Alberta has grown its wind power capacity substantially in the last few years. As of November 2012, 1.087 GW of generating capacity from 16 wind energy facilities had been connected to the transmission system, representing 7.5% of the Alberta Electric System Operator’s (AESO) total installed generation capacity.
There continues to be strong interest in building more wind projects in the province. There are currently more than 3.2 GW of wind in the connection project queue, and the grid operator’s June 2012 long-term transmission plan estimates a total of 2.5 GW of wind by 2020 in the baseline scenario.
However, there are implications of connecting more wind into the Alberta interconnected electric system, particularly with regard to wind variability.
In September 2010, the AESO released the short-term wind integration recommendation paper that identified measures to address up to 1.1 GW of wind capacity, with sensitivities tested for up to 1.5 GW of capacity. In 2012, the AESO implemented rules to deal with wind ramping up faster than what could be accommodated by the system. The AESO is also gathering real-time meteorological data from every wind farm in the province. This information is automatically transferred every 10 minutes to the forecaster, who, in turn, provides a long-term forecast (0-7 days) and a short-term forecast (0-12 hours). These measures are currently implemented as Phase I of the program.
In December 2010, the AESO released the Phase II wind integration discussion paper that identified and analyzed options for integrating variable generation onto the system over the long term. The following six options were identified:
- Reliance on the energy market merit order (EMMO),
- Increase of regulating reserve volumes,
- Refinement of short-term wind integration recommendations,
- Development of a ramping service,
- Development of a wind firming service, and
- Development of “must offer, must comply” rules for wind.
The options identified were not necessarily meant to be mutually exclusive or utilized as stand-alone methods of dealing with wind integration. In order to obtain external feedback, the AESO formed an industry wind work group and held 12 sessions to discuss the options with stakeholders, and eventually had them rank the options according to several criteria. These options were also evaluated and analyzed in the context of the AESO mandate to promote a fair, efficient and openly competitive market.
In December 2012, the AESO released the Phase II wind integration recommendation paper. Specifically, the AESO recommends investigating options for allowing wind to participate in the EMMO. Additionally, interested participants should explore the need for, and development of, a new system ramping service, which could include changes to the regulating reserve technical standards and options for altering the payment structure of the regulating reserve.
Wind power does not currently enter an offer into the EMMO and, as such, is only directed by the AESO for reliability reasons, such as transmission limitations. Wind is, in effect, a passive participant in the energy market; it is not dispatched under normal conditions and does not have the ability to indicate price responsiveness through an offer. Because wind generation does not currently offer into the merit order, higher amounts of wind energy in the market will result in growing amounts of generation that act as a price taker.
Participation in the market through dispatch is a trend for wind generation throughout the world as the amount of wind generation increases. Independent system operators (ISOs) – such as the New York Independent System Operator, the Midwest Independent Transmission System Operator (MISO), the Electric Reliability Council of Texas (ERCOT) and PJM Interconnection – are already dispatching wind.
The specific terms and conditions for enabling wind to be dispatchable vary from jurisdiction to jurisdiction due to differing market designs. However, most markets have developed an option for wind to participate in the market.
At a minimum, the AESO recommends that wind generators have the option to participate in the EMMO. In order to accommodate participation, the AESO will work to develop the rules, guidelines and practices that will be used for wind dispatch. The AESO recommends that, initially, wind’s active participation in the EMMO be voluntary, but mandatory participation continues to be explored. In addition, the AESO will examine the potential for wind generators to sell services, such as dispatch-down service and, potentially, some ancillary services.
The key benefits of allowing wind to be dispatchable include the following:
- Creates greater visibility of expected wind generation for the system controller and allows wind to be dispatched up in a controlled fashion,
- Treats wind more consistently as compared to other generators,
- Creates an incentive for more accurate wind forecasting,
- Allows wind to actively participate in the market through energy offers, and
- Potentially results in less-frequent occurrences of supply-surplus conditions.
As a first step toward implementation of this recommendation, in May 2012, the AESO initiated a wind dispatch pilot project with one market participant and two wind assets. The pilot project term was six months and aimed to test the ability of wind facilities to be equivalent to other generators in terms of energy dispatch requirements and participation in the EMMO, given existing ISO rules. The preliminary results of the pilot are expected to be published by the end of this quarter.
System ramping service
The ramping service would be dispatched only when the system ramp requirement is greater than the EMMO can provide. In determining whether to dispatch the ramping service, the AESO would calculate the available ramp rate from the EMMO based on current conditions and expected changes in load and the net intertie schedule. Qualified market participants that offer the service would get paid a premium for ramp-rate dispatches in addition to the payment for production at pool price.
This ramping service would provide a direct price signal for both upward and downward ramping capability. It would be designed to be used for short periods whenever the net change in the supply-demand balance is greater than that which can be accommodated by energy market dispatches. This can occur due to changes in load, intertie schedule, wind generation or other factors that significantly alter the supply-demand balance. The key challenge in developing the service is to create a transparent mechanism to distinguish between energy-market dispatches and ramp-rate dispatches.
This service is not unique to Alberta. Other energy markets that are characterized by high volumes of variable energy are also challenged by system reliability concerns; abrupt, short-term dispatches; and price volatility. The California Independent System Operator, MISO, ERCOT and other ISOs are using similar approaches. The structure and procurement of the services vary due to the differences in the market structures of the jurisdictions. These ISOs similarly enhance reliability of the system through ramping capability offers from market participants aimed at offsetting extreme system ramping events.
Here are some of the key aspects of the fully integrated service:
- The ramping service allows providers with qualifying capacity and ramp rates to be compensated for an ancillary service specifically for the provision of ramp rate.
- The ramping service would only be dispatched for short periods in order to supplement the ramp rate inherent in the EMMO.
- The energy from ramping service providers would not have to be held in reserve; it would continue to be offered through the EMMO and dispatched in economic order, and would also be able to be dispatched specifically for ramp rate when required.
- The ramp-up and ramp-down services will be separate. This will maximize potential suppliers and, thus, competition. In other words, wind could sell ramp-down service, load could sell ramp-up service and other generators – and potentially some storage technologies – could sell both directions.
Some advantages of a fully integrated ramping service include the following:
- The service sends a direct signal for flexibility, allowing market participants to indicate their willingness and ability to accept short-term dispatches in one or both directions, and at what price.
- The ramping service provides benefits to the system beyond wind integration (e.g., managing load ramps without incremental regulating reserve, managing intertie ramps).
- The service opens up the possibility for regulating reserve to be redesigned to reduce or eliminate the energy component.
- The service is scalable as system requirements change. Increasing or decreasing ramping requirements will be reflected in the price for the service and the volume of the service utilized.
Industry At Large: Wind Integration
How Alberta Plans To Tackle Wind Integration
By Jacques Duchesne
The Alberta Electric System Operator is studying ways to more efficiently bring wind energy onto its system.
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