IEEE Power & Energy Magazine - November/December 2017 - 29

Futures with 50-80% penetration levels of renewables are being
studied in detail by system operators and researchers, and, in many
areas, legislated requirements already exist for these levels.
Second, the right types of generation must be provided
with capacity payments. Generators that are flexible will be
increasingly valuable in modern power systems-especially,
generators that can handle part-load and part-time operation. A shift is occurring in markets that have high shares of
renewables, where less generation is operated as base load
and more is needed to cycle at faster ramp rates. At the same
time, with the right incentives, this might not require a major
increase in new, expensive peaking plants; some currently
base-loaded or start-limited generators could be upgraded
to provide more flexibility. CAISO has introduced a forward
"flexible capacity" product to create a ramping requirement
for some quantity of resource adequacy capacity; other ISOs
have preferred to leave the capacity product denominated
only in megawatts and rely on the energy and ancillary service markets to reward flexibility. Time will tell which of
these approaches is better when faced with rapid changes in
the resource mix.
Note that not all markets with high renewables penetration levels have capacity markets. For example, in the United
States, Texas runs an energy-only wholesale market that
relies on volatile energy prices-from negative prices to
US$9,000/MWh during times of scarcity-thus providing
income to the generators that are used during only a small
part of the year. High price volatility also incentivizes the
need for demand response and storage; however, it remains
to be determined how far energy-only markets can go to support investments, as renewables potentially suppress prices
during both current peak and off-peak periods.
Third, related to our observations about operational flexibility, there is some expectation that the demand and prices
for ancillary services will grow, as forecast uncertainty
increases because of more generation from wind and solar.
Revenues from these services could partially offset the loss
of energy revenues and limit the need to rely on capacity
payments. New ancillary products and market mechanisms
are needed, and several of these are currently being developed to help integrate renewables. For example, in several
U.S. regions, ramping reserves have recently been implemented, reflecting the impact of wind and solar on real-time
operations; however, as of now, these product markets are
small, and the amount of extra income they provide to generators will be affected by their design.
More research and analysis are required to understand
potential solutions and help the market provide the appropriate incentives to keep the grid reliable. The problem is one of
economics, so that generation not being used can be retired
november/december 2017

as soon as possible-but not so early that doing so leaves the
power system vulnerable to unforeseen constraints on renewable energy production and potential reliability problems.

Fact Five: Modern Power Electronics
Are Creating New Sources of Essential
Reliability Services
Modern power systems have more options for providing essential reliability services than ever before. Traditionally, fossil-fueled and hydropower resources were considered the
sole sources of services necessary to balance the system and
maintain transmission network security; however, advanced
inverter technologies coupled with modern communications
networks are adding new sources of grid flexibility and
responsiveness to the market. These capabilities enable wind,
demand, solar, and storage to offer a full suite of essential reliability services. Planners and regulators face the challenge of
determining how to enable these resources to come to market
and contribute to grid reliability, resiliency, and security.
One requirement of power systems is to maintain electrical frequency within a safe range. Frequency response is an
essential component of grid reliability. It measures an interconnection's ability to stabilize the frequency immediately
following the sudden loss of generation or load. A variety of
terms are used to describe the services procured to improve
a system's frequency response. In the United States, the
most common is primary frequency response, although primary control and frequency responsive reserve are also used
in referring to the automatic, local response to frequency
excursions through turbine speed governors as well as frequency responsive demand that adjusts to counter-frequency
deviations and so stabilizes the system. Another aspect of
the power system that contributes to system-wide stability is
system inertia, the aggregate inertia of load and synchronous
generation that injects or extracts stored kinetic energy from
the rotating mass of a machine. The combined impact of system inertia and primary frequency response is essential to balancing system frequency.
Recent studies in the United States and Australia have
shown that the frequency response of various interconnected
systems is declining. This decline results from a variety of
physical reasons, including generators that operate in modes
that do not offer primary frequency response, excessive
governor dead bands, and blocked governors. Other reasons
might be institutional or caused by inappropriate incentives
in electricity markets. Finally, the addition of asynchronous
generation such as wind and solar can reduce the amount
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Table of Contents for the Digital Edition of IEEE Power & Energy Magazine - November/December 2017