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Effects of Temporal Wind Patterns on the Value of Wind-Generated Electricity in California and the Northwest

Description: Wind power production is variable, but also has diurnal and seasonal patterns. These patterns differ between sites, potentially making electric power from some wind sites more valuable for meeting customer loads or selling in wholesale power markets. This paper investigates whether the timing of wind significantly affects the value of electricity from sites in California and the Northwestern United States. We use both measured and modeled wind data and estimate the time-varying value of wind power with both financial and load-based metrics. We find that the potential difference in wholesale market value between better-correlated and poorly correlated wind sites is modest, on the order of 5-10 percent. A load-based metric, power production during the top 10 percent of peak load hours, varies more strongly between sites, suggesting that the capacity value of different wind projects could vary by as much as 50 percent based on the timing of wind alone.
Date: May 1, 2008
Creator: Wiser, Ryan H; Wiser, Ryan H & Fripp, Matthias
Partner: UNT Libraries Government Documents Department

Using RPS Policies to Grow the Solar Market in the United States

Description: The market for photovoltaics in the United States remains small relative to the nation's solar resource potential. Nonetheless, annual grid-connected PV installations have grown from just 4 MW in 2000 to over 100 MW in 2006, fast enough to the catch the attention of the global solar industry. The state of California deserves much of the credit for this growth. The State's historical rebate programs resulted in roughly 75% of the nation's grid-connected PV additions from 2000 through 2006 being located in California, and the $3 billion California Solar Initiative will ensure that the State remains a mainstay of the US solar industry for years to come. But California is not the only market for solar in the US; other states have recently developed policies that may rival those of the western state in terms of future growth potential. In particular, 25 states, as well as Washington, D.C., have established renewables portfolio standards (RPS), sometimes called quota systems in Europe, requiring electricity suppliers in those states to source a minimum portion of their need from renewable electricity. (Because a national RPS is not yet in place, my focus here is on state policies). Under many of these state policies, solar is not expected to fare particularly well: PV installations simply cannot compete on cost or scale with large wind plants in the US, at least not yet. In response, an expanding list of states have established solar or distributed generation (DG) set-asides within their RPS policies, effectively requiring that some fraction of RPS-driven supply derive from solar energy. The popularity of set-asides for solar and/or DG has increased dramatically in recent years. Already, 11 states and D.C. have developed such RPS set-asides. These include states with outstanding solar resources, such as Nevada, Arizona, Colorado, and New Mexico, as well as ...
Date: November 20, 2007
Creator: Wiser, Ryan H & Wiser, Ryan H.
Partner: UNT Libraries Government Documents Department

Wind Power: How Much, How Soon, and At What Cost?

Description: The global wind power market has been growing at a phenomenal pace, driven by favorable policies towards renewable energy and the improving economics of wind projects. On a going forward basis, utility-scale wind power offers the potential for significant reductions in the carbon footprint of the electricity sector. Specifically, the global wind resource is vast and, though accessing this potential is not costless or lacking in barriers, wind power can be developed at scale in the near to medium term at what promises to be an acceptable cost.
Date: January 1, 2010
Creator: Wiser, Ryan H & Hand, Maureen
Partner: UNT Libraries Government Documents Department

The Importance of High Temporal Resolution in Modeling Renewable Energy Penetration Scenarios

Description: Traditionally, modeling investment and dispatch problems in electricity economics has been limited by computation power. Due to this limitation, simplifications are applied. One common practice, for example, is to reduce the temporal resolution of the dispatch by clustering similar load levels. The increase of intermittent electricity from renewable energy sources (RES-E) changes the validity of this assumption. RES-E already cover a certain amount of the total demand. This leaves an increasingly volatile residual demand to be matched by the conventional power market. This paper quantifies differences in investment decisions by applying three different time-resolution residual load patterns in an investment and dispatch power system model. The model optimizes investment decisions in five year steps between today and 2030 with residual load levels for 8760, 288 and 16 time slices per year. The market under consideration is the four zone ERCOT market in Texas. The results show that investment decisions significantly differ across the three scenarios. In particular, investments into base-load technologies are substantially reduced in the high resolution scenario (8760 residual load levels) relative to the scenarios with lower temporal resolution. Additionally, the amount of RES-E curtailment and the market value of RES-E exhibit noteworthy differences.
Date: October 8, 2010
Creator: Nicolosi, Marco; Mills, Andrew D & Wiser, Ryan H
Partner: UNT Libraries Government Documents Department

The Treatment of Renewable Energy Certificates, EmissionsAllowances, and Green Power Programs in State Renewables PortfolioStandards

Description: Twenty-one states and the District of Columbia have adopted mandatory renewables portfolio standards (RPS) over the last ten years. Renewable energy attributes-such as the energy source, conversion technology, plant location and vintage, and emissions-are usually required to verify compliance with these policies, sometimes through attributes bundled with electricity, and sometimes with the attributes unbundled from electricity and traded separately as renewable energy certificates (RECs). This report summarizes the treatment of renewable energy attributes in state RPS rules. Its purpose is to provide a source of information for states considering RPS policies, and also to draw attention to certain policy issues that arise when renewable attributes and RECs are used for RPS compliance. Three specific issues are addressed: (1) the degree to which unbundled RECs are allowed under existing state RPS programs and the status of systems to track RECs and renewable energy attributes; (2) definitions of the renewable energy attributes that must be included in order to meet state RPS obligations, including the treatment of available emissions allowances; and (3) state policies on whether renewable energy or RECs sold through voluntary green power transactions may count towards RPS obligations.
Date: April 17, 2007
Creator: Holt, Edward A. & Wiser, Ryan H.
Partner: UNT Libraries Government Documents Department

Wind Power Development in the United States: Current Progress, Future Trends

Description: The U.S. wind power industry is in an era of substantial growth, with the U.S. and China likely to vie for largest-market status for years to come. With the market evolving at such a rapid pace, keeping up with current trends in the marketplace has become increasingly difficult. At the same time, limits to future growth are uncertain. This paper summarizes major trends in the U.S. wind market, and explores the technical and economic feasibility of achieving much greater levels of wind penetration. China would be well served to conduct similar analyses of the feasibility, benefits, challenges, and policy needs associated with much higher levels of wind power generation than currently expressed in national targets.
Date: October 29, 2008
Creator: Wiser, Ryan H
Partner: UNT Libraries Government Documents Department

Using contingent valuation to explore willingness to pay for renewable energy: A comparison of collective and voluntary payment vehicles

Description: Some of the most basic questions about the organization and functioning of society involve issues raised by the existence of public goods. With respect to environmental public goods, how should funds used to support environmental improvement be collected and used? In particular, are collective, mandatory payments superior to voluntary, charitable payments due to the possibility of free riding? And to what degree should the government be involved in spending these funds: should the government directly fund environmental improvement projects or should the private sector be used to collect funds and determine funding priorities? This report explores these questions from the perspective of renewable energy: wind, geothermal, biomass, hydropower, and solar. In particular, this report analyzes the payment preferences of U.S. households through the implementation of a large-scale contingent valuation (CV) survey of willingness to pay (WTP) for renewable energy. Renewable energy can be supported through a mandatory ''tax'' on electric bills or through voluntary payments via green power marketing; the government may or may not be heavily involved in the collection and expenditure of such funds. The question of how households prefer to pay for renewable energy is therefore highly relevant. The primary objective of this study is to explore variations in stated WTP for renewable energy under the following four payment and provision contexts: (1) A mandatory increase in the electricity bills of all customers, the funds from which are collected and spent by the government on renewable energy projects. (2) A voluntary increase in the electricity bills of those customers who choose to pay, the funds from which are collected and spent by the government on renewable energy projects. (3) A voluntary increase in the electricity bills of those customers who choose to pay, the funds from which are collected and spent by electricity suppliers on renewable energy ...
Date: July 28, 2002
Creator: Wiser, Ryan H.
Partner: UNT Libraries Government Documents Department

The renewables portfolio standard in Texas: An early assessment

Description: Texas has rapidly emerged as one of the leading wind power markets in the United States. This development can be largely traced to a well-designed and carefully implemented renewables portfolio standard (RPS). The RPS is a new policy mechanism that has received increasing attention as an attractive approach to support renewable power generation. Though replacing existing renewable energy policies with an as-of-yet largely untested approach in the RPS is risky, early experience from Texas suggests that an RPS can effectively spur renewables development and encourage competition among renewable energy producers. Initial RPS targets in Texas will be far exceeded by the end of 2001, with as much as 930 MW of wind slated for installation this year. RPS compliance costs appear negligible, with new wind projects reportedly contracted for under 3(US)/242/kWh, in part as a result of a 1.7(US)/242/kWh production tax credit, an outstanding wind resource, and an RPS that is sizable enough to drive project economies of scale. Obliged retail suppliers have been willing to enter into long-term contracts with renewable generators, reducing important risks for both the developer and the retail supplier. Finally, the country's first comprehensive renewable energy certificate program has been put into place to monitor and track RPS compliance.
Date: November 1, 2001
Creator: Wiser, Ryan H. & Langniss, Ole
Partner: UNT Libraries Government Documents Department

Exploration of Resource and Transmission Expansion Decisions in the Western Renewable Energy Zone Initiative

Description: The Western Renewable Energy Zone (WREZ) initiative brings together a diverse set of voices to develop data, tools, and a unique forum for coordinating transmission expansion in the Western Interconnection. In this paper we use a new tool developed in the WREZ initiative to evaluate possible renewable resource selection and transmission expansion decisions. We evaluate these decisions under a number of alternative future scenarios centered on meeting 33percent of the annual load in the Western Interconnection with new renewable resources located within WREZ-identified resource hubs. Our analysis finds that wind energy is the largest source of renewable energy procured to meet the 33percent RE target across nearly all scenarios analyzed (38-65percent). Solar energy is almost always the second largest source (14-41percent). We find several load zones where wind energy is the least cost resource under a wide range of sensitivity scenarios. Load zones in the Southwest, on the other hand, are found to switch between wind and solar, and therefore to vary transmission expansion decisions, depending on uncertainties and policies that affect the relative economics of each renewable option. Further, we find that even with total transmission expenditures of $17-34 billion these costs still represent just 10-19percent of the total delivered cost of renewable energy.
Date: June 10, 2010
Creator: Mills, Andrew D.; Phadke, Amol A. & Wiser, Ryan H.
Partner: UNT Libraries Government Documents Department

Comment on"Air Emissions Due to Wind and Solar Power" and Supporting Information

Description: Katzenstein and Apt investigate the important question of pollution emission reduction benefits from variable generation resources such as wind and solar. Their methodology, which couples an individual variable generator to a dedicated gas plant to produce a flat block of power is, however, inappropriate. For CO{sub 2}, the authors conclude that variable generators 'achieve {approx} 80% of the emission reductions expected if the power fluctuations caused no additional emissions.' They find even lower NO{sub x} emission reduction benefits with steam-injected gas turbines and a 2-4 times net increase in NO{sub x} emissions for systems with dry NO{sub x} control unless the ratio of energy from natural gas to variable plants is greater than 2:1. A more appropriate methodology, however, would find a significantly lower degradation of the emissions benefit than suggested by Katzenstein and Apt. As has been known for many years, models of large power system operations must take into account variable demand and the unit commitment and economic dispatch functions that are practiced every day by system operators. It is also well-known that every change in wind or solar power output does not need to be countered by an equal and opposite change in a dispatchable resource. The authors recognize that several of their assumptions to the contrary are incorrect and that their estimates therefore provide at best an upper bound to the emissions degradation caused by fluctuating output. Yet they still present the strong conclusion: 'Carbon dioxide emissions reductions are likely to be 75-80% of those presently assumed by policy makers. We have shown that the conventional method used to calculate emissions is inaccurate, particularly for NO{sub x} emissions.' The inherently problematic methodology used by the authors makes such strong conclusions suspect. Specifically, assuming that each variable plant requires a dedicated natural gas backup plant to create ...
Date: March 18, 2009
Creator: Mills, Andrew D.; Wiser, Ryan H.; Milligan, Michael & O'Malley, Mark
Partner: UNT Libraries Government Documents Department

Public goods and private interests: Understanding non-residential demand for green power

Description: This article presents the results of the first large-scale mail survey of non-residential green power customers in the United States. The survey explored the motivations, attitudes, and experiences of 464 business, non-profit, and public-sector customers that have voluntarily opted to purchase - and frequently pay a premium for - renewable electricity. Results of this study should be of value to marketers interested in targeting these customer segments, to policy makers interested in fostering and understanding non-residential demand for green power, and to academics pondering the motivations for firms to engage in such voluntary environmental initiatives.
Date: January 1, 2001
Creator: Wiser, Ryan H.; Fowlie, Meredith & Holt, Edward A.
Partner: UNT Libraries Government Documents Department

Real Options Valuation of U.S. Federal Renewable Energy Research,Development, Demonstration, and Deployment

Description: Benefits analysis of US Federal government funded research, development, demonstration, and deployment (RD3) programs for renewable energy (RE) technology improvement typically employs a deterministic forecast of the cost and performance of renewable and nonrenewable fuels. The benefits estimate for a program derives from the difference between two forecasts, with and without the RD3 in place. The deficiencies of the current approach are threefold: (1) it does not consider uncertainty in the cost of non-renewable energy (NRE), and the option or insurance value of deploying RE if and when NRE costs rise; (2) it does not consider the ability of the RD3 manager to adjust the RD3 effort to suit the evolving state of the world, and the option value of this flexibility; and (3) it does not consider the underlying technical risk associated with RD3, and the impact of that risk on the programs optimal level of RD3 effort. In this paper, a rudimentary approach to determining the option value of publicly funded RE RD3 is developed. The approach seeks to tackle the first deficiency noted above by providing an estimate of the options benefit of an RE RD3 program in a future with uncertain NRE costs.While limited by severe assumptions, a computable lattice of options values reveals the economic intuition underlying the decision-making process. An illustrative example indicates how options expose both the insurance and timing values inherent in a simplified RE RD3 program that coarsely approximates the aggregation of current Federal RE RD3.This paper also discusses the severe limitations of this initial approach, and identifies needed model improvements before the approach can adequately respond to the RE RD3 analysis challenge.
Date: March 1, 2005
Creator: Siddiqui, Afzal S.; Marnay, Chris & Wiser, Ryan H.
Partner: UNT Libraries Government Documents Department

Factors driving wind power development in the United States

Description: In the United States, there has been substantial recent growth in wind energy generating capacity, with growth averaging 24 percent annually during the past five years. About 1,700 MW of wind energy capacity was installed in 2001, while another 410 MW became operational in 2002. This year (2003) shows promise of significant growth with more than 1,500 MW planned. With this growth, an increasing number of states are experiencing investment in wind energy projects. Wind installations currently exist in about half of all U.S. states. This paper explores the key factors at play in the states that have achieved a substantial amount of wind energy investment. Some of the factors that are examined include policy drivers, such as renewable portfolio standards (RPS), federal and state financial incentives, and integrated resource planning; as well as market drivers, such as consumer demand for green power, natural gas price volatility, and wholesale market rules.
Date: May 15, 2003
Creator: Bird, Lori A.; Parsons, Brian; Gagliano, Troy; Brown, Matthew H.; Wiser, Ryan H. & Bolinger, Mark
Partner: UNT Libraries Government Documents Department


Description: The U.S. wind industry experienced a banner year in 2008, again surpassing even optimistic growth projections from years past. At the same time, the last year has been one of upheaval, with the global financial crisis impacting near-term growth prospects for the wind industry, and with federal policy changes enacted to push the industry towards continued aggressive expansion. This rapid pace of development has made it difficult to keep up with trends in the marketplace. Yet, the need for timely, objective information on the industry and its progress has never been greater. This report - the third of an ongoing annual series - attempts to meet this need by providing a detailed overview of developments and trends in the U.S. wind power market, with a particular focus on 2008. As with previous editions, this report begins with an overview of key wind power installation-related trends: trends in wind capacity growth in the U.S., how that growth compares to other countries and generation sources, the amount and percentage of wind in individual states and serving specific utilities, and the quantity of proposed wind capacity in various interconnection queues in the United States. Next, the report covers an array of wind industry trends, including developments in turbine manufacturer market share, manufacturing and supply-chain investments, wind turbine and wind project size, project financing developments, and trends among wind power developers, project owners, and power purchasers. The report then turns to a discussion of wind project price, cost, and performance trends. In so doing, it reviews the price of wind power in the United States, and how those prices compare to the cost of fossil-fueled generation, as represented by wholesale power prices. It also describes trends in installed wind project costs, wind turbine transaction prices, project performance, and operations and maintenance expenses. Next, the ...
Date: July 15, 2009
Creator: Wiser, Ryan H.; Bolinger, Mark; Barbose, G.; Mills, A.; Rosa, A.; Porter, K. et al.
Partner: UNT Libraries Government Documents Department