispatch forecast (spot price)– Pre-dispatch & longer term (PASA & SOO) forecasts

20Integrating renewable energy in the NEM: technical issues © CEEM 2005

Western Power’s proposed wind penalty charge (c/kWh) (Western Power, 2002)

21Integrating renewable energy in the NEM: technical issues © CEEM 2005

Wind energy as intermittent generation

Renewable energy fluxes are time-varying:– Solar, wind, hydro (tidal), biomass, geothermal, wave

Wind & solar are non-storable:– Can be described as intermittent

22Integrating renewable energy in the NEM: technical issues © CEEM 2005

Intermittent generation (NER)National Electricity Rules (NER) definition of intermittent generation:– “A generating unit whose output is not readily

predictable, including, without limitation, solar generators, wave turbine generators, wind turbine generators and hydro generators without any material storage capability”

Issues identified by NEMMCO:– Forecasting & reserves; frequency control ancillary

services (FCAS); voltage control; management of network flows; modelling & security assessment

23Integrating renewable energy in the NEM: technical issues © CEEM 2005

Network issues for wind farms #1Networks are shared, centrally planned resources:– Must limit network disturbances caused by wind farms– Wind farms must survive disturbances from the network

Renewable resources are often distributed differently from fossil fuel resources:– Weak network conditions likely to be more common in

Australia & New Zealand than Europe or North AmericaNetwork must be built to carry peak flows:– Want good estimates of aggregation & seasonal effects

Benefits of staged development of wind resources:– Network savings; reduced voltage & frequency impacts

24Integrating renewable energy in the NEM: technical issues © CEEM 2005

Network issues for wind farms #2Wind turbine starting & stopping transients:– Severity can be alleviated by soft-start &

high wind-speed power-managementSome wind turbine designs:– May cause voltage distortions:

Harmonics &/or transients

– May have poor power factor, eg:Uncompensated induction generator

– May not ride-through system disturbancesTemporary voltage or frequency excursions

25Integrating renewable energy in the NEM: technical issues © CEEM 2005

Wind turbine type comparison(Slootweg & Kling, 2003, http://local.iee.org/ireland/Senior/Wind%20Event.htm)

26Integrating renewable energy in the NEM: technical issues © CEEM 2005

Size of wind turbines used by Western Power (www.wpc.com.au)

27Integrating renewable energy in the NEM: technical issues © CEEM 2005

Wind turbine starting transients for Esperance 2 MW wind farm 9 x 225 kW turbines with squirrel cage IGMagnetisation inrush current may cause a voltage dip - starts should be spaced out

(Rosser, 1995)

28Integrating renewable energy in the NEM: technical issues © CEEM 2005

Network connection issues & examplesApproximate ability of a transmission line to accept a wind farm:– 66kV ≤ 30MVA– 132kV ≤ 100MVA– 330kV ≤ 200MVA– Constraints may be determined by several factors:

Thermal, voltage, fault clearance, quality of supplyThermal ratings depend on line temperature & wind speed

Relevant wind farm rating is its maximum output, not the sum of turbine rated powers:– Coincident output of the connected wind turbines

29Integrating renewable energy in the NEM: technical issues © CEEM 2005

ConclusionsIntermittent generation:– Brings new challenges for electricity industry

restructuring (technical, market design, regulation)– Separate category only appropriate for small

penetrationsWind energy:– The first significant form of “intermittent generation”– Network connection issues:

Often distributed differently to traditional resources

– Forecasting & system security issuesRegional, rather than project specific