integrating high penetration renewable energy into the

Copyright – 2016 California ISO

Integrating High Penetration

Renewable Energy into the CAISO

MarketShucheng Liu, Ph.D.

Principal, Market Development

DOE CSP SunShot Program Summit

April 19, 2016


California SB 350 sets 50% Renewable Portfolio

Standard (RPS) goal for 2030

RPS

Goals

20%

33%

50%

2010 2020 2030

2013 actual 22.7%

2014 actual 25%

• RPS is calculated based on retail sales of electricity. It does not include

distributed PV and hydro power plant greater than 30 MW


CAISO conducted studies to assess the impact of

integrating high penetration renewable energy.

Biomass4%

Geothermal7%

Small Hydro7%

Large Solar PV27%

Small Solar PV22%Solar Thermal

4%

Wind29%

• A 40% RPS portfolio for 2024.

• Solar is more than 50% of the total 41,943 MW installed capacity.

• The portfolio excludes the 4,560 MW distributed PV.


The studies identified significant renewable curtailment

at 40% RPS.

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

11,000

12,000

13,000

14,000

1 2 3 4 5 6 7 8 9 10 11 12 13

Re

new

able

Cu

rtai

lme

nt

(MW

)

Month

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec


-5,000

0

5,000

10,000

15,000

20,000

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

(MW

)

Hour

Nuclear CHP Hydro Combined Cycle

Pumped Storage Gas Turbine Steam Turbine Demand Response

Storage (generation) Net Import Net Load Curtailment

Energy balance on March 24, 2024 with 40% RPS

• Load includes energy used by pumped storages and battery storages

• Net Load = (Load – Renewable Generation – DG PV Generation), which could be negative

CCGT & storage

dispatched to

provide reserves


Renewable integration solutions are being explored in

three areas.

Area Solution

Change Load • Improved Time of Use Rates

• Targeted energy efficiency

• Decarbonization of transportation fuels

• Demand response

Change Supply • Storage

• Diversified renewable portfolios

• Economic dispatch of renewables

• Retrofit of existing power plants

Collaborate

Regionally

• Participating in the CAISO Energy

Imbalance Market by additional

Balancing Authority areas

• Joining the CAISO


“Pocket Guide” to renewable integration solutions

Category Integration Solution Findings

Net benefits

even without

renewable

• Regional

coordination

• More efficient dispatch and reduced renewable

curtailment

(http://www.caiso.com/informed/Pages/RegionalEnergy

Market/BenefitsofaRegionalEnergyMarket.aspx

Low cost

solutions with

potentially large

benefits

• Time of use retail

rates

• Sub-hourly

renewable dispatch

• Renewable portfolio

diversity

• Shifts energy consumption toward daylight hours

• Allows system to operate with fewer thermal resources

during over-supply events

• Avoids curtailment by spreading renewable production

over more hours of the year

Costs and

benefits should

be evaluated on

specific project

or program

basis

• Flexible loads and

advanced DR

• Additional storage

• Gas retrofits

• New flexible gas

resources

• Shifts energy consumption toward hours with over-

supply, but cost and potential are unknown

• Reduces curtailment but requires significant investment

• Makes existing resources more flexible at a low cost

• Provides limited dispatch flexibility at a high cost

Valuable,

though not as

much for

integration

• Energy efficiency

• Conventional

demand response

• Provides significant cost and GHG savings but may not

reduce curtailment

• Provides cost savings but does not significantly reduce

curtailment

Solutions with the highest identified renewable integration value


A CAISO special study on bulk energy storage

• To explore solutions to curtailment of large quantity of

renewable generation

• To assess a bulk storage resource’s ability to reduce

– renewable curtailment

– CO2 emission

– production cost

– renewable overbuild to achieve the 40% RPS goal

• To analyze the economic feasibility of the bulk energy

storage resource

http://www.caiso.com/Documents/Board-Approved2015-2016TransmissionPlan.pdf

section 3.5

http://www.caiso.com/Documents/Board-Approved2015-2016TransmissionPlan.pdf


The study cases are defined as

• Based on the 2014 LTPP

40% RPS in 2024

Scenario allowing

unlimited renewable

curtailment

• Using a new 500 MW fast

and flexible pumped

storage as the bulk energy

storage resource

• Overbuilding solar or wind

resources to achieve the

40% RPS goal

C: A + Solar

Overbuild

D: A + Wind

Overbuild

E: B + Solar

Overbuild

F: B + Wind

Overbuild

No Renewable

Overbuild

With Overbuild to

Achieve 40% RPS

A: 40% RPS

Scenario

B: A + a Bulk

Storage

Without Bulk Storage

With Bulk Storage


Capacity of renewable overbuild to achieve the 40%

RPS goal

1,918

1,569

1,129950

500

500

500

0

500

1,000

1,500

2,000

2,500

A B C D E F

Cp

apci

ty (

MW

)

Case

Solar Wind Pumped Storage

No renewable overbuild

A: 38.9% RPS achieved

B: 39.1% RPS achieved

Renewable overbuild

to achieve 40% RPSPumped storage plus

renewable overbuild

to achieve 40% RPS


California renewable generation curtailment

• Renewable generation is curtailed at -$300/MWh market clearing price (MCP).

A B C E D F

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

No Overbuild Solar Overbuild Wind Overbuild

Cu

rtai

lme

nt

(GW

h)

Case

Without Pumped Storage With Pumped Storage

A

-408

-792

-508

A B C E D F

40% RPS not achieved 40% RPS achieved

Curtailment

reduction


California CO2 emission

• California CO2 emission includes the emission from energy net import.

• CO2 emission cost can be calculated using $23.27/m-ton price.

60.5

61.0

61.5

62.0

62.5

63.0


CO

2 E

mis

sio

n (

mill

ion

MTo

n)

Case


-0.33

-0.16-0.14

A B C E D F


CO2 emission

reduction


WECC annual production cost

• Production cost includes start-up, fuel and VOM cost, not CO2 cost.

13,950

14,000

14,050

14,100

14,150

14,200


Pro

du

ctio

n C

ost

($

mill

ion

)

Case


-56

-40

-31

A B C E D F


Production

cost reduction


Levelized annual revenue requirements of the

renewable overbuild and pumped storage resource

703

575

340286

183

183

183

0

100

200

300

400

500

600

700

800

A B C D E F

Re

ven

ue

Re

qu

ire

me

nt

($m

illio

n)

Case

Solar Wind Pumped Storage

No renewable overbuild

A: 38.9% RPS achieved

B: 39.1% RPS achieved

Renewable overbuild

to achieve 40% RPSPumped storage plus

renewable overbuild

to achieve 40% RPS


Pumped storage levelized annual revenue requirement

vs. net market revenue of 2024

• Net revenue is revenue from generation, reserves and load following minus cost of

operation and energy consumed.

183 183 183160

194170

0

20

40

60

80

100

120

140

160

180

200

B - No Overbuild E - Solar Overbuild F - Wind Overbuild

($m

illio

n)

Case

Levelized Annual Revenue Requirement Net Market Revenue
