Renewable energy credit driven wind power growth for system reliability

Abstract

Environmental concerns over electric power generation from conventional sources has led to widespread public support for renewable energy sources. Governments throughout the world have responded by providing various forms of financial incentives to promote power generation from renewable energy sources. The rapid growth of wind power since the last decade has primarily been driven by governmental subsidies. Long-term growth of wind power should, however, be driven by sustainable market mechanisms. A potential solution is to recognize monetary values to the environmental benefits from renewable energy sources, and to specify targets for their growth. The environmental benefits from wind sources can be leveraged to allow market competition of these sources with the less costly conventional generating sources. A probabilistic method to evaluate the impact of renewable energy credit and wind penetration level on the cost and adequacy of power generating systems is presented in this paper. The technique incorporates reliability and economic analyses and is applied to a published test system to illustrate the results and their influence on key system variables. The paper provides useful information to system planners and policy makers on wind energy application in electric power systems.