Report by Brattle Economists Assesses Impacts of Renewable Integration on Maintaining Resource Adequacy
Prepared for DTE Energy
In a new report prepared for DTE Energy, economists at global economic consulting firm The Brattle Group assess the potential impact of changes to system reliability and operational needs brought about by the shifting resource mix and integration of intermittent renewable resources in the Lower Peninsula of Michigan.
Based on their analysis, the authors find that the supply mix changes in “Zone 7” (the Lower Peninsula in Michigan) and in the rest of the Midcontinent Independent System Operator’s (MISO) system can present challenges to the area’s resource adequacy and system operations if the intertie capability with the rest of MISO is not maintained and if the Ludington pumped hydro storage and future demand response (DR) resources are not available whenever needed.
“As various regions across the U.S. experience rapid deployments of renewable resources, resource adequacy and operational risks need to be analyzed carefully,” noted Johannes Pfeifenberger, a Brattle principal and co-author of the study. “Detailed system analyses under various future scenarios help utilities identify future system needs and potential options to meet those needs.”
In their report, “Integrating Renewables into Lower Michigan’s Electricity Grid: Resource Adequacy and Operational Analysis, and Implications,” the Brattle authors define resource adequacy as the ability of generation resources to meet load in every hour, considering the uncertainties in the availability of resources in each hour, the uncertainty in the energy outputs from intermittent renewable generation resources, and the uncertainties around load forecasting.
The analysis involves simulating future scenarios of the MISO system in both the day-ahead time frame and in real time to capture the uncertainties around renewable generation and load. It also involves simulating the probabilistic outcomes of balancing supply and demand under a variety of future conditions, including various levels of renewable generation and available demand-side resources.
The authors find that Michigan’s Lower Peninsula currently has sufficient resources to meet resource adequacy needs, but meeting these needs in the future will depend on multiple factors, including: (a) the level of capacity import capability from the rest of MISO into Michigan, (b) the ability to fully harness the capabilities of the Ludington pumped hydro generation facility, and (c) the availability of demand-side resources.
Specific key findings of the Brattle study are as follows:
- Michigan’s Lower Peninsula will likely need to rely increasingly on DR resources to support reliability, especially by 2040. The Brattle simulations show that the performance characteristics of DR will need to evolve to allow for more frequent deployment to support the system’s supply and demand balance, particularly during evening hours when the system’s reliability risks are expected to increase.
- The analyses of 2040 show that Michigan’s Lower Peninsula could experience reliability challenges due to a lack of available local ramping capability. Additional ramping capability will be needed to ensure that the increase in the up and down ramping of net load can be met reliably.
- The simulated changes to the operations of Ludington and existing and potentially new gas-fired generation will help to mitigate the identified risks.
The report is authored by Judy Chang, Kai Van Horn, Akarsh Sheilendranath, Johannes Pfeifenberger, Ariel Kaluzhny, and Cecile Bourbonnais.