Grid operators and utilities in countries around the globe are grappling with the new challenge of incorporating large amounts of variable renewables, such as wind power, onto their systems

Wind power is now included in the electricity systems of many developed countries. In Spain, more than 13,800 MW of wind power capactiy has already been installed, providing about 10% of the country’s electricity production.


While wind power can offer significant financial and environmental returns, this resource does pose many challenges. Among these is the fact that wind is an idiosyncratic ‘fuel,’ due to its stochastic nature and to the fact that it is impossible to store. This idiosyncrasy presents difficulty in managing energy systems, with a significant increase in the resources required to establish a real-time balance between generation and demand.

There are several existing generation technologies available to firm the variability of wind capacity. At Iberdrola, we believe the best operational option is pumped storage, which is always available and provides significant flexibility with regard to start-ups and shutdowns. Indeed, the company is already building the 852 MW La Muela 2 pumped-storage plant for this purpose and is investigating construction of three additional pumped-storage plants with a total capacity of 1640 MW.

The Challenge of a Balanced Grid

Iberdrola is the largest producer of wind power in the world. At the end of 2008, the company had 9302 MW of installed wind capacity around the world, including 4526 MW in Spain, 665 MW in the United Kingdom, and 2876 MW in the United States. These plants produce nearly 17,000 GWh of electricity annually. In addition, Iberdrola is investigating potential new wind plants worldwide with a total capacity of more than 54,000 MW.

By comparison, global wind capacity at the end of 2008 was nearly 121,200 MW, with production of 260 TWh a year, according to the World Wind Energy Association. More than 27,200 MW of this capacity was added in 2008, the association reports.

Nonetheless, wind is limited in quantity and cannot be stored, so it is important to forecast wind speed in order to estimate future production. However, because winds are highly variable, long-term production forecasts have a large margin of error. Consequently, introducing significant quantities of wind capacity imposes special requirements on the electricity system, both in the long and short term.

Over the long term, the challenge arises from the fact that there are periods during which high demand coincides with a low level of wind power generation, and vice versa. For example, for wind production by the Spanish mainland power system, the average load level between 2005 and 2007 was about 21%. During this same time period, the load factor – the ratio between the net amount of electricity generated and net rated output capacity – varied significantly, with values of 2.5%–70%. Thus, electricity from wind power stations may not be available at those times when it is most needed for the electricity system. This requires the installation of additional power based on other technologies, which replaces wind during periods of low wind electricity production.

Over the short term, the effect of wind power production on the balance between the market and electricity system is clear. The time horizons of interest include weekly, daily, and real time.

The 635 MW La Muela pumped-storage plant in Valencia, Spain is being expanded with the addition of a second powerhouse, the 852 MW La Muela 2. Iberdrola anticipates this plant will begin operating in 2012 to help firm the variability of the utility’s extensive wind capacity. It will be Europe’s largest pumped hydro scheme.

Due to the difference in demand between work days and holidays, each generating company produces a weekly operation schedule that details planned start-up and shutdown times for each plant, the so-called ‘unit commitment’. Thermal stations have a high cost associated with start-ups and shutdowns, so utilities make use of their most flexible plants, such as conventional hydro plants and pumped-storage facilities. In this context, the presence of substantial wind power production has an important effect on the weekly operation schedule. Because of the stochastic nature of wind speed, the uncertainty involved in weekly planning is ± 25% of installed capacity, with a confidence level of 70%. With wind power installed capacity in Spain of 13,836 MW, the uncertainty level on a one-week horizon is ± 3460 MW. To absorb this uncertainty would require shutting down or starting up about nine 400 MW single-shaft, combined-cycle plants.

On the daily horizon, auctioning of production and demand of most of the system’s energy occurs one day ahead. Predictive uncertainty in wind power production one day in advance is ± 15%. Using the 13,836 MW of wind power in Spain as an example, this uncertainty represents about 2075 MW, equivalent to starting up or shutting down five 400 MW single-shaft, combined-cycle plants.

A substantial portion of the work to correct this imbalance may be performed in markets organized less than one day ahead (typically three to 24 hours). However, the remaining imbalance has to be managed in real time by other groups in the system, which requires an increase in the services dedicated to this objective. Using the Spanish mainland power system as an example, there are two principal mechanisms to solve these imbalances:

  • A secondary reserve system, in which power plants offer a range to increase and/or decrease generation, which is governed in real time by the system operator’s secondary power/frequency regulation loop
  • A tertiary reserve mechanism, which consists of the start-up/shutdown of a series of plants that receive remuneration for varying the load over a maximum timeframe of 10 minutes.

What Role can Hydro Play?

There are several types of electricity generation technology that can be used to help firm the variability of wind capacity. These include conventional hydro, pumped storage, conventional thermal, and simple cycle or combined cycle gas-fired turbines. To analyse the regulation capacity of these technologies, Iberdrola primarily considered three factors: start-up and shutdown capacity; regulation velocity (in % load per minute); and, technical minimum load (in % of maximum load).

Hydro plants have several advantages when considering these factors. First, they are the most flexible of the technologies in performing continuous start-ups and shutdowns without a significant detrimental effect on the equipment’s service life. Secondly, their load variation speed is high. For example, it is possible to vary the power output by about 100% per minute. And, thirdly, the minimum load is low, often less than 10% of the rated capacity. In addition, their fuel cost is zero and they do not produce any operational emissions of greenhouse gases. However, this type of technology is limited in connection to the hydraulic management of rivers, which is mainly conditioned by the storage capacity of the reservoirs in the basin in which each plant is located. During dry years, the reservoir level can decrease significantly, limiting the hydraulic power available.

Nonetheless, conventional hydro is the most attractive option for firming the variability of wind capacity, and this is for two main reasons. Firstly, it is the lowest-cost technology and secondly, it is the cleanest one, as its operational greenhouse gas emission level is zero. Unfortunately, in developed systems, almost all the hydroelectric potential has already been harnessed. This makes it difficult to increase installed capacity to supply grid regulation services. Therefore, other technologies are needed to provide balancing services.

From the technical point of view, pumped-storage stations have the same characteristics as conventional hydro plants. Additionally, their operation is not limited by exploitation of the basin in which they are located. Thus their power is always available, even during dry periods when conventional hydro is limited. A disadvantage of pumped storage, compared with conventional hydro, is that it is necessary to pump the water to the upper reservoir to produce electricity. This cost of this process is the price of the electricity divided by the efficiency of the cycle (typically about 75%).

From the environmental point of view, these stations permit a significant reduction in electricity system emissions by producing low-emissions electricity during off-peak periods and replacing more contaminating technologies (such as fossil-fueled plants) during periods of peak electricity demand.

Other Types of Balancing Capacity

The start-up and shutdown capacity of a conventional thermal plant is limited, for two reasons. First, its start-up process requires a substantial amount of energy, which involves a substantial cost, and, secondly, performing continuous start-ups and shutdowns significantly reduces the service life of the plant. The regulation velocity of conventional thermal stations is limited to about 1% per minute, due to their high thermal inertia. However, their control range is acceptable, given that the technical minimum lies at about 45% of maximum power.

Open simple cycle gas turbine technology involves significant flexibility for continuous start-ups and shutdowns. In addition, it allows relatively rapid power variations, with a change velocity of about 4% per minute. On the other hand, the minimum power of these plants is usually about 60% of full load, which limits their regulation capacity to 40% of rated power.

From the flexibility point of view, combined cycle gas turbine plants are placed between conventional thermal stations and open cycle turbines. Thus, with respect to conventional thermal stations, they are more robust when performing continuous start-ups and shutdown cycles, due to the greater flexibility provided by the gas turbine. With regard to the regulation velocity, it is about 2.5% per minute, slightly lower than open cycle turbines, because of the higher thermal inertia of the combined cycle’s conventional steam cycle part. Lastly, the minimum power of these plants is nearly 50% of the power at full load.

These plants can render regulation services at a moderate variable cost, although qualitatively higher than conventional hydro or pumped storage.

Thus, after conventional hydro, pumped-storage plants are the best choice to firm the variability of wind. Power from these plants is available without the restrictions inherent in conventional hydro plants. A disadvantage of this technology is its ‘fuel cost’ at around 40% greater per kilowatt hour than that of combined cycle plants.

However, in systems with a significant quantity of thermal generation, this risk is quite limited because off-peak prices usually drop considerably due to the fact that these stations cannot perform daily start-up and shutdown cycles.

After conventional hydro and pumped storage, combined cycle plants are the next most likely option to firm the variability of wind. In the case of systems with low levels of hydro generation, a mixture of open cycle and combined cycle power plants is the most viable alternative to firm the variability of wind.

Planning for PumpingHydro storage development

Iberdrola has about 10,000 MW of hydro capacity worldwide, including more than 8800 MW in Spain. Of this 8800 MW, representing 47% of the installed hydro capacity in Spain, more than 2300 MW is pumped storage. This large portfolio of hydro plants has allowed Iberdrola to maximize the profitability of its wind turbine installations. But because of its rapid development of new wind turbine installations, the company is continuously seeking to broaden its portfolio of pumped-storage stations. It can be difficult to find suitable sites that permit the construction of pumped-storage stations at a moderate investment cost. Even in systems where suitable sites are available, the investment cost of this type of station is very high, which obliges developers to assume a very high risk during the long periods of amortization required.

Iberdrola’s most recent activity to add to its pumped-storage portfolio involves the expansion of the existing 635 MW La Muela plant with the installation of a second powerhouse. La Muela began operating in 1989. Construction of 852 MW La Muela 2 began in 2006 and is expected to be complete in 2012. The new powerhouse will contain four sets of generators (supplied by Alstom) and pump-turbines (supplied by Voith Hydro). Fomento de Construcciones y Contratas, S.A. (FCC) of Spain is the civil contractor for La Muela 2, and a consortium of Alstom, Sacyr Vallehermoso, and Cavosa is supplying the penstock. Ingenieria y Construccion S.A.U. (Iberinco) is performing the engineering work for La Muela 2.

In addition, Iberdrola plans to begin construction of two pumped-storage plants in Portugal in 2010 as part of the Alto Tomega hydro complex. Construction of the 1200 MW complex involves building four dams and four power stations, two of which will be pumped-storage facilities: the 779 MW Gouvaes plant and the 112 MW Pradoselos plant. Construction is due to be completed in 2018.

Finally, Iberdrola is considering several other locations for pumped-storage facilities. Among these is the 750 MW Santa Cristina plant in Spain.

Pumping up a Solution

The increasing penetration of wind power technology in current electricity systems requires a substantial increase in the resources required to balance generation and demand, as well as additional investments to guarantee the continuity of electricity supply when wind intensity is low.

Of all of the available technologies in current electricity systems, pumped-storage plants constitute the most attractive option for firming the variability of wind. Accordingly, Iberdrola is involved in the development of several of these plants and when completed in 2018, they will provide nearly 1750 MW of capacity to the electrical system of Spain and Portugal.

Announcement from our Chairman, David C BarclayThe World Renewable Energy Association are delighted to announce the launch of a brand-new initiative exclusively for its members. The Renewable Energy Finance Hub has been launched following the largest survey undertaken with UK businesses conducted by WoREA in conjunction with the UK Government and its partners. Reduce your businesses carbon footprint today and begin your journey towards net zero!