Business & Technology Report April 2021 Use Cases for Distributed Wind in Rural Electric Cooperative Service Areas Business & Technology Report April 2021 RADWIND PROJECT REPORT SERIES: Use Cases for Distributed Wind in Rural Electric Cooperative Service Areas Prepared By: NRECA Research and project partners. This material is based upon work supported by the U.S. Department of Energy’s Office of Energy Efficiency and Renewable Energy (EERE) under the Wind Energy Technologies Office Award Number DE-EE0008958. Primary Author: Alice Orrell, Pacific Northwest National Laboratory NRECA Contacts: Michael Leitman (RADWIND Project Manager) Senior Analyst, Economics & Business NRECA Business and Technology Strategies [email protected] Venkat Banunarayanan (RADWIND Principal Investigator) Vice President, Integrated Grid NRECA Business and Technology Strategies [email protected] Legal Notices This work contains findings that are general in nature. Readers are reminded to perform due diligence in applying these findings to their specific needs, as it is not possible for NRECA Research to have sufficient understanding of any specific situation to ensure applicability of the findings in all cases. The information in this work is not a recommendation, model, or standard for all electric cooperatives. Electric cooperatives are: (1) independent entities; (2) governed by independent boards of directors; and (3) affected by different member, financial, legal, political, policy, operational, and other considerations. For these reasons, electric cooperatives make independent decisions and investments based upon their individual needs, desires, and constraints. 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Use Cases for Distributed Wind in Co-op Areas Table of Contents RADWIND Project .................................................................................................................... 1 What Is Distributed Wind? ...................................................................................................... 2 Distributed Wind Turbine Sizes ....................................................................................... 3 Distributed Wind Hybrids ................................................................................................ 3 Distributed Wind and Demand Response ....................................................................... 3 Microgrids and Isolated Grids ......................................................................................... 4 Distributed Wind Use Cases ................................................................................................... 4 Front-of-Meter Use Case ......................................................................................................... 5 Behind-the-Meter Use Case .................................................................................................... 7 Off-Grid Use Case .................................................................................................................... 9 Putting It All Together ........................................................................................................... 11 Next Steps .............................................................................................................................. 13 References ............................................................................................................................. 14 Use Cases for Distributed Wind in Co-op Areas RADWIND Project This is the first in a series of NRECA Research reports about wind as a distributed energy resource (DER). This report explains the primary ways, or use cases, that wind energy technologies can be deployed in electric cooperative service territories as a DER. This use case report lays the foundation for the future Value Case and Business Case reports. NRECA Research’s Rural Area Distributed Wind Integration Network Development (RADWIND) seeks to understand, address, and reduce the technical risks and market barriers to distributed wind adoption by rural utilities. The goal of the project is to reduce the barriers for distributed wind deployment, either as a standalone resource or as part of a hybrid power plant with other DER. For more information on the project and additional resources, please visit the project landing page at www.cooperative.com/radwind. 1 Use Cases for Distributed Wind in Co-op Areas What Is Distributed Wind? Distributed wind turbines are distributed energy resources connected at the distribution level of the electricity grid or in off-grid applications. Distributed wind technologies can range from a less than 1- kilowatt (kW) off-grid wind turbine at a remote cabin or oil and gas platform, to a 15-kW wind turbine at a home or farm, to several multi-megawatt wind turbines at a university campus, manufacturing facility, or connected to the distribution system of a utility. As a result, distributed wind is differentiated from wholesale power that is generated at large wind farms and carried over transmission lines to substations for distribution to distant end users. Wind as a DER is an emerging opportunity for rural America. Many of the regions in the United States that offer quality wind resources and population densities acceptable for distributed wind development are in rural electric cooperative territories. Research from the U.S. Department of Energy suggests there is significant economic potential for distributed wind capacity additions on rural distribution grids (Lantz et al. 2016). Rural electric cooperatives1 and their consumer-members are utilizing distributed wind across the United States. The RADWIND team has identified over 200 megawatt (MW) of distributed wind capacity in about 80 cooperative territories. Some of this installed capacity are from consumer-member-owned wind turbines interconnected to cooperative distribution systems via net metering agreements, but most of the capacity is either owned by or under power purchase agreement (PPA) contracts by distribution and generation and transmission (G&T) cooperatives, as shown in Figure 1. Cooperative projects are typically larger projects (i.e. around 10 MW) consisting of multiple large-scale turbines (1 MW and greater in size), hence their greater representation in Figure 1. Figure 1: Percentage of Distributed Wind Capacity, in Megawatts, by Customer Type in Cooperative Territories, 2003-2019 1 While this report generally uses “cooperatives,” NRECA’s membership also includes more than 40 utilities that are not organized as cooperatives, mostly rural public power districts as well as small municipal, tribal, and mutual utilities. While business models differ, this report should be applicable to them as well as other rural utilities that are not NRECA members. 2 Use Cases for Distributed Wind in Co-op Areas Distributed wind projects can utilize a variety of turbine technologies and can be deployed as standalone distributed generation projects or in combination with other DER. The remainder of this section discusses some technical considerations for distributed wind projects. Distributed Wind Turbine Sizes The RADWIND team considers wind turbines in the following three size segments: ● Small wind turbines are up through 100 kW in nameplate capacity2 ● Medium wind turbines are 101 kW to 999 kW in nameplate capacity ● Large-scale wind turbines are 1 MW and greater in nameplate capacity Distributed Wind Hybrids Wind energy technology is increasingly being combined with other distributed energy resources and technologies, such as batteries, solar PV, or combined heat and power (CHP) on distribution systems. These combination projects can be referred to as distributed wind hybrids. Distributed wind hybrid projects can generally be categorized based on their operational and locational characteristics. Distributed wind hybrids can be co-located resources only sharing a location,