Optimizing Synergy of Utility-Scale Wind and Pumped-Hydro Storage

Abstract

The increased penetration of wind-generated electricity exposes wind farm operators to market risks of a balanced supply in the transmission grid. In order to reduce the risks and to gain financial advantage for wind farm operators, the use of pumped hydro storage to adjust the delivery schedule of energy is proposed. An approach that systematically and rapidly addresses the economic, infrastructural, geographic and meteorological factors relevant to wind power plants and pumped hydro storage over large areas is required. An integrated Geographic Information System-based tool is developed to identify, on the scale of a country, wind power plants and pumped hydro storage facilities. Further, a decision algorithm that has inputs of the forecasted and actual wind energy productions, and the day-ahead and intraday electricity market prices is also developed to optimise the use of pumped hydro storage. This approach is demonstrated for Germany, with the target of increasing electricity production from renewable energy sources. A countrywide portfolio of wind power plants that meets the increased electricity production target, and existing and potential pumped hydro storage facilities are identified. By optimizing the use of pumped hydro storage, it is shown that wind farm operators can achieve a 2–4% gain on the Internal Rate of Return on investments. The improved financial performance with the use of pumped hydro storage increases the attractiveness for investments in the wind power sector and mitigates the adverse effects of the variability in the dispatch of wind-generated electricity.