Water and Climate Impacts on Power System Operations: The Importance of Cooling Systems and Demand Response Measures

The U.S. electricity sector is highly dependent upon water resources; changes in water temperatures and water availability can affect operational costs and the reliability of power systems. Despite the importance of water for power system operations, the effects of changes in water characteristics on multiple generators in a system are generally not modeled. Moreover, demand response measures, which can change the magnitude and timing of loads and can have beneficial impacts on power system operations, have not yet been evaluated in the context of water-related power vulnerabilities. This effort provides a first comprehensive vulnerability and cost analysis of water-related impacts on a modeled power system and the potential for demand response measures to address vulnerability and cost concerns. This study uniquely combines outputs and inputs of a water and power plant system model, production cost, model, and relative capacity value model to look at variations in cooling systems, policy-related thermal curtailments, and demand response measures to characterize costs and vulnerability for a test system. Twenty-five scenarios over the course of one year are considered: a baseline scenario as well as a suite of scenarios to evaluate six cooling system combinations, the inclusion or exclusion of policy-related thermal curtailments, and the inclusion or exclusion of demand response measures. A water and power plant system model is utilized to identify changes in power plant efficiencies resulting from ambient conditions, a production cost model operating at an hourly scale is used to calculate generation technology dispatch and costs, and a relative capacity value model is used to evaluate expected loss of carrying capacity for the test system.