Wind/Gas Cooptimization
-
Upload
eamonnmccormick -
Category
Documents
-
view
262 -
download
0
description
Transcript of Wind/Gas Cooptimization
Copyright © Tri Modal 2010
“Renewable Plus” PresentationFebruary 2011Eamonn McCormick – CEO
Copyright © Tri Modal 2010
Company Background• Focused on planning and optimization of “Wind/Solar/fossil” generation
portfolios• Goal is to assist “industry consortiums” to deliver “Firm/Shapable
Renewable Energy Product” we call “Renewable Plus”
Copyright © Tri Modal 2010
Current Environment is Challenging1. Recession:
A significant drop in energy growth in all regions and indeed in areas like Phoenix demand has dropped vis a vis 2006 levels.
Impacted the wind industry growth for the first time since the early 2000's. Indeed number of MWs this year is estimated to be 40% down on last year.
Sluggish recovery means more focus on optimization of existing assets, replacement of existing plants, reducing costs of renewable and planning for the mid to long term rather than shorter term traditional wind projects
2. Regulatory situation has not developed at the Federal level slowing growth furtherNational RPSFederal GHG standardsLittle regulatory stimulus to the market.
3. The industry is stretched by credit crises and other initiatives such as smart grid.4. There is a significant overhang of renewable projects from 2008/2009 that is depressing
interest in new projects5. Many states are facing increased technical challenges integrating higher percentages of wind. 6. Large European players like Acciona retrenching as they are impacted by fall in Euro and
financial crisis at home
Copyright © Tri Modal 2010
Implications
• The implication is that buyers and investors are reluctant to invest or sign PPAs for high cost traditional wind farms and are in a “wait and see” attitude
• Game is changing due to a need to address– Long term cost & demand implications of sluggish recovery– “Interstate” transmission projects and which are likely to evolve– Changing technology– “Renewables integration” with existing infrastructure– Need to address “Reliability” as renewables increase as % of the
generation capacity
• What we have determined is that the industry requires a new approach that will provide strategic advantage over competitors both in the short, medium and longer term.
Copyright © Tri Modal 2010
Questions?
It is clear that the current US wind industry is locked into a high cost business model. The key to future success is determined by:
1. How can we lower cost of wind and solar?2. How can we add more value to wind and solar?3. How can we reduce wind integration costs and reliability issues?4. How can we optimize existing fossil generation portfolio?5. How can we combine wind/solar/fossil to create a new highly competitive
product that is more akin to traditional fossil generation?6. How can we create an optimized business model for generators that attracts
strategic customers?7. How can this generation model be used to attract strategic transmission
partners?8. What kind of new “renewable plus” generation entity is required?
Copyright © Tri Modal 2010
Typical Daily Demand Profile versus Wind Generation Profile in ERCOT
Typical 24 Hours
Demand ProfileVs
Wind Generation
Copyright © Tri Modal 2010
How can we combine wind/solar/fossil to create a new highly competitive product that is more akin to traditional fossil generation?
7
RENEWABLE PLUS?
Copyright © Tri Modal 2010
The Renewable Plus Consortium Example
Wind Solar Fossil& Nuclear Storage
Firm/Shapable Renewable Energy Product
Renewable Plus
Gen Co.
Utility Customer
Copyright © Tri Modal 2010
Renewable Plus Product
WIND
Fossil& NUCLEAR
SOLAR
CSP
Photo Voltaic
Low Cost
Configured to Demand
Environment & Regulation Friendly
Reliable
Low Risk
Co-Optim
ized
Coal Plant
Storage
Gas Plant
Nuclear
Copyright © Tri Modal 2010
Wind, Gas, Solar, Storage not sufficient for true co-optimization• Co-Optimize
– New Components• Wind• Nuclear• Solar• Gas• Storage
• AND – Existing plants
• Fossil• Nuclear• Gas
• AND– Transmission (Interstate Highways and Local Byways)
• AND CONSIDER– Need to blend energy sources– Configure to customer needs
10
Copyright © Tri Modal 2010
Example of a Simple “Renewable Plus” Generation Plant (Wind, Gas, Storage)
11
1. Wind farm generates electricity2. Off peak energy stored as
compressed air3. Compressed air released during
on-peak hours4. Compressed air energy
converted to electricity and blended with electricity generated from gas
Copyright © Tri Modal 2010
Renewable Plus Generation Consortium – Back to an old approach to generation• Assuming it is possible via the “Renewable Plus” approach to
combine “renewables and traditional generation” to create a “renewable plus plant” that operates at low cost like a traditional “dispatchable plant”
• Then:– We can use the proven utility model of utilities forming consortiums to build
major “dispatchable plants”– Similar approach to proven Nuclear and Coal Plant model (like Palo Verde)
where “consortium” owns and operates the plant based on their aggregated needs
– No longer makes sense for independent small scale renewables as plant needs to be engineered to exact “consortium” specifications
– Approach can be used to plan for retirement of large old coal based generation while minimizing cost, increasing “green” energy and optimizing gas and nuclear assets
12
Copyright © Tri Modal 2010
Advantages of “Renewable Plus” Product
• Higher value to customer– Lower reserve margin costs– Lower transmission costs– Lower ancillary services costs– Lower wind integration costs– Lower integrated energy costs– Lower risk
• Both the “renewable plus” optimization achieves higher PPAs• Higher probability to get transmission capacity faster• Increases value of wind projects and gas/CAES plant• Improves wind sales by bundling with value added services• Attracts additional buyers• Most attractive to utilities rather than pure retail energy providers (REPS)• Results in market dominance
Copyright © Tri Modal 2010
Optimization
The optimization uses a multi-year mixed integer programming algorithm to minimize costs over the planning horizon, subject to customer demand, security and other constraints, and customer ancillary service procurement requirements.
14
Copyright © Tri Modal 2010
Renewable Plus Planning Process
Physical ModelingCloud
Computing
Logical Modeling
LinearProgram
Conceptual
Modeling
Spreadsheet
15
IncreasingModelComplexity
National Labs
Research 1Universities
Other Key Univ/Colleges
DOD
RenewableEnergyProject Area
Modular NuclearReactor
Copyright © Tri Modal 2010
Summary
• Configurable “Renewable Plus” product is the key to the next generation of renewable generators
• Initial market feedback is very positive from potential partners• Renewable Plus business model will be anchored by Consortium Lead• Powerful customer led consortiums will ensure Consortium Lead have the
correct US partners in order to succeed and gain market dominance