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Renewables as grid flexibility tool gives glimpse of the future

As economic activity declined under the pandemic so did demand for electricity. Fossil fuel generation was squeezed off the grid by renewable energy projects with lower marginal costs. Fears that the higher proportion of fluctuating supply would destabilise power systems proved unfounded and grids remained stable. If renewables are to be tasked with keeping the grid secure, alternative mechanisms, already available, must be introduced soon

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Grids have coped well with fluctuating and unpredictable demand during the Covid-19 health crisis

BALANCING ACT The fall in electricity demand tripped by the Covid-19 pandemic highlighted how conventional generators will be pushed off the grid in the future, meaning they are no longer available to offer system flexibility. Other technologies are already stepping into the breach

RAPID RESPONSE In need of extra, low-cost flexible generation to cope with a rising proportion of variable supply in the electricity mix as demand dropped, the UK system operator rapidly advanced plans for small wind and solar generators to take part in a new flexibility market. As a stabilisation tool, it worked

KEY QUOTE Renewables can replace conventional energy sources without the market going down or going bust”

Lockdowns imposed on economic activity in Europe to slow the spread of Covid-19 saw shares of renewable energy rise on power systems at the expense of fossil fuel generation. Despite the proportional increase in variable input to the grid from solar and wind facilities, system operators continued to successfully balance power supply and demand. But the pandemic has revealed that with grids increasingly reliant on wind and solar power, operators need more options for flexibility in reducing or increasing demand as well as supply.

The UK illustrates the challenges ahead. After it imposed its lockdown on March 23, causing industries, businesses and offices to shut down, the demand for electricity fell by about 10-15%. During morning hours, loss of demand on the system reached as high as 25%, exacerbated by the contribution from dispersed small generators feeding into the system from the distribution network. In the UK such “embedded supply” to consumers is treated as “negative load”, or power the transmission grid does not have to supply. In May, renewable electricity production hit a peak of 67.5% of the total, with the UK recording its first full calendar month without coal-fired generation since the industrial revolution. Indeed, the UK went without coal power for more than two months.

The trend in lower electricity production, a higher share of renewables and a sharp fall in coal’s contribution are hardly unique to the UK during times of economic stagnation. According to analysis from climate think-tank Ember, renewables generation in the 27 countries of the European Union (EU) exceeded fossil fuel generation in the first half of 2020 for the first time ever, accounting for 40% of total generation compared to 34% for fossil fuels. Wind and solar alone provided 22% of the EU total and reached shares of 64% in Denmark, 49% in Ireland and 42% in Germany.

From Europe to the United States, the strong showing of renewables was not accompanied by blackouts or other significant grid problems, despite widespread concerns as lockdowns began. “Renewables can replace conventional energy sources without the market going down or going bust,” Annegret Groebel, president of the Council of European Energy Regulators (CEER), said recently. “Renewables played an important part during the crisis of stabilising the system.”

Mark Dyson, with the electricity practice of America’s Rocky Mountain Institute, says no one should be surprised, noting that wind and solar were already making strides before the pandemic.“Coal has taken a huge hit in the United States and given the large buildout of wind and solar generation last year, by default renewables have gained. System operators have become quite good in forecasting and integrating renewable energy.”

DOWNWARD FLEXIBILITY ROLL OUT

To help ensure security of supply in the UK during the health crisis, National Grid Electricity System Operator (ESO) added to the operational tools at its disposal, starting with the roll-out of a voluntary Optional Downward Flexibility Management (ODFM) marketplace for small-scale renewable generators connected to the distribution network to be paid by the ESO to reduce or stop production. National Grid’s Julian Leslie says this rapidly assembled market has given it access to about four gigawatts (GW) of embedded generation.

A modification was also made to the grid code clarifying that distribution companies could also switch off generation if needed and an agreement reached with utility EDF to temporarily reduce output at the Sizewell nuclear plant in east England, effectively paying it for the service.

National Grid aims to be able to operate a carbon-free electricity grid whenever the market is delivering that solution by 2025. It got close during the lockdown, attaining a peak of about 85%.Tom Edwards, with market research firm Cornwall Insight, notes that at times much as 70-80% of the electricity clearing the wholesale market was variable renewable energy even before other zero-carbon energy sources are considered. “They time-travelled ahead to 2025,” says Edwards.

GRID STABILITY WITHOUT GAS

Yet the need to guarantee grid stability meant that renewables generation sometimes had to be turned off to allow gas plants to operate. “The biggest challenge at these low demand levels is to have enough inertia on the system to ensure grid stability,” explains Leslie. Inertia helps to keep the electricity system running at the right frequency – 50 Hertz in Europe and 60 Hertz in the United States – and has typically been provided by the rotating parts of large gas and coal generators spinning at the same frequency as the grid as they produce electricity. The inherent inertia means the turbines will continue to spin for a period after the generator loses power, slowing down a change in system frequency while the system operator restores balance.

National Grid intends to have synthetic inertia tools available by 2025 do away with the need for gas power plants to stabilise the grid. To that end, it is procuring carbon-free inertia. In January, it awarded a total of €360 million in six-year zero-megawatt contracts for inertia and other grid stability services to five parties. One example of these contracts is Statkraft’s agreement to provide inertia with what it describes as two “rotating stabiliser synchronous machines” essentially big spinning wheels, at a site in northeast Scotland.

Alongside National Grid’s new operational tools, Cornwall Insight’s Edwards says one of the welcome developments during the pandemic has been the system operator’s increased market openness. National Grid has been holding regular webinars on its forecasts and concerns. “Its transparency on data and plans has been useful and will be essential [in the future],” he says.

ITALY STAYS BALANCED

Italy was the first European country to be severely hit by the coronavirus, initially putting into place local restrictions in northern Italy before imposing a national lockdown on March 9 and blocking all activities considered to be non-essential on March 22. On Sunday, April 5, a day when demand for electricity was 36% below the 2019 average, 47.6% of total power generation came from renewable energy and 30.6% from wind and solar sources alone.

According to an analysis from Italian energy research group RSE, grid operator Terna handled the situation by tapping into existing flexibility resources – mainly natural gas plants, hydroelectric power, pumped hydro storage and grid interconnectors with neighbouring countries, in particular with France, to which Italy exported power during hours of excess renewable production and imported during the evening ramp-up as Italian solar photovoltaic plants stopped producing.

While the impact of the pandemic on the Italian power system has been significant, Michele Benini, director at RSE, says integrating renewable energy has been manageable at its current level of penetration. It will become more challenging as Italy seeks for renewable energy to provide 60.5% of all electricity in 2030 with 37.1% from variable renewables. “In the future, much more flexibility will be required,” says Benini.

One way to facilitate the needed power system evolution and to bring down the costs of running a greater share of renewable power, is to integrate wind, solar and other flexibility resources in the balancing market. The need for renewables to pull their weight in matching supply with demand was revealed when the costs of balancing the market and procuring reserves increased significantly during Italy’s lockdown.

The cost hike was partly the result of greater difficulties in forecasting demand, which system operators around the world are having to battle with throughout the pandemic. Italy’s case was made additionally harder because wind, solar and the contribution that can be made by reducing or increasing demand are excluded from the balancing mechanism, as is battery storage.

Italian wind farms are sometimes curtailed for local grid congestion reasons, but Benini argues that wind and solar plants should participate in the balancing market alongside hydroelectric and thermoelectric plants of 10 MW or more. “If these wind farms were on hand to reduce output in exchange for a payment, you would need fewer reserves, even if their production did not actually end up being cut,” he notes.

As Italy looks to renewables and other non-conventional power resources to provide balancing services, Terna is carrying out pilot projects with virtual units composed of distributed generation, demand response, and battery and other storage assets with an aggregator acting as a balancing responsible party.

Andrea Marchisio, with Italian energy consultancy Elemens, expects batteries will be one essential element to increasing the flexibility of Italy’s power system, particularly given the prevalence of small distributed solar photovoltaic (PV) capacity in the country. Batteries can help avert the need to build out the grid or construct additional power generating capacity, he notes.

NEGATIVE PRICES

Italy sets a floor of €0 for wholesale electricity prices, a level that was reached a handful of times during the lockdown. Negative prices, when generators pay to offload their power to the grid if they do not take unneeded capacity offline, have been a feature of other European markets for the past decade. They became more frequent during Covid-19 lockdowns, due to the increasing combination of high wind and solar generation and low demand.

Dave Jones, at Ember, notes the very low or negative prices seen on European markets reveal inflexibilities in both supply and demand, with producers unwilling or unable to shut down generation and most consumers not in a position to shift their demand to take advantage of lower prices.

Flexibility on both demand and supply sides will be critical in ensuring the grid can run 100% on wind and solar, says Jones. The Covid-19 pandemic has shown it might be wise to prepare for that day sooner rather than later.

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Heather O’Brian