Risk-averse based optimal operational strategy of grid-connected photovoltaic/wind/battery/diesel hybrid energy system in the electricity/hydrogen markets

The techno-economic advantages of grid-connected hybrid energy system (HES) exploit synergies to improve reliability and economic efficiency while maintaining grid stability. Therefore, this paper proposes a risk-averse optimal operational strategy of grid-connected photovoltaic/wind/battery/diesel HES to participate into two energy markets including electricity and hydrogen markets. The grid company can flexibly trade power into two markets to maximally achieve profits based on price arbitrage. The risk influences of the uncertainties, i.e., photovoltaic/wind generation, and electricity prices on the expected revenue are evaluated with CVaR model. For a better exhibition of seasonal variability effects on HES optimal operation strategy, two typical Spring/Summer days are chosen. The proposed risk-averse optimal operational strategy is formulated as a two-stage mixed-integer linear programming (MILP) model. The results in a Spring day simulation under non-risk situation indicate that the overall expected revenue can be improved 2.74 times larger if considering hydrogen market. Moreover, the optimal operational strategy of hydrogen production is considerably affected by unpredictable wind farm. Sensitivity analysis also validates that the changes of PV/WT curtailment penalty have a profound influence than battery degradation coefficient on the HES expected revenue.     

Optimizing hydrogen production capacity and day ahead market bidding for a wind farm in Texas

Producing green hydrogen from wind energy is one potential method to mitigate curtailment. This study develops a general approach to examine the economic benefit of adding hydrogen production capacity through water electrolysis along with the fuel cell and storage facilities in a wind farm in north Texas. The study also investigates different day ahead market bidding strategies in the existence of these technologies. The results show that adding hydrogen capacity to the wind farm is profitable when hydrogen price is greater than $3.58/kg, and that the optimal day ahead market bidding strategy changes as hydrogen price changes. The results also suggest that both the addition of a fuel cell to reconvert stored hydrogen to electricity and the addition of a battery to smooth the electricity input to the electrolyzer are suboptimal for the system in the case of this study. The profit of a particular bidding scenario is most sensitive to the selling price of hydrogen, and then the input parameters of the electrolyzer. This study also provides policy implications by investigating the impact of different policy schemes on the optimal hydrogen production level.     

Electrolysers for mitigating wind curtailment and producing ‘green’ merchant hydrogen

The implementation electrolysis plant in combination with wind power plant is proposed, to absorb wind generation otherwise curtailed while generating ‘green’ hydrogen for the merchant hydrogen market. The objective are to (i) achieve exceptionally high wind power penetrations in future power systems, and (ii) derive hydrogen for sale in the existing merchant industrial market from surplus (zero cost) renewable electricity. The economic rationale is investigated for an isolated power system as a function wind penetration, wind curtailment target, electrolyser cost, hydrogen system efficiency and hydrogen sales price. The main outputs are the total annualized cost of wind power plant with electrolysis plant, net annual revenues and discounted pay-back periods. Unprecedented low values of pay-back period are attainable, relative to the implementation of wind power plant at low wind penetrations (Φ_W). For example, at Φ_W = 50%, a wind curtailment target of 80% allows the investment to be recovered after 4-7 years, provided the hydrogen system efficiency is ≥50% and the hydrogen sales price is 20-30 $/kg. Making use of some non-curtailed wind electricity to boost the utilization of the electrolyser stock is also investigated as a means for improving the return on investment.     

An integrated approach for optimal coordination of wind power and hydro pumping storage

The increasing wind power penetration in power systems represents a techno‐economic challenge for power producers and system operators. Because of the variability and uncertainty of wind power, system operators require new solutions to increase the controllability of wind farm output. On the other hand, producers that include wind farms in their portfolio need to find new ways to boost their profits in electricity markets. This can be done by optimizing the combination of wind farms and storage so as to make larger profits when selling power (trading) and reduce penalties from imbalances in the operation. The present work describes a new integrated approach for analysing wind‐storage solutions that make use of probabilistic forecasts and optimization techniques to aid decision making on operating such systems. The approach includes a set of three complementary functions suitable for use in current systems. A real‐life system is studied, comprising two wind farms and a large hydro station with pumping capacity. Economic profits and better operational features can be obtained from the proposed cooperation between the wind farms and storage. The revenues are function of the type of hydro storage used and the market characteristics, and several options are compared in this study. The results show that the use of a storage device can lead to a significant increase in revenue, up to 11% (2010 data, Iberian market). Also, the coordinated action improves the operational features of the integrated system. Copyright © 2013 John Wiley & Sons, Ltd.     

The impact of wind power on electricity prices

This paper investigates the impact of wind power on electricity prices using a production cost model of the Independent System Operator – New England power system. Different scenarios in terms of wind penetration, wind forecasts, and wind curtailment are modeled in order to analyze the impact of wind power on electricity prices for different wind penetration levels and for different levels of wind power visibility and controllability. The analysis concludes that electricity price volatility increases even as electricity prices decrease with increasing wind penetration levels. The impact of wind power on price volatility is larger in the shorter term (5-min compared to hour-to-hour). The results presented show that over-forecasting wind power increases electricity prices while under-forecasting wind power reduces them. The modeling results also show that controlling wind power by allowing curtailment increases electricity prices, and for higher wind penetrations it also reduces their volatility.     

Insurance strategy for mitigating power system operational risk introduced by wind power forecasting uncertainty

The increasing penetration of wind power significantly affects the reliability of power systems due to its intrinsic intermittency. Wind generators participating in electricity markets will encounter operational risk (i.e. imbalance cost) under current trading mechanism. The imbalance cost arises from the service for mitigating supply-demand imbalance caused by inaccurate wind forecasts. In this paper, an insurance strategy is proposed to cover the possible imbalance cost that wind power producers may incur. First of all, a novel method based on Monte Carlo simulations is proposed to estimate insurance premiums. The impacts of insurance excesses on premiums are analyzed as well. Energy storage system (ESS) is then discussed as an alternative approach to balancing small wind power forecasting errors, whose loss claims would be blocked by insurance excesses. Finally, the ESS and insurance policy are combined together to mitigate the imbalance risks of trading wind power in real-time markets. With the proposed approach, the most economic power capacity of ESS can be determined under different excess scenarios. Case studies prove that the proposed ESS plus insurance strategy is a promising risk aversion approach for trading wind power in real-time electricity markets.     

Optimal operational strategy for a future electricity and hydrogen supply system in a residential area

This study introduces a novel framework of an electricity and hydrogen supply system integrating with a photovoltaic power station for a residential area. The non-residential parts including the power grid and non-residential vehicles are added to ensure power balance and bring benefits, respectively. The optimal operational strategy of the proposed framework with considering uncertainties is proposed. The objective function minimizes the expected operational cost (EOC) by reducing the imported electricity from the power grid and increasing exported electricity/hydrogen to non-residential vehicles. Additionally, the demand response program (DRP) is applied in the residential load to achieve operational cost reduction. The uncertainties are modeled via various scenarios by using scenario-based stochastic optimization method. Notably, existing research for similar frameworks both lacks the consideration of uncertainties and DRP, and fails to distinguish the residential and non-residential vehicles with different charging behaviors. The results indicate that 1) The feasibility of the proposed framework is validated which can ensure the power balance of the residential area and reduce the operational cost. 2) The EOC is reduced when considering DRP.     

Trading wind power through physically settled options and short‐term electricity markets

Wind power producers participating in today's electricity markets face significant variability in revenue streams, with potential high losses mostly due to wind's limited predictability and the intermittent nature of the generated electricity. In order to further expand wind power generation despite such challenges, it is important to maximize its market value and move decisively towards economically sustainable and financially viable asset management. In this paper, we introduce a decision‐making framework based on stochastic optimization that allows wind power producers to hedge their position in the market by trading physically settled options in futures markets in conjunction with their participation in the short‐term electricity markets. The proposed framework relies on a series of two‐stage stochastic optimization models that identify a combined trading strategy for wind power producers actively participating in both financial and day‐ahead electricity markets. The proposed models take into consideration penalties from potential deviations between day‐ahead market offers and real‐time operation and incorporates different preferences of risk aversion, enabling a trade‐off between the expected profit and its variability. Empirical analysis based on data from the Nordic region illustrates high efficiency of the stochastic model and reveals increased revenues for both risk neutral and risk averse wind producers opting for combined strategies.     

Impact of wind farm integration on electricity market prices

Wind generation is considered one of the most rapidly increasing resources among other distributed generation technologies. Recently, wind farms with considerable output power rating are installed. The variability of the wind output power, and the forecast inaccuracy could have an impact on electricity market prices. These issues have been addressed by developing a single auction market model to determine the close to real-time electricity market prices. The market-clearing price was determined by formulating an optimal power flow problem while considering different operational strategies. Inaccurate power prediction can result in either underestimated or overestimated market prices, which would lead to either savings to customers or additional revenue for generator suppliers.     

Trading wind energy on the basis of probabilistic forecasts both of wind generation and of market quantities

Wind power is not easily predictable and non‐dispatchable. Nevertheless, wind power producers are increasingly urged to participate in electricity market auctions in the same manner as conventional power producers. The aim of this paper is to propose an operational strategy for trading wind energy in liberalized electricity markets and to assess its performance. At first, the so‐called optimal quantile strategy is revisited. It is proved that without market power, i.e. under the price‐taker assumption, this strategy maximizes expected market revenues. Forecasts of wind power production, of day‐ahead and real‐time market prices and of the system imbalance are inputs to this strategy. Subsequently, constraining of the bid that maximizes the expected revenues is proposed as a way to overcome the strategy's disregard of practical limitations and, at the same time, of risk. Two constraining techniques are introduced: constraining in the decision space and in the probability space. Finally, the trade of a wind power producer is simulated in a test case for the Eastern Danish (DK‐2) price area of the Nordic Power Exchange (Nord Pool) during a 10 month period in 2008. The results of the test case show the financial benefits of the aforementioned strategy as well as the consequent interaction with the electricity market. This study will support a demonstration in the framework of the EU project ANEMOS.plus. Copyright © 2012 John Wiley & Sons, Ltd.     

考虑制氢效率特性的风氢系统容量优化

针对利用风电制氢导致电解槽间歇式运行的问题,提出了考虑制氢效率特性的风氢系统容量配置优化方法。首先研究了电解槽的制氢效率特性,评估电解槽的最优工作区间;在此基础上,采取电网辅助购电策略,维持电解槽的最优运行;考虑售电收益、售氢收益、投资运维成本和弃风成本,以风氢系统联合收益最大化为目标,计及风氢系统稳定运行约束和风电出力爬坡约束,合理地分配风电上网功率和制氢功率。文章联合风电外送输电工程进行了风氢系统容量配置优化,为风氢系统的容量优化提供新思路。     

Contribution of pumped hydro storage to integration of wind power in Kenya: An optimal control approach

This paper investigates the benefit of optimally integrating wind power in Kenya with pumped hydro storage. The approach includes development of an optimal control strategy to deploy paired wind and pumped hydro storage resources, for the Lake Turkana Wind Power project. The stochastic model, which maximizes expected revenue over the planning horizon, is developed taking into the consideration the structure and running of the Kenya electricity market. The 300 MW Lake Turkana Wind Power wind farm is simulated using wind speed data from Marsabit, which is in close proximity to the Lake Turkana region. From the simulation of the wind farm, we find that the daily pattern exhibited by the wind speeds, does not match the average daily load pattern. Pumped hydro storage reduces the systems total power output shortage by 46%. This approach to operation could alleviate the significant economic burden of the take-or-pay purchase agreement that led to the removal of financial backing of the project by the World Bank. The use of pumped hydro storage in conjunction with the wind farm is also found to increase the expected daily revenue of the wind farm by over ten thousand dollars.     

Techno-economic analysis of a hybrid energy system for CCHP and hydrogen production based on solar energy

A typical problem in Northeast China is that a large amount of surplus electricity has arisen owing to the serious photovoltaic power curtailment phenomenon. To effectively utilize the excess photovoltaic power, a hybrid energy system is proposed that uses surplus electricity to produce hydrogen in this paper. It combines solar energy, hydrogen production system, and Combined Cooling Heating and Power (CCHP) system to realize cooling, heating, power, and hydrogen generation. The system supplies energy for three public buildings in Dalian City, Liaoning Province, China, and the system configuration with the lowest unit energy cost (0.0615$/kWh) was obtained via optimization. Two comparison strategies were used to evaluate the hybrid energy system in terms of unit energy cost, annual total cost, fossil energy consumption, and carbon dioxide emissions. Subsequently, the annual total energy supply, typical daily loads, and cost of the optimized system were analyzed. In conclusion, the system is feasible for small area public buildings, and provides a solution to solve the phenomenon of photovoltaic power curtailment.     

基于EEMD-ACS-SELM的弃风电量组合预测模型

风电已在电力系统中得到了有效利用,因此,弃风电量的准确预测对于电网的安全、经济运行至关重要。文章提出了一种基于集合经验模态分解(EEMD)和t分布自适应变异布谷鸟算法(ACS)优化改进极限学习机(SELM)的弃风电量组合预测方法(EEMD-ACS-SELM)。该方法先采用集合经验模态分解,将原始弃风电量序列分解为一系列不同频率的分量,基于模糊熵理论计算各分量的熵值,并将熵值相似序列重构为新的子序列。然后,将新序列分别建立改进极限学习机预测模型,利用ACS优化算法对SELM算法的输入权值和阈值进行优化。最后,将各序列预测值叠加求和得到原始弃风电量序列的预测值。以新疆某风电场实际运行数据进行算例分析,结果表明,文章所提方法对弃风电量的预测具有较高的精度。     

Economic viability and production capacity of wind generated renewable hydrogen

Generally, wind to power conversion is calculated by assuming the quality of wind as measured with a Weibull probability distribution at wind speed during power generation. We build on this method by modifying the Weibull distributions to reflect the actual range of wind speeds and wind energy density. This was combined with log law that modifies wind speed based on the height from the ground, to derive the wind power potential at windy sites. The study also provides the Levelized cost of renewable energy and hydrogen conversion capacity at the proposed sites. We have also electrolyzed the wind-generated electricity to measure the production capacity of renewable hydrogen. We found that all the sites considered are commercially viable for hydrogen production from wind-generated electricity. Wind generated electricity cost varies from $0.0844 to $0.0864 kW h, and the supply cost of renewable hydrogen is $5.30 to $ 5.80/kg-H₂. Based on the findings, we propose a policy on renewable hydrogen fueled vehicles so that the consumption of fossil fuels could be reduced. This paper shall serve as a complete feasibility study on renewable hydrogen production and utilization.     

Hydrogen storage for mixed wind–nuclear power plants in the context of a Hydrogen Economy

A novel methodology for the economic evaluation of hydrogen production and storage for a mixed wind–nuclear power plant considering some new aspects such as residual heat and oxygen utilization is applied in this work. This analysis is completed in the context of a Hydrogen Economy and competitive electricity markets. The simulation of the operation of a combined nuclear–wind–hydrogen system is discussed first, where the selling and buying of electricity, the selling of excess hydrogen and oxygen, and the selling of heat are optimized to maximize profit to the energy producer. The simulation is performed in two phases: in a pre-dispatch phase, the system model is optimized to obtain optimal hydrogen charge levels for the given operational horizons. In the second phase, a real-time dispatch is carried out on an hourly basis to optimize the operation of the system as to maximize profits, following the hydrogen storage levels of the pre-dispatch phase. Based on the operation planning and dispatch results, an economic evaluation is performed to determine the feasibility of the proposed scheme for investment purposes; this evaluation is based on calculations of modified internal rates of return and net present values for a realistic scenario. The results of the present studies demonstrate the feasibility of a hydrogen storage and production system with oxygen and heat utilization for existent nuclear and wind power generation facilities.     

Nuclear hydrogen: An assessment of product flexibility and market viability

Nuclear energy has the potential to play an important role in the future energy system as a large-scale source of hydrogen without greenhouse gas emissions. Thus far, economic studies of nuclear hydrogen tend to focus on the levelized cost of hydrogen without accounting for the risks and uncertainties that potential investors would face. We present a financial model based on real options theory to assess the profitability of different nuclear hydrogen production technologies in evolving electricity and hydrogen markets. The model uses Monte Carlo simulations to represent uncertainty in future hydrogen and electricity prices. It computes the expected value and the distribution of discounted profits from nuclear hydrogen production plants. Moreover, the model quantifies the value of the option to switch between hydrogen and electricity production, depending on what is more profitable to sell. We use the model to analyze the market viability of four potential nuclear hydrogen technologies and conclude that flexibility in output product is likely to add significant economic value for an investor in nuclear hydrogen. This should be taken into account in the development phase of nuclear hydrogen technologies.     

Wind park reliable energy production based on a hydrogen compensation system. Part II: Economic study

Power production from renewable energy resources is increasing day by day. In the case of Spain, in 2009 it represented 26.9% of installed power and 20.1% of energy production. Wind energy makes the most important contribution to this production. Wind generators are greatly affected by the restrictive operating rules of electricity markets because, as wind is naturally variable, wind generators may have serious difficulties in submitting accurate generation schedules on a day-ahead basis, and in complying with scheduled obligations. Weather forecast systems have errors in their predictions depending on wind speed. Therefore, if wind energy becomes an important actor in the energy production system, these fluctuations could compromise grid stability. In the previous paper in this brief series [1], the authors showed technical results of the proposed solution, which consists of combining wind energy production with a biomass gasification system and a hydrogen generation system based on these two sources. In the present paper it is shown the economic results of the study, considering the most profitable technical configurations and three possible economic scenarios.     

Electricity generation from the first wind farm situated at Ras Ghareb, Egypt

Egypt is one of the Red Sea and Mediterranean countries having windy enough areas, in particular along the coasts. The coastal location Ras Ghareb on the Red Sea has been investigated in order to know the wind power density available for electricity generation. To account for the wind potential variations with height, a new simple estimating procedure was introduced. This study has explicitly demonstrated the presence of high wind power density nearly 900 kW/m² per year at 100 m of altitude for this region. Indeed, the seasonal wind powers available are comparable to and sometimes higher than the power density in many European cities for wind electricity applications like Vindeby (Denmark) and also America.New technical analysis for wind turbine characteristics have been made using three types of commercial wind turbines possessing the same rotor diameter and rated power to choice the best wind machine suitable for Ras Ghareb station. As per the decreasing the cut-in wind speed for the wind turbine used, the availability factor increases for a given generator. That it could produce more energy output throughout the year for the location.The aim of this research, was to predict the electrical energy production with the cost analysis of a wind farm 150 MW total power installed at Ras Ghareb area using 100 wind turbines model (Repower MD 77) with 1.5 MW rated power. Additionally, this paper developed the methodology for estimating the price of each kWh electricity from the wind farms. Results show that this wind park will produce maximum energy of 716 GWh/year. The expected specific cost equal to 1.5 € cent/kWh is still less than and very competitive price with that produced from the wind farms in Great Britain and Germany and at the international markets of wind power. The important result derived from this study encourages several wind parks with hundreds of megawatts can be constructed at Ras Ghareb region.     

Techno-economic feasibility of fleets of far offshore hydrogen-producing wind energy converters

Innovative solutions need to be developed for harvesting wind energy far offshore. They necessarily involve on-board energy storage because grid-connection would be prohibitively expensive. Hydrogen is one of the most promising solutions. However, it is well-known that it is challenging to store and transport hydrogen which may have a critical impact on the delivered hydrogen cost.In this paper, it is shown that there are vast areas far offshore where wind power is both characterized by high winds and limited seasonal variations. Capturing a fraction of this energy could provide enough energy to cover the forecast global energy demand for 2050. Thus, scenarios are proposed for the exploitation of this resource by fleets of hydrogen-producing wind energy converters sailing autonomously. The scenarios include transportation and distribution of the produced hydrogen.The delivered hydrogen cost is estimated for the various scenarios in the short term and in the longer term. Cost estimates are derived using technical and economic data available in the literature and assumptions for the cost of electricity available on-board the wind energy converters. In the shorter term, delivered cost estimates are in the range 7.1–9.4 €/kg depending on the scenario and the delivery distance. They are based on the assumption of on-board electricity cost at 0.08€/kWh. In the longer term, assuming an on-board electricity cost at 0.04€.kWh, the cost estimates could reduce to 3.5 to 5.7 €/kg which would make the hydrogen competitive on several hydrogen markets without any support mechanism. For the hydrogen to be competitive on all hydrogen markets including the ones with the highest GHG emissions, a carbon tax of approximately 200 €/kg would be required.