ENERGY EFFICIENCY EVALUATIONS Wind-Diesel Hybrid System Testing at the Alaska Center for Energy and Power A Review of Project Activities under the Denali Commission Emerging Energy Technology Grant Award #01233-00 Dennis Witmer 10/31/2013 Final Report Introduction As the cost of diesel fuel has risen sharply in the past few years, the incentive to replace expensive diesel electric power generation with less costly alternatives has also increased. Many remote Alaska communities have excellent wind resources, but the cost of installing utility-scale wind turbines in these locations is high. Even more challenging is the stochastic (random) nature of wind energy, which makes it difficult to provide utility-grade electricity from this resource. High-penetration wind-diesel hybrid systems that use energy storage are one option, but they require several components: diesel electric generators (DEGs), wind turbines, batteries or flywheels for energy storage, and a control system. Inverters—devices that convert alternating current (AC) to direct current (DC)—are usually required for transferring energy in and out of batteries as well as converting “wild AC” from wind turbines and flywheels into utility-grade 60-cycle AC. Often the inverter is at the center of the control strategy, allowing the system to collect excess energy when available (from high wind events), then store that energy (in the battery or flywheel) and release it later. Since fuel savings can be maximized if DEGs are off during wind events, in an ideal system the diesel would operate during calm periods but be turned off when sufficient wind energy is available. Conventional utilities depend on rotating generators to provide AC power for both energy and reactive power support, tasks that must be done by the inverter in the new hybrid systems. In 2009, the Denali Commission, an independent federal agency in Alaska, released a public solicitation for proposals to be funded by its Emerging Energy Technology Grant program (EETG). The EETG targeted (1) research, development, or demonstration projects designed to test new energy technologies or methods of conserving energy or improve an existing energy technology, and (2) applied research projects that employ energy technology with a reasonable expectation that the technology will be commercially viable in Alaska in not more than five years. The Denali Commission selected “Evaluating NW100B Inverter to Support Diesel-Off Operation in Alaskan Wind-Diesel Systems,” a proposal submitted by the Alaska Center for Energy and Power (ACEP), as one its project. This report is a review of that project and includes an overview of the technology, summarizes project activities, and provides results and next steps. Background Today, much of Alaska remains wild and undeveloped. Approximately 175 small communities are scattered across the vast landscape, where electric power is provided by DEGS, each serving a small, local power gird connected to a few dozen to a thousand houses. There are only a few roads and electrical transmission lines connecting the largest communities. The absence of roads, electrical grids, and pipelines means that much of rural Alaska experiences very high energy costs. While DEGs are efficient (35% and higher for new generators), diesel fuel is 1 considerably more expensive than the natural gas and coal available for electricity generation along the Alaska Railbelt1. Diesel fuel sells for about $3.50 per gallon at the pump along the Railbelt at current world oil prices. This fuel must be then shipped to rural communities by barge, which adds approximately $1 per gallon to the delivered cost of fuel.2 At $4.50 a gallon and 14 kWh per gallon3, fuel costs $0.32 per kWh, much higher than the cost of several cents per kWh for natural gas or coal, which is used in power plants along the Railbelt. Fuel costs along with capital costs for the power plant, operations and maintenance costs, local utility line costs, and administrative and overhead costs add up to a total cost of electricity between $0.40 and $1.20 per kWh to the customer, as reported to the Regulatory Commission of Alaska under the Power Cost Equalization (PCE) program.4 The high cost of diesel fuel has led to increased interest in the use of local energy sources, in particular renewable energy sources. Because many rural Alaska communities have significant wind resources, there has been substantial interest in developing wind projects over the past few years. Alaska has been implementing utility-scale wind power as an energy source for rural communities for the past 15 years, beginning with the installation of wind turbines in Kotzebue and Wales. Since that time, wind turbines have been installed in more than 20 rural communities, and several installations have been made along the Railbelt. 1 A term referring to the broad geographic area served by the Alaska Railroad from the Kenai Peninsula to Fairbanks, which is also connected by the state’s largest electricity grid. 2 In current prices, natural gas is currently sold in bulk at $3.50 per MMBTU, but the same chemical energy costs about $32.60 when delivered to a rural village as diesel fuel at $4.50 per gallon. 3 Diesel fuel contains about 39 kWh of chemical energy, so 14 kWh per gallon represents a DEG efficiency of about 36%, typical of well-maintained modern diesel generators. The kWh per gallon statistic is reported by utilities to the PCE program and is one simple metric for utilities. 4 The PCE program is intended to reduce residential power bills by providing a subsidized rate for the first 500 kWh per month of an electric bill, with payments made directly to the utility to compensate for lost revenue, but it requires utilities to provide documentation to justify payments. http://www.akenergyauthority.org/PDF%20files/pcereports/fy12statisticalrptcomt.pdf. 2 Figure 1: Low-penetration wind system, where the wind power remains well below the load. System stability is not threatened, and fuel savings are realized. Data represents a one-day wind event (24 hours) presented in seconds (86,400 seconds/day). Figure 2: High wind event, simulated for modeling purposes. Note that the wind output sometimes rises above the load (suggesting the possibility of a diesel-off mode) but there are also events during which the wind falls rapidly from above to below the load. Event simulated from wind event shown in Figure 1, above. 3 The challenge with wind (and other renewable sources such as solar) is that the energy is intermittent, available only when the wind blows, and not necessarily when people want it. In remote Alaska communities, the stochastic nature of wind is a significant problem. The only other source of power is the DEG, which must provide power when the wind is not available. The simplest wind-diesel hybrid system uses an appropriately sized wind turbine to provide a portion of the energy needed, similar to the larger utility wind farms along the Railbelt. If the wind energy contribution is relatively low (less than 50% of the local load), the diesel engine can act as the bridge between the wind and the load, providing the necessary power to make up the difference between the two and providing some diesel fuel savings as well. This type of system is referred to as a low- penetration system. The advantage of this type of system is its relative simplicity (although integrating wind turbines and diesel generators is not without its challenges), but the disadvantage is that relatively little wind energy can be harvested for use compared to the overall energy requirement, and the costs per installed kilowatt are often quite high compared to larger utility wind farms. Some systems have attempted to incorporate additional wind turbines—referred to as medium- penetration systems (the wind output rises to equal or exceed the load)—but unfortunately the diesel engines must be kept running to cover the breaks in the wind. This means keeping the diesel engine on at some reasonable minimum load—most often between 20% and 40% (depending on engine size) of the maximum—to minimize maintenance issues and diverting the excess electricity to “dump loads” or curtailing the output from the wind turbines. Either way, less energy is delivered to the load from the wind turbine than it is capable of providing. The total diesel displacement at the power plant is greater than with a low-penetration system, but capital costs are higher. There may be some value for the heat energy provided, but this a lower-value use of the electricity. Stable operation of medium-penetration systems has been demonstrated in several locations in Alaska. High-penetration systems are the most complex, but they also provide the potential for additional fuel savings by enabling a “diesel-off” mode of operation. The typical components of a high-penetration wind-diesel hybrid system are (1) a conventional diesel plant large enough to supply the entire village load when wind is not available, (2) wind turbines that are capable of providing significantly more power that the grid demands, (3) energy storage capability, and (4) a control system to manage the operation of each of the individual components. The energy storage system can contain capacitors, batteries, or flywheels, usually matched with an inverter. In addition, a synchronous condenser (essentially a rotating generator with no engine) can be used for frequency stabilization during diesel-off operation, although some systems have been proposed to eliminate the need for this component. Of the components of a high-penetration system, the two that currently require the most attention are the energy storage system and control system. While it is possible to devise energy storage systems that use only utility-grade AC electricity (for example, pumped hydro can use AC electricity to pump water uphill and generate AC electricity on the return), many energy storage systems use either DC electrical components (batteries) or devices that provide AC at highly variable frequencies and then convert it to DC power and back to utility-grade AC (often used for flywheel storage systems).