Economic and technical challenges of flexible operations under large-scale variable renewable deployment

John Bistline

Energy Economics, 2017, vol. 64, issue C, 363-372

Abstract: Fundamental characteristics of solar and wind power have generated controversy about their economic competitiveness and appropriate techniques for assessing their value. This research presents an approach to quantify the economic value of variable renewable capacity and demonstrates its dependence on renewable deployment levels, regional resource endowments, fleet flexibility, and trade assumptions. It assesses economic and technical impacts of large-scale renewable penetration by linking two models, representing electric-sector investments and detailed operations. Model results for California and Texas suggest that operational constraints and costs of dispatchable generators (e.g., minimum load levels, ramping limits, startup costs) can impact renewable integration costs, but the temporal and spatial variability of solar and wind are larger determinants of their value. Restrictions on transmission and regional coordination in capacity planning and dispatch decrease the economic value of variable renewable energy, highlighting the potential roles of market design and trade. Energy storage is shown to be a valuable balancing asset at higher solar and wind penetration levels, but potential revenues diminish with increased storage deployment.

Keywords: Renewable integration; Variable renewable energy; Power system planning; Flexible operations; Regional heterogeneity; Unit-commitment modeling (search for similar items in EconPapers)
JEL-codes: C61 F18 L94 Q20 Q42 Q48 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (38)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0140988317301196
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:64:y:2017:i:c:p:363-372

DOI: 10.1016/j.eneco.2017.04.012

Access Statistics for this article

Energy Economics is currently edited by R. S. J. Tol, Beng Ang, Lance Bachmeier, Perry Sadorsky, Ugur Soytas and J. P. Weyant

More articles in Energy Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().