Audun Botterud

Wind power forecasting : state-of-the-art 2009.

Many countries and regions are introducing policies aimed at reducing the environmental footprint from the energy sector and increasing the use of renewable energy. In the United States, a number of initiatives have been taken at the state level, from renewable portfolio standards (RPSs) and renewable energy certificates (RECs), to regional greenhouse gas emission control schemes. Within the U.S. Federal government, new energy and environmental policies and goals are also being crafted, and these are likely to increase the use of renewable energy substantially. The European Union is pursuing implementation of its ambitious 20/20/20 targets, which aim (by 2020) to reduce greenhouse gas emissions by 20% (as compared to 1990), increase the amount of renewable energy to 20% of the energy supply, and reduce the overall energy consumption by 20% through energy efficiency. With the current focus on energy and the environment, efficient integration of renewable energy into the electric power system is becoming increasingly important. In a recent report, the U.S. Department of Energy (DOE) describes a model-based scenario, in which wind energy provides 20% of the U.S. electricity demand in 2030. The report discusses a set of technical and economic challenges that have to be overcome for this scenario to unfold. In Europe, several countries already have a high penetration of wind power (i.e., in the range of 7 to 20% of electricity consumption in countries such as Germany, Spain, Portugal, and Denmark). The rapid growth in installed wind power capacity is expected to continue in the United States as well as in Europe. A large-scale introduction of wind power causes a number of challenges for electricity market and power system operators who will have to deal with the variability and uncertainty in wind power generation when making their scheduling and dispatch decisions. Wind power forecasting (WPF) is frequently identified as an important tool to address the variability and uncertainty in wind power and to more efficiently operate power systems with large wind power penetrations. Moreover, in a market environment, the wind power contribution to the generation portofolio becomes important in determining the daily and hourly prices, as variations in the estimated wind power will influence the clearing prices for both energy and operating reserves. With the increasing penetration of wind power, WPF is quickly becoming an important topic for the electric power industry. System operators (SOs), generating companies (GENCOs), and regulators all support efforts to develop better, more reliable and accurate forecasting models. Wind farm owners and operators also benefit from better wind power prediction to support competitive participation in electricity markets against more stable and dispatchable energy sources. In general, WPF can be used for a number of purposes, such as: generation and transmission maintenance planning, determination of operating reserve requirements, unit commitment, economic dispatch, energy storage optimization (e.g., pumped hydro storage), and energy trading. The objective of this report is to review and analyze state-of-the-art WPF models and their application to power systems operations. We first give a detailed description of the methodologies underlying state-of-the-art WPF models. We then look at how WPF can be integrated into power system operations, with specific focus on the unit commitment problem.

Optimal investments in power generation under centralized and decentralized decision making

This work presents a novel model for optimization of investments in new power generation under uncertainty. The model can calculate optimal investment strategies under both centralized social welfare and decentralized profit objectives. The power market is represented with linear supply and demand curves. A stochastic dynamic programming algorithm is used to solve the investment problem, where uncertainty in demand is represented as a discrete Markov chain. The stochastic dynamic model allows us to evaluate investment projects in new base and peak load power generation as real options, and determine optimal timing of the investments. In a case study, we use the model to compare optimal investment strategies under centralized and decentralized decision making. A number of interesting results follow by varying the assumptions about market structure and price response on the demand side.

Wind Power Trading Under Uncertainty in LMP Markets

This paper presents a new model for optimal trading of wind power in day-ahead (DA) electricity markets under uncertainty in wind power and prices. The model considers settlement mechanisms in markets with locational marginal prices (LMPs), where wind power is not necessarily penalized from deviations between DA schedule and real-time (RT) dispatch. We use kernel density estimation to produce a probabilistic wind power forecast, whereas uncertainties in DA and RT prices are assumed to be Gaussian. Utility theory and conditional value at risk (CVAR) are used to represent the risk preferences of the wind power producers. The model is tested on real-world data from a large-scale wind farm in the United States. Optimal DA bids are derived under different assumptions for risk preferences and deviation penalty schemes. The results show that in the absence of a deviation penalty, the optimal bidding strategy is largely driven by price expectations. A deviation penalty brings the bid closer to the expected wind power forecast. Furthermore, the results illustrate that the proposed model can effectively control the trade-off between risk and return for wind power producers operating in volatile electricity markets.

Assessment of Impacts of PHEV Charging Patterns on Wind-Thermal Scheduling by Stochastic Unit Commitment

Light duty plug-in hybrid electric vehicle (PHEV) technology holds a promising future due to its “friendliness” to the environment and potential to reduce dependence on fossil fuels. However, the likely significant growth of PHEVs will bring new challenges and opportunities for power system infrastructures. This paper studies the impacts of PHEV charging patterns on power system operations and scheduling. The stochastic unit commitment model described in this paper considers coordination of thermal generating units and PHEV charging loads, as well as the penetration of large-scale wind power. The proposed model also addresses ancillary services provided by vehicle-to-grid techniques. Daily electricity demands by various types of PHEVs are estimated on the basis of a PHEV population projection and transportation survey. The stochastic unit commitment model is used to simulate power system scheduling with different charging patterns for PHEVs. The results show that a smart charging pattern can reduce the operating costs of a power system and compensate for the fluctuation in wind power. The proposed model also can serve as a foundation and tool to perform long-term cost-benefit analysis and to assist policy making.

A survey on wind power ramp forecasting.

The increasing use of wind power as a source of electricity poses new challenges with regard to both power production and load balance in the electricity grid. This new source of energy is volatile and highly variable. The only way to integrate such power into the grid is to develop reliable and accurate wind power forecasting systems. Electricity generated from wind power can be highly variable at several different timescales: sub-hourly, hourly, daily, and seasonally. Wind energy, like other electricity sources, must be scheduled. Although wind power forecasting methods are used, the ability to predict wind plant output remains relatively low for short-term operation. Because instantaneous electrical generation and consumption must remain in balance to maintain grid stability, wind powers variability can present substantial challenges when large amounts of wind power are incorporated into a grid system. A critical issue is ramp events, which are sudden and large changes (increases or decreases) in wind power. This report presents an overview of current ramp definitions and state-of-the-art approaches in ramp event forecasting.

Demand Dispatch and Probabilistic Wind Power Forecasting in Unit Commitment and Economic Dispatch: A Case Study of Illinois

In this paper, we analyze how demand dispatch combined with the use of probabilistic wind power forecasting can help accommodate large shares of wind power in electricity market operations. We model the operation of day-ahead and real-time electricity markets, which the system operator clears by centralized unit commitment and economic dispatch. We use probabilistic wind power forecasting to estimate dynamic operating reserve requirements, based on the level of uncertainty in the forecast. At the same time, we represent price responsive demand as a dispatchable resource, which adds flexibility in the system operation. In a case study of the power system in Illinois, we find that both demand dispatch and probabilistic wind power forecasting can contribute to efficient operation of electricity markets with large shares of wind power.

Time Adaptive Conditional Kernel Density Estimation for Wind Power Forecasting

This paper reports the application of a new kernel density estimation model based on the Nadaraya-Watson estimator, for the problem of wind power uncertainty forecasting. The new model is described, including the use of kernels specific to the wind power problem. A novel time-adaptive approach is presented. The quality of the new model is benchmarked against a splines quantile regression model currently in use in the industry. The case studies refer to two distinct wind farms in the United States and show that the new model produces better results, evaluated with suitable quality metrics such as calibration, sharpness, and skill score.

Risk management and optimal bidding for a wind power producer

This paper discusses risk management, contracting, and bidding for a wind power producer. A majority of the wind power in the United States is sold on long-term power purchase agreements, which hedge the wind power producer against future price risks. However, a significant amount is sold as merchant power and therefore is exposed to fluctuations in future electricity prices (day-ahead and real-time) and potential imbalance penalties. Wind power forecasting can serve as a tool to increase the profit and reduce the risk from participating in the wholesale electricity market. We propose a methodology to derive optimal day-ahead bids for a wind power producer under uncertainty in realized wind power and market prices. We also present an initial illustrative case study from a hypothetical wind site in the United States, where we compare the results of different day-ahead bidding strategies. The results show that the optimal day-ahead bid is highly dependent on the expected day-ahead and real-time prices, and also on the risk preferences of the wind power producer. A deviation penalty between day-ahead bid and real-time delivery tends to drive the bids closer to the expected generation for the next day.

Dynamic Scheduling of Operating Reserves in Co-Optimized Electricity Markets With Wind Power

Summary form only given. We propose a probabilistic methodology to estimate a demand curve for operating reserves, where the curve represents the amount that a system operator is willing to pay for these services. The demand curve is quantified by the cost of unserved energy and the expected loss of load, accounting for uncertainty from generator contingencies, load forecasting errors, and wind power forecasting errors. The methodology addresses two key challenges in electricity market design: integrating wind power more efficiently and improving scarcity pricing. In a case study, we apply the proposed operating reserve strategies in a two-settlement electricity market with centralized unit commitment and economic dispatch and co-optimization of energy and reserves. We compare the proposed probabilistic approach to traditional operating reserve rules. We use the Illinois power system to illustrate the efficiency of the proposed reserve market modeling approach when it is combined with probabilistic wind power forecasting.

System-Wide Emissions Implications of Increased Wind Power Penetration

This paper discusses the environmental effects of incorporating wind energy into the electric power system. We present a detailed emissions analysis based on comprehensive modeling of power system operations with unit commitment and economic dispatch for different wind penetration levels. First, by minimizing cost, the unit commitment model decides which thermal power plants will be utilized based on a wind power forecast, and then, the economic dispatch model dictates the level of production for each unit as a function of the realized wind power generation. Finally, knowing the power production from each power plant, the emissions are calculated. The emissions model incorporates the effects of both cycling and start-ups of thermal power plants in analyzing emissions from an electric power system with increasing levels of wind power. Our results for the power system in the state of Illinois show significant emissions effects from increased cycling and particularly start-ups of thermal power plants. However, we conclude that as the wind power penetration increases, pollutant emissions decrease overall due to the replacement of fossil fuels.