Incorporating Renewables into The Electric Grid: Expanding Opportunities for Smart Markets and Energy Storage

Posted: June 16, 2016 - 11:09 / Reports

The cost of renewable energy has been quickly dropping and renewable energy generation has been rapidly growing in the United States, spurred by state and federal policies and technological advances. Moreover, projections going forward suggest ever increasing penetration of renewables into the electricity grid. The two most rapidly growing renewable energy sources, wind and solar, provide variable energy output that depends on the time of day, location, season, weather, and other factors. Integrating high levels of these renewables onto the grid will require a reimagining of the management of the grid. It will increase the demand for grid management services, opening up a new set of important opportunities for promising technologies and approaches. This report examines economic and technical considerations related to increasing integration of variable renewable energy resources onto the existing electric grid, which highlight the importance of emerging technologies and approaches in smart markets and energy storage that can help smooth this transition. Smart markets use new communications technologies to develop integrated approaches allowing for electricity demand to respond during times of high value. Energy storage technologies allow the temporary storage of electricity so it can be released during times of high value. The key report findings are outlined below.

Renewable electricity from wind and solar is rapidly growing around the world.
• Wind and solar are known as “variable energy resources” (VERs) because their output is variable. Generation of wind and solar depends on when the sun is shining and the wind is blowing, which is imperfectly predictable.
• There are regions in the world that are already successfully managing an extremely high penetration of renewable VERs. For example, Portugal was run 100 percent on wind, solar, and hydropower for four days straight in May 2016, and Texas hit a record level of 45 percent instantaneous penetration from wind generation during one evening in February of this year.

The distinctive characteristics of VERs will likely require a reimagining of electricity grid management.
• One characteristic of a system with a high penetration of solar energy is the possibility that net electricity load (i.e., electricity demand minus VER generation) may exhibit a “duck curve.” A duck curve, as seen below in the 2020 forecast for the net load during a typical spring day in California, contains a steep ramp of net load downward in the morning as the sun rises and a steep ramp upwards in the evening as the sun sets.

Read full report here