PJM could get 30% of its energy from wind and solar power without reliability problems, but it will require as much as $13.7 billion in transmission upgrades and 1,500 MW in additional regulation reserves, according to a long-awaited study.

The results of the study, which PJM commissioned in 2011, were presented to stakeholders yesterday by a study team headed by GE Energy.

Stakeholders had asked PJM to assess the impact on grid operations of state renewable portfolio standards. PJM states have targets calling for at least 10% of their electricity from renewables by the middle of the next decade, with most states setting targets between 20% and 25%. In total, the state targets anticipate the addition of 33 GW of wind and 9.2 GW of solar by 2029 (see chart).

Ten Scenarios                                        

The study considered 10 scenarios, ranging from a business-as-usual case based on 2011 levels of wind and solar generation to a high-end case in which nearly one-third of the region’s power was generated by those renewables.

The study looked at the impact on regulating and operating reserves, transmission upgrades, PJM markets and operations, power plant emissions and the impact of cycling duty on variable operation and maintenance (VOM) costs.

Findings

It found that PJM could adapt to the 30% renewable scenario without significant reliability problems by adding transmission and regulation reserves. “PJM has long held that ISOs and RTOs are better able to integrate variable energy resources because of their organized markets and regional infrastructure planning processes,” PJM said in its summary of the study. “… The study found that PJM’s large geographic footprint also provides significant benefit for integrating wind and solar generation because it greatly reduces the magnitude of variability-related challenges.”

All 10 of the scenarios predicted lower average Locational Marginal Prices and reduced revenues for conventional generators.

Although renewable generation increased the amount of cycling on existing generators, the increased VOM costs were small relative to the reduction in spending on fuel.

Recommendations

The study recommends that PJM:

• Develop a method for determining reserve requirements based on forecasted levels of wind and solar production.
• Consider intra-day unit commitments that would allow use of more efficient combined cycle units rather than combustion turbines to balance renewables’ variability. The study’s authors said that four-hour wind and solar forecasts have half the error rate of day-ahead projections.
• Identify the reasons for ramping constraints on individual generators (i.e., technical, contractual, or otherwise) and seek methods for improving the flexibility of those that have traditionally operated as baseload units.

The study suggested PJM consider further study on how conventional generators can remain economically viable despite reduced energy market revenues.

It also recommended the RTO investigate how wind and solar plants could contribute to frequency response. Current wind and solar generators have the ability to respond to frequency response and down-regulation.

PJM’s Ken Schuyler, who introduced the study team yesterday, said PJM management has not taken a position on the study’s recommendations and plans to consult with members to “see which ones stakeholders think we should pursue.”