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Wind Power & Energy Storage in the ERCOT
Electricity Market
February 14, 2013
Jared Garrison
The University of Texas at Austin
Jared Garrison IEA Energy Storage
Feb 14, 2013 2
Introduction to the Electric Reliability Council
of Texas (ERCOT)
Jared Garrison IEA Energy Storage
Feb 14, 2013 3
ERCOT or (TRE) Covers Most of the State of
Texas
(Image courtesy of U.S. EPA)
Jared Garrison IEA Energy Storage
Feb 14, 2013 4
ERCOT Information
• Formed in 1970
– Approximately 6400 buses and 7800 lines
– 550 generating units
– Serves 23 million people
• 2001 ERCOT became the single control area
operator (balancing authority)
• 2011 Nodal competitive wholesale market with
locational marginal pricing
– Co-Optimization of balancing and ancillary
services markets
– Centrally dispatched real-time & day-ahead
market
Jared Garrison IEA Energy Storage
Feb 14, 2013 5
ERCOT’s 2011 fuel mix is heavy on Natural
Gas
(Image courtesy of Aaron Townsend)
• 74 GW
Capacity
• 68.3 GW
Peak
Demand
Jared Garrison IEA Energy Storage
Feb 14, 2013 7
Wind energy in Texas has grown rapidly
0
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0200400600800
100012001400160018002000220024002600280030003200
Tota
l ER
CO
T W
ind
Cap
acit
y [G
W]
Tota
l Mo
nth
ly W
ind
Ge
ne
rati
on
[G
Wh
]
Date
Total Monthly Wind Generation Total ERCOT Wind Capacity
Jared Garrison IEA Energy Storage
Feb 14, 2013 8
Curtailment occurs at time of high wind
power output
Data: Hourly, June 2009 – Nov 2010
Jared Garrison IEA Energy Storage
Feb 14, 2013 9 Data: Hourly, June 2009 – Nov 2010
Adjusting for curtailment yields a much more
linear relationship
Jared Garrison IEA Energy Storage
Feb 14, 2013 10
Utility-Scale Electrical Energy Storage Is
Currently Limited to Three Technologies
• Batteries
– Expensive
• Pumped Hydro
– Requires water and elevation change
– Difficult to site due to environmental & NIMBY
issues
• Compressed Air Energy Storage (CAES)
– Easier to site
– Has lowest costs
Jared Garrison IEA Energy Storage
Feb 14, 2013 11
CAES Can Be Built In Most of the U.S.
EPRI-DOE Handbook of Energy Storage for Transmission and
Distribution Applications, EPRI 1001834, 2003.
Jared Garrison IEA Energy Storage
Feb 14, 2013 13
Presidio TX Battery Storage
• City relies on 100 km transmission line built in 1948
– Hostile terrain & age of line led to frequent power
outages and fluctuations
• 4 MW (32 MWh) NAS Sodium-Sulfer battery
– By Electric Transmission Texas (ETT)
• Dedicated on April 8, 2010
– $25 million
Jared Garrison IEA Energy Storage
Feb 14, 2013 14
New CAES in Texas – COMING SOON!
• Chamisa Energy
– 270 MW facility in Tulia, TX
– 100 hrs continuous output capacity (27,000 MWh)
– Proven geological samples (salt formation)
– Construction to begin soon
• Apex Energy Storage
– Still in design and site evaluation phase
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Feb 14, 2013 16
Project Detail
• Analyze a future scenario with 20% of generation
coming from Wind
– Role of Energy Storage? (CAES)
• Unit commitment model of the ERCOT grid
– Minimizes the cost of electricity dispatch across
the fleet
– Input: plant performance parameters, electricity
demand, wind generation, and AS requirements
• Simulated dispatch under various conditions
– NG Price, CAES operation (Arbitrage vs.
Ancillary Services), etc
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Feb 14, 2013 18
Best results when allowing CAES to
participate in both arbitrage and AS markets
• Increased output from CAES compared to Arbitrage
Only case
– Capacity factors increase by ~ 5%
• Only a small reduction in CAES use for AS
compared to the AS Only case
• CAES is still significant for AS
– 10-20% of Regulation Up
– 10-20% of Regulation Down
– 10-15% of RRS
– 1-5% of NSRS
Jared Garrison IEA Energy Storage
Feb 14, 2013 20
Project Detail
• Unit commitment model of ERCOT (PLEXOS)
– Minimizes the cost of electricity dispatch across
the fleet
– Input: plant performance parameters, electricity
demand, wind generation, and AS requirements
• Unit commitment model of ERCOT (PLEXOS)
– Natural Gas Price (4-10 $/MMBTU)
– Wind Capacity (0-30 GW)
– CAES Capacity (0-6 GW)
Jared Garrison IEA Energy Storage
Feb 14, 2013 21
Calibration had to be done to yield more
realistic electricity prices
(Analysis done by Aaron Townsend)
• Addition of variable marginal heat rates, higher
start up costs, and marginal cost markups
Jared Garrison IEA Energy Storage
Feb 14, 2013 22
CAES profitability without including scarcity
pricing
(Analysis done by Aaron Townsend)
Jared Garrison IEA Energy Storage
Feb 14, 2013 23
CAES profitability without including scarcity
pricing
(Analysis done by Aaron Townsend)
Jared Garrison IEA Energy Storage
Feb 14, 2013 24
CAES profitability including scarcity pricing
(Analysis done by Aaron Townsend)
Jared Garrison IEA Energy Storage
Feb 14, 2013 25
Acknowledgements
• Supervisor and Contributors:
– Dr. Michael Webber, UT Department of Mechanical
Engineering
– Dr. Carey King, Dr. Ross Baldick & Dr. Stuart Cohen
• Funding Support :
– U.S. Department of Energy
• Referenced Work: – A. K. Townsend, A Grid-Level Assessment of Compressed Air
Energy Storage in ERCOT. PhD dissertation, The University of
Texas at Austin, 2013
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Feb 14, 2013 26
Questions?
Jared Garrison
Graduate Research Assistant Thermal Fluid Systems Mechanical Engineering
University of Texas at Austin [email protected]
http://www.webberenergygroup.com
Jared Garrison IEA Energy Storage
Feb 14, 2013 28
CAES Modifies a Natural Gas Turbine Cycle
Compressor Turbine Electricity
Generator
Combustor
Air Exhaust
Fuel
Jared Garrison IEA Energy Storage
Feb 14, 2013 29
CAES Modifies a Natural Gas Turbine Cycle
Compressor Turbine Electricity
Motor-
Generator
Combustor
Air Exhaust
Fuel Storage Reservoir
Clutch Clutch
Jared Garrison IEA Energy Storage
Feb 14, 2013 31
A thermodynamic T-s (temp-entropy) diagram
shows the overall power output of the DSWiSS
system
Jared Garrison IEA Energy Storage
Feb 14, 2013 32
Cost and other parameters used in my
optimization models
Parameter Cost Units
CAES Capital Cost 787 $/kW
CAES Fixed O&M 17.5 $/kW/yr
CAES Variable O&M 1.31 $/MWh
Wind Capital Cost 2492.2 $/kW
Wind Fixed O&M 28.76 $/kW/yr
(Ridge, 2005)
Parameter Value Units
CAES Generator Capacity 100 MW
CAES Compressor Capacity 54 MW
CAES Electricity Required 13.5 MWh/15min
CAES Heat Rate 30.8 MWh/15min
Natural Gas Price 15.4 $/MWh
Max Air Mass in Storage 14.36 Million kg
(EIA-AEO, 2010)
Jared Garrison IEA Energy Storage
Feb 14, 2013 33
Methodology to calculate the levelized cost of
electricity (LCOE) involved estimating capital and
O&M costs
1. Estimate total capital expenditures (CAPEX)
– $/kW installed
2. Estimate annual O&M expenditures (OPEX)
– $/MWh generated
3. Annualize CAPEX and convert to a per MWh
generated basis
4. Add OPEX + annualized CAPEX = LCOE