A new study from Cornell University’s Sibley School of Mechanical and Aerospace Engineering examines the use of utility scale solar power to meet peak power demand in New York State.
The study, Strategic Planning for Utility-Scale Solar Photovoltaic Development – Historical Peak Events Revisited, found both benefits and concerns regarding solar power’s ability to meet peak demand and said further work should be done to establish capacity payments that would make wider solar power penetration more viable.
The study used three solar penetration scenarios – 4,500 MW, 6,000 MW, and 9,000 MW – to examine the impact of distributed utility-scale solar farms on peak demand reduction and ramping requirements during historical peak events.
The study found that solar generation can reduce peak demand by up to 9.6% under the 9,000-MW scenario. Depending on location and weather condition, a solar farm can reduce demand during peak periods anywhere from 10% to 74% of its rated capacity during the hottest summer months.
That performance variability during peak periods, however, creates uncertainty in a solar farm’s installed capacity payment, making it more difficult to obtain project financing. To address that, the researchers recommended establishment of an alternative installed capacity compensation mechanism that values all summer peak hours in addition to the system peak hours and sends a more predictable market signal to developers.
The Cornell researchers – Jeffrey Sward, Jackson Siff, Jiajun Gu, and Max Zhang – were surprised to find a different scenario in the winter. While solar generation often reduces peak load in summer, it tends to displace baseload resources during the winter. That could lead to a situation in which maximum ramping rates are likely to occur in the winter under high solar penetration scenario.
The researchers recommended that system flexibility constraints during winter “should be assessed.” High ramp rates often lead to burning more fossil fuels, incurring costs and offsetting the environmental benefits of solar power.
“When you have several days of sunshine in a row during winter, that causes the largest ramping on the power system in New York state,” Zhang, an associate professor at the Sibley School, said in an article in the Cornell Chronicle.
“The increasing ramping requirement will be a challenge in pursuing our renewable energy target,” Zhang said, “but it can be met with flexible resources, both in the supply and demand sides, as well as energy storage.”
New York’s Clean Energy Standard mandates that 50% of all electricity be generated by renewable energy by 2030.
The study also said that because developers cannot predict the performance of their solar farms during the annual system peak, “current capacity valuation methodologies for solar projects may not be adequate to promote a healthy competitive market for solar.”
As part of the state’s Reforming the Energy Vision program, New York’s Public Service Commission is engaged in an ongoing process to establish a new way of compensating distributed energy resources. That process, called the Value of Distributed Energy Resources, or the value stack, aims to compensate projects based on their locations and their contributions to the performance of the overall grid.
Capacity payments are all the more important because the energy value of solar generation decreases as solar penetration increases, the researchers note. They also note that peak load reduction is a critical component of valuing installed capacity.
The researchers recommended that introducing a broader spectrum of peak demand conditions into variable resource capacity valuations would improve strategic planning, “not only in New York, but across growing solar markets worldwide.”
Because solar power projects are capital intensive, “how solar capacity is valued could determine if utility-scale solar projects remain viable investments,” the researchers said.
