With heightened focus on the means of transitioning to a net zero carbon energy system (and economy) in the next decade there are significant questions for the power system to address. These include how to secure the system and customer supplies at levels equivalent or better than today and how to build a network infrastructure to transport electrical energy to new large electrical loads from transport and heat. One big question to go with those is how to deal with the unavoidable renewable power surpluses and deficits that will existing when providing 100% of electrical energy needs from clean sources averaged over the course of a year.
Since wind power, solar power and other forms of renewable power have outputs subject to their variable primary energy sources then solutions are required to ensure that there is enough zero carbon energy available at all times and in all places. So, what are the solutions and how should they be deployed to deliver the best possible system outcomes? The answers to these major energy transition questions have longer-term system development and operational implications for all stakeholders.
In a GTM Interchange podcast from earlier this summer, Stephen Lacey and Shayle Kann, which shed light on this crucial topic, offering four solutions to this renewable electricity production surplus and deficit, including:
1. Storage: Captures the excess renewable generation for use at a later time. While energy storage solutions are generally good for daily cycles in production and demand, a big challenge is providing long-term, inter-seasonal energy storage capability. Storage on such a scale has challenging technical and economic barriers at present. Storage can be considered a very good partial, but not a full, solution at present.
2. Transmission: Existing and new bulk power transmission assets enable energy transfers between areas of high instantaneous renewable production and areas of low production. In the same way that energy storage shifts energy production in time, transmission networks shift produced energy production over space (or geography). While taking advantage of the ‘smoothing’ effect of geography on different variable renewable sources, new build transmission faces the major hurdles of social and political acceptability.
3. Demand-Side Flexibility: Load shifting and shaping to match available renewable production needs to be a larger part of the solution for balancing of consumption with production but, like storage, is more problematic as a source of longer-term, inter-seasonal balancing. The use of electrical power for EV charging, hydrogen production, heating and cooling provides a significant opportunity for demand side balancing and is an efficient solution but with various implementation, scalability and monetization hurdles.
4. Curtailable Renewables Overbuild: Overbuilding renewable capacity and curtailing the excess energy is claimed by various analysts to be economically attractive compared to the other three solutions based on current solution technologies and prices and these will improve with continued cost reductions in renewable technologies. This is an important point made by others as well – the economic solution can be a deliberate over-build of renewable capacity with a pre-planned intention to curtail the surplus production when the energy is not required (or cannot be diverted to use in flexible demand e.g. filling heat, cool, chemical or hydrogen fuel stores). Similar timing and locational production and consumption challenges would still exist in an overbuilt renewables-based system (i.e. a larger installed capacity solar PV will still provide no output at night and the wind occasionally does not blow strongly over a wide geographical area!). The renewable technologies and the advanced grid management controls to execute curtailment, both system-wide and local, already exist and are already becoming increasingly economic.
Interestingly, the four solutions might be owned by four different types of system and market participant. Would a desirable outcome for the system and society, as well as the asset owners, be for horizontal or vertical integration of these solutions or is it advantageous that they are in competition and used by system operators as the availability, need and cost dictates.
If we took an optimal economical approach then then we would invest in the four solutions in line with long-run marginal costs of the solutions then that might favour transmission lines. Alternatively, if we took a short-run marginal cost approach then that may favour demand side flexibility. The optimal outcome is likely to be a combination of all four solutions built in a manner that allows each to complement the others and solve the long and short term and the local and wide area resource balancing problems.
Hybridised versions of the solutions also have merits such that operationally, any optimisation would look at the regional load demand and renewable generation production forecasts and allocate the different time and geographical balancing requirement to the optimal mix of demand response, transmission, energy storage and renewable curtailment, either co-located or connected over the grid.
It is likely that each of the four solutions will develop for reasons other than whole system, international/regional, inter-seasonal balancing. Different economic incentives will be required to promote the development of appropriate levels of each of the four solutions so that the whole system can be operated economically while achieving net zero carbon and delivering overall system security.
Some power markets already operate with all four solutions playing an active role today. For example, the GB Electricity System Operator (ESO) purchases renewable curtailment, storage services and demand response for operational flexibility while using transmission circuits and interconnectors to ship electricity (not all renewables yet) across regional and national boundaries.
There have been recent articles on curtailment promoting its economic value and that is a topic with some great terminology suggestions (e.g. spill, leftovers, shrinkage) to encourage overbuilding renewables with curtailment to be seen as a natural and positive solution en route to the zero carbon electricity system.
Renewable energy surpluses and curtailment already play an important role in managing renewable generation and this is becoming increasingly material at a system level (e.g. curtailed energy volumes, negative market prices). So, the time for a new thinking on managing curtailment, blending that with the other solutions and developing the optimal system development and operational models has arrived. Better approaches to managing surplus clean energy production and curtailment and smarter use of curtailed renewable energy will play a very valuable role in the zero carbon system. Imbalance forecasting, tradeable and preferential clean energy access rights, more dispatchable flexibility, aggregating of flexible Distributed Energy Resources (DER), scheduling demand side and production flexibility and optimizing the operation of available energy storage facilities will all play a role in local systems and markets as well as at the wider system level.