Integrating Renewables

Gloria GodsonEnergy Bar Association

December 3, 2009

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Conectiv Energy

Pepco Holdings, Inc.(“PHI”)

Pepco Holdings, Inc.(“PHI”)

Regulated T&D BusinessesRegulated T&D Businesses Unregulated BusinessesUnregulated Businesses

Competitive Energy Businesses

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Peaking Units, 25%

Coal, 10%Oil-NG fired

steam, 12%

Gas Combined Cycle, 53%

2008 Capacity (4,283 MW)(Owned and contracted)

An Eastern PJM, Mid-Merit Focused Generator

Note: Excludes units under development

Construction projects (649 MW)

Conectiv Energy Generating Facilities

Delta

Vineland

Existing sites

Cumberland

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Cumberland Project – Commercial 6/01/09

LMS Technology• Nominal Capacity: 100 MW (Per Unit)

• Simple cycle gas turbine

• Ten minute start to full load capability

• Low heat rate

• Dual fuel (natural gas and oil)

• Fuel switching ability under load

• Spinning reserve capable

• One hour minimum run time• Compact foot print

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Delta Project – 2Q-11 COD

545 MW dual fuel combined cycle

plant located in Peach Bottom

Township, PA

Project Status

• Commercial operation date –

June 2011

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Vineland Solar Project

4 MW Solar PV project located in Vineland, NJ

Project Summary• Supports NJ’s Energy Master Plan • LT PPA with City of Vineland

Project Status• Commercial operation date:

– Phase I: 2 MW 3Q-09– Phase II: 2 MW 2Q-10

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Landfill Gas (LFG)

Conectiv’s LFG portfolio - high BTU “pipeline” landfill gas. Raw landfill gas that has the impurities and water removed.

High BTU LFG is:• Flexible- the gas is injected into the interstate gas pipeline for use at

a facility remote from the landfill• Efficient- the fuel is utilized at facilities with low heat rates

• Environmentally friendly- reduced emissions; SOx, NOx, CO emissions reduced 47x, 181x and 234x respectively.

• Cost effective- capital costs of high BTU landfill gas are 70% of biomass

Conectiv’s LFG produces over 300,000 RECs per year.

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Integrating Renewables

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Renewable Generation

• Many benefits

• NERC 2008 Long Term Reliability Assessment – over 145,000 MW of new renewable resources in the next 10 years

• Federal/state environmental policy• Looming carbon legislation

• Characteristics of renewable generation• Variability – fluctuations in output with fuel availability. Exacerbates existing

demand variability• Uncertainty – timing and magnitude is unpredictable

– Fuel source cannot be controlled or stored– Fuel availability does not positively correlate with electricity demand– Output characterized by steep ramps– Down ramps can occur in opposite direction to demand increase

• Operational, Economic and Reliability impacts

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Operational Impacts

•Regulation – additional generation is needed to provide regulation due to increased minute-to-minute variability

•Load following – conventional generators must adjust output due to wind intra-hour and inter-hour variability

•Unit Commitment – day ahead wind forecast errors can cause over- or under-scheduling , and increase the operating reserve requirement

Seconds to minutes

Issues• Real time operations• Autonomous protection and control

Seconds to minutes

Operations• Frequency

• Regulation

Minutes to hours• Hour ahead forecasting • active power management

Minutes to hours• Load following capability

Hours to days• Day ahead and multi day forecasting

Hours to days• Unit commitment

• Day ahead scheduling

Days to week(s)• Long term load growth forecasting

Days to week(s)• Resource adequacy and capacity planning

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Economic Impacts

• Base load generation cycling to manage variability• New transmission infrastructure: NERC – 15,000 miles of new transmission at

$80 billion needed to meet the 20% wind energy scenario in Eastern interconnection

• Interconnect remote variable generation• Smooth variable generation output across broad geographic regions and resource

portfolio• Deliver ramping capability and ancillary services

• Adequate ancillary services and flexible resources are needed • Voltage control, regulation and contingency reserves, reactive power reserves,

quick start capability, load following, demand resource• Storage• Back-up flexible fossil generators• Distribution system design enhancements

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Reliability Impacts

• Bulk power system reliability must be maintained, regardless of the generation mix

• System operators provide for the reliable operation of the power system by continuously matching the supply of electricity with the demand plus reserves

• Forecasting output of variable generation is critical to system reliability to ensure adequate available ancillary and ramping resources.

• Necessary Tools:• Real time power output, availability and curtailment information must be visible to

the system operators• Variable generation must be able to respond to dispatch instructions during

normal and emergency conditions• Forecasting techniques must be incorporated into day to day operational planning

and RT operations • Reliability focused equipment standards must be developed and enforced to

provide product design clarity to equipment manufacturers and developers• Consistent set of interconnection procedures and standards must be maintained

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Potential Solutions

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Integrate Renewables Across Large Geographic Regions

Characteristic Impact to Wind Integration Cost

Larger balancing areas •Reduces overall increase in variability•Less regulation and ramping service required

Faster markets, i.e., shorter scheduling intervals (5-15 minutes)

•Less regulation required to accommodate intra-hour variations

Larger geographic area •Increases wind diversity and reduces overall variability

Centralized wind power forecasting •Cost-effective approach to reduce scheduling impacts

PJM

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Renewable Generator Technology Can Address Ramping, Surplus Supply and Voltage Control

• Renewable generation can actively participate in maintaining system reliability through either built in capability or added equipment

– Modern wind turbine generators can meet equivalent technical performance requirements provided by conventional generation technologies with proper control strategies, system design and implementation:

– Variable speed

– Reactive power control

– Pitch control

– Ramp rate and power limiting features

– Older wind designs can add equipment

– Modification of turbine generator controls

– Capacitors,

– Static VAR compensators

– Solar inverters

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Storage Technologies

A. Nourai

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Flexible Back Up Gas GeneratorsCumberland Project – Commercial 6/01/09

LMS Technology•Nominal Capacity: 100 MW (Per Unit)

• Simple cycle gas turbine

• Ten minute start to full load capability

• Low heat rate

• Dual fuel (natural gas and oil)

• Fuel switching ability under load

• Spinning reserve capable

• One hour minimum run time

• Compact foot print

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Other Solutions

• Demand response• Solar and wind can be matched to improve the

resulting composite capacity value for variable generation

• Wind forecasting

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Policy Recommendations

• All generation resources must contribute to system reliability • No discriminatory rules

• No preferential dispatch• Consistent interconnection standards • No socialization of costs• Accurately determine the all-in costs of renewable integration

• Operating criteria, forecasting, commitment, scheduling, dispatch and balancing practices, procedures and tools must be enhanced to assist operators in maintaining bulk power system reliability

• Industry should implement reliability models that perform load flow, stability and short circuit studies for variable generation

• New system planning tools and techniques are needed to accommodate increased resource uncertainty and variability

• Comprehensive variable generation integration study should be conducted to assess the appropriate level of system flexibility needed

• Educate policy makers on the policy issues and implications of renewable integration