SEVILLA, APRIL 2010 Distributed Generation and Microgeneration...

55
Campus da FEUP Rua Dr. Roberto Frias, 378 4200 - 465 Porto Portugal T +351 222 094 000 F +351 222 094 050 [email protected] www.inescporto.pt © 2010 Distributed Generation and Microgeneration and its Impacts João A. Peças Lopes Power Systems Unit – INESC Porto SEVILLA, APRIL 2010

Transcript of SEVILLA, APRIL 2010 Distributed Generation and Microgeneration...

Page 1: SEVILLA, APRIL 2010 Distributed Generation and Microgeneration …catedras-etsi.us.es/endesared/documentos/Seminario Joao... · 2014. 5. 23. · ©2010 Distributed Generation and

Campus da FEUPRua Dr. Roberto Frias, 3784200 - 465 PortoPortugal

T +351 222 094 000F +351 222 094 050

[email protected]

© 2010

Distributed Generation and Microgenerationand its Impacts

João A. Peças Lopes

Power Systems Unit – INESC Porto

SEVILLA, APRIL 2010

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2Distributed Generation and its Impacts on Distribution Networks© 2010

Scope

• I Distributed Generation and Microgeneration and its technicalimpacts

• II Global evaluation of the impacts of a large scalemicrogeneration penetration

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3Distributed Generation and its Impacts on Distribution Networks© 2010 3

Introduction

• Driving forces for the future development of the electric energy systems:

– 1) Environmental issues: meet Kyoto protocol targets (reduce emissions by replacing fossil generation by zero emission generation, reduce network losses), minimize visual impacts and land use.

– 2) Replacement of old infrastructures (generation and grid)

– 3) Security of Supply

– 4) Increase quality of service (more automation and remote control)

– 5) Electricity market liberalization (energy and services)

– 1) Increase renewable generation, exploit clean coal technologies, CCGT and others

– 2) Increase Distributed Generation

– 3) Demand Side Management (increase load consumption efficiency)

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4Distributed Generation and its Impacts on Distribution Networks© 2010 4

Introduction

• More recently European leaders have agreed to a legally binding

objective to meet 20% of their energy needs with renewable

such as wind power in a fresh drive to put the EU on track to a

low-carbon economy by 2020.

– This means intensive use of resources like: biomass, hydro, wind, solar.

– This means intensive use of distributed generation.

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5Distributed Generation and its Impacts on Distribution Networks© 2010 5

Introduction – The new targets on RES

• European member states with a significant share of electricity requirements being met by renewable power sources (DG resources)

50% - 55% target on electrictygeneration from renewablepower sources defined for Portugal [REN]

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6Distributed Generation and its Impacts on Distribution Networks© 2010

I - Distributed Generation and Microgeneration - New Paradigmas

• The vision

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7Distributed Generation and its Impacts on Distribution Networks© 2010

Introduction

• Distributed Generation (DG) has attained a considerable penetration level in HV and MV networks, involving different types of sources and conversion technologies;

– The most relevant ones are:

• Mini-hydro using synchronous or asynchronous generators;

• Cogeneration using mainly synchronous units;

• Biomass generation units with synchronous generators;

• Wind generation, exploiting conventional asynchronous or DFIM units and synchronous units with electronic converters.

– Usually these generation devices do not participate in voltage control and frequency regulation

– Current practice is based on a “fit and forget” approach, which provokes:

• Negative impact in the deployment rate of DG;

• Increases costs of investment and operation in the networks;

• Undermines integrity and security of the system.

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8Distributed Generation and its Impacts on Distribution Networks© 2010

Introduction

• The change of paradigm that DG introduced started at the MV

level;

• Microgeneration directly connected to the LV network is

becoming a reality:

– Next 10 to 20 years:

• The change that occurred in MV networks may also happen in LV networks:

– Connection of small modular generation sources;

– Typically in the range from 5 to 100 kW;

– Fuel cells, renewable generation (wind turbines and PV systems), micro

turbines (natural gas or bio fuels);

• LV networks are also becoming active;

A more ambitious change

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9Distributed Generation and its Impacts on Distribution Networks© 2010

Introduction

• New paradigmas are under development

Yesterday Tomorrow: distributed/ on-site generation with fully integrated network management

Storage

Photovoltaicspower plant

Windpowerplant

House with domestic CHP

Powerqualitydevice

Storage

Central power station

House

Factory Commercialbuilding

Local CHP plant

Storage

Storage

Powerqualitydevice

FlowControl

Breaking the Rules

Trans mis s ion Network

Dis tribution Network

Current distribution grid

Management practice

needs to be changed

from passive to active –

DG control paradigmDG control paradigm

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10Distributed Generation and its Impacts on Distribution Networks© 2010

Technical problems in distribution grids

• Load flows may become bi-directional;

• Voltage profiles have different patterns;

• Losses change as a function of the production and load levels;

• Congestion in system branches is a function of the production and load levels;

• Short-circuit levels increase;

• Voltage transients may appear as a result of connection disconnection and operation of generators;

• Risk of non controlled islanding operation;

• Power quality and reliability may be affected;

• Utility protections need to be coordinated with DG ones.

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11Distributed Generation and its Impacts on Distribution Networks© 2010

Characterization of DG units

• Three main types of energy conversion systems can

be found among DG units:

– Conventional synchronous machines (cogeneration, CHP, mini-hydro, biomass);

– Asynchronous generators (wind power, mini-hydro);

– AC/DC/AC electronic conversion systems used together with synchronous or induction machines (micro-turbines, fuel cells, wind generators, wave systems).

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12Distributed Generation and its Impacts on Distribution Networks© 2010

Characterization of DG units

• Classification (according to primary energy source and

conversion system used):

– Non- controllable (Ex: Wind park with asynchronous stall generators);

– Partially controllable (Ex: Wind park with synchronous variable speed gen. + AC/DC/AC converters and DFIM);

– Controllable (Ex: Mini-hydro or Cogeneration plants with synchronous units).

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13Distributed Generation and its Impacts on Distribution Networks© 2010

Modelling DG for Dynamic Behaviour Analysis

• DG units having synchronous generators can adopt the usual modeling with the presence of AVR and frequency regulator (to be activated for islanding mode of operation or in case of participation in frequency regulation);

• Wind generators (CIGRE TF 38.01.10)

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14Distributed Generation and its Impacts on Distribution Networks© 2010

New paradigm of hierarchical distributed control

• Distribution Management Systems (DMS) need deal withcontrollability capabilities of large number of DG units

....

MGCC

HV

N

DGMGCC

LV

LV

N

DG

MGCC

LV

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HV

MV

RTURTU

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DMS

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. . .

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HV

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LV

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N

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HV

N

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LV

LV

N

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MGCC

LV

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RTURTU

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N

MGCC

HV

N

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LV

LV

N

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MGCC

LV

CAMC

HV

MV

RTURTU

MV CAMC

DMS

MGCC

HV

N

DGMGCC

LV

LV

N

DG

MGCC

LV

CAMC

HV

MV

RTURTU

MV CAMC

DMS

HV

N

DGMGCC

LV

LV

N

DG

MGCC

LV

CAMC

HV

MV

RTURTU

MV CAMC

DMS

HV

N

DGMGCC

LV

LV

N

DG

MGCC

LV

CAMC

HV

MV

RTURTU

MV CAMC

DMS

HV

N

DGMGCC

LV

LV

N

DG

MGCC

LV

CAMC

HV

MV

RTURTU

MV CAMC

DMS

HV

N

DGMGCC

LV

LV

N

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MGCC

LV

CAMC

HV

MV

RTURTU

MV CAMC

DMS

HV

N

DGMGCC

LV

LV

N

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MGCC

LV

CAMC

HV

MV

RTURTU

MV CAMC

DMS

N

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LV

LV

N

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LV

CAMC

HV

MV

RTURTU

MV CAMC

DMS

N

DGMGCC

LV

LV

N

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HV

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RTURTU

MV CAMC

DMS

MGCC

LV

LV

N

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RTURTU

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DMS

MGCC

LV

LV

N

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MGCC

LV

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RTURTU

MV CAMC

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HV

MV

RTURTU

MV CAMC

DMS

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HV

MV

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MV CAMC

DMS

RTURTU

MV CAMC

DMSDMSDMSDMS

N

. . .

...

.. ...

...

.. ......

. .. .

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15Distributed Generation and its Impacts on Distribution Networks© 2010

Participation of DG in Voltage VAR control

• DG can be used to optimise the operation strategy of distribution networks.

The Problem can be formulated an optimisation problem for the network such that:

Min (active power losses)

Subj. to:

Vmax < Vi < Vmin

Sij max < Sij

Qgmaxi< Qgi < Qgmini taking into account the type of generator

Qimpor max < Qimpor

Transformer tap limits are kept

Control variables: Qg

The need to use a motor of optimisation

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16Distributed Generation and its Impacts on Distribution Networks© 2010

Some results of the participation of DG in Voltage VAR control

• Test System: 60 kV distribution network with a large penetration of DG (mini-hydro and wind generation).

Activate control on reactive power generated in the DG Units.

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17Distributed Generation and its Impacts on Distribution Networks© 2010

Some results of the participation of DG in Voltage VAR control

Results of tg for each generator and

transmission connection

peak load scenario

-0.50

-0.30

-0.10

0.10

0.30

0.50

0.70

2 8 10 11 15 28 34 35 36 39 40 44 19 20 31 32 21 47 49

Initial Scenario Final Scenario

Reactive power absortion

Asynchronous gen operatingwith product. level below nominal(Control through capacitor banks)

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18Distributed Generation and its Impacts on Distribution Networks© 2010

Some results of the participation of DG in Voltage VAR control

• Changes in active Losses

– Peak load scenario

– A clear reduction on actives losses was obtained

1950

1641

309

0

500

1000

1500

2000

2500

Loss

es (k

W)

Initial Losses

Final Losses

Difference

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19Distributed Generation and its Impacts on Distribution Networks© 2010

Some results of the participation of DG in Voltage VAR control

• Results concerning voltage in network busses

0.98

1.00

1.02

1.04

1.06

1.08

1.10

1.12

1.14

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 24 25 26 27 28 34 35 36 37 38 39 40 41 42 43 44

Volta

ge (p

.u.)

Initial Scenario Final Scenario

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20Distributed Generation and its Impacts on Distribution Networks© 2010

Some results of the participation of DG in Voltage VAR control

• Main conclusions

– Active loses are clearly reduced;

– Voltage levels increase, but violations are eliminated;

– In general, reactive power production is reduced in generating units far from important loads or near loads well compensated;

– In general, a reduction on load flow levels in network branches is obtained.

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21Distributed Generation and its Impacts on Distribution Networks© 2010

Islanding operation

• Programmed islanding when upstream grids need maintenance:

– Availability of units capable of frequency regulation;

– Additional monitoring and control capabilities;

– Pre-balance between load and generation inside the island;

– Relaxation of some settings of some relays (2 sets of settings are then recommended)

Frequency behaviour

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22Distributed Generation and its Impacts on Distribution Networks© 2010

Islanding operation

• Some simulation results from islanding operation in a distribution grid with wind generation, cogeneration and hydrounits.

Response from one hydro

unit making frequecy regulationVoltages in two buses of the grid

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23Distributed Generation and its Impacts on Distribution Networks© 2010

New Management tools in DMS

• In the short term change in control operating philosophy from central to distributed systems may increase overall costs;

• Increase communication capabilities to monitor and control better DG units and other grid devices;

• Voltage and VAR control tools are needed;

• New tools for network reconfiguration in operation optimisation and system restoration are needed, taking into account DG and their control capabilities;

• If interruptability of DG to deal with congestion management in the grids is to be allowed - specific management tools are needed;

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24Distributed Generation and its Impacts on Distribution Networks© 2010

New Management tools in DMS

• Architecture and functionalities of CAMC

....

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HV

N

DGMGCC

LV

LV

N

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LV

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HV

MV

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HV

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LV

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MV CAMC

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HV

N

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LV

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MV CAMC

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HV

N

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LV

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MV CAMC

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N

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LV

N

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LV

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MV CAMC

DMS

N

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LV

LV

N

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LV

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HV

MV

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MV CAMC

DMS

MGCC

LV

LV

N

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LV

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MV

RTURTU

MV CAMC

DMS

MGCC

LV

LV

N

DG

MGCC

LV

CAMC

HV

MV

RTURTU

MV CAMC

DMS

CAMC

HV

MV

RTURTU

MV CAMC

DMS

CAMC

HV

MV

RTURTU

MV CAMC

DMS

RTURTU

MV CAMC

DMSDMSDMSDMS

N

. . .

...

.. ...

...

.. ......

. .. .

Local

measurements

RemoteTerminal Unit

RemoteTerminal Unit

StateEstimation

EmergencyFunctions

Control Sheduling(markets)

Network Data, Pseudo

measurements

ConstraintsContractsand Bids

VoltageVAR

Support

CoordinatedFrequency

Support

MGCCs

OLTCsCapacitors

SVCs

DG Units

Loads

CAMC

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25Distributed Generation and its Impacts on Distribution Networks© 2010

Microsources

• Microgeneration (to be connected at the LV level) is the new challenge for the electric power industry

• Microsources and storage devices:

– Flywheels;

– Microturbines (single shaft and split shaft)

– PV panels

– Fuel cells

– Micro wind turbines;

– Micro CHP.

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26Distributed Generation and its Impacts on Distribution Networks© 2010

The Microgrid concept

MV LVDMSDMS

MGCCMGCC

DCAC

PV

MC

LC

MCAC

DC

LC

Storage

LC

~ CHPMC

Micro Turbine

MC

Fuel CellMCAC

DC

LCACDC

~

FlywheelMCAC

DC

MGCC – Micro Grid Central Controller;

MC – Micro Source Controller;

L C – Load Controller.

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27Distributed Generation and its Impacts on Distribution Networks© 2010

Normal interconnected mode

• Managing the microgrid

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28Distributed Generation and its Impacts on Distribution Networks© 2010 28

MicroGrid Islanded Operation

• The MicroGrid can operate autonomously in case of

– Failure in the upstream MV grid – forced islanding

– Maintenance actions – intentional islanding

– In this case the MGCC:

• Performs frequency and voltage control in close coordination with the local

controllers in order to not jeopardize power quality

• Triggers a black start function for service restoration at the low voltage level if

the MicroGrid was unable to successfully move to islanded operation and if the

main power system is not promptly restored after failure removal

MicroGrid flexibility will contribute to the improvement of the energy system reliability and quality of service

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29Distributed Generation and its Impacts on Distribution Networks© 2010

II Global evaluation of the impacts of a large scale microgenerationpenetration

• Investigate the impact of microgeneration on the

Portuguese Electrical Distribution System

– quantify overall benefits of microgrids in terms of energy losses and

avoided CO2 emissions

– quantify the impact of a widespread deployment of microgrids on the

future replacement and investment strategies investment deferral

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30Distributed Generation and its Impacts on Distribution Networks© 2010

Methodology

• Hence, typical networks at the distribution level were identified (HV,

MV and LV)

• For each network it was necessary to define:

– load scenarios

– microgeneration scenarios

• For each network, load and microgeneration do:

– Calculate losses, by solving load-flows (with and without microgeneration

integration)

– Estimate the amount of avoided CO2 emissions

– Evaluate benefits from investment deferral

For 1 year

For 25 years

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31Distributed Generation and its Impacts on Distribution Networks© 2010

Typical High Voltage Network

No3

No4

No5No1

No2

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32Distributed Generation and its Impacts on Distribution Networks© 2010

Typical Rural Medium Voltage Network

N061

N076

N0130

N0114

N085

N0119

N077

N039N025

N024

N036

N037

N064

N0199

N0185

N0190

N0206

N0176

N0175

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33Distributed Generation and its Impacts on Distribution Networks© 2010

Typical Urban Medium Voltage Network

NO95NO4 NO16 NO44NO29 NO122

NO155

NO81NO117

NO120

NO48

NO112

NO54

NO53

NO28

NO12

NO151

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34Distributed Generation and its Impacts on Distribution Networks© 2010

Typical Rural Low Voltage Network

NO1

NO9

NO10

NO12

NO13

NO16

NO17

NO23

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35Distributed Generation and its Impacts on Distribution Networks© 2010

Typical Urban Low Voltage Network

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36Distributed Generation and its Impacts on Distribution Networks© 2010

Defining Scenarios…

• Scenarios for Load

– 24h Daily diagrams for Summer/Spring and Winter/Autumn time

• Scenarios for Generation (considering 10%, 20% and 30% of

microgeneration penetration)

– 24h Daily diagrams for Summer/Spring and Winter/Autumn time, considering

different microgeneration technologies:

• Micro-Wind generation

• Micro-PV generation

• Micro-CHP generation

• Micro-Hydro generation

Penetration level (%)= Generation installed capacity *100/peak load

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37Distributed Generation and its Impacts on Distribution Networks© 2010

Load Scenarios

0

20

40

60

80

100

1 2 3 4 5 6 7 8 9 10 11 1213 14 15 16 17 18 19 20 21 22 23 24

Hours

Perc

enta

ge

Load

• Example: Aggregated curve considering a mix of residential and

commercial consumers

Typical Aggregated Daily Load Diagram for Portugal (% of peak value)

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38Distributed Generation and its Impacts on Distribution Networks© 2010

Generation Scenarios

• Main Assumptions

– No DG is considered to be connected directly to the MV and HV level

– The LV networks connected to the MV level are all considered to be microgrids

– It is considered that 60% of the MV networks connected to the HV level are Urban and 40% are Rural type

• The inclusion of microgeneration is simulated by reducing the load at all load nodes according to the percentage of the peak load

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39Distributed Generation and its Impacts on Distribution Networks© 2010

Generation Scenarios

• Generation Percentages for each Scenario per Technology

CHP 42,00%Hydro 16,00%

PV 26,00%Wind 16,00%CHP

Hydro 40,00%PV 20,00%

Wind 40,00%CHP 70,00%

HydroPV 30,00%

WindCHP

Hydro 40,00%PV 20,00%

Wind 40,00%CHP 70,00%

HydroPV 30,00%

Wind

Percentage per Technology

HV

Network

RMV

UMV

RLV

ULV

GenerationTechnology

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40Distributed Generation and its Impacts on Distribution Networks© 2010

Generation Scenarios – Summer/Spring

01020304050607080

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Hours

Perc

enta

ge

PV

0

5

10

15

20

25

0 5 10 15 20 25

Hours

Perc

enta

ge

Wind

0

20

40

60

80

100

1 3 5 7 9 11 13 15 17 19 21 23

Hours

Perc

enta

ge

CHP

0

5

10

15

20

25

1 3 5 7 9 11 13 15 17 19 21 23

Hours

Perc

enta

ge

Hydro

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41Distributed Generation and its Impacts on Distribution Networks© 2010

Generation Scenarios – Winter/Autumn

0

20

40

60

80

100

1 3 5 7 9 11 13 15 17 19 21 23

Hours

Perc

enta

ge

CHP

05

101520253035

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Hours

Perc

enta

ge

PV

0

10

20

30

40

50

0 5 10 15 20 25

Hours

Perc

enta

ge

Wind

0

10

20

30

40

50

60

1 3 5 7 9 11 13 15 17 19 21 23

Hours

Perc

enta

ge

Hydro

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42Distributed Generation and its Impacts on Distribution Networks© 2010

Analysis Procedure

• Loss reduction

– Distribution System Losses (2005) 3437 GWh

• Environmental benefits (reduction of CO2 emissions)

– Estimate the amount of CO2 emissions that can be avoided due to loss reduction

(370 tonCO2/GWh – ERSE reference value for 2005)

Distribution Networks Percentage of the Total (%)

Rural LV 24,0

Urban LV 36,0

Rural MV 13,6

Urban MV 20,4

HV 6,0

Total 100,0

Distribution Networks Percentage per Voltage Level

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43Distributed Generation and its Impacts on Distribution Networks© 2010

Analysis Procedure

• Investment deferral

– May be estimated in 2 different ways, depending on the type of network to analyze

(urban or a rural):

• Investment deferral in urban networks is assessed by evaluating the reduction of line

loading considering microgeneration integration

• For the case of rural networks, the benefits regarding investment deferral are evaluated in

terms of the voltage drop reduction across a feeder due to microgeneration integration

30,0625,295,091,15

23,2712,718,129,574,04

94,50

HV Aerial LineHV/MV Substation

Transformer Stations

Reinforcement Investments2005 (106 euros)

TotalLV Underground Cables

LV Aerial Line

MV Underground CablesMV Aerial Line

MV/MV SubstationHV Underground Cables

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44Distributed Generation and its Impacts on Distribution Networks© 2010

Results

• 10% Microgeneration Penetration

0

500

1000

1500

2000

2500

3000

3500

HV UMV RMV ULV RLV Total

Ener

gy L

osse

s (G

Wh)

Without µGWith µG

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45Distributed Generation and its Impacts on Distribution Networks© 2010

Results

Losses vs. µG Penetration

0100200300400500600700800

10% 20% 30%

µG Penetration

Loss

Red

uctio

n (G

Wh)

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46Distributed Generation and its Impacts on Distribution Networks© 2010

Diferential

HV 5,15 134 127 7UMV 7,35 456 422 33RMV 4,79 304 289 15ULV 11,35 1237 1097 140RLV 7,55 825 763 62Total 8,72 2956 2698 258

Loss Rate (%) 7,0 6,4 0,6CO2 (ton) 1093653 998330 95324

Energy Loss Reduction (%)

Energy Loss per Network Type

(without µG) (GWh)

Energy Loss per Network Type (with µG)

(GWh)

Results

• 10% Microgeneration Penetration

Considering:370 tonCO2/GWh(ERSE reference value)

0.05 €/kWh(average energy cost) 12,9 M€ avoided costs in losses

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47Distributed Generation and its Impacts on Distribution Networks© 2010

1 2 3 4 5 6 7 8 9 10 11 12 13 140

20

40

60

80

100

120

Years

Line

Loa

ding

(%)

Before (without DG)After (with DG)

Results

• 10% Microgeneration Penetration: UMV Network – Winter/Autumn

– Branch with more loading: evolution in time

Investment1 Year Delayed

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48Distributed Generation and its Impacts on Distribution Networks© 2010

1 2 3 4 5 6 7 8 9 100

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1

Years

Bus

Volta

ge (p

u)

Before (without DG)After (with DG)

Results

• 30% Microgeneration Penetration: RMV Network – Winter/Autumn

– Worst Bus Voltage evolution in time

Investment2 Years Delayed

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49Distributed Generation and its Impacts on Distribution Networks© 2010

Results

• 10% Microgeneration Penetration

Savings resulting from the reduction in the average annual energy losses for a time span of 25 years, at the present time

Avoided interests due to postponing for 25 years the line and transformer investments

n

ii

a

aii

a

ic

ttI

ttC

11

11

1

0 )1()1()1(1 12,882 0,207

2 12,924 0,0003 12,967 0,1994 13,010 0,0005 13,053 0,1916 13,096 0,0007 13,140 0,1848 13,183 0,0009 13,227 0,177

10 13,271 0,00011 13,315 0,17112 13,359 0,00013 13,403 0,16414 13,448 0,00015 13,492 0,15816 13,537 0,00017 13,582 0,15218 13,627 0,00019 13,672 0,14720 13,718 0,00021 13,763 0,14122 13,809 0,00023 13,854 0,13624 13,900 0,00025 13,946 0,131 Total

Total 335,181 0,207 1,953 337,3403

Energy Loss Reduction (106

euros)Line Loading Reduction

(106 euros)YearLine Loading Reduction Year 1

(106 euros)

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50Distributed Generation and its Impacts on Distribution Networks© 2010

Microgeneration Installed Capacity and Total Energy Generation

Largely dependent on the mix of microsources

0

5001000

1500

2000

25003000

3500

4000

534 1068 1603

Installed Capacity (MW)

Ene

rgy

(GW

h)

10%

20%

30%

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51Distributed Generation and its Impacts on Distribution Networks© 2010

Daily Load Diagram

• 10% Microgeneration Penetration

0 5 10 15 20 250

1000

2000

3000

4000

5000

6000

7000

8000

9000

Hours

Load

(MW

)

Winter Scenario

Without uGWith uGuG

0 5 10 15 20 250

1000

2000

3000

4000

5000

6000

7000

8000

Hours

Load

(MW

)

Summer Scenario

Without uGWith uGuG

Maximum μG contribution: 337 MW

μG contribution at peak load: 248 MW

Maximum μG contribution: 204 MW

μG contribution at peak load: 86 MW

Avoided energy generation : 1272 GWh (in year 2005)

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52Distributed Generation and its Impacts on Distribution Networks© 2010

Conclusions - Benefits

• Large technical, economic and environmental benefits can be achieved by using microgeneration:

– Considerable amount of loss network reduction;

– Better voltage profiles;

– Reliability improvements;

– Increased economic performance of the distribution activity

• investment deferral network reinforcement costs;

• avoided costs in network losses.

– Avoided CO2 emissions

Specific and fair new remuneration schemes must be identified

Beneficiaries: Microgenerators, consumers, DSOs, society

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53Distributed Generation and its Impacts on Distribution Networks© 2010

Conclusions - Benefits

• Consequences of the SmartGrid concept

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54Distributed Generation and its Impacts on Distribution Networks© 2010

Conclusions - Benefits

• Society benefits (less tangible benefits related to energy policy):

– increased security of power systems,

– diversification of primary energy sources,

– reduction on energy external dependence),

– potential economic benefits (new economic activities, innovation).

How to share these benefits?

The microgenerator should recover its cost and should take a part of these benefits

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55Distributed Generation and its Impacts on Distribution Networks© 2010

Conclusions – Next steps

• Adjustments in the regulatory framework are needed

• Two approaches should be exploited:

– For DG units

• Remuneration of ancillary services to G

• Additional incentives for better located G units

– Nodal cost prices approaches can be used (active and reactive) requires

– For DSO

• Incentives to accept and manage G (accept additional monitoring and control costs developed by DSO),

since general loss reduction can be achieved

– Target values for the losses should be more ambitious, with stronger incentives (within the normal

regulatory schemes). Ex: Ofgem.

– Again the nodal cost mechanism can be used

• Incentives to accept DG, since deferral in reinforcement investments can be obtained