Abstract
This study provides a framework to explore the potential use and incremental value of small- to large-scale penetration of solar and wind technologies as a physical hedge against the risk and uncertainty of electricity cost on multi-year to multi-decade timescales. Earlier studies characterizing the impacts of adding renewable energy (RE) to portfolios of electricity generators often used alevelized cost of energy or simplified net cash flow approach. In this study, we expand on previous work by demonstrating the use of an 8760 hourly production cost model (PLEXOS) to analyze the incremental impact of solar and wind penetration under a wide range of penetration scenarios for a region in the Western U.S. We do not attempt to 'optimize' the portfolio in any of these cases. Rather weconsider different RE penetration scenarios, that might for example result from the implementation of a Renewable Portfolio Standard (RPS) to explore the dynamics, risk mitigation characteristics and incremental value that RE might add to the system. We also compare the use of RE to alternative mechanisms, such as the use of financial or physical supply contracts to mitigate risk anduncertainty, including consideration of their effectiveness and availability over a variety of timeframes.
Original language | American English |
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Number of pages | 50 |
DOIs | |
State | Published - 2013 |
NREL Publication Number
- NREL/TP-6A20-59065
Keywords
- natural gas prices
- production cost model
- renewable energy penetration
- risk and uncertainty