44.1 Renewables - important challenges for transmissions system operators

Otilia Marin , Network Tariffs, Romanian Energy Regulatory Authority, Bucharest, Romania
Violeta Radu , Energy, Technical College, Gheorghe Airinei,, Bucharest, Romania
Full Papers
  • GIN 2009 Aalborg 8-10 iunie - long.pdf (170.9 kB)
  • Promotion of renewables in electricity production introduces new challenges to the sector. Procurement, installing and connection to the existing grid of thousands of MW (12000 MW) in a short period of time represent a real challenge to the Romanian electricity system (17000 MW). Not only new high voltage lines (400 kV) and substations are needed, but also new regulation regarding to the definition of necessary system reserves and their level.

    This new challenge makes more actual the question if the electricity only market forces could normally lead the system to a medium term security/adequacy. There are concerns that in real life the electricity only market cannot assure the adequate capacity at all moments. The signal given by a high electricity price could have diferrent roots as a lack of producing capacity, energy resources or congestion. A more dedicated signal, led by market forces, should be developed on different types of medium term requested capacities.

    The Romanian Energy Regulatory Authority developed in July 2007 a regulatory framework for a capacity mechanism as a first step in order to ensure a more specific signal, to ensure on medium term the adequacy of the system and reward all generators which contribute to effective competition or to system reliability.

    A mechanism to ensure today enough proper capacity for medium term (about 4 years) and to put on market basis this managing activity of the surplus capacity could be appropriate, together with redesign of the actual European technical procedures to determine the necessary system reserves.

    It is sustainable for the society to ensure a market mechanism, which provides the financial resources for units offering proper medium term adequacy of the electricity system in order to let the in-efficient units which can provide adequacy, not to operate.

    A medium term capacity market could give the correct signal for new efficient units in order to assure the medium term adequacy of the system and also it could give the surety on an adequacy of the system from capacity point of view. It recognizes in time the potential capacity shortfalls (or surpluses) before they actually occur, thereby facilitating the capacity investments that would avoid the price volatility that results when electricity supply becomes limited.

    TSO should determine the necessary capacity (including the type) for each year of the near future period of time based on the estimated demand received from suppliers and long term system and generation planning studies. This period of time should be about 4 years in order to allow the building of new capacity. A longer period would bring the estimation errors and stranded cost in unneeded capacity. TSO could awards certificates for each capacity available in the target year according to the net available long term/peak capacity, differentiated by various categories of reserves/plants, in order to be used on the market by each production company.

    The market mechanism should require to each supplier to medium term secure or contract for sufficient proper reserve capacity to match his customer profile according to the system operator specification, bilaterally/ offers to the capacity market operator/ via auction. Those consumers who need higher power reserve should buy more reserves. The money would be paid in the year in which capacity is appointed. A penalty system has to be considered for both demand side and supply side of capacity.

    In the other hand, taking into account the huge present possibility, from the technical point of view, to efficiently use the renewables potential, especially wind, to produce electricity, the redesign of the necessary system reserves has to make a step further than the biggest installed unit and the variation over prognoses of the load.

    The dimension of the installable wind power has to be determined based on the installed and new coming capacity qualified for ancillary services in the electricity system, the instantaneous, in all steady states, not average, available ancillary services, the characteristics of the existing and new coming wind farms (installed power, simultaneous power, wind potential and its characteristics), network congestion etc.

    The paper will contain a short description of the present situation of the Romanian electricity system, the actual regulatory framework focused on capacity mechanism (obstacles and results) and possible new developments of the regulatory framework regarding to the definition of necessary reserves, their level and the economical impact on the electricity system from the perspective of the wind energy.