Analysis of Forecasting and Scheduling of Wind Power for … Walia... · Analysis of Forecasting...

Summer Internship Report

On

Analysis of Forecasting and Scheduling of Wind Power for Grid

Integration in U.S.A. and Europe alongwith the comparison with the

Indian Power Market.

Under the guidance of

Mr. Amit Mittal (AGM)

ICRA Management Consulting Services Ltd

Submitted by

Kriti Walia

Roll No. 39, Batch 2012-14

MBA (POWER MANAGEMENT)

NATIONAL POWER TRAINING INSTITUTE

Affiliated to

Analysis of Forecasting and Scheduling of Wind Power for Grid Integration in

U.S.A. and Europe alongwith the comparison with the Indian Power Market. 2013

2 National Power Training Institute (NPTI) | ICRA Management Consulting Services Ltd (IMaCS)

TRAINING COMPLETION CERTIFICATE




ACKNOWLEDGEMENT

The projects done by me under this internship program would not have been completed, if not for

the active help and guidance of various people.

I express my sincere thanks to Mr. Amit Mittal (AGM), IMaCS and Mr. Sunil Varma Marri

(Head – Energy Sector), IMaCS for giving me a great opportunity to work in such a dynamic

organization and for guiding me in all stages of the project. I am thankful to Mr. Santosh Singh

and Mr. Himanshu Chawla, IMaCS for their guidance and support. I have a deep sense of

gratitude and respect for the entire staff of IMaCS for sharing their knowledge and for assisting

me.

I am indebted to Mr. S K Choudhary (Principal Director), CAMPS and the entire faculty in

CAMPS for arranging the internship and for the assistance provided in various stages of

internship. As a student, I thank you for the knowledge and values which you have imparted to

me. As a citizen, I thank you for the service you are rendering to this Nation.




DECLARATION

I, Kriti Walia, Roll no. 39 / Semester III / Class of 2010-12 of the MBA (Power

Management) programme of the National Power Training Institute, Faridabad hereby

declare that the Summer Training Report entitled

Analysis of Forecasting and Scheduling of Wind Power for Grid Integration in U.S.A.

and Europe alongwith the comparison with the Indian Power Market.

is an original work and the same has not been submitted to any other Institute for the award

of any other degree.

A Seminar presentation of the Training Report was made on ………………….. and the

suggestions as approved by the faculty were duly incorporated.

Presentation In charge Signature of the Candidate

(Faculty)

Countersigned

Director/Principal of the Institute




Contents

Abbreviations ........................................................................................................................................ 7

Organization Profile ............................................................................................................................... 8

IMaCS - An introduction ....................................................................................................................... 8

IMaCS Consulting Services in the Energy Sector ............................................................................... 10

Project

1. Executive Summary ............................................................................................................... 13

2. Objective of the Project ......................................................................................................... 17

3. Significance of Project .......................................................................................................... 18

4. Research Methodology ........................................................................................................... 19

5. Introduction …………............................................................................................................ 20

6. Development of wind power forecasting in abroad ................................................................ 24

7. Analysis of International Power markets …………………………………………………… 25

7.1 Europe ………………………………………………………………………………………………… 25

7.2 U.S.A. …………………………………………………………………………………………………. 45

7.3 India ………………………………………………………………………………………………… 60

8. Solutions for wind integration in India ……………………………………………………………….. 71

9. Conclusion ……………………………………………………………………………………………. 72

10. References ……………………………………………………………………………………………. 72




ABBREVIATIONS

AC Alternating Current

DSM Demand Side Management

GW Gigawatt

GWh Gigawatt hour

HVAC High voltage AC

ISO Independent System Operator

MVAR Mega Volt Ampere Reactive

MW Megawatt

MWh Megawatt hour

NREL National Renewable Energy Laboratory (Boulder, USA)

NRMSE Normalised Root Mean Square Error

NWP Numerical Weather Prediction

PIRP Participating in Intermittent Resource Programme

RMSE Root Mean Square Error

SCADA Supervisory Control and Data Acquisition

TSO Transmission System Operator

TW Terawatt

TWh Terawatt hour

VPP Virtual Power Plant

VSC Voltage Source Converter

WEPP Wind Energy Power Plant




LIST OF TABLES AND FIGURES

Fig.1 Overview of operating frequency limits imposed by grid codes

Fig.2 European Market Structure

Fig. 3 NORDPOOL market structure

Fig. 4 Integration measures for Large Scale Wind Power in Denmark

Fig.5 The interconnectors to the Continental and the Nordic synchronous areas

Fig.6 Time divisions of the Danish electricity market

Fig 7 A. Price setting of the market (no wind)

Fig 7B. Price setting of the market (wind)

Table 1: Structure of Wind Farm

Table 2: Cumulative Wind Generation Capacity as on Dec 2011

Table 3: Classification Of Wind Power Forecast Methods According To Time Scales Relevant For Power

Systems Operation




Organization Profile

IMaCS - An introduction

ICRA Management Consulting Services Limited (IMaCS) is a multi-line management

consulting firm headquartered in India. It has an established track record of 17 years in

management and development consulting across various sectors and countries. IMaCS has

completed more than 1200 consulting assignments with about 600 clients and has worked in

over 40 countries across the globe. IMaCS is a wholly-owned subsidiary of ICRA Limited

(ICRA), one of India‟s leading credit rating agencies. IMaCS operated as an independent

division of ICRA till March 2005, when it was de-merged from ICRA and became a

standalone company in its present form.

Launched in 1991, ICRA has been set up by a number of prominent Indian financial

institutions, banks, and insurance companies. ICRA has subsidiaries in Indonesia and Sri

Lanka. Group ICRA comprises four businesses, namely, Credit Rating, Management

Consulting, Information Technology, and Outsourcing, offered by four different companies

comprising ICRA and its three subsidiaries, namely, IMaCS, ICRA Techno Analytics Ltd.

(ICTEAS) and ICRA Online Limited. ICRA is listed on the National Stock Exchange and the

Bombay Stock Exchange in Mumbai, India.

Group ICRA

IMaCS began as a firm operating in India and has since worked in several parts of the world

on its own and through strategic partners. The clientele includes banks & financial service

companies, private corporates (manufacturing and service organizations), governments,

government-owned organizations, financial investors and fund managers, regulators, and

multilateral agencies. The New York based subsidiary, IMaCS Virtus Global Partners, Inc.

offers Strategy and Transactional Advisory services to companies in North America and in

India seeking to operate in the Indo-American corridor.




IMaCS has six practice areas grouped under Strategy, Risk Management, Process Consulting,

Transaction Advisory, Policy Advisory, and Capacity Building

IMaCS’s Matrix of Service Offering

Through the process of carrying out several assignments over the past 17 years, IMaCS has

accumulated considerable analytical and consulting expertise, backed by the following

organisational capabilities:

An extensive and organised database on several sectors.

Knowledge of key factors of success in different projects and program.

An ability to research emerging global trends, both in specific countries as well as in

different sectors, based on primary and secondary data.

Performance benchmarking

Quantitative and financial modelling

Ability to identify the various types of risks and suggest appropriate strategies to mitigate

the same

Ability to work in different geographies on its own and through affiliate partners

IMaCS’ Consulting Services in the Energy Sector

The Energy Group of IMaCS is a leading provider of policy and regulatory consulting,

transaction advisory services to all stakeholders in the power sector. The Energy Group

focuses on strategy, policy and transactional issues related to the Electricity, Renewable

energy, and the Oil and Gas sectors. The Group has garnered significant expertise in the

restructuring and reform process in the electricity sector by having been associated with




multiple entities such as the government, regulators, state owned and private power

companies since the beginning of the reforms process in the sector.

IMaCS‟ services in the energy domain encompass regulatory assistance to utilities and

regulatory commissions, restructuring and privatization formulating strategies and business

plans for utilities, conducting market assessment studies for investors/utilities, providing

assistance to developers/project appraisal/project risk assessment, and investment and

transaction assistance. IMaCS has also assisted Indian and international business groups in

formulating strategies to enter the energy business. IMaCS has completed several projects in

the renewable sector covering diverse technologies such as wind, hydro, co-generation, and

biomass, and has also worked on policy level assignments.

IMaCS offers its services in the power sector along four functional areas as shown below.

IMaCS’s Offerings in the Power Sector

Offerings in Reform, Regulation & Policy

Power sector reforms and restructuring

Institutional development and capacity building

Designing/drafting regulatory frameworks /rules

Corporatization & Privatization Advisory

Pricing /costing models

Assistance in tariff setting process to regulators /utilities and bulk consumers

Demand side management strategies

Creating competitive wholesale and retail level markets




Performance improvement - Benchmarking, Setting multi-year tariff

Formulating policies for PPP/PSP & power trading

Universal service/coverage - Rural electrification

Renewable & Hydro sector development

Designing & developing energy markets/exchanges

Designing and implementing regulatory information systems

Offerings in Risk Management

Independent assessment of project risks

Project appraisal for lenders and developers

Assessment of project sponsors and Joint Venture partners

Credit risk assessment for off-taker entities – utilities/ electricity boards & bulk consumers

Market and fuel risk management solutions

Structuring solutions to address payment risk and other risks - Payment Security

Mechanisms

Enterprise risk management solutions for IPPs, trading companies

Equity Investment Appraisal

Offerings in Transaction & Project Advisory

Feasibility studies – Techno-economic and financial feasibility, Economic/Social Cost

Benefit Analysis, and Environmental Impact Analysis

Structuring of investments – Risk assessment, allocation of risks, identification

Bid process management – Drafting & review of concessions/contractual agreements

Preparation/Review of bid documents – RFQ/RFP & evaluation of bids, negotiation and

selection of bidder(s)

Drafting & negotiation of Power Purchase Agreements & Fuel Supply Agreements

EPC bid-process management for Power project developers

Project Appraisal with a focus on lenders' perspectives for bankability verification

Project/Capital structuring, financial engineering and securitisation for power projects

Equity mobilisation for power projects from private equity investors

Assistance in financial closure of power projects.

Due diligence and business valuation

Assistance to utilities/power projects in financial/debt restructuring

Acquisition/Divestment Advisory for power projects




Offerings in Strategy & Operations

Energy Market Analysis

Demand forecasts – time series & econometric modelling

Market assessment & competitiveness studies for IPPs & power equipment manufacturers

Business Plans for utilities, power projects and captive power projects

Market entry strategy formulation for strategic investors

Improving regulatory preparedness of utilities

Fuel procurement strategies

Expansion/diversification/backward integration strategy

Cost/Loss reduction and Process improvements for utilities

Performance measurement and benchmarking for utilities

Organisational restructuring and Manpower rationalisation

Clients

IMaCS has advised/assisted almost all types of entities in the Energy Sector such as,

Leading international Project Developers and Domestic Independent Power Producers

(IPPs)

Lenders – Multi-lateral agencies, International / Domestic Financial Institutions and Banks

Equity investors

Governments and Government agencies

Public Sector Enterprises

Private sector entities

Utilities operating in power sector

Renewable Energy Development Agencies

Industry Associations

Regulatory Bodies




Fertiliser Companies

EPC Contractors and Manufacturers




1. EXECUTIVE SUMMARY

The possibilities and detailed strategies for managing variable-output wind power vary

between national and regional power systems. Like any other form of generation, wind power

will have an impact on power system reserves. It will also contribute to a reduction in fuel

usage and emissions. The impact of wind power depends mostly on the wind power

penetration level, but also depends on the power system size, generation capacity mix, the

degree of interconnection to neighbouring systems and load variations. Wind farms have the

inherent advantage over conventional power plants of being smaller in total output capacity.

On the wind farm level, their power output variation is always smaller than, for example, the

variation caused by an outage of a conventional plant. On regional aggregated level, wind

power variations are smoothed and the occurrences of zero wind power are rare.

Accurate methods for short-term forecasting of wind power are widely available as there is a

whole range of commercial tools and services in this area, covering a wide range of

applications and customized implementation. On an annual basis, reducing the forecast

horizon from day-ahead to a few hours ahead reduces the required balancing energy due to

prediction errors by 50%. Comprehensive national studies have focused on determining the

additional balancing costs as a function of increasing wind penetration in the national power

system (Nordic region, Germany, UK, Ireland, Spain). The requirements for Grid codes

depend on the specific characteristics of each power system and the protection employed and

they deviate significantly from each other. More demanding appear to be the requirements of

the German, UK, Nordic, Danish, Belgian, Hydro-Quebec, Swedish and New Zealand grid

codes, which stipulate that wind farms must remain connected during voltage dips down to

0%. The business of the Nordic power exchange is to provide market places for trading in

physical and financial contracts in the Nordic countries (Finland, Sweden, Denmark and

Norway). Its physical market accounts for over 60 per cent of the total value of the Nordic

region’s power consumption.

Despite the differences in assumptions, optimization criteria and system characteristics, the

studies arrive at similar results. There is a gradual increase of the additional balancing costs

with wind power penetration. Because of the positive effect of geographical smoothing,

results from these studies show that power systems in large geographical areas can integrate

wind power at lower cost. Likewise, good interconnection to neighbouring systems reduces

balancing costs. Both the allocation and the use of reserves cause extra system costs. This




means that only the increased use of dedicated reserves, or increased part-load plant

requirement, will cause extra costs. According to several national studies made so far, there is

no need for additional conventional plant and that extra reserve needs for wind power can be

obtained from the existing conventional power plants. Estimates regarding the costs of

increase in secondary load following reserves suggest €1–3/MWh (of wind) for a wind power

penetration of 10% of gross consumption and €2-4/MWh for higher penetration levels. The

costs are quite sensitive to the accuracy of wind power forecasting, as well as the practice of

applying forecasts in the market rules.

My observations and suggestions for implementation in India after the work done by me at

IMaCs are as follows:

Wind energy generators are mandated to forecast the wind generation,

since wind forecasting software packages are available in the market.

The philosophy of limited applicability of UI charges to Wind generators

is that it is seen that they can forecast generation of wind energy with an

accuracy of at least 70%. Therefore, within the band of +/-30% variation

from the forecast, they should not be subjected to UI charges.

However, for variation more than that, they are liable to be included in

the UI mechanism, beyond this limit.

The UI mechanism is used only in India. It has been introduced in South

Africa only last year. It is suggested that penalty mechanism other than

UI charges must be adopted in India.

The wind power is forecasted in 15minute time block (96 time blocks in a

day) in India. Internationally, the wind power is forecasted on an hourly

basis. An hourly forecast system must be used in India.




*the total duration of these operating conditions must not exceed 10hours/year

Fig.1 Overview of operating frequency limits imposed by grid codes

ABSTRACT

With the world in almost permanent energy crisis due to the pressure of

economic development, wind power is nowadays one of the predominant

alternative sources of energy. The experience in advanced wind power countries

indicates that wind power forecasting (WPF) technology is one of the effective

measures to mitigate peak-load regulation pressure, reduce reserve capacity and

increase wind power accommodation capacity for power grids. Recently, the

leading countries in wind power in Europe and the United States have already

established impeccable management mechanism in WPF, and their forecast is

performed both in wind farm side and dispatching facility side.

This report, combining the international experience and national situation,

studies on the tailor-made wind power forecasting and scheduling system

framework and implementation plan in India.




2. OBJECTIVE OF THE PROJECT

This Project has analyzed the effect of wind power on the power system and analysis of the

business model followed by IPP’s of wind power in USA. The major issues of wind power

integration are related to: changed approaches in operation of the power system, connection

requirements for wind power plants to maintain a stable and reliable supply, extension and

modification of the grid infrastructure, and influence of wind power on system adequacy and

the security of supply. Thus there is huge opportunity available in the Sector and the main

aim of the project is to identify the opportunities available in the Sector.

The objectives of the project are as follows:

Analysis and comparison of scheduling and forecasting provisions in various

countries.

Analysis of wind power forecasting technologies present and their benefits

Identification of balancing requirements for the power system.

Identification of various storage options.

Analysis of the IEGC requirements related to wind power integration.

Study of electricity markets of U.S.A. and Europe

Identification of business opportunities available in the sector.

Suggestions for implementation of efficient grid integration of Wind Power.




3. SIGNIFICANCE OF THE PROJECT

Wind power is continuous growing in the world and acting as mainstream power suppliers in

many countries instead of it is viewed as an intermittent source of energy. This project

analysed the different Balancing, Storage, Grid code requirements, Forecasting methods &

approaches for making wind power as a firm energy source. Also the business model

followed by IPP’s in USA makes us understand the difference between Indian model and

USA model.

This project is important in a way to study the future opportunities available in the Wind

power sector.




4. RESEARCH METHODOLOGY

The report has been compiled on the basis of secondary data sources. Data on integration

cost, balancing, storage technologies etc. have been collected from the information available

on the internet validated from various recognized websites like FERC, NREL, DOE, UWIG,

CAISO, MISO, IEA, AWEA, GWEA, CWET, EWEA & many others.

Steps followed for the project work are as under:

Selection of the project title

Selecting the IPP’s for the purpose of study and analysis

Downloading of all available information of all the IPP’s, ISO, TSO for analysis

Understanding the business model & legalisations of different countries.

Thorough study of all information available from various sources to understand the

wind

power sector.

Scrutinizing the data & Collecting the relevant data from the available documents and

literatures on Internet

Arranging the data year wise in a lucid manner

Comparison of data

Drawing of inferences and conclusions

Giving suggestions & recommendations

Drafting of report

Submission of report to the mentor for review, suggestions and modifications




5. INTRODUCTION

5.1 Wind Energy

Air in the motion is called wind. Wind is global phenomenon occurring on the

earth’s surface due to unequal heating of various parts of the earth’s surface by

the sun. Wind speed and direction vary in the short and long term. There is a

variation on minute to minute basis. Wind is affected by the terrain and by

height above the ground. Wind speed generally increases with the height above

the ground as moving wind moving across the earth’s surface encounters

friction caused by the turbulent flow over and around the mountains, hills, trees,

buildings etc. The Earth is unevenly heated by the sun, such that the poles

receive less energy from the sun than the equator; along with this, dry land heats

up (and cools down) more quickly than the seas do. The differential heating

drives a global atmospheric convection system reaching from the Earth's surface

to the stratosphere which acts as a virtual ceiling. Most of the energy stored in

these wind movements can be found at high altitudes where continuous wind

speeds of over 160 km/h (100 mph) occur.

5.2 Wind Power Generation

Generation of electricity has emerged as the most important application of wind

energy worldwide. The concept is simple: flowing wind rotates the blades of a

turbine, and causes electricity to be produced in generator unit. The blades and

generator(housed in a unit called ‘nacelle’) are mounted at the top of a tower.

Wind turbines generally have three rotor blades, which rotate with wind flow

and are coupled to a generator either directly or through a gear box. The rotor

blades rotate around a horizontal hub connected to a generator, which is located

inside the nacelle. The nacelle also houses other electrical components and the

yaw mechanism, which turns the turbine so that it faces the wind.

Sensors are used to monitor wind direction and the tower head is turned to line

up with the wind. The power produced by the generator is controlled




automatically as wind speeds vary. The rotor diameters vary from 30 metres (m)

to about 90 m, whereas the towers, on which the wind electric generators

(WEGs) are mounted, range in height from 25 to 80 m. The power generated by

wind turbines is conditioned properly so as to feed the local grid. The unit

capacities of WEGs presently range from 225 kilowatt (kW) to 2 megawatt

(MW), and they can operate in wind speeds ranging between 2.5 m/s (metres

per second) and 25 m/s.

5.3 Wind Power Grid Integration

Grid Integration of existing off-grid DRE projects will considerably increase

their viability and sustainability and further have positive implications for

enhancing electricity access. Since the centralized grid acts like a large battery,

feeding electricity into the grid will ensure lowering of the costs of DRE

projects by improving their Capacity Utilization Factors (CUFs).WPF

technology is widely developed and applied in the European countries over the

past about 20 years. They actively develop and construct WPF systems and

bring wind power into electricity market and grid dispatching system. The

experience in advanced wind power countries indicates that wind power




forecasting (WPF) technology is one of the effective measures to mitigate peak-

load regulation pressure, reduce reserve capacity and increase wind power

accommodation capacity for power grids. Meanwhile, this technology also

plays an important role in instructing maintenance plan of wind farms,

increasing utilization of wind energy and improving economical benefit of wind

farms.

Recently, in most of the advanced wind power countries WPF systems are

installed in both sides of wind farms and dispatching facilities and related

management systems are established. WPF is a mandatory requirement in many

countries and utilities, such as in Spain, Ireland, and PNM and ERCOT

(Electrical Reliability Council of Texas) in the United States; California ISO

(CAISO) stipulates that the wind farms in its jurisdiction have free choice of

WPF system providers rather than those listed by CAISO, although wider

forecast error is allowed for the listed WPF providers for grid integration.

Priority for grid connection is granted to wind farms in Denmark and Germany

based on their Renewable Energy Law. But grid operators do not set the liability

for wind farms to forecast their generated power in Grid Integration Agreement

and Electricity Purchase Agreement.

Countries such as Denmark, Germany and the United States have been able to

meet their strict forecasting guidelines through the availability of updated

meteorological information and employing various technical measures like

energy assessments, use of a sufficient number of onsite meteorological masts,

wind flow modelling etc. However, these technical measures are best suited to

geographies with consistent wind patterns, unlike India. These countries also

have the benefit of professional forecasting agencies like Energy and Me-teo

GmbH (Previento) and AWS Truewind (eWind) which is not the case in India.

As of March 2012, the majority of Indian wind farm developers were in the

process of acquiring and setting up the necessary tools for forecasting and only




a few farm developers like Gamesa and GFL in Gujarat have commenced

forecasting and providing schedules to the SLDC on a trial basis. Wind

forecasting is further complicated by the SLDCs inability to evaluate forecasts

and schedules provided by wind energy producers due to inadequate metering

facilities. According to industry insiders, the absence of reliable meteorological

data, historical wind pattern data, sophisticated wind prediction technology

coupled with inconsistent wind flow patterns prevalent in India, means that the

imposition of UI charges will have a crippling effect on financing of wind

energy projects as well as project profitability.

Table 1: Structure of Wind Farm




5.4 Importance of Wind Power Forecasting

6. Development Status of the Wind Power Forecasting Abroad

Table2: Cumulative Wind Generation Capacity as on Dec 2011

Nowadays the wind power prediction system have been widely applied in

Denmark, Germany, Spain, United States and other developed countries. It had

• Better forecasts mean lower operating reserves

• Lower operating reserves mean lower operating costs

• Avoid penalties for bad forecasts

Economics

• Situational awareness for operators

• System positioning for ramping events

• Preparation for extreme events

Reliability

• Understand need for and provide incentives for the right market

• Products with high VG penetration

• Align market rules with forecasting capabilities

Market Operation

62733

46919

29060 21674

16084

6800 6747 6540 5265 4083

32446

0

10000

20000

30000

40000

50000

60000

70000




become an important support system of the wind power optimal dispatch.

Recently, in most of the advanced wind power countries WPF systems are

installed in both sides of wind farms and dispatching facilities and related

management systems are established.

The wind power prediction system is classified into 0-4 hours ultra-short term

forecasting and 0-48 hours short term forecasting. With the development of

wind power industry, moreover, the effective forecasting is playing a more and

more important role in the economic operation, its benefit to utilities is also

increased with the improvement of forecasting accuracy. Although these

methods obtained definite forecasting effect, the forecasting precision and

stability still need to improve.

7. Analysis of International Experience

7.1 EUROPE

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

82,232 92,518 1,01,773 1,09,815 1,18,248 1,27,324 1,35,590 1,43,790 1,52,905 1,61,165 1,70,054 2,590 3,724

5,820 9,146

12,357 15,606

20,423 25,827

31,104 36,790

43,324

Cumulative wind power installations in the EU(MW)

Onshore Offshore




The net output of all wind turbines on the system or large groups of wind farms

are considered. Wind power has to be considered relative to the overall demand

variability and the variability and intermittency of other power generators. Thus,

wind can be harnessed to provide reliable electricity even though the wind is not

available 100% of the time at one particular site.

In terms of overall power supply, it is largely unimportant what happens when

the wind stops blowing at a single wind turbine or wind farm site.

The Forecast performance varies with many factors:

a. Forecast time horizon especially for short term

b. Amount and diversity of Regional aggregation

c. Quality of generation and meteorological data from the plant

d. Distributions of wind speeds relative to the power curve

e. Type of wind and weather regime

f. Shape of the plant-scale power curve

g. Amount of variability in the wind resource

3.8

74

43

8.5

16.1

80

2.5

20.6

11.6

1.7 1.6 1.6

66

28 27

20

10

2 0

10

20

30

40

50

60

70

80

90

Wind Power Capacity Penetrations in Various European Countries

Reference Load(GW)

Wind Power Capacity (GW)

Capacity Penetration




h. Sensitivity of a forecast to initialization error

These factors make casual comparisons of forecast performance very

difficult and lead to misconceptions.

5-60 min 1-6 hours Day ahead Seasonal

long-term

Uses Regulation

Real-time

despatch

decisions

Load

following, unit

commitment

for next

operating hour

Unit

commitment and

scheduling,

market trading

Resource

planning

contingency

analysis

Phenomena Turbulent

mixing

transitions

Fronts, sea

breezes,

mountain-

valley

circulations

Low and high

pressure areas,

storm systems

Climate

oscillations,

global

warming

Methods Largely

statistical,

driven by recent

measurements

Combination of

statistical and

NWP models

Mainly NWP

with corrections

for systematic

bias

Based

largely on

analysis of

cyclical

patterns

Table 3: Classification Of Wind Power Forecast Methods According To Time Scales Relevant For

Power Systems Operation




Fig.2 European Market Structure

Fig. 3 NORDPOOL market structure

Nord Pool launched its day-ahead market in 1993 and its adjustment market in

March 1999. 216 participants were allowed to trade on the spot market in

December 2001. Nord Pool Spot organises the market place which comprises

the Elspot and Elbas products. Elspot is the common Nordic market for trading

physical electricity contracts with next-day supply. Elbas is a physical balance

WHOLESALE MARKET

•Here bulk electricity is sold and purchased between suppliers, generators, non-physical traders and large end users

RETAIL MARKET

•Here electricity is finally sold to the end consumer




adjustment market for Sweden, Finland and Denmark. Both the Elspot and

Elbas market also include the KONTEK area in Germany.

Elspot (day-ahead market)

The Elspot day-ahead power market is a market with physical delivery. The

products traded are power contracts with one hour duration and block bids. The

hourly contracts cover all 24 hours of the following day. Currently, there are

five block periods approved for trading in the day-ahead market:

• Block 1 – 1:00-7:00;

• Block 2 – 8:00-18:00;

• Block 3 – 19:00-24:00;

• Block 4 – 1:00-24:00;

• Block 5 – 8:00-24:00.

Prices at Elspot are determined through auction trade for each delivery hour.

Each sale/purchase bid is a sequence of price/volume pairs for each specified

hour with a minimum size of 0.1 MWh/h.

Bids are submitted to the marketplace either electronically via Internet, or by

fax on special bid forms, before noon (deadline). Purchases are designated as

positive numbers, sales as negative numbers.

Elbas (Adjustment Market)

The adjustment market “Elbas” aims to improve the balance of physical

contracts of the participants.The trading products are one-hour physical delivery

contracts, which can be traded up to 1 hour before delivery. This market is

currently limited to Sweden and Finland, but the inclusion of further Nordic

countries is under consideration.




Elbas offers continuous trading all around the clock and every day. The trading

session for a specific day starts after the publication of the results of Elspot for

this day. Bids can be submitted electronically or by phone (helpdesk). Their

minimum size is 1 MWh and prices are quoted in Euro with a minimum tick

size of 0.1 Euro.

Danish Electricity Market

Denmark is the connecting node of the Nordpool, the Nordic electricity market

and the European electricity market, but mainly participates in the Nordpool

because of limitation of the electric transmission capacity in different countries.

Nordpool is composed by Denmark, Norway, Sweden and Finland. Energinet is

the power system, grid and electricity market operator of Denmark.




Fig.4 Integration measures for Large Scale Wind Power in Denmark

Denmark is the only country in Europe that belongs to two synchronous areas.

For historical reasons Western Denmark belongs to the Continental

synchronous area and Eastern Denmark belongs to the Nordic synchronous

area. Both the Continental synchronous and the Nordic synchronous areas

operate at 50 Hz AC, but the areas are not synchronized. As a result, the

interconnector between Western Denmark and Germany is AC, and similarly

the interconnector between Eastern Denmark and Sweden is also AC. On the

other hand, the interconnectors between the Nordic synchronous area and the

Continental synchronous are DC, including the interconnector between Western

Denmark and Eastern Denmark. Due to the historical background, Western

Denmark and Eastern Denmark are also separate electricity market price areas.




Fig.5 The interconnectors to the

Continental and the Nordic synchronous areas

With the liberalisation of the power sector in 2000, the unsuccessful attempt to

introduce a green certificate system to compliment the liberalised market and a

change of government policy for wind power remuneration in 2002 the

deployment of wind turbines met an abrupt halt. This has been the case until

2008, when deployment of turbines once again begun to gather momentum in

Denmark due to the introduction of a new feed-in tariff.

The Nordpool electricity market includes future market, day ahead market (spot

market) and intraday market. All markets are hourly markets. Additionally, the

TSOs operate reserve and regulating markets. In the reserve market, the

reserves for the coming day are purchased at 9:30. The Day ahead market is set

at 12:00. Intraday market starts at 14:00 the day before operating day until one

hour before delivery hour. Regulating market is continuously operated from

0:00 to 24:00.




Fig.6 Time divisions of the Danish electricity market

Pricing mechanism of the market

1. Reserve market

In reserve market, the single buyer is the TSO. The sellers are all of the power

plants which can offer the reserved capacity. The reserved capacity is mainly

used to guarantee safe and stable operation of the systems for any emergency.

The prices for a reserved capacity are low in reserve market in Denmark but the

price for the activated energy can be very high. Participants submit bids to the

market. No matter whether the reserved capacity is used in the day, TSO need to

pay for it. The payment which is used for the reserved capacity comes from the

income of the electricity rates.

2. Day ahead market (spot market)

In day ahead market, all the power plants and the demanders are the market

participants. The market price is determined by marginal pricing of the supply

and the demand. The day ahead market is mainly used to ensure the 24 hours

generation plan and the electricity prices of the next day, according to the

bidding results. The red and green curves are the demand and supply curves




respectively. The cross point of the curves is the electricity price of that hour.

The different productions follow the same price.

Fig 7 A. Price setting of the market (no wind)

Fig 7B. Price setting of the market (wind)

There are big bidding differences in market among different productions.

Because of the low operation costs and the governmental subsidy, the submitted

bid of wind power was lower than other powers. The output of the wind power

obviously influences the price of that hour. The more the wind power outputs,

the lower the market price will be. When the outputs of the wind power are

larger enough, to sell the wind power successfully, the bidding could be

negative electricity price. Even so, the wind power plants can earn the profit due




to the balance of the subsidy. In the market of negative electricity price, the

wind power plants supply the most of the electric power. Parts of the thermal

power plants sell the electric power to avoid the loss of turn off operations.

3. Intraday market

The intraday market is the trade that takes place during the day of operation

when the day-ahead market is closed. After the day-ahead market is closed, the

day ahead plans would be adjusted according to the real condition due to the

faults of hydroelectric generating units, faults of transmission line, forecasting

errors of the wind power and so on.

The intraday market trades hourly power from 14:00 the day before delivery

day until one hour before delivery hour. Market participants can use the

intraday market to balance their positions. In general, the later the generation

plan adjusts, the more the cost goes up. For example, when the wind power

plants find the output of the wind power can not satisfy the generation plan of

the day ahead market in the next hour according to the updating forecasting

results, they need to buy the electricity gap from other power plants. The

electricity price is usually higher than the price of the day ahead market; when

the wind power plants find the output of the wind power is more than the

generation plan of the day ahead market, they can also sell the extra power. But

the electricity price is much less than the price of the day ahead market.

4. Regulating market (Real time market) Regulating market is from 0:00 to 24:00. In order to supervise the generation

plan and guarantee the stable operation of the systems, TSO adjust the outputs

of the power plants in regulating market. The regulating market is administered

by TSO. To make a balance between demand and production, TSO buys (sells)

the power from (to) the market participants according to the difference between

the generation plan/demand and the real power outputs/demand. The payments




mentioned above are undertaken by all the market participants. In regulating

market, the electricity price is quite different with the day ahead and intraday

market. If the power generation, such as wind power, is more than its generation

plan, the extra part will be sold by TSO with a price much lower than that in the

day ahead and the intraday markets, and the price even could be negative. If the

wind power is less than its generation plan, the extra part will be bought by TSO

whose price is much higher than the day ahead and intraday market.

Code Control Specified Set Points Specified Droop

Settings

Transient

Response

Set

Point

Charges

Denmark Reactive Power Control

Power Factor Control

Voltage Control (>25

MW)

Required 10s

Germany Reactive Power Control


Voltage Control

Immediate 1 min

UK 95%-105% 2%-7% 90%

within 1s

Ireland Voltage regulation

similar to AVR

HV side of grid transformer 1%-10% 90%

within 1s

20s

Spain AVR Voltage, Reactive or Power

Factor set points

0-25

(Mvar

pu/

Voltage

dev pu)

Full

response

in 1min

Table: Voltage Control Requiements

Ancillary services

Ancillary services are services that ensure reliability and support the

transmission of electricity from generation sites to customer loads. Energinet.dk




applies ancillary services to avoid fluctuations in the frequency and

interruptions of supply. Energinet.dk buys 3 different types of reserves, and uses

each type of reserve to balance the power system, depending on the reaction

time. Within 15 minutes of the reaction time the primary reserves will be used.

Within one hour the secondary reserves will be used. If the reaction time needed

is longer than one hour, the manual reserves will be used.

Fig. The functions of different reserves

The need for ancillary services is dynamic throughout the year in terms of

volume and the nature of the ancillary services. There are also regional

differences between Eastern and Western Denmark. Consequently, the volumes

and services on offer are adapted to requirements for specific periods of the year

in Eastern and Western Denmark. The needed ancillary services in November

2011 are described below:

Primary reserves:

The primary reserves are used to adjust the frequency in the respective

synchronous areas. There are two different setups in Western Denmark and

Eastern Denmark. Primary reserves are shared reserves with Continental Europe

(3000 MW) for Western Denmark (± 25 MW) and with the Nordic Region

(1200 MW) for Eastern Denmark (± 22 MW). Western Denmark shares the

3000 MW with the whole Continental Europe area. The 3000 MW has been




selected to withstand a 10-year extreme event. The Nordic primary reserves of

1200 MW correspond to the largest production unit in the Nordic Region.

Secondary automatic reserves:

The secondary automatic reserves are used to balance a subsystem, i.e. Western

Denmark. There are differences between the setups in Western Denmark and

Eastern Denmark. When the secondary reserves are activated, they replace the

primary reserves so the primary reserves are available again. The secondary

reserves are cheaper in operation than the primary reserves, because the

secondary reserves do not have to react as quickly as primary ones.

Western Denmark (± 90 MW):

- Energinet.dk pays a monthly capacity price for the reserves

- The secondary reserves are mainly provided by conventional power stations

- The reserves are calculated on the basis of the yearly max load

Eastern Denmark (± 160 MW):

- Energinet.dk purchases secondary reserves in blocks of 4 hours

-The secondary reserves are only provided by conventional power stations

- The reserves are calculated on the basis of the largest unit in each Nordic

country.

Manually activated reserves:

Manual reserves are used if the reaction time needed is longer than one hour.

The manual reserves are selected to cover the largest production unit in Western

Denmark and Eastern Denmark respectively. Manual reserves are a part of the

merit order list of the regulating market. When producers sell manual reserves,

producers commit to place a bid in the regulating market.

The costs of ancillary services are correlated with the day-ahead prices. The

day-ahead prices depend, among other variables, on the reservoir levels in the

Nordic Region. Energinet.dk aims to reduce the costs of ancillary services, but




it does not control the day-ahead prices, which partly determine the costs of

ancillary services. The market controls the day-ahead prices.

Fig. The costs of the ancillary services in the Danish power system

Type of reserve Effect of wind power on the reserve requirement Factors affecting

the additional cost

Primary reserve

(minute to minute

or less)

Nil Geographical

dispersion

Secondary/Tertiary

reserve

(15 minutes, hour to

hour)

Regulating capacity

2% of wind rated capacity at low penetrations and 4% at higher

penetration levels

Costs : €1-3/MWh wind at penetrations up to 10%, at higher

penetrations : €3-4/MWh wind

Geographical

dispersion,

Forecasting

Load following

(4-12 hours)

Efficiency loss due to wind power variations and prediction errors

Reduced fuel use and reduced emissions. Wind is replacing the

most costly power units, operating at the margin, by the forecasted

amount of wind power production. The forecast errors will either

come to the regulating/balancing power market, or be settled by

producers when more accurate closer to delivery time forecasts

appear

Prediction errors

Correlation of

wind power and

load

Production mix

Table: Balancing Requirements and costs

SPANISH ELECTRICITY MARKET

Law and Regularity




Spanish Royal Decree 436/2004 issued in 2004 clearly formulated the pricing

system and accessory service for wind power. It ruled that a double-track

pricing system is applied for wind power, i.e. a system combined with fixed

price and premium mechanism; meanwhile the Act also presents clear liability

requirement for wind farms, i.e. the wind farms with 10MW capacity and above

must report their WPF results to grids and accept examination from grids. To

guarantee the safe and stable operation of the electric systems and insure the

benefit of the wind plants, Spanish Royal Decree 661/2007 issued in 2007

contains the legal and economic framework for Special Regime production

which including the obligations that the renewable energy plants must fulfill in

order to allow a favourable integration in the electrical system. It includes the

following aspects:

(1) Real time telemetry each 12 seconds to the TSO for all wind power plants with

an installed capacity greater than 10 MW and association into generation

control centers. The items include active power, reactive power, wind speed,

direction, temperature, and pressure etc.

(2) Power factor control with the possibility for the TSO to modify the ranges in

real-time for plants larger than 10 MW.

Spanish Royal Decree 436/2004 issued in 2004 modified the RD 661/2007 to

include the requirement of real-time telemetry every 12 seconds for plants or

clusters of plants larger than 1 MW. It also includes the need for association

into control centers for clusters of plants of the same technology larger than 10

MW. It modifies slightly the power factor ranges for RES and introduces the

possibility to develop voltage control with these types of plants.

ELECTRICITY MARKET

The electricity market is composed by Spain and Portugal. The

market’sclassification and bidding system are similar with the Nordic electricity

market.




Fig. Framework of the Spanish Electricity market

Until now, the installed capacity of the renewable energies is 20,000 MW in

Spain. In order to accept more wind power, Spain’s grid company issued lots of

administrative regulations and presents clear requirement for wind farms, i. e.

the wind farms should possess the active and reactive power control capability

and the low voltage ride-through (LVRT) capability. To keep the balance of the

power, the grid company provides the control target every 15 minutes to ensure

the priority of the wind power. This control target is usually the installed

capacity of the wind farm. In case of emergency, the grid company balances the

outputs of the wind power by controlling the cycle gas units. The loss is paid by

the final consumers. So there are few restrictions for the wind power. Only

0.2% percentage of the wind power is limited in 2010.

WIND POWER FORECASTING

Wind power forecasting in TSO

Wind power forecasting (WPF) technology is one of the effective measures to

mitigate peak-load regulation pressure, reduce reserve capacity, guarantee safe

and stable operation of the systems, and ensure the participants’ financial

benefit. For TSO, the function of WPF is as follows:




(1) Determine the reserved capacity in reserve market according to the forecasting

results. The assessment of the requirement and the bidding are influenced by the

forecasting accuracy;

(2) In regulating market (real time market), the buying (selling) of the extra wind

power based on the updating forecasting results every 5 minutes. It is very

important for TSO to keep the stable of the power system. The forecasting

results influence the financial benefits of the participants due to the payment of

the electricity buying (selling) afforded by the power plants.

The related work and responsibility of the Danish TSO and the Spain TSO are

listed below:

a. Danish TSO

Energinet.dk is the TSO of Denmark whose main task is to guarantee safe and

stable operation of the electric systems. Its responsibility is electric storage and

transmission.

Energinet.dk mainly uses two predictions tools: one external and one internal.

The external forecasting method includes 0-12 hours prediction every 5 minutes

and 0-48 hours prediction every hour. The forecasting results take four different

numerical weather predictions into consideration. The internal forecasting

method includes 0-6 hours short term forecast and 12-36 hours day ahead

prediction. The combined forecasting result is based on three meteorological

prognoses.

b. Spanish TSO

Red Eléctrica de España (REE) is the TSO of Spain whose grids connect with

France, Portugal and Morocco. REE was the first company in the world

dedicated exclusively to power transmission and operation of electrical systems.

Its installed capacity of wind power is about 21.3% of the total installed

capacity. Beside study of the forecasting method by itself, REE buys three wind

power forecasting system. The combined forecasting result is based on three




meteorological prognoses. The precise forecast can be obtained through the

weighted results based on four forecasting tools to guarantee the stable

operation of the electricity system.

Wind power forecasting in wind farms

For wind farms participation, wind power forecasting is the base in the

electricity market. The short term forecast and ultra-short term rolling forecast

are the most important items for generation schedule, bidding in market, the

payment of the extra power and so on. Its main functions are as follows:

(1) In day ahead market, the wind farms join the market according to the short term

forecast. The forecasting result influences the 24 hour’s electric quantity and

bidding price of the next day directly. If the forecasting result is so bad, the

wind plants will pay the expensive compensation for their mistakes in intraday

market.

(2) In the intraday market, the wind farms adjust the hour’s generation plan based

on the updated ultra-short term forecasting result in real time to correct the short

term forecast. The higher the forecast accuracy is, the less the payment of the

extra power will be. The narrower the gap between the generation plan and the

real output is, the less is the TSO’s adjustment required in regulating market. As

a result, the wind farms’ payments for that are reduced.

In general, the accuracy of WPF determines the economic benefit of the wind

farms. It is the most important technique tool for the wind plants to participate

the market.

DONG Energy bids in electricity market and determines the ratio of the wind

power and other generations (such as biomass, coal, oil, gas). They develop the

generation plan according to the market and send it to Energinet.dk. The real

outputs of the power should be consistent with the generation plan, or they need

to pay the loss of the difference between the real and the plan.




In reserve market, the electric quantity and the electricity price are traded. To

get better wind prognosis for next year, the forecast of DONG Energy includes

monthly forecast and yearly forecast which are served as the reference of

trading in the medium and long term market.

In day ahead market, DONG Energy forecast the wind power of next 24 hours.

The result is served as the reference of the trade of the day ahead market. In

intraday market, ultra-short term forecasting is used to adjust the generation

plan for dealing with the emergence, such as the wind storm, the sudden power

break, and the icing of wind turbines-hub caused by frost and fog. DONG

Energy reduces the economic loss by consulting with Energinet.dk and adjust

the generation plan in time.

Discussion of the wind power forecasting technology

National Laboratory for Sustainable Energy (Risø) in Denmark is leading the

way in wind power forecasting technology research. Its Prediktor system based

on the NWP+WAsP+Power Curves is used in east of the Denmark from 1993.

In 1994, the Zephyr system was developed by Risø and Technical University of

Denmark (DTU). Since its setting-up, Zephyr have been applied in Denmark

and expanded to Spain, Ireland, America, Japan and so on. The valuable

experiences with the system include:

(1) The combination of the numerical weather predictions and statistical forecasts;

(2) Using the numerical weather prediction data which is close to the hub height of

the wind turbines;

(3) Establishing the power curves based on the wind direction & speed of the

numerical weather predictions and the real output of the wind power;

(4) Considering the uncertainty and probability of the forecast;

(5) Obtaining the ensemble prediction result by combining the several numerical

weather predictions;

(6) Measuring the errors of each variable;




(7) Reducing the forecasting errors by extending the forecasting region;

(8) Training the meteorological knowledge for the technical staff of the electricity

transmission enterprises;

(9) Providing the consulting services under the special situation.

7.2 UNITED STATES OF AMERICA

Different works have shown that the largest share in wind power forecasting

errors comes from the input meteorological forecasts. If for instance a timing

error is present in the meteorological forecasts, it will be directly passed on to

the related wind power forecasts. It should then be envisaged to use several

meteorological forecasts as input, with appropriate combination methods

allowing getting the best out of those inputs. Fortunately, more data, joint

research efforts, and rising commercial interests, will certainly help further

acceleration in the improvement of forecast accuracy. In parallel, the case of

extreme prediction errors, which are the most costly whoever the end-user is,

will necessitate particular attention. If more and more wind power is to be

integrated into the grid, our whole approach to management has to turn towards

probabilistic approaches, permitting to account for these uncertainty aspects, for

the non-symmetric nature of regulation costs, as well as to control the risk of

unbearable costs coming from unforeseen events. This then also means that

easing integration of wind generation via the use of forecasts is not only a

technical problem: all actors concerned should be aware of probabilistic

methods and more sensitive to the concept of risk management.

The Final Rule for “Inter-Connection for Wind Energy” was issued by the

Federal Energy Regulatory Commission on 2nd

June 2005. These regulations are

applicable to plants having more than 20 MW capacity.




INTERCONNECTION REQUIREMENTS FOR A WIND

GENERATING PLANT

1. Low Voltage Ride Through

A wind generating plant shall be able to remain online during voltage

disturbances up to the time periods and associated voltage levels set forth in the

transition period standard and a post-transition period standard.

Transition Period LVRT Standard

The transition period standard applies to wind generating plants that have either:

(i) interconnection agreements signed and filed with the Commission, filed with

the Commission in unexecuted form, or filed with the Commission as non-

conforming agreements between January 1, 2006 and December 31, 2006, with

a scheduled in-service date no later than December 31, 2007, or (ii) wind

generating turbines subject to a wind turbine procurement contract executed

prior to December 31, 2005, for delivery through 2007.

The maximum clearing time the wind generating plant shall be required to

withstand for a three-phase fault shall be 9 cycles at a voltage as low as 0.15

p.u., as measured at the high side of the wind generating plant step-up

transformer

i. Post-transition Period LVRT Standard

The maximum clearing time the wind generating plant shall be required to

withstand for a three-phase fault shall be 9 cycles after which, if the fault

remains following the location-specific normal clearing time for three-phase




faults, the wind generating plant may disconnect from the transmission system.

A wind generating plant shall remain interconnected during such a fault on the

transmission system for a voltage level as low as zero volts

ii. Power Factor Design Criteria (Reactive Power)

A wind generating plant shall maintain a power factor within the range of 0.95

leading to 0.95 lagging, measured at the Point of Interconnection, which is the

appropriate measurement point for the power factor standard

iii. Supervisory Control and Data Acquisition (SCADA) Capability

The wind plant shall provide SCADA capability to transmit data and receive

instructions from the Transmission Provider to protect system reliability. The

Transmission Provider and the wind plant Interconnection Customer shall

determine what SCADA information is essential for the proposed wind plant,

taking into account the size of the plant and its characteristics, location, and

importance in maintaining generation resource adequacy and transmission

system reliability in its area.

Code Control Specified Set Points Specified Droop

Settings

Transient

Response

Texas Must be capable of producing a defined

quantity of Reactive Power to maintain

a Voltage Profile established by

ERCOT

Alberta Continuously-variable, continuously

acting, closed loop control voltage

regulation system

95%-105%

Reactive current

compensation

0-10% 95% in 0.1s

to 1s

Quebec AVR system comparable with

synchronous generator

0-10%




Ontario AVR 95%-105% of rated

voltage

Not more than 13%

impedance from HV

terminal

50ms for 5%

step

ENTSO-E Reactive Power Control


95%-105% 2%-7% 90% within

1s

Australia

(Automatic)

95%-105% of normal

voltage

Reactive current

compensation

<2s for 5%

step

Table: Voltage Control Requirements in U.S.A.

A wind plant is required to satisfy the low voltage ride-through standard if the

Transmission Provider shows, through the System Impact Study, that such

capability is required to ensure safety or reliability. The Final Rule adopts the

Point of Interconnection as the point of measurement for the low voltage ride-

through standard .It helps to provide a secure and reliable power supply, and

will facilitate increased use of wind as a generation resource while ensuring that

reliability is protected.

The System Impact Study determines if there is a need for a wind plant to

remain on-line during low voltage events to ensure the safety or reliability of

the system. Requiring low voltage ride-through capability only if the System

Impact Study shows it to be necessary ensures that the increased reliance on

wind plants does not degrade system safety or reliability. It also ensures that the

Transmission Provider does not require a wind plant to install costly equipment

that is not needed for grid safety or reliability. This limits the opportunities for

undue discrimination; a wind plant Interconnection Customer will not have its




interconnection frustrated by unnecessary requirements to install costly

equipment that is not needed for safety or reliability.

PJM NYISO ISO-NE Ontario IMO

Scheduling in

Energy markets

Day-ahead scheduling;

wind usually submits

zero.

Takes real-time LMP

for energy provided.

Day-ahead scheduling

available but not required.

Up to 500 MW: takes real

time price for all energy

produced beyond day

ahead amounts.

Approach may be revised.

Day-ahead bid option;

or self schedule day

before.

Settle at real-time

nodal price.

Energy from

renewable

intermittent

generation accepted

as generated.

Day ahead market

under development.

Imbalance

settlement

Operating reserves

deviations charges

apply on differential

between day-ahead and

RT levels; (5 MW

dead band; differentials

less than this incur no

deviation charges).

Up to 500 MW, no

penalties. Buy out

shortfalls at real-time

LBMPs. Approach may

be revised.

If deviations, notify

ISO.

No imbalance charges

No penalties;

payments settled at

the hourly spot

market price.

Ancillary

Services

No penalties; payments

settled at the hourly

spot market price.

Wind doesn’t participate

in A/S markets, but is not

precluded from doing so.

Currently no ancillary

services markets. May

have by late 2005.

Considering products

to mitigate variability.

No significant

impacts expected,

but will evaluate

experience.

System has some

tolerance for wind

variability (first 300

MW or so).

Wind Forecasting In operation since

2009:

• DA transmission

security and reserve

adequacy assessments

In operation since 2008:

• Reliability assessment

commitment at DA stage

• RT commitment and

No role so far. Likely

to change with higher

penetrations

No role so far.




• Developing

automated procedures

• Specific ramp

Forecast

dispatch

• Ramping alert system

under Consideration

Capacity

Calculation

3-yr rolling average, 3-

to-7 pm output, 6/1

through 8/31; default

value: 20% of net plant

rating until actual

operating data become

available. Wind must

bid into day-ahead

market to be a capacity

resource and receive

capacity market

Historic capacity factor,

adjusted for maintenance.

May be adjusted to reflect

correlation with system

peak hours.

Intermittent resources not

required to participate in

day-ahead market to

receive capacity revenues.

Historic capacity

factor, adjusted for

maintenance.

May change to

performance during

the top 100 “critical

hours.”

Yet to be developed.

Probably based on

assumptions at first,

then on experience

as it develops.

Capacity

Recognition

LSEs may procure

capacity bilaterally,

self supply, or

purchase capacity

credits from PJM

capacity auctions. PJM

proposing significant

changes to capacity

requirements to better

incorporate locational

values and demand

response.

LSEs may self supply,

purchase bilaterally, or

purchase capacity in

monthly auctions or

biennial six-month

capacity auctions.

LSEs may self supply

or purchase bilaterally

or purchase in

monthly auctions

No capacity markets

in Ontario at this

time.

MISO SPP ERCOT CAISO

Wind

Forecasting

In operation since

2008:

• DA and intra-day

RAC

• Transmission

security and outage

coordination

• Transmission

security and peak load

analysis

• Indication of ramps

No role so far. In operation since

2008:

• 80% exceedance

forecast used for

DA planning

• To be fully

integrated in new

nodal design, to be

introduced end of

2010

•Developing ramp

Forecast

In operation since 2004:

• Used to calculate

energy schedule in RT

market

• Advisory role in DA

market




Capacity

Calculation

Regional reliability

organization (MAPP,

MAIN, ECAR)

determines criteria.

Output level that

wind plant equals

or exceeds during

85% of period

defined by top 10%

of load hours.

10% of installed

wind-plant rating

assumed when

assessing regional

capacity sufficiency

Working group

currently studying the

capacity value of wind

generation and

developing improved

models for calculating

the capacity value

Capacity

Recognition

Payments received in

bilateral market for

capacity if designated

as a Network Resource

in MISO meeting

Network Load. As a

designated Network

Resource, must offer

capacity into the Day-

Ahead Market.

No payments

received for

capacity—just

credit toward

overall system

reliability through

reserve margins

Currently no

capacity market.

No payments

received for

capacity—just

credit toward

overall system

reliability through

reserve Margins

No payments received

for capacity—just credit

toward overall system

reliability through

reserve margins.

Resource-adequacy

procurement program

under development by

CPUC,with

implementation by

2006.

MISO NYISO PJM ERCOT

Market timeline DA bids due: 11 a.m.

DA results: 4 p.m.

Re-bidding due: 5pm

RT bids due:

OH -30 min

DA bids due:5 am

DA results:11 am

RT bids due: OH -

75 Min

DA bids due: noon

DA results: 4 p.m.

RT bids due: 6pm

(DA)

DA bids due

(reserves only):

1p.m/4 p.m.

DA results: 1:30p.m/6

p.m.

RT bids due: OH - 60

min

Wind power

bidding,

dispatch,

imbalance

settlements,

deviation

penalties

If wind is a capacity

resource it must bid in

DA market and RAC

•No deviation

penalties

• No wind dispatch,

but this is being

considered

Wind required to

bid in RT market.

DA bidding

optional

• Dispatch signals

provided from

SCED

•Penalty for over

generation in

constrained

situations

• No penalties for

under-generation

If wind is a capacity

resource it must bid

in DA market

•Deviation charges

apply

• Wind dispatch

signals provided in

constrained

situations

• Bilateral market

• Imbalances settled at

RT zonal energy price

•Penalty exemption for

+/- 50% of scheduled

generation

• Ramping limits

Table: Provisions and market schedule of electricity market




Dispatch

adjusted during

day

Balancing

requirements/

provision

adjusted

during day

Flexible use of

individual

conventional

power stations

International

integration of

intraday/

balancing

markets

Integration of

demand side

response

Effective

monitoring of

market power

possible

UK

system

Liquidity in

Bilateral market

low, so utilities

pursue internal

Balancing and

hold excessive

reserves

Difficult to find

matching

partners for

trade

Only within

portfolio of

utility; difficult to

find matching

partner(s) that

buy/provide

energy matching

demand technical

constraints

Difficult due to

separate energy

and

transmission

markets; illiquid

markets for both

products

intraday

No system-

wide

optimisation

Difficult

because prices

bundle energy,

scarcity, and

start-up cost

German

system

To some extent,

as TSO contracts

energy intraday

to match

changing wind

projections

No, volume of

balancing

services

contracted (not

necessarily

used) is

prespecified;

also,

generators

cannot find

matching

partners to

change unit-

commitment

Only within

portfolio of

utility, difficult to

find matching

partner(s) that

buy/provide

energy matching

demand/technical

constraints

No Possible Difficult

because prices

bundle energy

and start-up cost

Nordpool Yes Access to

Hydro Power

Not necessary

because of hydro

flexibility, not

possible because

trade only hour-

byhour

and prespecified

block-bids

Yes Yes, provides

a program to

Integrate

DSM.

Difficult

because prices

bundle energy

and start-up

cost

Spanish

system

Yes, intraday

markets allow

redispatch

There is a day-

ahead

secondary

reserve market

after the

closure of the

day-ahead

market and 6

additional

markets

between the

intraday energy

markets.

Tertiary reserve

is contracted in

a continuous

market.

Yes No Possible Difficult

because prices

bundle energy

and start-up

cost




PJM type

system

Yes, ISO can

centrally

coordinate

Intraday

adjustments

Yes, All

markets are

centrally

coordinated.

The ISO can

decide if

resources bid

into the market

are used to

adapt to

intraday

changes or are

used close to

real-time

Yes, Complex

bids and a central

optimization

allow for inter

temporal

optimization of

each power plant

Yes Yes, PJM

implements

several DSM

programmes

to access

potential on

the demand

side.

Yes, bids

specify variable

cost, start-up

cost and

technical

constraints

Table: Comparison of different Power Markets

Mechanism Market Reform

Energy Only UK Maintained, but less inclined to support higher

prices

ERCOT Maintain and improve price signals by raising

price caps

Capacity Market UK Limited capacity market for reliability purposes

only

ERCOT Possible three year forward market

Feed In Tariffs (FiT),

with Contract for

Differences (CfD)

UK Long term contract for differences to provide

revenue certainty for low carbon generation

investment

ERCOT No such reform is under consideration.

Demand Response

UK Successful energy efficiency programs. Limited

mechanisms to procure and call on Demand

Response for reliability purposes. Desire to

increase DR.

ERCOT Policy reforms are focused on improving the

participation of demand in energy and/or

capacity market

Carbon Price Support

and Emissions

Performance Standard

(EPS)

UK Reinforcement of renewable and carbon

reduction policies

ERCOT No such reform is under consideration

Table: Comparison between UK and ERCOT markets

7.3 INDIA

The overall wind energy based capacity installations on an all India basis have

grown at a CAGR of 26% (from 1908 MW as on March 31, 2003 to 19051 MW




as on March 31, 2013) over the last ten year period. The share of wind energy

based capacity within the overall installed capacity has increased to about 9% as

on March 31, 2013 from 2% as on March 31, 2003 and accounts for about 68%

of overall renewable energy capacity.




Strength

•Proven technology for electricity generation

•Growth in manufacturing Sector

•Dedicated MNRE at central Level

•Low gestation period as compared to fossil fuel or hydro power projects

•State nodal agencies at state level

•Financial assistance by IREDA

•Specialized institutions and organisations

•Comprehensive Resource Assessment

•Environment friendly clean technology

•No fuel inputs

•Guaranteed off-take- long term PPA with Discoms

•Competitive manufacturing base

Weakness

• Intermittent source of power supply

•Low capacity utilisation factor

•Higher cost as compared to fossil fuel based power generation

•Small wind farms are not techno-economically viable

•Potential sites are inaccessible

• Inadequate grid infrastructure

•Bird and Bat Mortality

•Noise Pollution

•Considering the risk involved, the financing rates are high

•Absence of Single window Clearance System

Opportunities

•Huge untapped potential

•Continuing electricity demand-supply gap

•Distributed/ decentralized generation

•Escalation in the cost of fossil fuel-based power generation

•Shortage of fossil fuel (especially coal)

•Fiscal incentives and promotional activities by government

• Interest and capital subsidies

•Remunerative Returns on Equity

•REC and RPO

•CDM credits

•Hybrid models

•100% FDI is allowed through automatic route

•Third party sale at mutually agreed tariff

Threats

•Matured Market

•Wind Power subsidies and incentives may be rationalized or pegged down (GBI, AD)

•Land cost may shoot up

•Discounts provided by manufacturers may dry up

•Technological process may be on hold

•Delay in receipt of payments from DISCOMS (considering the current financial conditions of the DISCOMS)

•Shift in focus

Wind Energy Sector




INDIAN WIND GRID CODE

The draft Indian Wind Grid Code was formulated by the Center for Wind

Energy Technology in 2009. The primary objective of IWGC is to establish the

technical rules which all wind farms must comply within relation to their

planning, connection and operation on the Indian grid. The matter of non-

compliance of IWGC shall be reported to Member Secretary, RPC or the

desgnated agency by any agency/RLDC.

Plannning Code for Transmisssion Systems Evacuating Power

The Planning Code applies to transmission licensees, wind farms, SEBs, CTU/

STU and distribution licensees involved in developing the transmission/

evacuation system for wind power evacuation.

PLANNING CRITERIA

1. Study of transmission system for wind power evacuation

High Wind Generation refers to:

a. 100% capacity factor for wind farms connected below 66kV.

b. Mininmum 90% capacity factor for wind farms connected at 66kV or

110kV or 132 kV.

c. Minimum 80% capacity factor or wind farms connected above 132kV.

i) System Peak Load with High Wind Generation

All generating units in a region during Peak Load conditions will

run at or near its maximum capacity. Power flow will take place at

a higher transmission level and evacuation planning of wind farm

shall not cause any congestion in network during peak load

condition.




ii) System Light Load with High Wind Generation

All the available wind power should be evacuated under system

light load condition.

iii) Local Light Load with High Wind Generation

All the wind power is evacuated to the system during light load

condition in local areas.

2. Contingency study

N-1 contingency criteria is not applicable in case of wind farms because

their plant load factor is lesser than conventional generators. N-1

contingency criteria is applicable only to wind farms connected at 220kV

and above voltage level.

3. Reactive Power Compensation

Reactive Power injection from wind farms is least expected, so the power

factor range is 0.95 leading to 0.95 lagging unlike conventional

generators which have a power factor range of 0.95 leading to 0.85

lagging. Dynamic VAr compensation is used to prevent the voltage

collapse during high wind generation.

Country India UK Germany Canada

Power Factor

Range

0.95 leading to

0.95 lagging

0.95 leading to

0.95 lagging

0.95 leading to

0.95 lagging

0.95 leading to

0.90 lagging

Connection Code For Wind Farms

It specifies the minimum technical and design criteria which must be satisfied

by any wind farm seeking connection to ISTSs/STSs/STUs.

1. TRANSMISSION SYSTEM VOLTAGE REQUIREMENTS

a. Transmission System Voltage Range




The wind farm must be able to deliver available or rated power when

the voltage at grid connection point remains in following range:

Nominal % Limit of variation Maximum Minimum

400 +5% to -10% 420 360

220 +11% to -9% 245 200

132 +10% to -9% 145 120

110 +10% to -12.5% 121 96.25

66 +10% to -9% 72.5 60

33 +5% to -10% 34.65 29.7

Table: Voltage withstand limits for wind farms (kV)

b. Voltage Unbalance

It is defined as the deviation between the highest and lowest line

voltage divided by the average line voltage of three phases. The WTG

connection to an unbalanced system will cause negative phase

sequence current to flow in the rotor of the machine. Wind farms must

be able to withstand following voltage unbalance limits:

Voltage Level (kV) Unbalance (%)

400 1.5

220 2

<220 3

Table: Voltage Unbalance Limits

2. Reactive Power Capability of wind farms

Wind farms connected at 66kV and below shall maintain power factor

between 0.95 lagging and 0.95 leading at grid connection point.

3. Frequency Tolerance Range

i) Wind farms must be capable to operate continuously for system

frequency range of 47.5 to 51.5Hz.




ii) Above 51.5 Hz and below 47.5 Hz allowable frequency tolerance

range of wind farms must remain in accordance with wind turbine

specifications.

iii) Wind turbine must remain grid connected when rate of change of

frequency is within 0.5 Hz/sec.

4. Disconnection of Wind turbine from grid

a. Wind farms must have voltage and frequency relays for disconnection

of wind turbines from grid under abnormal voltage and frequencies.

b. Wind farms connected below 66kV can be disconnected from grid

during system faults and fault ride through capability is not

mandatory.

5. Fault Ride Through Requirements

During Fault Ride Through, the WTGs in the wind farm must have the

capability to meet following requirements:

a) Minimize the reactive power drawl from the grid.

b) The wind turbine generators must provide active power in proportion

to retained grid voltage as soon as fault is cleared.

Nominal System Voltage (kV) Fault Clearing Time,T (ms) Vpf (kV) Vf(kV)

400 100 360 60.0

220 160 200 33.0

132 160 120 19.8

110 160 96.25 16.5

66 300 60 9.9

Table: Fault clearing time for various system nominal voltage levels

where Vf = 15% of Nominal System Voltage

Vpf = Minimum voltages mentioned in IWGC for Reactive

Power Compensation

6. Grid Protection

Limits for release levels and release times of:




Under frequency

Over frequency

Under voltage (fault ride-through behaviour must be considered)

Over voltage

Operating Code for Wind Farms

It specifies the operating conditions that the wind farms must comply with for

safety and reliable operation of the grid and must be applicable to the wind

farms connected to the grids and the SEBs/STUs/SLDCs/RLDCs/SSLDCs.

The wind farm must operate at the same voltage and frequency conditions as

mandated under connection conditions. The Active power and power factor

must also must remain same as the connection conditions.

1. Reactive Power and Voltage Control

The wind farms must not draw reactive power from the grid. VAr

exchanges with the grid shall be priced as follows:

a. Wind farm owner pays for VAr drawl from grid when voltage at the

grid connection point is below 97%

b. The wind farm owner gets paid for VAr given to the grid when

voltage is below 97%

c. The wind farm owner gets paid for VAr drawl when voltage is above

103%

d. The wind farm owner pays for VAr given to the grid when voltage is

above 103%

The wind farm operator must minimize the VAr drawl from the grid

when the voltage at the grid connection point is below 95% of the rated

voltage ,and must not supply VAr to grid when voltage is above 105%.




2. Ramp Rate Limits

These are applicable to grid connected wind farms with installed capacity

50 MW and above. The WTGs must have two ramp rates:

a. 10 minute maximum ramp rate

b. 1 minute maximum ramp rate

Wind Farm Installed Capacity

(MW)

10min Maximum Ramp

(MW)

1 min Maximum Ramp

(MW)

50-150 Installed Capacity/1.5 Installed Capacity/5

>150 100 30

Table: Ramp rate limits for wind farms

This is similar to Irish Grid Code where ramp rate averaged over 1minute

should not exceed 3 times the average ramp rate over 10 minutes.

3. Scheduling Process

When wind penetration increases, it would be necessary to carry out wind

energy forecasting to know the predicted wind power in next day on

hourly basis so as to minimize the scheduling errors. The system operator

must aim at utilizing the wind energy fully and the Merit Order dispatch

shall not be allowed for wind farms.

4. Forecasting

Centralized wind forecasting facility must be provided in area with

aggregated capacity of 200MW and above. The centralized wind

forecasting facility must be installed by system operator or wind

developer to forecast the wind flow over a certain geographic area (for a

cluster of wind farms).

The wind energy forecasting system must forecast power based on wind

flow data at the following intervals:

i) Day- ahead forecast:




Wind power forecast with an interval of one hour for the next

24hours for the aggregate wind farms. It is done to assess the

probable wind energy that can be scheduled for the next day.

ii) Hourly forecast:

Wind Power forecast with a frequency of one hour and interval of

30minutes for the next 3 hours for the aggregate wind farms. It is

necessary to minimize the forecasting error that can occur in the

day ahead forecasting of the wind power.

DATA PROCESSING

Wind farms shall give information about:

Active Power Output

Reactive Power Output

Status

Set point values of grid operator to wind farm:

Reactive power (MVAr or power factor)

Active Power Reduction

Wind farms should behave more like conventional power plants and support the

grid. To set-up a grid connection for wind farms, it must match the standard grid

code.

Complementary Commercial Mechanism as per IEGC

Wind farms =10MW & above connected to 33kV or above should give their :

1. Outage planning

2. Day ahead forecast with an interval of 15 min. (max 8 revisions in 3 hr. time

slot ) with accuracy of 70%




In case of wind generators ,if :

a. Generation is beyond +/- 30% of the schedule then wind generator will

bear UI charges

b. Generation within +/- 30% of the schedule then host state will bear UI

charges which shall be shared among all the States of the country in the

ratio of their peak demands in the previous month based on the data

published by CEA, in the form of a regulatory charge known as the

Renewable Regulatory Charge operated through the Renewable

Regulatory Fund (RRF), operated through NLDC.

Energy Accounting of Wind Generator

Inter-State

The transactions would be between the wind generator and the purchasing

State at the contracted rate for actual generation upto 150% of the scheduled

generation.

The difference of actual generation from the schedule for the purchasing

State would be settled at the UI rate of the Region of the purchasing state

through the RRF.

The implication due to deviations of actual generation within +/- 30% of the

scheduled generation would be settled with the host State through the RRF.

The deviations outside +/- 30% would be settled directly between the host

State and the Wind Farm.

Intra-State

The transactions would be between the wind generator and the host State at

the contracted rate for actual generation.




The implication due to deviations of actual generation within +/- 30% of the

scheduled generation would be settled through the RRF.

The implication due to deviations outside +/- 30% would be settled directly

between the host State and the Wind Farm

Scheduling Provisions for Wind Generators as per IEGC

For capacity and voltage level below the levels mentioned in IEGC, as well

as for old wind farms it could be mutually decided between the Wind

Generator and the transmission or distribution utility, as the case may be, if

there is no existing contractual agreement to the contrary.

The schedule by wind power generating stations may be revised by giving

advance notice to SLDC/RLDC, as the case may be. Such revisions by wind

power generating stations shall be effective from 6th

time-block ,the first

being the time –block in which notice was given.

There may be maximum of 8 revisions for each 3 hour time slot starting from

00:00 hours during the day.

Forecasting for Wind Generation

As per Para 3 of Annexure-1 ( Complementary Commercial Mechanism) of IEGC

Wind energy being of variable nature, needs to be predicted with

reasonable accuracy for proper scheduling and dispatching.

Wind generation forecasting can be done on an individual developer basis or

joint basis for an aggregated generation capacity of 10 MW and above

connected at a connection point of 33 kV and above.




If done jointly, the wind forecasting facility shall be built and operated by

wind developers in the area and sharing of the cost shall be mutually

discussed and agreed.

As per Para 4 of Annexure-1(Complementary Commercial Mechanism),

IEGC

The wind energy forecasting system shall forecast power based on wind

flow data on day ahead basis.

Wind/ power forecast with an interval of 15 minutes for the next 24

hours for the aggregate Generation capacity of 10 MW and above.

Types of Wind Energy Forecast Required based on Time Horizon

Energy Forecast Over day month and year – Cash Flow of Wind Generator

MW Forecast- Day ahead useful for System operation

Ramp Forecast- Hours ahead -to reduce forecast gap

Operational Requirements as per IEGC

As per Regulation 5.2 (u) of IEGC,2010:

System Operator ( SLDC/RLDC) shall make all efforts to evacuate the available

solar and wind power and treat them as a must run station.

However, system operator may instruct the wind or solar generator to back

down on consideration of grid security or safety of equipment or personnel and

the generators shall comply these directions.

For this Data Acquisition system facility shall be provided for transfer of

information to concerned SLDC/RLDC.




SLDC/RLDC may direct a wind farm to curtail its Var drawal/injection in case

the security of grid or safey of any equipment or personnel is endangered.

During the wind generator start-up, the wind generator shall ensure that the

reactive power draw shall not affect the grid performance.

As per Regulation 5.3 (g) the SLDC shall take into account the wind energy

forecasting to meet the active and reactive power requirements.

SPECIFICATIONS REQUIRED DURING DIFFERENT PHASES OF

WIND FARM

DISCIPLINE/

PROJECT

STATUS

PRE CONSTRUCTION DURING

CONSTRUCTION

DURING OPERATION

MARKET

SPECIFICATIONS Wind assessment review

Building Permit Review

Grid Connection

License/Feed In License

National Specifications-

Remuneration, grid code

etc

Fulfilment of

Building/grid

connection

License

Requirements

Acknowledgement

of OP license

Wind assessment

update

Operation License-

review

Grid Connection/

Feed In License

Review

Grid Code- changes,

requirements,

fulfilment

TECHNICAL

SPECIFICATIONS Review on site Layout

Wind Turbine Technical

Review (track record,

suitability etc.)

Electrical Works Review

(Internal grid, substation,

connection to the grid)

Civil Works Review

(Foundations, Geotech,

Accesses, Crane Pads,

SE building)

Overlapping Issues (eg

Construction Schedule

Review, grid

compliance)

Construction Monitoring

Supervision of

fulfilment of

technical

requirements

Regular

Construction

Reports

Supervision/

review of

Equipment tests

Commissioning of

WTG

Supervision and

Control of Take

Over Procedure

WTG inspection

(end of warranty)

Specific component

inspections

Scada Data analysis

general inspections,

end of warranty

inspections etc

Grid code needs/

changes




CONTRACTUAL

SPECIFICATIONS TSA, O&M, Warranties

BoP/EPC

Grid Connection

Agreement

PPA / CPA PPA Review

(Changes)

Land Agreements

Overlapping Issues (e.g.

contractual

interaction during construction)


- Fulfilment of Contractual

Obligations

- payment supervision

WT- O&M

Agreement

Management

Agreement

PPA Review

(Changes)

In all contracts:

review in case of

changes

FINANCE

SUPERVISION

Cash Flow review (CAPEX,

revenues,

OPEX, etc.)


- Approval of Draw Downs

and review of

Cash Flow during

Construction Phase

- regular construction

reports

Financial operation

Monitoring

Cash Flow

Assessment

ANCILLARY MARKET

Two main Ancillary Services – one being Reserves and the other Frequency

Keeping, however, there are other ancillary services such as Voltage Support.

A. The Reserve Market

• As part of the System Operator responsibilities, Transpower are required

to keep enough generation in reserve to cover the risk of the largest

generator tripping (stopped generating suddenly) and subsequently are

required to keep frequency at around 50 Hz in both the North and South

islands.

• There are two types of reserve required – Fast Instantaneous Reserve

(FIR) and Slow Instantaneous Reserve (SIR). FIR is required to respond

within 6 seconds of frequency falling and sustain this extra generation for

at least 60 seconds. SIR is required to respond within 60 seconds of a

frequency event and be maintained for up to 15 minutes if required.




• The energy and reserve markets can affect each other. Eg. When the

market is short of reserve, a generating unit may be backed off to provide

reserve resulting in a higher spot price

B. The Frequency Keeping Market

• It is a separate market from the energy market, here the companies

providing frequency keeping compete by offering a fee for the service for

each half hour trading period. The frequency keeper is required to

maintain frequency within a band of 50.2 Hz to 49.8 Hz.

• Governors on each generator monitor the state of frequency and control

the amount of water or steam flowing through the turbine to adjust the

level of generation to suit the frequency level.

• For example if generation is constant and demand suddenly increases, the

waves above are stretched out and the frequency falls which requires

extra generation to get back to 50 Hz and as a result of this the frequency

keeper increases their generation to stabilize the frequency.

• Drastic drop in Hz is potentially disastrous. One unit tripping can cause

Hz to fall, which leads to another unit tripping

and causes other

generators to trip. This is commonly known as cascade failure and would

lead to a blackout – such as those seen in New York a couple of years

ago.

Automatic demand management in IEGC.

Para 5.4.2.(d) : The SLDC through respective State Electricity

Boards/Distribution Licensees shall also formulate and implement state-

of-the-art demand management schemes for automatic demand

management like rotational load shedding, demand response (which may




include lower tariff for interruptible loads) etc. before 01.01.2011, to

reduce overdrawlin order to comply para5.4.2 (a) and (b) .

Wide area measurement systems (WAMS)

•Two schemes in the Northern and Western Regions of India.

•The scheme in Northern Region is a pilot scheme for installation of four Phasor

Measurement Units (PMUs) at certain identified locations. Commissioned in the

end of April 2010 and data has been flowing since then to the system operator

of Northern Region.

•The scheme in Western Region is a pilot scheme for installation of 28 PMUs at

various locations in the Western Region. Optimum location through software

program.

State

Wheeling and

transmission

Charges

Banking FiT (INR

per unit)

Cross subsidy

surcharge (CSS) RPO

Karnataka 5% wheeling

charges and losses

12 months, 2%

banking charges 3.70 Nil

7-10% Captive &

Open Access

(OA) -5%

Tamil Nadu

HT/EHT: 5% for

all OA consumers

LT: 7.5% for all

OA consumers

1 year TOD

banking

Charges @ 5% of

energy generated

in billing month

3.51

50% CSS

applicable for

WEGs

9%

Gujarat Normal OA

charges

1 month banking

for captive

consumers

4.61 Nil 7% in FY 13




Maharashtra Normal OA

charges 12 months

Zone 1: 5.67

Zone 2: 4.93

Zone 3: 4.20

Zone 4: 3.78

25% CSS

2010-11: 6%

2011-12: 7%

2012-13: 8%

2013-16: 9%

Rajasthan

50% of normal

transmission

charges

Banking and

withdrawal on six-

month basis.

Withdrawal not

allowed in Dec,

Jan and Feb

4.46-4.69 Nil

5.1% for wind

with overall

7.1% in FY 13

Andhra

Pradesh

As per rules and

regulations of the

Commission

Allowed 3.50

50% CSS for

generation from

renewable

sources

5%

Table: Various Regulatory Provisions for Wind Sector in India

Nord Pool PJM NEMMCO IEX

Participation Voluntary for day-

head and ,

adjustment market

Compulsory for

day-ahead market

Compulsory for

day-ahead spot

Voluntary

Market Offerings Day-ahead spot,

hour ahead,

Forwards, Futures,

Options

Day-ahead spot,

real-time balancing,

capacity credits

market

Day-ahead spot and

short-term forwards

Day-ahead spot

Bidding type Double-sided Double-sided Double-sided Double-sided

Adjustment

Market

Elbas; intra-day

auction market

Bid-quantity can be

changed till gate

closure

-

Not available

Real time/

Balancing market

Counter trade for

real time, .

Participants are

given MCP

Deviations are

traded in real-time

Through purchase

of Ancillary .

services, reserve

capacity buying

Deviations are

subjected to UI

charges

Pricing rule Zonal pricing Nodal pricing Zonal pricing Zonal pricing




Pricing type Ex-ante Ex-post Ex-post Ex-ante

Risk management Forwards, Futures,

Options

FTRs-ARRs,

Bilateral OTC,

Multi-settlement

market, virtual

bidding, Financial

trading@ NYMEX

Bilateral OTC,

Derivatives on

Sydney future

exchange

Bilateral OTC

Congestion

management

Area splitting Security

constrained

economic dispatch

Locational signals

for transmission

tariffs

Area splitting

Transmission

Losses

Included in zonal

price

Included in LMP To be purchased by

generators

To be purchased by

participants

Time blocks Hourly blocks Hourly blocks Half-hourly blocks Hourly blocks

Table: Consolidated overview of Nord Pool, PJM, NEMMCO, IEX

8. SOLUTIONS FOR INDIA –WIND ENERGY

Wind energy generators are mandated to forecast the wind generation,

since wind forecasting software packages are available in the market.

The philosophy of limited applicability of UI charges to Wind generators

is that it is seen that they can forecast generation of wind energy with an

accuracy of at least 70%. Therefore, within the band of +/-30% variation

from the forecast, they should not be subjected to UI charges.

However, for variation more than that, they are liable to be included in

the UI mechanism, beyond this limit.

The UI mechanism is used only in India. It has been introduced in South

Africa only last year. It is suggested that penalty mechanism other than

UI charges must be adopted in India.

The wind power is forecasted in 15minute time block (96 time blocks in a

day) in India. Internationally, the wind power is forecasted on an hourly

basis. An hourly forecast system must be used in India.




Internationally, an accuracy of 90% is achieved on the basis of

calculation of absolute mean error. But in India, absolute error is

computed, which provides accuracy of 70%.

India must develop technologies like radar for forecasting local wind.

India presently has two satellites-INSAT 3A and Kalpana 2 for

forecasting of global winds.

In order to prevent gaming by the wind generator by always playing safe

and declaring on the lower side during times of low frequency, a cap of

+50% has been put.

This provision is being mandated for wind generators with an aggregate

capacity of 10 MW or more and for solar generators with an aggregate capacity

of 5 MW or more, connected at a connection point of voltage level of 33 kV and

above, whose Power Purchase Agreements have not been signed as on 3.5.2010,

the date of coming into effect of the new IEGC.

9. CONCLUSION

If hourly wind forecasting replaces the 15 minute time block wind forecasting in

India and absolute mean error is used to compute accuracy, then India will be

able to achieve 90% wind forecasting accuracy like U.S.A. and Europe.

10. REFERENCES

Ackermann, Thomas (Editor). Wind Power in Power systems. Wiley and Sons,

2005.

http://www.windpowerinpowersystems.info/

Holttinen, H. The impact of large scale wind power on the Nordic electricity

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http://www.vtt.fi/inf/pdf/publications/2004/p554.pdf

EWEA. Wind Energy. The Facts. 2004; www.ewea.org




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Billund, Denmark, Editors:

Matevosyan, J. and Ackermann, T., published by the Royal Institute of

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Acker, T. 2007. Arizona Public Service Wind Integration Cost Impact Study.

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Arizona University.

Almon, B. 2011. Personal communication with Brian Almon, Public Utility

Commission of Texas. January 31, 2011.




American Wind Energy Association (AWEA). 2011a. U.S. Wind Industry

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Energy Association.

American Wind Energy Association (AWEA). 2011b. U.S. Wind Industry First

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