PJM has just released a new study it commissioned to analyze the impacts of integrating large amounts of renewable power into its grid management system. This report is somewhat similar to a Synapse study that PJM released last May.
Here is a link to PJM’s 55-page executive summary of the report. Only PJM would release a 55-page “summary.”
Here are the study’s main conclusions:
The study findings indicate that the PJM system, with adequate transmission expansion and additional regulating reserves, will not have any significant issues operating with up to 30% of its energy provided by wind and solar generation. The amount of additional transmission5 and reserves required are briefly defined later in this summary and in much greater detail in the main body of the report.
- Although the values varied based on total penetration and the type of renewable generation added, on average, 36% of the delivered renewable energy displaced PJM coal fired generation, 39% displaced PJM gas fired generation, and the rest displaced PJM imports (or increased exports).
- No insurmountable operating issues were uncovered over the many simulated scenarios of system-wide hourly operation and this was supported by hundreds of hours of sub-hourly operation using actual PJM ramping capability.
- There was minimal curtailment of the renewable generation and this tended to result from localized congestion rather than broader system constraints.
- Every scenario examined resulted in lower PJM fuel and variable Operations and Maintenance (O&M) costs as well as lower average Locational Marginal Prices (LMPs). The lower LMPs, when combined with the reduced capacity factors, resulted in lower gross and net revenues for the conventional generation resources. No examination was made to see if this might result in some of the less viable generation advancing their retirement dates.
- Additional regulation were required to compensate for the increased variability introduced by the renewable generation. The 30% scenarios, which added over 100,000 MW of renewable capacity, required an annual average of only 1,000 to 1,500 MW of additional regulation compared to the roughly 1,200 MW of regulation modeled for load alone. No additional operating (spinning) reserves were required.
- In addition to the reduced capacity factors on the thermal generation, some of the higher penetration scenarios showed new patterns of usage. High penetrations of solar generation significantly reduced the net loads during the day and resulted in economic operation which required the peaking turbines to run for a few hours prior to sun up and after sun set rather than committing larger intermediate and base load generation to run throughout the day.
- The renewable generation increased the amount of cycling (start up, shut down and ramping) on the existing fleet of generators, which imply increased variable O&M costs on these units. These increased costs were small relative to the value of the fuel displacement and did not significantly affect the overall economic impact of the renewable generation.
- While cycling operations will increase a unit’s emissions relative to steady state operations, these increases were small relative to the reductions due to the displacement of the fossil fueled generation.
Keep in mind that this report, prepared by GE Energy Consulting, was prepared for PJM, which is focused on grid scale operations. The study was designed to tell PJM the results of various scenarios of renewable generation on its system. While the PJM cartel definitely shapes trends in generation because the companies that own big generation run the cartel, PJM itself cannot create government policy or policy incentives that encourage different kinds of generation.
The study was not designed to advocate for one kind of generation over another. It was focused on showing the impacts of various levels of renewable generation on PJM’s operations.
The significance of the GE report is what it says about the impacts of expanding renewable power in PJM:
- Expanded renewable generation would put more pressure on fossil generators to be able to ramp production up and down much more quickly than the current system.
- Expanded renewable generation would drive down the price of electricity.
- Expanded renewable generation would raise costs for fossil generators, because they have to vary their output more than they do now.
- The concept of base load generation would disappear with expanded renewable generation.
- Expanded renewable generation would not cause any operational problems for PJM as the grid operator.
The GE study does not do a very good job modeling or presenting useful information about new transmission investment that would be required by expanded grid scale renewable development. First, footnote 5 in the executive summary, which appears on the same page as the conclusions quoted above states: “This study did not examine the cost allocation for the transmission expansion required to deliver the renewable energy in the study scenarios.” Cost allocation is at the heart of the transmission issue. It appears that GE Energy Consulting is playing the old PJM game of hiding the all important questions of who benefits and who pays for transmission projects.
The one conclusion that our friends in the Midwest can draw from this study is that PJM Interconnection doesn’t need to import wind-generated electricity from the Great Plains. Zero. None.