UNIVERSIDAD PONTIFICIA COMILLAS ESCUELA TÉCNICA SUPERIOR DE INGENIERÍA (ICAI) MÁSTER OFICIAL EN EL SECTOR ELÉCTRICO Master in Economics and Management of Network Industries TESIS DE MÁSTER Impact of Large Scale Wind Power Integration on Operating Reserves in Spain AUTOR: Metin INAN MADRID, February 2014 1 | P a g e UNIVERSIDAD PONTIFICIA COMILLAS ESCUELA TÉCNICA SUPERIOR DE INGENIERÍA (ICAI) MÁSTER OFICIAL EN EL SECTOR ELÉCTRICO Master in Economics and Management of Network Industries TESIS DE MÁSTER Impact of Large Scale Wind Power Integration on Operating Reserves in Spain AUTOR: Metin INAN SUPERVISOR: Pablo FRIAS MARIN MADRID, February 2014 2 | P a g e Summary English: Wind power besides its benefits at large scale integration levels brings certain challenges into electricity systems. The most concerned drawbacks are due to the variability of wind energy and the accuracy of forecasting the wind power production. These characteristics of wind power cause some negative effects regarding the operation of power systems both on the long and short-term such as the need of voltage management, transmission or distribution losses, increase in operating reserves, discarded wind energy and system reliability issues. The purpose of this thesis is to demonstrate the impacts of wind power in Spain on operating reserves and to quantify the additional costs -if there is any- due to the integration of large scale wind power. Español: La energía eólica además de sus beneficios en los niveles de integración a gran escala trae algunos retos en los sistemas eléctricos. Los inconvenientes más afectados son debido a la variabilidad de la energía eólica y la exactitud de la predicción de la producción eólica. Estas características de la energía eólica causan algunos efectos negativos sobre el funcionamiento de los sistemas de energía, tanto en el corto y largo plazo, tales como la necesidad de la gestión de tensión, las pérdidas de transmisión o de distribución, aumento de las reservas, la energía eólica vertida y problemas de fiabilidad del sistema. El propósito de esta tesis es demostrar los impactos de la energía eólica en España en reservas y cuantificar los costes adicionales -si hay alguno- debido a la integración de la energía eólica a gran escala. 3 | P a g e TABLE OF CONTENTS 1. Introductıon & Objectıves ............................................................................................................. 8 2. Wind Power in Europe .................................................................................................................... 9 2.1. Initiatives to Promote Electricity Generation from RES in EU .................................... 10 2.2. Challenges Facing Integration of Wind Power into Power Systems ........................... 13 2.3. Large Scale Wind Power Integration in Europe ............................................................... 15 2.3.1. Denmark ............................................................................................................................. 16 2.3.2. Germany ............................................................................................................................. 17 2.3.3. Ireland ................................................................................................................................. 17 2.3.4. Britain ................................................................................................................................. 18 3. Wınd Power Intergration In Electricity Markets ................................................................. 19 3.1. Electricity System Balancing Mechanisms ....................................................................... 19 3.1.1. Real-time Energy Market .................................................................................................. 19 3.1.2. Intraday Markets ................................................................................................................ 19 3.1.3. Balancing Markets ............................................................................................................. 20 3.1.4. Electricity System Balancing Mechanisms in Spain ....................................................... 22 3.1.5. Ancillary Services .............................................................................................................. 26 3.1.5.1. Operating reserves ................................................................................................... 26 3.1.5.2. Procurement and remuneration .........................................................................29 3.2. Relationship between Wind Power Penetration and Operating Reserves .................. 32 4. Case Study Description ................................................................................................................. 34 4.1. Renewable Energy Support Schemes ................................................................................. 35 4.2. Generation Mix ....................................................................................................................... 36 4.3. Interconnection Capacity ...................................................................................................... 39 4.4. Wind Power Deployment ...................................................................................................... 41 5. Case Study Analysis ....................................................................................................................... 43 5.1. Data Set ..................................................................................................................................... 43 5.2. Methodology ............................................................................................................................ 44 5.3. Analysis of the Data ............................................................................................................... 45 5.3.1. Wind power production ..................................................................................................... 45 5.3.1.1. Variation of wind power production - Seasonal .................................................... 46 5.3.1.2. Variation of wind power production - Daily .......................................................... 47 5.3.1.3. Variation of wind power production - Hourly ....................................................... 48 5.3.2. Demand load ...................................................................................................................... 50 5.3.3. Operating reserves ............................................................................................................. 52 5.3.4. Hourly variations of load and wind power production ................................................... 56 5.3.4.1. Net load variations ................................................................................................... 57 5.3.4.2. Probabilistic method................................................................................................. 59 5.3.5. Cost of Increase in Operating Reserves ........................................................................... 63 6. Final Results & Conclusions ........................................................................................................ 65 7. References ......................................................................................................................................... 71 8. Annexes .............................................................................................................................................. 74 4 | P a g e Acknowledgements I wish to express my debt of gratitude to my thesis supervisor, Dr. Pablo Frías Marín. He has been supportive since the day I began working on my thesis. He patiently provided the vision and advice necessary for me to complete my dissertation. I would like to thank also Camila Fernandes for her useful feedbacks and help to obtain the analysis data. I would like to acknowledge the academic and technical support of the University of Pontificia Comillas, University of Paris-Sud XI and its staff, and European Commission particularly for the award of Erasmus Mundus Master Scholarship that provided the necessary financial support for this master program. Special thanks to my master colleagues for the friendship and social environment they created within this master and for their assistance when I needed help with anything. Last, but by no means least, I am most grateful to my family for their unconditional support and encouragement throughout, for which my mere expression of thanks likewise does not suffice. 5 | P a g e LIST OF FIGURES Figure 1: Power System Impacts of Wind Power [24] ________________________________________________ 13 Figure 2: Market Shares for Total Installed Capacity [17] Figure 3: Wind Power Share of Total Electricity Consumption in EU [17] ________________________________ 15 Figure 4: Share of New Power Capacity Installations in EU [17] Figure 5: EU Member State Market Shares for New Capacity Installed [17] ______________________________ 16 Figure 6: Daily Market Supply and Demand Curves [35] _____________________________________________ 23 Figure 7: Sequence of Processes in the Electricity Market [35] _________________________________________ 25 Figure 8: Framework for Frequency Regulation within the UCTE [39]___________________________________ 28 Figure 9: Forecast Errors (left) and Short-term Fluctuations (right) [8]