Electricity transmission tariffs for large-scale wind power consumption in western Gansu province, China

Abstract

Large-scale wind power transmission presents the power system with several challenges. The determination of the transmission tariff and the cost-sharing issue are potential obstacles which may influence the development of wind power. This paper analyses the incremental cost to the power system for long-distance transmission of wind power, considers the fixed and variable properties of the incremental cost and the risk of fluctuations in the cost, and establishes a comprehensive risk-based pricing model for long-distance transmission of large-scale wind power electricity. Gansu Province in China has abundant wind resources, so we use the Jiuquan wind power integration and the ±800kV Gansu-Zhuzhou direct current (DC) power transmission as examples to test the validity of the model. The conclusions are as follows: the allowances for access grid connection cost should be separately estimated for the large-scale wind power base and long-distance transmission; and the long-distance transmission pricing of large-scale wind power should apply a two-part electricity transmission pricing system, in order to eliminate the volatility risk inherent in each simple allocation method, and the fixed and variable characteristics of the transmission cost. The transmission price must include compensation for depreciation, operation and maintenance costs, and also a reasonable return on investment, in order to offer an effective incentive and guidance mechanism for enterprises’ business development.