Operational costs induced by fluctuating wind power production in Germany and Scandinavia

Adding wind power generation in a power system changes the operational patterns of the existing units due to the variability and partial predictability of wind power production. For large amounts of wind power production, the expectation is that the specific operational costs (fuel costs, start-up costs, variable operation and maintenance costs, costs of consuming CO2 emission permits) of the other power plants will increase due to more operation time in part-load and more start-ups. The change in operational costs induced by the wind power production can only be calculated by comparing the operational costs in two power system configurations: with wind power production and with alternative wind production having properties such as conventional production, that is, being predictable and less variable. The choice of the characteristics of the alternative production is not straightforward and will therefore influence the operational costs induced by wind power production. A method is applied for calculating the change in operational costs due to wind power production using a stochastic optimisation model covering the power systems in Germany and the Nordic countries. Two cases of alternative production are used to calculate the change in operational costs, namely perfectly predictable wind power production enabling the calculation of the costs connected to partial predictability and constant wind power production enabling the calculation of the operational costs connected to variability of wind power production. A 2010 case with three different wind power production penetration levels is analysed.     

Wind power planning: assessing long-term costs and benefits

In the following paper, a new and straightforward technique for estimating the social benefit of large-scale wind power production is presented. The social benefit is based upon wind power's energy and capacity services and the avoidance of environmental damages. The approach uses probabilistic load duration curves to account for the stochastic interaction between wind power availability, electricity demand, and conventional generator dispatch. The model is applied to potential offshore wind power development to the south of Long Island, NY. If natural gas combined cycle and integrated gasifier combined cycle (IGCC) are the alternative generation sources, wind power exhibits a negative social benefit due to its high capacity cost and the relatively low emissions of these advanced fossil-fuel technologies. Environmental benefits increase significantly if charges for CO₂ emissions are included. Results also reveal a diminishing social benefit as wind power penetration increases. The dependence of wind power benefits on CO₂ charges, and capital costs for wind turbines and IGCC plant is also discussed. The methodology is intended for use by energy planners in assessing the social benefit of future investments in wind power.     

Assessing the potential for a wind power incentive for remote villages in Canada

This paper discusses the uptake potential for a wind–diesel production incentive designed specifically for Canadian northern and remote communities. In spite of having over 300 remote communities with extremely high electricity costs, Canada has had little success in developing remote wind energy projects. Most of Canada’s large-scale wind power has been developed as a direct result of a Federal production incentive implemented in 2002. Using this incentive structure as a successful model, this paper explores how an incentive tailored to remote wind power could be deployed. Micro-power simulations were done to demonstrate that the production incentive designed by the Canadian Wind Energy Association would cost on average $4.7 $Cdn million and could be expected to result in 14.5 MW of wind energy projects in remote villages in Canada over a 10 year period, saving 11.5 $Cdn million dollars in diesel costs annually, displacing 7600 tonnes of CO_2eq emissions and 9.6 million litres of diesel fuel every year.     

Understanding the variability of wind power costs

Wind power has a significant contribution to make in efforts to abate CO₂ emissions from global energy systems. Currently, wind power generation costs are approaching parity with costs attributed to conventional, carbon-based sources of energy but the economic advantage still rests decidedly with conventional sources. Therefore, there is an imperative to ensure that wind power projects are developed in the most economically optimal fashion. For wind power project developers, shaving a few tenths of a cent off of the kilowatts per hour cost of wind power can mean the difference between a commercially viable project and a non-starter. For civic authorities who are responsible for managing municipally supported wind power projects, optimizing the economics of such projects can attenuate stakeholder opposition. This paper attempts to contribute to a better understanding of how to economically optimise wind power projects by conflating research from the fields of energy economics, wind power engineering, aerodynamics, geography and climate science to identify critical factors that influence the economic optimization of wind power projects.     

Potential role of power authorities in offshore wind power development in the US

This article examines how power authorities could facilitate and manage offshore wind power development in US coastal waters. The power authority structure is an American 20th century institution for managing energy resources—a form of a public authority or public corporation dedicated to creating, operating and maintaining electric generation and transmission infrastructure. Offshore wind power is characterized by high capital costs but no fuel costs and thus low operating costs. Therefore a power authority, by virtue of its access to low-cost capital and managerial flexibility, could facilitate offshore wind power development by reducing financial risk of developing and lowering debt payments, thus improving the risk profile and lowering the cost of electricity production. Additionally, power authorities can be made up of multiple states, thus opening the possibility for joint action by neighboring coastal states. Using primary and secondary data, we undertake an in-depth analysis of the potential benefits and shortcomings of a power authority approach.     

Large scale integration of wind power: moderating thermal power plant cycling

Power plant cycling in thermal plants typically implies high costs and emissions. It is, therefore, important to find ways to reduce the influence of variations in wind power generation on these plants without forsaking large amounts of wind power. Using a unit commitment model, this work investigates the possibility to reduce variations by means of a moderator, such as a storage unit or import/export capacity. The relation between the reduction in CO₂‐emissions and the power rating of the moderator is investigated, as well as the benefit of a moderator which handles weekly variations compared with a moderator which has to be balanced on a daily basis. It is found that a daily balanced moderator yields a decrease in emissions of about 2% at 20% wind power grid penetration. The reduction in emissions is mainly due to an avoidance of start‐up and part load emissions and a moderator of modest power rating is sufficient to achieve most of this decrease. In the case of a weekly balanced moderator, emissions are reduced as the moderator power rating increases. At 40% wind power grid penetration, a weekly balanced moderator reduces emissions with up to 11%. The major part of this reduction is due to the avoidance of wind power curtailment. The simulated benefit (CO₂‐emissions and costs) from adding a general moderator is compared with emissions from Life Cycle Assessment (LCA) studies and cost data of five available moderator technologies; transmission capacity, pumped hydro power, compressed air energy storage, flow batteries and sodium sulphur batteries. Copyright © 2010 John Wiley & Sons, Ltd.     

Combining spatial modeling and choice experiments for the optimal spatial allocation of wind turbines

Although wind power is currently the most efficient source of renewable energy, the installation of wind turbines (WT) in landscapes often leads to conflicts in the affected communities. We propose that such conflicts can be mitigated by a welfare-optimal spatial allocation of WT in the landscape so that a given energy target is reached at minimum social costs. The energy target is motivated by the fact that wind power production is associated with relatively low CO₂ emissions. Social costs comprise energy production costs as well as external costs caused by harmful impacts on humans and biodiversity. We present a modeling approach that combines spatially explicit ecological–economic modeling and choice experiments to determine the welfare-optimal spatial allocation of WT in West Saxony, Germany. The welfare-optimal sites balance production and external costs. Results indicate that in the welfare-optimal allocation the external costs represent about 14% of the total costs (production costs plus external costs). Optimizing wind power production without consideration of the external costs would lead to a very different allocation of WT that would marginally reduce the production costs but strongly increase the external costs and thus lead to substantial welfare losses.     

Hydrogen production from offshore wind power in South China

Wind power hydrogen production is the direct conversion of electricity generated by wind power into hydrogen through water electrolysis hydrogen production equipment, which produces hydrogen for convenient long-term storage through water electrolysis. With the development of offshore wind power from offshore projects, construction costs continue to rise. Turning power transmission into hydrogen transmission will help reduce the cost of offshore wind power construction. This paper analyses the methods of producing hydrogen from offshore wind power, including alkaline water electrolysis, proton exchange membrane electrolysis of water, and solid oxide electrolysis of water. In addition, this paper outlines economic and cost analyses of hydrogen production from offshore wind power. In the future, with the development and advancement of water electrolysis hydrogen production technology, hydrogen production from offshore wind power could be more economical and practical.     

Impact of wind power on the power system imbalances in Finland

A study on the imbalance costs or payments that wind power producers pay on the one hand and the cost incurred for the power system on the other hand is presented. Both the producer side and the system side will be examined with case data on prediction errors, system net imbalances and the balancing costs. The upscaled forecast errors of wind power that result in imbalances have been combined with the system real net imbalance. Comparisons and discussion about the balancing costs of wind power depending on the wind penetration are provided. The results for Finland show that a two-price system for imbalances results in higher imbalance costs than a one-price system. At low wind power penetration levels, the difference in imbalance payments is high for one- and two-price system. When wind penetration increases, there is not so much difference in the different balance settlement rules used. According to the comparison between imbalance payments and system costs, the increase in system costs because of wind power is lower than imbalance payments for wind power producers when using either average prices for up- and down-regulation or the regulation prices that increase linearly with regulation demand.     

Economics of wind power when national grids are unreliable

Power interruptions are a typical characteristic of national grids in developing countries. Manufacturing, processing, refrigeration and other facilities that require a dependable supply of power, and might be considered a small grid within the larger national grid, employ diesel generators for backup. In this study, we develop a stochastic simulation model of a very small grid connected to an unreliable national grid to show that the introduction of wind-generated power can, despite its intermittency, reduce costs significantly. For a small grid with a peak load of 2.85 MW and diesel generating capacity of 3.75 MW provided by two diesel generators, the savings from using wind energy (based on wind data for Mekelle, Ethiopia) can amount to millions of dollars for a typical July month, or some 5.5–17.5% of total electricity costs. While wind power can lead to significant savings, the variability of wind prevents elimination of the smaller of two diesel units, although this peaking unit operates less frequently than in the absence of wind power.     

Dispatch modeling of a regional power generation system – Integrating wind power

A modeling tool has been developed which can be used to analyze interaction between intermittent wind power generation and thermal power plant generation in a regional electricity grid system. The model uses a mixed integer programming (MIP) approach to determine the power plant dispatch strategy which yields the lowest systems costs. In the model, each large thermal plant is described separately, including properties such as start-up time, start-up cost and minimum load level. The model is evaluated using western Denmark as a case study.For western Denmark, it is found that the inclusion of start-up performance (i.e. start-up time and related costs) and minimum load level of the power generating units have a significant impact on the results. It is shown that the inclusion of these aspects influences the analysis of the effect of wind power variations on the production patterns of thermal units in the system. The model demonstrates how the introduction of wind power production and associated variations change the dispatch order of the large thermal power plants in the western Denmark system so that the unit with the lowest running costs no longer has the highest capacity factor. It is shown that this effect only is detected if start-up performance and minimum load level limitations are included in the optimization. It can also be concluded that start-up performance and minimum load level must be taken into account if the total system costs and emissions are not to be underestimated. The simulations show that if these aspects are disregarded, both total costs and total emissions of the power system are underestimated, with 5% in the case of western Denmark. Models such as the one developed in this work can be efficient tools to understand the effects of large-scale wind power integration in a power generation system with base load plants.     

Liberalization of the indian power industry: Wind power in Gujarat

Since liberalization of the Indian power sector in 1991, private participation in wind power production has been encouraged in Gujarat through a range of capital investment subsidies. Despite encouraging a significant level of investment within wind power, the technologies have not become more cost-effective. However capabilities within the activities of manufacturing, operating, maintaining and planning of windfarms are now relatively well established. The introduction of incentive mechanisms that explicitly encourage generation output are likely to encourage the costs of wind power to become more competitive with conventional power.     

Optimal electricity market for wind power

This paper is about electricity market operation when looking from the wind power producers’ point of view. The focus in on market time horizons: how many hours there is between the closing and delivering the bids. The case is for the Nordic countries, the Nordpool electricity market and the Danish wind power production. Real data from year 2001 was used to study the benefits of a more flexible market to wind power producer. As a result of reduced regulating market costs from better hourly predictions to the market, wind power producer would gain up to 8% more if the time between market bids and delivery was shortened from the day ahead Elspot market (hourly bids by noon for 12–36 h ahead). An after sales market where surplus or deficit production could be traded 2 h before delivery could benefit the producer almost as much, gaining 7%.     

Wind power potential of Baja California Sur, México

This work is an analysis of wind characteristics of Baja California Sur (BCS), México, during the period from February 1997 to February 1998. Fifteen wind stations located in the eastern coastal area recorded the wind speed and wind direction for this region. The wind resources of BCS were recorded and the annual average wind speed, power density, and annual energy density at 10 m above ground level are presented here.We considered the wind data from El Cardón, BCS, as a case study. This location can be considered to be representative of the 15 wind stations that were installed in BCS. Using the Weibull probability density function, we estimated the wind energy output and the capacity factor for two different wind turbines during the year. The capacity factors for both wind turbines were estimated at close to 25%. Considering the wind energy output and the capacity factor, we estimated the levelized production costs for both wind turbines. Taking into account two different discount rates of 7% and 10%, we developed data for the levelized production cost of both wind turbines.     

Cost analysis of wind-electrolyzer-fuel cell system for energy demand in Pınarbaşı-Kayseri

In this study, the hydrogen production potential and costs by using wind/electrolysis system in P?narba??-Kayseri were considered. In order to evaluate costs and quantities of produced hydrogen, for three different hub heights (50 m, 80 m and 100 m) and two different electrolyzer cases, such as one electrolyzer with rated power of 120 kW (Case-I) and three electrolyzers with rated power of 40 kW (Case-II) were investigated. Levelised cost of electricity method was used in order to determine the cost analysis of wind energy and hydrogen production. The results of calculations brought out that the electricity costs of the wind turbines and hydrogen production costs of the electrolyzers are decreased with the increase of turbine hub height. The maximum hydrogen production quantity was obtained 14192 kgH₂/year and minimum hydrogen cost was obtained 8.5 $/kgH₂ at 100 m hub height in the Case-II.     

The economics of wind power with energy storage

We develop a nonlinear mathematical optimization program for investigating the economic and environmental implications of wind penetration in electrical grids and evaluating how hydropower storage could be used to offset wind power intermittence. When wind power is added to an electrical grid consisting of thermal and hydropower plants, it increases system variability and results in a need for additional peak-load, gas-fired generators. Our empirical application using load data for Alberta's electrical grid shows that costs of wind-generated electricity vary from $37 per MWh to $68/MWh, and depend primarily on the wind profiles of installed turbines. Costs of reducing CO₂ emissions are estimated to be $41–$56 per t CO₂. When pumped hydro storage is introduced in the system or the capacity of the water reservoirs is enhanced, the hydropower facility could provide most of the peak load requirements obviating the need to build large peak-load gas generators.     

Does bulk electricity storage assist wind and solar in replacing dispatchable power production?

This paper discusses the impact of bulk electric storage on the production from dispatchable power plants for rising variable renewable electricity shares. Two complementary optimization frameworks are used to represent power systems with a varying degree of complexity. The corresponding models approximate the wholesale electricity market, combined with the rational retirement of dispatchable capacity. Two different generic storage technologies are introduced exogenously to assess their impact on the system.The analysis covers two countries: France, where the power supply's large nuclear share allows for the discussion of storage impact on a single generator type; and Germany, whose diverse power supply structure enables storage interactions with multiple electricity generators. In the most general case, additional storage capacity increases dispatchable power production (e.g. nuclear, coal) for small wind and solar shares, i.e. it compensates the replacement induced by renewable energies. For larger variable renewable electricity volumes, it actively contributes to dispatchable power replacement. In a diverse power system, this results in storage-induced sequential mutual replacements of power generation from different plant types, as wind and solar capacities are increased.This mechanism is strongly dependent on the technical parameters of the storage assets. As a result, the impact of different storage types can have opposite signs under certain circumstances. The influence of CO₂ emission prices, wind and solar profile shapes, and power plant ramping costs is discussed.     

Value of electric heat boilers and heat pumps for wind power integration

The paper analyses the economic value of using electric heat boilers and heat pumps as wind power integration measures relieving the link between the heat and power production in combined heat and power plants. Both measures have different technical and economic characteristics, making a comparison of the value of these measures relevant. A stochastic, fundamental bottom‐up model, taking the stochastic nature of wind power production explicitly into account when making dispatch decisions, is used to analyse the technical and economical performance of these measures in a North European power system covering Denmark, Finland, Germany, Norway and Sweden. Introduction of heat pumps or electric boilers is beneficial for the integration of wind power, because the curtailment of wind power production is reduced, the price of regulating power is reduced and the number of hours with very low power prices is reduced, making the wind power production more valuable. The system benefits of heat pumps and electric boilers are connected to replacing heat production on fuel oil heat boilers and combined heat and power (CHP) plants using various fuels with heat production using electricity and thereby saving fuel. The benefits of the measures depend highly on the underlying structure of heat production. The integration measures are economical, especially in systems where the marginal heat production costs before the introduction of the heat measures are high, e.g. heat production on heat boilers using fuel oil. Copyright © 2007 John Wiley & Sons, Ltd.     

Opportunities for hydrogen production in connection with wind power in weak grids

This paper gives an overview of the opportunities that exist for combining wind power and hydrogen (H₂) production in weak grids. It is described how H₂ storage can be applied in both isolated and grid-connected systems, and how the produced H₂ can be utilized for stationary energy supply and/or as a fuel for transportation. The paper discusses the benefits and limitations of the different H₂ storage applications, and presents a logistic simulation model for performance evaluation of wind-H₂ plants. A case study simulating the use of excess wind power in a weak distribution grid to produce H₂ for vehicles has been presented. It is shown that the penetration of wind power can be significantly increased by introducing electrolytic H₂ production as a controllable load. The results also indicate that there are large benefits of using the grid as backup for H₂ production in periods with low wind speed, regarding the H₂ storage sizing and the electrolyser operating conditions.     

A review on wind energy and wind–hydrogen production in Turkey: A case study of hydrogen production via electrolysis system supplied by wind energy conversion system in Central Anatolian Turkey

Studies about investigation of hydrogen production from wind energy and hydrogen production costs for a specific region were reviewed in this study and it was shown that these studies were rare in the world, especially in Turkey. Therefore, the costs of hydrogen, hydrogen production quantities using a wind energy conversion system were considered as a case study for 5 different locations of Nigde, Kirsehir, Develi, Sinop and Pinarbasi located in the Central Anatolia in Turkey. Annual wind energy productions and costs for different wind energy conversion systems were calculated for 50 m, 80 m and 100 m hub heights. According to wind energy costs calculations, the amounts and costs of hydrogen production were computed. Furthermore, three different scenarios were taken into account to produce much hydrogen. The results showed that the hydrogen production using a wind energy conversion system with 1300 kW rated power had a range from 1665.24 kgH₂/year in Nigde at 50 m hub height to 6288.59 kgH₂/year in Pinarbasi at 100 m hub height. Consequently, Pinarbasi and Sinop have remarkable wind potential and potential of hydrogen production using a wind–electrolyzer energy system.