Integrating Renewable Energy Resources into the Grid

ferc-slide-2The amount of electricity produced with renewable energy, especially wind and solar power, is growing rapidly in the United States. In the last decade alone, wind power has increased from a modest 500 megawatts (MW) to 60,000 MW of installed capacity. Solar power is increasing even more rapidly. Thirty states now have renewable energy standards requiring a set percentage of clean resources in the power mix. These standards, new carbon rules and falling technology prices mean that within a generation more than half of our country’s power could be supplied with renewable energy.

Producing the power is one thing; getting it onto the electric grid and to consumers is another matter. Large amounts of wind and solar power must be moved from the (often remote) locations where they are produced to the cities and towns that need power. Moving this much power will require the more efficient use of existing high power transmission lines and the development of new transmission lines.

Apart from new transmission infrastructure, many of the grid rules governing how to plan for, interconnect, and operate power on the grid also need to change to accommodate wind and solar power. Renewable energy, like the customer demand it serves, is often variable, meaning that it fluctuates up and down based on factors like weather and the time of day. Some of the current grid rules have been in place since the 1930s – well before solar and wind generation became available in significant amounts.

The National Renewable Energy Laboratory predicts that the U.S. transmission grid can support up to 80% renewable energy by 2050, but not without significant improvements to grid design and operation, some of which are described below.

The 21st Century Grid Toolkit

The new, more flexible grid depends on a combination of tools to keep the grid reliable while we make it cleaner – careful transmission siting and planning, technically advanced grid operations, and supportive markets. The Sustainable FERC Project works on all of these issues.

Careful Transmission Siting is Key

The Sustainable FERC Project encourages the efficient use of the full capacity contained in existing transmission lines. When new lines are necessary, they should be built on existing power line right-of-ways whenever possible so as to minimize the need for new land acquisition.

Our partner organizations in the Eastern and Western Interconnections have worked with transmission developers, state and federal land and wildlife agencies, and others to develop tools that allow for “smart from the start” siting of transmission. Careful siting early in the planning process can avoid the most significant impacts to land and wildlife and as well as contentious litigation with landowners and others concerned about losing use of their land.

Transmission Planning to Ensure Reliability and Cost Savings

Transmission planning is critical to maintaining a reliable grid that ensures the lights don’t go out. Planners need to think forward 10, 20 or more years to make sure sufficient transmission lines and related equipment are in place to support electricity demand and transport wind and solar power long distances. But, planners also need to ensure that we avoid building expensive and unnecessary transmission projects that we won’t need in five or 10 years, and that their efforts complement rather than frustrate state clean energy standards and other policy decisions. Good planning is especially critical since large transmission projects often take more than five years to develop and construct, and once built, will remain in the ground for many years.

The Sustainable FERC Project has supported several landmark FERC rules promoting longer-term and broader planning – locally, regionally, and interregionally:

  • Order 888 (issued in 1996) –Opened the wholesale electric power system to competition. Requires all FERC-jurisdictional utilities to provide transmission service to all eligible customers on a non-discriminatory basis at just and reasonable rates.
  • Order 2000 (1999) – Strongly encouraged (but did not require) transmission-owning utilities to create regional transmission organizations (RTOs) to improve reliability and grid efficiency and reduce costs.
  • Order 890 (2007) – Improved local planning and regional coordination for all transmission-owning utilities (including those not in RTOs) by requiring grid planners to consider all resources on a comparable basis.
  • Order 1000 (2011) – Required all transmission-owning utilities to (i) take federal and state environmental, energy and other policies into consideration in the grid planning process; (ii) coordinate their planning activities with neighboring regions; and (iii) allocate costs of transmission line upgrades to all consumers who benefit from them.

Grid Operations and Markets to Smoothly Integrate Wind and Solar Power

One thing that’s different about wind and solar power compared to “traditional” power plants is that power production occurs when the wind is blowing and when the sun shines. (Fossil and nuclear power resources also are variable in their own ways, such as through unexpected outages, emissions limits which constrain operation, and fluctuating fuel costs.) Grid operations and markets must be designed to maximize clean energy’s access to the grid in real time operations.

As weather forecasting and grid systems improve, managing these resources becomes increasingly easier. For example, in the Midwest, the grid operators at the Midcontinent Independent System Operator (MISO) can remove much of the variability through “dispatch” of wind energy in five- minute increments, similar to other power generation.

FERC has taken some steps to address operational issues through Order 764 (issued in 2012), which requires grid operators to provide more flexible operational rules for renewable energy power plants, while also requiring owners of those facilities to provide the grid operator with weather and other relevant power production data. The Sustainable FERC Project supported some aspects of Order 764, but doesn’t believe it does enough to provide a level playing field for renewable resources.

New Technologies Help Integrate Wind and Solar Power

The variability related to wind and solar power sometimes takes the form of “ramping” up or down – the amount of power being produced and sent onto the grid changes quickly for a short period of time. Several fast-acting and flexible energy storage resources such as flywheels, electric vehicle batteries, and even aggregated household appliances like air conditioners and pool pumps can respond to signals from grid operators to smooth out the variability caused by ramping. Rapid-cycling gas turbines also can help by demanding response actions.

The Sustainable FERC Project has supported several significant FERC rulemakings intended to encourage investments in and use of these and other emerging resources:

  • Order 719 (2008) – several important reforms to make wholesale markets more responsive to consumers and encourage newer technologies, including: (i) improving market access for demand response; (ii) encouraging long-term power contracting; (iii) strengthening the role of the independent market monitor; and (iv) requiring RTOs and ISOs to be more responsive to their customers.
  • Order 745 (2011) – another step towards treating demand response more comparably to generation. Requires RTOs and ISOs to compensate demand response resources at the full market price for energy whenever the benefits of the demand response are greater than the costs of paying for the DR.
  • Order 755 (2011) – applies to the “frequency regulation” market (maintaining the grid’s frequency is critical for grid reliability). Created additional financial incentives in the market for resources which respond quickly and accurately to signals from the grid operators (energy storage devices like flywheels and batteries perform especially well).
  • Order 784 (2013) – provided clarifying accounting treatment for energy storage resources and expanded market access for third-party providers of the kinds of ancillary services that can help to integrate variable energy resources into the grid, and required utility transmission providers to take into account the speed and accuracy of resources when establishing it requirements for regulation and frequency response reserves.

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