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Study: 30% renewables in PJM would cut costs, emissions

Solar panels being installed at Wayne National Forest facilities in Ohio in 2009. (Photo by Wayne National Forest via Creative Commons)

Solar panels being installed at Wayne National Forest facilities in Ohio in 2009. (Photo by Wayne National Forest via Creative Commons)

©2013 E&E Publishing, LLC
Republished with permission

By Peter Behr

The eastern Great Lakes and mid-Atlantic region could rely on wind and solar power for as much as 30 percent of their generation capacity — without threatening electricity delivery — with net benefits even after additional transmission lines and reserve resources are added, according to a preliminary study released by the PJM Interconnection, the region’s grid operator.

The study, by GE Energy Consulting, investigates several scenarios for additions of wind and solar generation to the PJM grid, which extends from New Jersey to to Ohio and parts of Michigan, Indiana and northern Illinois. It calculates the amount of new transmission lines needed to deliver the renewable energy and the required backup generation to support the variable wind and solar power.

The main impacts it reports are lower emissions of pollutants and greenhouse gases; no power outages and minimal curtailment of renewable energy; lower systemwide energy production costs; and lower wholesale customer power costs with the additional wind and solar resources.

“Even at 30 percent penetration, results indicate that the PJM system can handle the additional renewable integration with sufficient reserves and transmission build out,” GE said.

PJM shared the preliminary findings with industry stakeholders this week but won’t discuss the report until a final version is ready. The study is a new entrant into an ongoing debate over the costs and benefits of higher use of renewable power in the U.S. generation mix.

In one key assumption, GE concluded that onshore wind farms serving PJM would be running between 14 and 18 percent of the time. Solar units would have an operating capacity of between 55 and 66 percent, depending on the type of units. Critics of wind power have argued that the units would run less often, requiring more backup from conventional generation.

“The rhetoric is sometimes that you need enormous amounts of backup generation to support a high level of renewable power, and it consumes all the benefits,” said Michael Jacobs, senior energy analyst for the Union of Concerned Scientists, who was part of the audience for the PJM briefing. The GE research finds that isn’t the case, he said.

“How much generation is needed to manage the variability of all this wind and solar? The need for reserves to manage the variability of the combined wind and solar (spread over 13 states and the District of Columbia) is 4 percent of the 100,000 megawatts of added wind and solar,” Jacobs said.

GE reported that if renewable power were to make up 20 to 30 percent of generation capacity, the grid management would be “significantly different” from today’s common control room operations. But it did not find that reliability would be compromised, even on a series of high-stress days it modeled. Existing state requirements would bring renewable generation up to 14 percent of capacity in PJM.

In one high-renewables scenario, GE evaluated a mix in which onshore wind generation would rise from 5,122 megawatts now to 40,942 MW in 2026, with 4,851 MW of new offshore wind and 18,189 MW of solar generation, divided between distributed and centralized sources. In this case, renewables would account for 20 percent of PJM’s capacity.

GE estimated that meeting a 20 percent renewable capacity goal with this generation mix would require 820 miles of new transmission lines at a cost of $3.8 billion. The new transmission needed for a 30 percent renewables goal would range between 1,182 and 2,946 miles and cost between $5 billion and $14 billion.

The addition of the renewable generation would produce net lower location-based wholesale electricity prices, GE said, but operators of coal and natural gas combined cycle generation would suffer significant revenue reductions. Moreover, both coal and gas plants would be forced to cycle on and off much more rapidly than now to support variable renewable generation, GE said, creating wear and damage to these plants.

Comments (5)

Of course the study fails to compare the incremental costs and benefits of other alternatives. Likely ignores or underestimates under-utilization costs imposed on existing dispatchables, borne by rate payers. Likely ignores subsidy costs. If wind and solar can really do this, let them compete in the free market under the same rules with all other forms of energy and capacity.

I was unaware PJM was this deep into political advocacy. Perhaps it should open a political action wing on behalf of its members. Can you say “conflict of interest?” Sure. I knew you could.

By Tom Stacy on Oct 31, 2013

Tom Stacy’s comment is odd. Surely everyone knows that fossil fuels are subsidized six different ways from Sunday? Wind developers are able to say that they will be able to do without the wind tax credit by the end of this decade. Fossil fuel developers cannot say the same thing, since it would simply tilt the table further against them.

The subsidy issue is critical to PJM. In the Central states, wind is already cheap enough that it could do without the subsidy. But the effect of the subsidy is to speed up the price reductions and lower the cost of the technology further. Fossil fuel developers cannot say the same thing. (Repeat the obvious until it sticks).

Eastern PJM base prices are much higher than in Western PJM, and may justify wind even without the PTC today. That depends on where the wind is, and how the grid can handle it. I do find that the available materials from PJM do not actually respond to the question of how they handled the subsidy issue, but it is also important to know that existing fossil resources are inadequate to serve expected load without extremely expensive retrofit or new construction. Either retrofit (on coal plants which aren’t going to be used most of the time, and therefore carry a very high cost per KWh) or new construction is more expensive than wind in PJM without the PTC.

And this is just part of the cascading rush of the clean energy revolution which is under way.

By Ned Ford on Oct 31, 2013

To compare fossil to renewable, gas or coal need CCS which would make either more expensive than renewables. So the cheapest way to lower fossil carbon is to use it as backup having renewables lower overall carbon emissions for the PJM area.

By Lklisch on Nov 1, 2013

And guess which company is the leading US producer of those wind turbines. It’s like asking Hershey Corporation to study whether chocolate is good for us.

By Rolf Westgard on Nov 2, 2013

GE also builds nuclear reactors and steam turbines for coal and gas plants, Rolf.

By Ken Paulman on Nov 4, 2013