Renewable Integration: Solving the Volatility of a Smart Grid

In addition to frequency regulation and spinning reserve, advanced energy storage technology, including lithium ion battery systems, helps facilitate the increased penetration of renewable energy sources to the grid. Energy storage addresses the inherent variability of wind and solar, which is one of the key remaining hurdles to renewable adoption within the current power infrastructure. With the increased penetration of renewable generation, the grid is experiencing a shift from predictable dispatchable generation to variable non-dispatchable generation. This adds a new level of uncertainty and volatility to the grid that causes an array of problems as the relative proportion of variable generation vs. traditional dispatchable generation increases.

Since generation from renewable sources is unpredictable, it becomes difficult to schedule and manage traditional generation assets to compensate. Renewable sources also tend to be geographically concentrated and isolated, causing problems related to transmission constraints. Furthermore, the continuous change in generation results in imbalances and volatility, increasing the area control error (ACE), which measures the generation and demand imbalance usually on a second-by-second basis.

Grid and renewable operators are struggling to respond to these changes. Options such as adding additional gas turbines to compensate for the variability of renewables are being discussed, but these are imperfect solutions given that they essentially counteract the benefits and purpose of deploying renewable sources. Wind farm operators can curtail their output to reduce the impact, but doing so forgoes generation and reduces the value of wind output.

Advanced energy storage can be used to address the unpredictability of renewable generation, and meet operational performance standards being established to mitigate the effects of increased amounts of variable generation. Technically, storage can address most of the issues associated with intermittent generation. Short-term, fast-response storage has already been demonstrated as a viable means of managing grid imbalances and volatility through the regulation service. In the longer term, storage can be deployed to shift energy in time to “smooth” the output of renewable generation or reduce the peak load on constrained transmission assets. 

In addition, inverters used to connect large scale battery systems to electrical grids can provide reactive power as a coincident service that can help support improved voltage, and related performance requirements. One utility taking advantage of these benefits is Southern California Edison, which is deploying energy storage systems based on lithium-ion technology at the Tehachapi wind farm.

An important factor to take into account is whether advanced energy storage can provide an economically viable solution. While regulation services using short-duration storage produce measurable return on investment, increasing the duration of storage increases the cost.

Renewable energy and power grid operators should therefore consider multiple functions for storage assets—for example, performing both shifting and regulation—or taking advantage of price differences during the day, often referred to as inter-temporal arbitrage. Combining multiple functions can provide multiple revenue streams, making the economic benefits of advanced energy storage for renewable integration more prominent.