Wind Power Integration and Transmission: Addressing Some Common Misconceptions

1. Wind Power Integration and Transmission: Addressing Some Common Misconceptions Ed DeMeo Renewable Energy Consulting Services, Inc. Technical Advisor: Governors Wind Energy Coalition (EPRI Renewable Energy Programs, 1976-1998) Governors Wind Energy Coalition Transmission Briefing November 3, 2011 Washington, DC eademeo@comcast.net 650 327 3090

2. Key Questions What benefits are expected from wind power? Will these benefits actually be realized? Address common misconceptions in the context of these questions

3. Expected Benefits • Affordable, plentiful, domestic energy • Clean energy; reduced fossil-fuel combustion and emissions • Substantial economic development opportunities nationwide • Reduced electric-sector water consumption • http://www.20percentwind.org

4. Affordable? • Common criticism: wind needs subsidies • But conventional energy has received substantial subsidies for years – nearly 100 for oil and gas • There is no Free Market in energy! • O&G, 91 yrs, $4.9 B/yr Wind, 15 yrs, $0.4 B/yr

5. Affordable? • Common criticism: wind’s variability and uncertainty require one-for-one backup and greatly increase power-system operating costs • Balance between demand and generation needs to be continually maintained • Wind’s variability and uncertainty complicates the balancing process over minutes, hours, days • But utilities are used to dealing with variability in demand • Wind’s challenge is one of degree, not kind

6. One-for-One Backup? • Does a megawatt of wind require a megawatt of conventional backup?

7. One-for-One Backup? • Does a megawatt of wind require a megawatt of conventional backup? • No power plant has dedicated backup • All plants work together to serve system demand for electric energy • Generation mix includes reserves to accommodate a wide range of potential contingencies (10-15%) • Substantial wind increases the need for reserves, increasing operating costs • Incremental operating costs: integration costs

8. One-for-One Backup? • Does a megawatt of wind require a megawatt of conventional backup? • No power plant has dedicated backup • All plants work together to serve system demand for electric energy • Generation mix includes reserves to accommodate a wide range of potential contingencies (10-15%) • Substantial wind increases the need for reserves, increasing operating costs • Incremental operating costs: integration costs • With over 40,000 MW of wind in the US, not 1 MW of backup generation has been added!

9. 2003 through 2010: Many Wind Integration Studies Across the Nation • Examined larger and larger regions • Wind energy contributions up to ~ 30% • Key Result: Wind integration costs under ~10% of wholesale value (i.e., under ~ ½¢/kWh) • Why? Aggregating wind over larger regions mitigates wind variability • Variability tends to average out • Why? Sharing reliability responsibilities over larger regions reduces operating costs

10. Large Balancing Areas Reduce Reserve Requirements Peak load: 100 1,000 10,000 100,000 Regulation: 9 30 90 300 Approximate regulating requirements for a BA as a function of peak demand. Source: MN DOC

11. Wind Integration Requires Power-System Flexibility • Operating strategies: e.g., reserves sharing; and generator dispatch decisions at 5-min intervals instead of hourly, enabling better use of forecasts • Regional connectivity: efficient transmission use and judicious transmission expansion • Demand response: automatic load shifting at critical times • Generating units designed for rapid changes in output level • Affordable system-level storage (most expensive source of flexibility – may not be needed) Terry Boston, CEO of PJM Interconnection on Demand Response: “Traditionally, generation chases loads. Now we need to have load chase generation.” October 26, 2011

12. Wind Forecasting Reduces System-Operation Costs • Benefits of Forecasting • Better decisions for day-ahead system planning • Better plant-dispatch decisions hour-to-hour and within the hour • Advance warning of major weather events • Forecasting accuracy good and improving • Value of current forecasts: ~1¢/kWh (NY study) • Accuracy improves with aggregation

13. Plentiful? • Common criticism: wind requires too much land

14. 20% Wind: Area Comparisons Anchorage, AK 1,961 mi2 305 GW of Wind Total Footprint*: 23,830 mi2 Area Occupied by Turbines, Equipment, Roads**: 950 mi2 Rhode Island 1,045 mi2 West Virginia 24,087 mi2 *12.8 MW/mi2 ; **4% occupancy Wind equipment occupies an area less than Rhode Island and less than half of Anchorage, AK

15. Plentiful? • Common criticism: wind requires too much land • For 20% US electricity from wind, about 1,000 mi2 dedicated to wind equipment • Comparable to area occupied by US Interstate Highway System (about 1% of all roads) • For perspective, May 2011 Arizona wildfire burned 469,000 acres (~730 mi2) • Wind area requirement criticized in June 2011 NY Times Op-Ed by Robert Bryce • GWC Chair and Co-chair rebutted; NYT ignored

16. But Wind Needs Transmission • Allows access to the best wind resources • Allows pooling of wind plant outputs over wide regions, smoothing variability and reducing integration costs • Allows sharing of reliability responsibilities over wider regions, reducing costs • Provides broad reliability and economic benefits to all in the region

17. But Wind Needs Transmission • Allows access to the best wind resources • Allows pooling of wind plant outputs over wide regions, smoothing variability and reducing integration costs • Allows sharing of reliability responsibilities over wider regions, reducing costs • Provides broad reliability and economic benefits to all in the region • Common criticism: transmission is too expensive • Eastern concern: transmission from Midwest will increase coal generation transport to the East

18. Total $65.75 Total $66.62 Transmission 6% Impact from $12.6 billion increase (20%) in Transmission Infrastructure LARGE TRANSMISSION INVESTMENTS HAVE VERY SMALL RETAIL BILL IMPACTS Generation 74% Distribution 20% Source: FERC ~ 2001 Average Monthly Retail Bill $ / 1,000 kWhs

19. Eastern Wind Integration and Transmission Study Scenarios 1) Best wind, Midwest primarily, no off-shore (20% wind) 2) Some off-shore, less Midwest (20% wind) 3) Aggressive off-shore (20% wind) 4) Aggressive on- and off-shore (30% wind) • Substantial transmission added in all four scenarios, but coal generation nearly same in the three 20% scenarios

20. Does Wind Power Really Reduce Emissions? • Ramping of fossil plants introduces inefficiencies • Providing reserves from fossil plants also introduces inefficiencies • Some have claimed that the inefficiencies would cancel out any expected wind emissions benefits • Bentek, LLC originally claimed this but has revised their work and retracted the claim • But naysayers continue to perpetuate this myth • The press seems to love the controversy and gives the naysayers airtime

21. Stylized Illustration: 100 MW Fossil Plant Providing +/-10 MW Reserves Plant efficiency reduced slightly when power deviates 10 MW from rated level

22. Does Wind Power Really Reduce Emissions? • Careful studies to date indicate actual emissions reductions will be 90-to-95% of ideal reductions • More thorough evaluations are underway “The study implies that small, short-term emission increases associated with ramping result in significant increases in the total emissions. This is simply wrong. Since 2007, we have added hundreds of megawatts of wind generation, and our overall emissions have declined. In 2009, wind produced 10 percent of the energy delivered to our customers. Without wind, that electricity would have been generated by gas or coal, creating greater total emissions.” Frank Prager, VP Environmental Policy, Xcel Energy Denver Post, May 28, 2010

23. Does Wind Power Really Reduce Emissions? 20% Wind Evaluation estimates flat-lined CO2 emissions from the electric sector Substantial wedge of needed reduction Climate-change deniers doubt the earth is warming; Berkeley Earth Surface Temperature study – carried out by skeptics – has crushed this myth

24. Significant Water Use Savings Cumulatively, the 20% Wind Scenario would avoid the consumption of 4 trillion gallons of water through 2030. The 20% Wind Scenario cuts electric sector water consumption by 17% in 2030. Extraction of shale gas and tar-sands oil requires large amounts of water

25. Xcel Energy Today: Minnesota and Colorado • Wind now exceeds 10% of retail energy generation • Revising previously approved system expansion plans – with PUC approval • Replacing planned coal plants with wind and gas plants; emissions and costs are key factors driving this strategy • Learning how to deal with wind’s natural characteristics Actual utility experience is the strongest response to those who perpetuate the myths!

26. Summary • Wind energy is affordable now • Integration costs are minor; increased power-system flexibility and wind forecasting will reduce them • Wind tax incentives help to compensate for existing subsidies for conventional energy • Transmission is affordable and provides broad benefits • Wind reduces emissions of pollutants and greenhouse gases and saves water • Utilities are relying on wind for substantial and growing portions of their generation portfolio

27. Wind Integration State of the Art: IEEE Power & Energy Magazines November-December 2005, 2007, 2009, 2011 • www.uwig.org

28. References U.S. Department of Energy. 2008. 20% Wind Energy by 2030. DOE/GO-102008-2567. Washington, DC. Available at http://www.20percentwind.org Pfund and Healey. 2011. What Would Jefferson Do? The Historical Role of Federal Subsidies in Shaping America’s Energy Future. DBL Investors. Available at http://www.dblinvestors.com/documents/What-Would-Jefferson-Do-_Final_September2011.pdf Hand et al. 2008. Power System Modeling of 20% Wind-Generated Electricity by 2030. National Renewable Energy Laboratory. Conference Paper NREL/CP-500-42794. Golden, CO. Available at http://www.nrel.gov/docs/fy08osti/42794.pdf National Renewable Energy Laboratory. 2010. Eastern Wind Integration and Transmission Study. NREL/SR-550-47078. Golden, Colorado. Available at http://www.nrel.gov/wind/systemsintegration/ewits.html Berkeley Earth Temperature Study. Available at http://berkeleyearth.org/