Assessing the benefits of wind power curtailment in a hydro-dominated power system

Many utilities have performed wind integration studies to determine the costs attributed to wind's inherent variability and unpredictability. Changes to the operational strategies of existing generation infrastructure also contribute to the costs of integrating wind power into a power system. A valid operational strategy considered herein is the option of wind generation curtailment as a decision variable. This paper explores the question, "Is there additional value to be gained from wind power curtailment for reasons other than grid stability?" Data from the hydroelectric system in British Columbia, Canada are used to perform numerous year-long simulation and optimization runs. These are performed to determine the hydro generation system's response under constrained circumstances with and without wind curtailment capability. The economic impact of curtailment to both the hydroelectric utility and the wind power producers are identified and discussed. These assumptions and impacts include changes to market prices of energy, operating reserve requirements, annual electrical energy production, hypothetical value of wind energy, and generating capacity and energy exchanges on the market. From the initial results and annual analyses of these simulation and optimization modeling runs, several observations can be made. 1) The hydroelectric utility could increase the value of wind energy very slightly (0.1 % to 0.02% for wind capacity penetration levels 3% to 12%) during a dry water year if allowed the option of curtailing wind power, but still requiring it to pay the wind power producer for all available wind power. 2) Under the same requirements, but during a wet water year, the value of wind energy could increase a greater amount: 0.2% to 1.0% for wind capacity penetration levels 3% to 12%. 3) For either the dry or wet water year, total annual wind energy curtailment is less than 2.5%. This potential for adding value to wind power, although small, is interesting and is currently being studied in more detail to understand its causes. Key assumptions used in this research are outlined in the paper, and they too could be explored further to determine their effects on the value of wind energy.