Browsing by Subject "ERCOT"
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Item Analysis of storing wind energy for periods of seconds to hours in ERCOT(2010-08) Weber, Robert Arthur, 1983-; Baldick, Ross; Ghosh, JoydeepWind energy has dramatically changed the energy portfolio of Texas and more specifically, a region covering 75% of the state designated as ERCOT (Electric Reliability Council of Texas). Hardly existent at all ten years ago, the amount of capacity the wind farms provide is over 9000MW and accounts for 10% of the total generation. Due to the intermittent nature of wind and limitations of transmission lines, short and long term storage of this energy would benefit wind farms and the grid as a whole. This paper studies the relationship between wind, storage and real time electricity prices by analyzing prices and simulating a wind farm with different wind storage strategies over the course of a year. Based on these simulations, it is found that an ideal storage medium with no losses could be in the money for $17.50/kW for long term storage and $1,998/kW for short term storage for prices similar to 2009-2010.Item Analysis of the correlation between wind power generation and system response characteristics following unit trips on the ERCOT grid(2010-05) Lovelace, William Edward; Grady, W. M.; Santoso, SuryaElectric power generation using wind turbines is on the rise in not only the United States but the entire globe. While the benefits from such methods of generation include clean and renewable energy, wind turbines may pose a potential risk to the stability of grid operation. Wind turbine generators are similar to conventional generators; however, the manner with which the wind turbine is coupled to the grid may reduce system inertia and increase the magnitude of transient stability problems. This study empirically examines the effect of wind generation on ERCOT system response characteristics following unit trips such as frequency drop, and phasor oscillation frequency and damping. It is shown with a high degree of certainty that an increase in wind generation is leading to a greater phasor oscillation frequency and lesser system inertia. Wind generation may also be leading to less system damping and smaller power frequency drops.Item Consolidated Network Model Management System for ISO/RTO to support electrical transmission system model data(2015-12) Moseley, Johnathan David; Santoso, Surya; Grady, William; Arapostathis, Ari; Barber, Kathleen; Nuthalapati, SarmaThe introduction of new “smart-grid” related technologies has created a challenge that the electrical power industry has been slow to recognize: that being, vast amounts of data must be integrated into the operational decisions of those who manage the grid, and made available to those serviced by the grid. As these technologies evolve into commercial viability, new challenges emerge: data aggregation of phase-angle measurements, use of market products like distributed resources, analysis methodologies such as solar generation forecasting, and management techniques like those required for operating energy storage devices will need to be merged into the already complicated process of energy management. In addition, pressures from enhanced regulatory over-sight, the unwinding of the vertically integrated power industry model, and market pressures are pushing for transmission and generation systems to be operated closer and closer to their physical limitations. The objective of this research is to show that all of these issues may be dealt with, using a robust integration approach and constructing a unified modeling system capable of acting as a single source of data for supporting all facets of electrical power transmission system modeling. In general, this method relies on leveraging and extending a current industrial data-exchange standard into a single time-based data repository, and using that single data source to meet the needs of the applications supporting grid-management activities. The new system supports all aspects of the model life-cycle: including the data entry, validation, creation of power system models, testing and finalization, and archiving of model data changes. Additionally, the system has a flexible design that supports easy integration of new items. Therefore, this new method of data support allows for state of the art devices to be readily integrated into existing process data flows, reduces organizational adoption time, and produces a level of modeling consistency and accuracy that current industry practices are incapable of. Application of this methodology allows for the rapid operational integration of energy storage devices, the utilization of phase-angle measurements, the aggregation of smart-metering devices, and generally leads to greater operational awareness of grid conditions and the greater reliability of the system.Item A dynamic model-based estimate of the potential value of a vanadium redox flow battery for energy arbitrage and frequency regulation in Texas(2012-08) Fares, Robert Leo; Webber, Michael E., 1971-; Meyers, Jeremy P.Large-scale electrochemical energy storage is a technology that is uniquely suited to integrate intermittent renewable energy sources with the electric grid on a large scale. Grid-based energy storage also has the potential to reduce costs associated with periods of peak electric demand. For these reasons, this work describes the potential applications for grid-based energy storage, and then reviews large-scale energy storage technology innovations since the development of the lead-acid battery. The potential value of grid-based battery energy storage is discussed in the context of restructured electricity markets; then, a dynamic model-based economic optimization routine is developed to gauge the potential value of a vanadium redox flow battery (VRFB) operating for wholesale energy arbitrage and frequency regulation in Texas. Based on this analysis, the relative value of a VRFB in various regions of Texas for energy arbitrage and frequency regulation is examined. It is shown that frequency regulation is an appealing application for a grid-based VRFB, with a VRFB utilized for frequency regulation service in Texas potentially worth approximately $1500/kW. Finally, the effect of a VRFB’s characteristics on its value for frequency regulation and energy arbitrage are compared, and the operational insight developed in this work is used to glean how policies to integrate a large-scale energy storage with the electricity market might be crafted.Item Essays on Energy and Regulatory Compliance(2012-10-19) Cancho Diez, CesarThis dissertation contains two essays on the analysis of market imperfections. In the first essay, I empirically test whether in a three-level hierarchy with asymmetries of information, more competition among intermediaries leads to more deception against the principal. In this setting, intermediaries supervise agents by delegation of the principal, and compete among themselves to provide supervision services to the agents. They cannot be perfectly monitored, therefore allowing them to manipulate supervision results in favor of the agents, and potentially leading to less than optimal outcomes for the principal. Using inspection-level data from the vehicular inspection program in Atlanta, I test for the existence of inspection deception (false positives), and whether this incidence is a function of the number of local competitors by station. I estimate the incidence of the most common form of false positives (clean piping) to be 9% of the passing inspections during the sample period. Moreover, the incidence of clean piping -- passing results of a different vehicle fraudulently applied to a failing vehicle -- per station increases by 0.7% with one more competitor within a 0.5 mile radius. These results are consistent with the presence of more competitors exacerbating the perverse incentives introduced by competition under this setting. In the second essay, we test whether electricity consumption by industrial and commercial customers responds to real-time prices after these firms sign-up for prices linked to the electricity wholesale market price. In principle, time-varying prices (TVP) can mitigate market power in wholesale markets and promote the integration of intermittent generation sources such as wind and solar power. However, little is known about the prevalence of TVP, especially in deregulated retail markets where customers can choose whether to adopt TVP, and how these firms change their consumption after signing up for this type of tariff. We study firm-level data on commercial and industrial customers in Texas, and estimate the magnitude of demand responsiveness using demand equations that consider the restrictions imposed by the microeconomic theory. We find a meaningful level of take-up of TVP ? in some sectors more than one-quarter of customers signed up for TVP. Nevertheless, the estimated price responsiveness of consumption is still small. Estimations by size and by type of industry show that own price elasticities are in most cases below 0.01 in absolute value. In the only cases that own price elasticities reach 0.02 in absolute value, the magnitude of demand response compared to the aggregate demand is negligible.Item Essays on regulatory impact in electricity and internet markets(2014-05) Roderick, Thomas Edward; Ryan, Stephen (Stephen P.)This dissertation details regulation's impact in networked markets, notably in deregulated electricity and internet service markets. These markets represent basic infrastructure in the modern economy; their innate networked structures make for rich fields of economic research on regulatory impact. The first chapter models deregulated electricity industries with a focus on the Texas market. Optimal economic benchmarks are considered for markets with regulated delivery and interrelated network costs. Using a model of regulator, consumer, and firm interaction, I determine the efficiency of the current rate formalization compared to Ramsey-Boiteux prices and two-part tariffs. I find within Texas's market increases to generator surplus up to 55% of subsidies could be achieved under Ramsey-Boiteux pricing or two-part tariffs, respectively. The second chapter presents a framework to analyze dynamic processes and long-run outcomes in two-sided markets, specifically dynamic platform and firm investment incentives within the internet-service platform/content provision market. I use the Ericson-Pakes framework applied within a platform that chooses fees on either side of its two-sided market. This chapter determines the impact of network neutrality on platform investment incentives, specifically whether to improve the platform. I use a parameterized calibration from engineering reports and current ISP literature to determine welfare outcomes and industry behavior under network neutral and non-neutral regimes. My final chapter explores retail firm failure within the deregulated Texas retail electricity market. This chapter investigates determinants of retail electric firm failures using duration analysis frameworks. In particular, this chapter investigates the impact of these determinants on firms with extant experience versus unsophisticated entrants. Understanding these determinants is an important component in evaluating whether deregulation achieves the impetus of competitive electricity market restructuring. Knowing which economic events decrease a market's competitiveness helps regulators to effectively evaluate policy implementations. I find that experience does benefit a firm's duration, but generally that benefit assists firm duration in an adverse macroeconomic environment rather than in response to adverse market conditions such as higher wholesale prices or increased transmission congestion. Additionally, I find evidence that within the Texas market entering earlier results in a longer likelihood of duration.Item Excel model for electric markets : ERCOT(2016-05) Cuevas, Pedro Pablo; Dyer, James S.; Butler, John C.(Clinical associate professor); Hahn, JoeThe effects of changing regulatory and fuel-cost environments have far reaching implications on the ability of electric markets to plan and provide cheap, clean, and reliable electric grids. The current state of the art tools for modeling the regulations and fuel prices requires days to process and access to these tools is also held by a small number licensed users that must also have the training and technical ability to run the model, which limits the study of planning and electricity market design.. This thesis presents an Excel model that simulates the operations of ERCOT over the next fifteen years. Tradeoffs between accuracy, run time, cost, and model complexity will be discussed. The advantages of this model are speed and accessibility, which will allow more users to understand the major implications of policy discussions and scenarios without needing a commercial tool. The model predicts the fuel mix and average market price for 2014 with less than a 1% and 2% error respectively. For 2015, the model predicts the fuel mix with less than a 5% error. Using the current trends assumptions, the model predicts that by 2030 the energy mix will undergo significant changes. Coal generation will drop from 28% to 21%, while gas generation will decline from 48% to 46%. Renewable generation will increase with wind going from 12% to 17% and solar from 0% to 7%. The model also predicts that a carbon tax between $20 and $60 per short ton of CO2, could rise the operational and capital costs of ERCOT in present value terms until 2030 from $75 billion to $218 billion. Finally the model forecasts that the reserve margin in ERCOT will not reach the target of 13.75% in 2020 and that renewable energy addition does not affect this indicator. Even more, the reserve margin is increased when solar energy enters the market.Item A framework to model and optimize the operation of lithium-ion energy storage in electricity markets, and an assessment of lithium-ion energy storage in Texas(2015-08) Fares, Robert Leo; Webber, Michael E., 1971-; Baldick, Ross; Bickel, James E.; Chen, Dongmei; Edgar, Thomas FThe lithium-ion (Li-ion) battery has become an established technology in portable electronics and electric vehicle applications. At the same time, there is rising interest in grid-based battery energy storage to improve the flexibility of the electric grid and integrate intermittent sources of renewable energy. To provide information for energy storage developers, battery system operators, state policymakers, and the general public, this research develops a framework to characterize, operate, and evaluate Li-ion battery energy storage that is connected to the electric grid and participates in a wholesale electricity market. Methods are developed to characterize and model the voltage, temperature, and capacity degradation behavior of a Li-ion battery system. Then, an optimization program is developed to schedule Li-ion storage in an electricity market while modeling and controlling its operating state and rate of capacity loss. The optimization framework is used to simulate operation of Li-ion storage in Texas’s Electric Reliability Council of Texas (ERCOT) electricity from 2002–2014, and the market revenue potential and operating lifetime of Li-ion storage are approximated. It is shown that controlling capacity degradation in operational management can extend the lifetime of Li-ion battery modules by approximately 30–60% without significantly reducing market revenue potential. To test the reliability impact of distributed Li-ion storage, residential electricity data are used to approximate how long a battery system could isolate downstream electricity customers during an outage. Thousands of outage events are simulated to show the expected islanding duration for outages occurring at different times of day. The potential reliability benefit from avoided residential electric outages is calculated and found to be much smaller than the revenue potential from the electricity market, indicating that market applications should be prioritized over residential reliability applications in siting and operating a battery system. It is found that the net-present value (NPV) of a Li-ion battery system providing wholesale energy arbitrage in the ERCOT market is negative across a range of cost and benefit parameters. However, controlling capacity degradation in operational management of the battery system is found to increase its value by approximately $100/kWh of rated energy capacity. The NPV of a battery system providing a combination of energy and Fast Responding Regulation Service (FRRS) is found to be positive across a wide range of cost and benefit parameters, indicating a Li-ion battery system could most likely provide a combination of energy and FRRS service to the ERCOT electricity market at a profit. Controlling capacity degradation in operational management of the battery system for energy and FRRS is found to have little impact on its NPV. However, controlling capacity loss makes the NPV less sensitive to variation in the lifetime of the battery modules, reducing the risks associated with premature battery cell failure.Item A grid-level assessment of compressed air energy storage in ERCOT(2013-05) Townsend, Aaron Keith; Webber, Michael E., 1971-In the Electric Reliability Council of Texas (ERCOT) compressed air energy storage (CAES) is currently viewed as the most promising energy storage technology due to Texas having suitable geology for CAES and few locations suitable for pumped-hydro storage. CAES is a proven technology but the economics for new facilities are uncertain. This work quantified the economic prospects for CAES in ERCOT as a function of installed wind capacity, natural gas price, and CAES capital cost. Two types of models were developed and used in this work. The first type of model was a CAES dispatch optimization model, which determined the maximum operating profits a CAES facility could earn given a set of electricity and ancillary services market prices. These models were used to examine several separate research questions relating to the maximum potential for CAES and the impact of uncertainty and other real-world complications. The models determined that the maximum operating profit from 2002-2010 varied widely from year to year and averaged $120-140/kW-year, which is likely below the operating profits required to justify investing in CAES. The models also determined that current price forecasting methods are sufficient to earn approximately 95% of the operating profits achievable with perfect knowledge of all prices in the year. The second type of model was a unit commitment model of ERCOT, which determined the least-cost operation of all the generators in the generation fleet to meet given load. The unit commitment model was used to determine electricity and ancillary service market prices under different assumptions about natural gas price, installed wind capacity, and installed CAES capacity. The CAES dispatch optimization model was then used to determine the operating profits of a CAES facility under these scenarios. CAES operating profits were found to increase with increasing natural gas price and installed wind capacity and to decrease with increasing installed CAES capacity. CAES operating profits were estimated to support installed CAES capacities from zero to more than 6 GW, depending on the natural gas price, installed wind capacity, installed CAES capacity, and the CAES capital costs. The strongest determinant of the maximum CAES capacity that would be profitable is the natural gas price, followed by the CAES capital costs.Item Impacts of environmental regulation and wind penetration level on the ERCOT market(2012-12) Jin, Joo Hyun; Baldick, Ross; Kwasinski, AlexisAs more renewable resources are added into the grid and environmental regulations are imposed to reduce emissions, there will be dramatic changes in the generation portfolio. Assessing the impact of these changes is important for policy makers, market participants, and general public to understand trends in the electricity market. This paper addresses this issue by analyzing how the ERCOT market is affected by CO2 penalty and wind penetration. In order to assess the future power system, the study model should represent the long term dynamics of various factors to find out how investment decisions are made economically in a competitive market with appropriate assumptions. Another important aspect is the short term market dynamics from real operation of power system. For this study, AURORAxmp, a commercially available market simulator, is utilized to capture both long term and short term dynamics. This study runs 5 different scenarios: two base cases with and without CO2 price, 20%, 27%, and 33% wind penetration level. The result shows that, increasing wind penetration reduces production and capacity of both coal and gas units, electricity market prices, and amount of emissions. However, increasing wind penetration has greater impacts on a decrease in generation from thermal units than reduction in thermal capacity, resulting in 11.4% capacity value of wind power. The study also confirms that CO2 price impacts capacity and generation of coal (negatively) and gas (positively) units in opposite ways, and reduces emission, but increases power prices and generation cost. Especially, the impact on retirement of coal units is noticeable. Almost half of the current coal capacity (19 GW), 9,390 MW, is retired by 2040 in this study.Item Spatially resolved life cycle models for the environmental footprint of electricity generation(2014-08) Pacsi, Adam Philip; Allen, David T.Electricity generation has significant environmental impacts, including on regional air quality, greenhouse gas emissions, and water availability. Modeling the overall environmental impact of electricity generation requires linked simulations of power generation, air pollution physics and chemistry, greenhouse gas emissions, and water use. Tools for performing these analyses in an integrated manner are just beginning to emerge. This work expands on the development of linked models for electricity generation, air quality, and water use that have provided single-day snapshots of these environmental impacts. The original model used a non-linear optimization model for power generation, a regional photochemical model for air quality impacts, and self-contained modules for greenhouse gas emissions and water usage at power plants in Texas. The new model includes life cycle scenarios for the power sector (including changes in both the fuel production and electricity generation stages) and expands the temporal scale of the modeling framework to include impacts on monthly, seasonal, and annual time scales instead of on single days. In addition, the air quality framework has been expanded to include atmospheric particulate matter as an air quality impact. This modeling framework will be used to assess the air quality impacts of new natural gas developments in the Barnett and Eagle Ford shale regions in Texas, the consumptive water impact of new natural gas development in Texas, the impact of seasonal versus ozone forecast-based pricing for power plant NOx emissions in the state of Texas, and the potential cost and air quality impacts of drought-based operation of the power grid in Texas.Item A techno-economic plant- and grid-level assessment of flexible CO2 capture(2012-08) Cohen, Stuart Michael, 1984-; Rochelle, Gary T.; Webber, Michael E., 1971-; Baldick, Ross; Schmidt, Philip S.; Bickel, EricCarbon dioxide (CO₂) capture and sequestration (CCS) at fossil-fueled power plants is a critical technology for CO₂ emissions mitigation during the transition to a sustainable energy system. Post-combustion amine scrubbing is a relatively mature CO₂ capture technology, but barriers to implementation include high capital costs and energy requirements that reduce net power output by 20-30%. Capture energy requirements are typically assumed constant, but work investigates whether flexibly operating amine scrubbing systems in response to electricity market conditions can add value to CO₂ capture facilities while maintaining environmental benefits. Two versatile optimization models have been created to study the electricity system implications of flexible CO₂ capture. One model assesses the value of flexible capture at a single facility in response to volatile electricity prices, while the other represents a full electricity system to study the ability of flexible capture to meet electricity demand and reliability (ancillary) service requirements. Price-responsive flexible CO₂ capture has limited value at market conditions that justify CO₂ capture investments. Solvent storage can add value for price arbitrage by allowing flexible operation without additional CO₂ emissions, but only with favorable capital costs. The primary advantage of flexible CO₂ capture is an increased ability to provide grid reliability services and improve grid resiliency at minimum and maximum electricity demand. Flexibility mitigates capacity shortages because capture energy requirements need not be replaced, and variable capture at low demand helps respond to intermittent renewable generation.Item Texas offshore wind power and water desalination potential(2015-05) Beceiro, Jose Daniel; Spence, David B.; Webber, Michael E., 1971-Texas leads the nation in oil and gas production as well as renewable energy production. Texas also leads the nation in installed wind power and is the 6th largest wind market in the world. Over the past decade, Texas has gone from nearly zero megawatts of installed wind to now over 14,000 megawatts. Texas has an immense onshore wind resource that has been exploited. However, another of Texas' large untapped energy resources has yet to be explored -- offshore wind. Texas is also experiencing one of the most severe and longest sustained drought cycles in the state's history. Texas is blessed with a vast supply of ocean water and brackish groundwater trapped in aquifers, but energy-intensive water desalination plants are required to purify the water to potable standards. Offshore wind has the ability to turn large-scale water desalination into an economical solution. This thesis focuses on offshore wind and water desalination technology development, cost competitiveness with competing renewable energy and thermo electric generation resources on the ERCOT nodal grid, and the opportunity to couple water desalination facilities with offshore wind farms to enhance overall project economics, reduce the cost of electricity, and increase the supply of fresh water. An economic model evaluating offshore wind-powered water desalination is utilized to demonstrate the viability of implementing these technologies across the state.Item Valuation of an advanced combined cycle power plant and its cost of new entry (CONE) into the ERCOT market(2014-08) Zaborowski, Jeremy Ronald; Webber, Michael E., 1971-The Texas ERCOT market is one of the most open, deregulated electricity markets in the world. This open market brought electricity costs down for Texas residents and businesses, creating a much more competitive economic climate. However, these low prices currently generate insufficient revenue for generators to finance construction of new or replacement generation assets. In the instance of combined cycle advanced natural gas, the Independent Market Monitor 2012 annual report estimated that a plant needed to generate 2.5 times as much as revenue it did in 2012 to incent new generation. This author argues that while the gap is still significant, the continuous changes to the ERCOT market since its inception make an historical examination like that used by the IMM less accurate. New market rules such as price caps or changes in fuel markets through new technologies like hydraulic fracturing create a very different valuation gap than a model based on historical activity alone. This analysis attempts to get a more accurate approximation of the gap through the use of publicly traded futures contracts for natural gas and electricity. Electricity futures reflect market expectations of revenue based on current and future market rules. Gas futures reflect price expectations in light of market changes like fracturing, potential LNG exports, and other changes. Financial positions can be maintained in both markets to give a fixed rate of return. Using this method, one can create a very conservative valuation model that still more accurately reflects market sentiment. This thesis starts with a brief history of ERCOT deregulation from the early 2000s to present in order to clarify for the reader the changes that have taken place in the market. It then demonstrates the futures-valuation model using an advanced combined cycle power plant as an example.