DOES THE GRID SNUB WIND?

Do the Rules of the Nation's Electric Grid Discriminate Against Wind Power?
Peter Behr, April 27, 2010 (NY Times)

"…[C]hanges in the way the grid works -- if they occur – hinge…on what happens at the Federal Energy Regulatory Commission, where a set of central policy issues are on the table…[FERC is investigating ] whether the grid's current operating rules discriminate unduly against wind power, and if so, what should be done about it. The inquiry focuses on possible rule changes in how wind power forecasts are handled, how backup generation for wind is priced, and whether wind generation should be coordinated more widely across grid regions to dampen the impact of sudden wind shifts…[C]omments fill 2,800 pages, and the commission has set no timetable for taking action…

"…FERC [and] Chairman Jon Wellinghoff…[see] plenty of reason for concern about the prospects for wind and solar power based on the way the grid is run today…[This is] another front in the continuing, behind-the-scenes struggle between the renewable power sector and some of the electricity industry's old guard, whose historic ways of doing business are now under challenge…[T]here are fundamental disputes within the power industry over how the grid should be planned, who should pay to expand it, and how wind and solar power's climate benefits should figure in future transmission projects' costs. What FERC's staff will propose, and what its commissioners will ultimately do, on this proceeding remains unclear."

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"The wind industry has seized on FERC's invitation in the wind inquiry to level charges of discrimination against competitors and grid operators…[T]he continued growth of wind energy is threatened on many fronts -- by low natural gas prices, a patchwork of uncertain government policies, and industry bias and favoritism against wind resources…Wind power's obvious liability is its fickle nature, which requires grid operators to keep other generation reserves operating on standby. That comes at a cost…When wind ramps steeply down after a front passes, the drop is often relatively gradual and could be dealt with by calling on backup generation that can respond in 10 to 30 minutes…This is the cheapest source of standby power…Typically, however, dispatchers make up for a drop in wind power by calling on "regulation" generation reserves that can respond in minutes -- a far more expensive option…It is unfair to saddle wind generators with those higher costs…

"…Most wind generators don't offer to supply power for the following day -- the "day ahead" market featured in many competitive wholesale markets. The reason is the risk of financial penalties if they can't deliver on scheduled deliveries because the wind dies…These rules were created to accommodate coal and gas generators…More subtle discrimination involves policy-setting industry committees…More than 600 such stakeholder meetings were held in one recent year, and smaller wind generators can't afford the time or cost of attending and voting…"

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"…FERC asked whether it should require regions of the grid that schedule an hour or more in advance to move to shorter, inter-hour scheduling, since the shorter the lead time, the easier it is to forecast wind speed -- lessening the risk of penalties…Wind generators' output can vary by large amounts over an hour, but can be relatively constant when looking five or 10 minutes ahead…[S]tudies show that backup costs for wind could be cut by 80 percent by shortening hourly scheduling intervals…

"…Wind generators and their rivals also fell out on another question FERC posed -- whether it would help expand wind generation if scores of small grid dispatch regions or "balancing areas" in the southeastern and central United States were combined into a few large regional ones…To avoid blackouts, engineers running the grid must always keep power supply matched to demand…The larger the area where dispatchers can match generation with demand, the easier it is to deal with variable wind power: If the wind is still in one area, it's apt to be blowing in another in the same region…The National Renewable Energy Laboratory reported this year that the Eastern grid interconnection could rely on wind for 20 to 30 percent of its electricity supply by 2024 with a large-scale expansion of transmission…[T]he current grid operating structure, decades in the making, is embedded with rules and practices that affect reliability, planning and markets. Changing the system won't happen quickly, or without a fight…"