‘Grid-Flexible’ Solar and Wind – What It Means for Our Future

As with most new technologies, the early versions of wind and solar inverters and associated plant control systems were rather simple. Today’s versions, however, are some of the most advanced devices on the grid, using digital controls, power electronics, and advanced communications systems that can provide a wide range of features and grid services. For example, solar and wind power plants can respond to automatic generation control (AGC) signals, support ramping by accurately following dispatch signals, and autonomously provide very fast frequency response to stabilize the grid after a disturbance. Collectively, these features are part of today’s ‘grid-flexible’ solar and wind resources.

Below we present key findings from three recent studies that are great examples of why grid-flexible solar and wind resources are a major part of the solution for our energy future. We also highlight two major implications: 1) curtailment can be economic and enables key grid services; and, 2) contracts for renewable capabilities, not just for the renewable energy, are the path forward.

Part 1: Renewables are flexible – even without storage!

In 2017, CAISO, First Solar, and NREL demonstrated that a 300-MW solar PV plant without storage could deliver essential reliability services such as frequency regulation and voltage control. Importantly, the report concluded that the solar PV plant demonstrated the ability to deliver some of those capabilities (e.g., frequency regulation) with greater precision than a gas-fired conventional power plant under all tested solar conditions.

Specifically, it was found that while best-in-class gas resources provide regulation services with approximately 60 percent accuracy against operator signals, the solar PV power plant was capable of response accuracy approaching 90 percent. As shown in the following figure from the report, the plant response (in yellow) is so accurate that it almost perfectly covers the four-second AGC signals (in red).

Figure 1: Demonstration of a solar PV plant responding to an AGC signal

 

 

 

 

 

 

 

 

 

Part 2: Flexibility reduces production costs & curtailment

Having helped demonstrate the inherent flexibility of solar PV, First Solar worked with E3 and Tampa Electric Company in 2018 to quantify the operational benefits of dispatching solar PV in a flexible manner. This study demonstrated that using the full flexibility of solar (including contributing to system headroom and footroom requirements) results in:

• significant annual production cost savings;
• reduced thermal commitments, fuel burn, and associated emissions; and,
• less system-wide solar curtailment when solar penetrations exceed roughly 15% (for Tampa Electric Company’s system)

Flexible dispatch for utility-scale solar PV plants allows those resources to provide the same balancing services – footroom (e.g., downward dispatch) and headroom – as thermal assets.  The more flexibility that is enabled from solar resources, the fewer thermal generators must be committed. As shown in Figure 2 (right graphic), this actually results in reduced curtailment, as the removal of thermal generators operating at their minimum outputs creates more room for solar to operate. This translates into more zero marginal cost solar serving load, which drives production cost savings (Figure 2, left graphic). Without enabling this flexibility, the system’s ability to absorb solar and derive cost savings for the consumer are hampered.

Figure 2: Annual production cost savings and solar curtailment associated with different solar operating modes

 

 

 

 

 

 

 

 

Part 3: Flexibility is a key on the journey toward 100% renewables and mitigates the need for seasonal storage

In November 2018, Washington, DC joined Hawai‘i in passing legislation aimed at a 100% renewable energy future. This is an ambitious target and there are already some known challenges, not least of which is ensuring that enough energy is available on days with low solar and low wind production. Storage is one way to meet this challenge and it will certainly be needed, but storage is not the only way.

A new report from the MN Solar Pathways project (authored by Clean Power Research), illustrates how combining additional solar and wind capacity with energy curtailment can be a cost-effective method for delivering renewable energy during days with low solar and low wind production. The construction of additional solar and wind capacity results in modest amounts of solar and wind curtailment. However, the additional solar and wind capacity also dramatically mitigates the need for seasonal energy storage. The end result is that doubling the solar and wind capacity results in a 90% reduction of the storage capacity that would be needed to support a 100% renewables future. Notably, this finding holds even when modeling future storage costs of $100/kWh (roughly one-quarter of 2018 long-term storage costs).

Figure 3: Building additional solar capacity (‘Additional Capacity’) reduces production short-falls on a daily-basis and thus mitigates the need for seasonal storage

 

 

 

 

 

 

 

 

 

 

 

 

 

Implication #1: Curtailment can be economic and enables key grid services

When the price of renewables was high, the potential for curtailment added insult to injury when trying to develop a new project. But today, wind PPAs are approaching $10/MWh, while PPAs for fully dispatched solar are around $25/MWh, making them least-cost generation resources. As a result, curtailment can provide solar and wind dispatch flexibility and still offer a low cost, clean energy system for consumers. For example, curtailing 10% of a project’s energy increases the cost of a wind project by $1.11/MWh and a solar project by $2.75/MWh. Additionally, it may be possible to recover at least some of these costs through evolving grid services (such as payments for the value of frequency regulation, ramping, and reserves).

Grid-flexible solar and wind requires some amount of energy curtailment, but it also expands the total addressable load that solar and wind can serve. To embrace this concept, resource planning, power procurement and contracting, market operations, and regulatory policy must evolve to view economic dispatch, curtailment, and grid services more holistically. Successfully planning for dispatchability and including curtailment as a logical option will enable solar and wind to serve a greater fraction of the addressable load, while helping to drive down total energy generation costs.

Implication #2: Contracts for renewable capabilities, not just for renewable energy, are the path forward

There is a cost to curtailment, particularly to a PV or wind plant that is holding headroom to provide grid services without additional compensation for these services, while other plants are maximizing their energy sales without providing such grid services. However, this cost is offset by the increasing fraction of addressable load that can be served by renewables and by increasing the fundamental value propositions of wind and solar to grid operators. Done correctly, grid-flexible solar and wind become the economic solution not just for energy, but also for the other services that support a more reliable grid.

The latest solar RFPs from Hawaiian Electric Company and NV Energy reveal that the market is shifting. These utility RFPs have made it clear that they are prioritizing a dispatchable resource that can meet a host of grid needs beyond just energy delivery. And it makes sense: as the studies referenced above clearly indicate, these resources excel in following dispatch signals and are effectively zero marginal cost resources. It is anticipated that renewable PPAs will transition away from energy-only agreements, which exclusively motivate designs that maximize energy production, towards contracts that compensate for grid-flexible services.

Next steps

Not all of the next steps needed to address Implications #1 and #2 above are immediately obvious. However, good progress is being made to identify and address the actions needed to interconnect larger amounts of solar and wind onto the grid.  We conclude with a few steps that the solar and wind industries should undertake in a collaborative manner:

• Continue educating utilities, regulators, and policymakers on the capabilities of inverter-based resources in providing the same (or better) grid services as conventional resources.
• Educate grid operators on the latest advancements in renewable forecasting so that they can gain confidence in relying upon these resources for headroom and footroom.
• Sponsor technical conferences with commissions and key stakeholders that identify how procurement and contracting must evolve to enable the use of grid-flexible wind and solar resources.
• Conduct additional studies that analyze high penetration cases in other balancing areas to gain further understanding of the applicability of the results from the studies noted herein.
• Further explore the definitions and value propositions for the grid services that we will want for the grid of the future. We should not assume that today’s definitions of reserves and ancillary services are optimal for the future.
• Begin recognizing as an industry the true value of flexibility, as well as the costs inflexible generation assets impose on the grid.

We also support the consideration of the market reform recommendations articulated in the recent Wind Solar Alliance (WSA) report, Customer Focused and Clean: Power Markets for the Future. While thoughtful early adoption of grid-flexible solar and wind concepts is taking place outside of the organized market regions, the markets must evolve to reward performance-based and technology-neutral grid services. As described in the WSA report, this will require changes so that power markets are flexible, fair and free of barriers to using grid-flexible wind and solar resources.

Morgan Putnam, Clean Power Research
John Sterling, First Solar
Mark Ahlstrom, NextEra Energy Resources