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LARGE SCALE GRID INTEGRATION OF RENEWABLE

ENERGY IN INDIA
September 2017

Challenges and Solutions for System Operations with high share


of RE Chile Experience
National Electric Coordinator (Chilean ISO)
www.coordinadorelectrico.cl
Ernesto Huber, Operation Manager www.coordinadorelectrico.cl
Agenda
National Electric Systems in Chile
Electricity Market Framework, History and Context
Main challenges in V-RE Integration
Lack of transmission capacity for RE
Interconnection the National Electric Grid
Ramping control for net load demand.
Final Comments

2 www.coordinadorelectrico.cl
Agenda
National Electric Systems in Chile
Electricity Market Framework, History and Context
Main challenges in V-RE Integration
Lack of transmission capacity for RE
Interconnection the National Electric Grid
Ramping control for net load demand.
Final Comments

2 www.coordinadorelectrico.cl
National Electric Coordinator
Chilean ISO
(Coordinador Elctrico Nacional)
Independent technical organization in charge of operating (coordinating) the
electric facilities in the national electric grid.

Responsible for ensuring reliable, efficient operation of the power system, and for ensuring
open access to the transmission systems
Chilean ISO started up on January 1st, 2017 (Law 20,936, July 2016)
Chilean ISO is the legal continuator of former CDECs (SIC and SING)
Independent Board of Directors (5 members, 5-year period) responsible for steering and
administering the organization
Board Members elected by a Nomination Committee (National Energy Commission, Panel
of Experts, Antitrust Tribunal, Public Executives Search Service) in a public recruitment
process

13 www.coordinadorelectrico.cl
NATIONAL ELECTRIC COORDINATOR: CHILEAN ISO

Chile imports most


of fossil fuel to
produce electricity
from international
markets
Electric System SING
Northern Interconnected System (2016)
Capacity & Energy by Fuel Type
79%
80%
Installed Capacity: 5,032 MW 70%
Energy Generated: 19,467 GWh 60% 48%
50% 38%
Peak Demand: 2,555 MW 40%
30%
Population: 1.1 Mill. (6.3%) 20% 8% 6% 9%
2% 1% 4% 4%
10% 0% 1% 0% 0%
Customers: 90% industrial 0%
Hydro Coal Diesel LNG Cogen Wind Solar

Installed Capacity Energy Generated

SING
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Electric System SIC
Central Interconnected System (2016)
Capacity & Energy by Fuel Type
39%
40% 36% 45% of
Installed Capacity: 16,837 MW 35% 32%
R.E.
30%
Energy Generated: 53,906 GWh 25% 18% 19% taking
20% 16%
Peak Demand: 7,789 MW 15%
14%
into
Population: 16.6 Mill. (92.2%) 10%
1% 2%
5% 6%
4% 5%
3% account
5%
Customers: 70% regulated 0% Large
Hydro Coal Diesel LNG Cogen Wind Solar
Hydro in
Installed Capacity Energy Generated SIC.
33% for
both
system
SIC&SING

SIC
10 www.coordinadorelectrico.cl
Electric Systems Total
National System (2016)
Capacity & Energy by Fuel Type
44%
45%
Installed Capacity: 22,045 MW 40%
35% 29%
Energy Generated: 73,877 GWh 30% 26%
22% 23%
25%
Peak Demand: 10,400 MW 20% 17%
14%
Population: 17.3 Millions 15%
10% 4% 5% 5%
3% 2% 3% 3%
5%
0%
Hydro Coal Diesel LNG Cogen Wind Solar

Installed Capacity Energy Generated

11 www.coordinadorelectrico.cl
Agenda
National Electric Systems in Chile
Electricity Market Framework, History and Context
Main challenges in V-RE Integration
Lack of transmission capacity for RE
Interconnection the National Electric Grid
Ramping control for net load demand.
Final Comments

2 www.coordinadorelectrico.cl
GENERATION AND ENERGY PRICES:
Produccin Energa
[ GWh /mes] HISTORICAL EVOLUTION Cmg Quillota 220 kV
[ USD / MWh ]
6.000 350
First Natural Gas Argentinean Natural LNG
curtailment Gas Crisis (Quintero Plant)
300
5.000 from Argentina

250
4.000

200
3.000
150

2.000
100

1.000
50

0 0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Elico Solar Otros (Biomasa-BioGas)
Carbn Hidrulico GN
GNL Petrleo Cmg Quillota 220 kV
www.coordinadorelectrico.cl
Chilean electricity market Historical
development
<1982 (1)
1982 2004-2006

Amendments
State-owned
Private model
model
The Short Law I:
Generation
- Open access regulation
Generation
Transmission - It creates Expert Panel
Transmission
- No transmission charges for
Distribution Distribution
non-conventional small
projects < 9 MW
All segments were Vertical integration was
public entities modified
The Short Law II:
Market introduction with
locational marginal price Tenders distribution companies
scheme supply (end-users)
www.coordinadorelectrico.cl
Chilean electricity market Historical developmen
Chile adopted a non-subsidiary model for the
integration of2008
renewables. 2012 - 2013 2016

Renewable Energy Law Transmission and only one


Renewable Energy Law Coordinator (Chilean ISO)
version 2
version 1
- Increment on RPS - Robust Transmission to
- Introduction of a avoid constrains.
target: 20% by 2025
renewable portfolio Charged to demand
(NCRE) (prorate)
standard: 10% by
- Net-metering Law. - A.S. Market (check
2024 (NCRE).
competitive conditions)

www.coordinadorelectrico.cl
THE DEVELOPMENT OF
NCRE
Annual generation 2008 Annual generation 2016

1567 GWh 7841 GWh


COMPLIANCE THE TARGET
2010-2016

Generation
NCRE

Target
NCRE

The annual target has been exceeded by projects developed under market conditions
Tenders Process for supply
energy to Distribution
Companies
Introduction of the so-called hourly blocks,
with a significant impact on bidding prices.

A B C

00:00 08:00 18:00 23:00


08:00 18:00 23:00

www.coordinadorelectrico.cl
Average price 2016= 47.6
US$/MWH
(include a record bid for Chile
PV project=29 US$/MWh
Block B)
INTERNATIONAL CONTEXT
Bidding process
Electricity Market Framework
Ministry of
Energy Fuels & Electricity
National Energy
Commission Superintendency
(CNE) (SEC)
Regulatory body Sanctioning body
Laws, decrees, norms Interprets regulations
Set rates Norms compliance oversight
National Electric
Other organizations: Coordinator
Panel of Experts (Chilean ISO)
National Economic
Prosecution Office
(FNE)
Transparency Counsel

Generation Distribution &


Companies Large
Transmission Customers
Companies

4 www.coordinadorelectrico.cl
Wholesale Energy,
Generator A Capacity
LMP

& AS Markets
Chilean ISO defines day-ahead generation schedule based on economic dispatch
Pricing
LMP from economic dispatch is based on declared variable costs (LMP settlement ex-post)
Chilean ISO determines energy balances by differences (contracted vs. actual generation priced at LMP)
Competitive long-term energy bids for regulated customers conducted by the CNE
National Electric Capacity payments based on plants availability during peak demand
Ancillary services will transition from cost-based to auction-based for balancing
Coordinator

LMP
Pricing Long-term
Contracts Distribution
(Regulated) Proportionally charged
Generator Transmission
to demand
B (Regulated/
Tariff based on tender
Competitive) process for new
Bilateral
Large transmission projects
Contracts
Customers

5 www.coordinadorelectrico.cl
Wholesale Marginal Cost & Tariffs
120.0
CMO SIC CMG Quillota 220 kV CMO SING CMG Crucero 220 kV
Average Operation Average Marginal
100.0 Cost (CMO) SING Cost (CMG) SING

80.0
39 64
[USD/MWh]

USD/MWh USD/MWh
60.0

40.0 Average Operation Average Marginal


Cost (CMO) SIC Cost (CMG) SIC
20.0
23 56
0.0 USD/MWh USD/MWh

DIC
SEP

FEB

Mar
JUL
JUN

OCT
MAY

ENE

MAY
AGO

Abril
NOV
2017

Rates 2016:

Capacity: 100,000 USD/MW/Yr.


End customer: 200 USD/MWh (70% G, 8% T, 22% D)
Large Customers: 62 USD/MWh

6 www.coordinadorelectrico.cl
Transmission Sector
Generators

Dedicated Dedicated

The transmission system was separated into


three segments: National, Zonal and Dedicated
National System Transmission segments
(Bulk Transmission) Centralized planning (CNE-Chilean ISO)

System expansions based on competitive


Zonal bidding process
Zonal
(Sub-transmission) (Sub-transmission)
Bidding process administered by Chilean ISO
Dedicated

Dedicated
Distributors
Distributors Consumers

Consumers

7 www.coordinadorelectrico.cl
Agenda
National Electric Systems in Chile
Electricity Market Framework, History and Context
Main challenges in V-RE Integration
Lack of transmission capacity for RE
Interconnection the National Electric Grid
Ramping control for net load demand.
Final Comments

2 www.coordinadorelectrico.cl
Potential Renewable Energy in Chile
Chile has enormous potential, more than 1,865 GW of wind, solar and
hydro energy, and probably 2,000 or more MW geothermal power and
2,000 MW of biomass.

Fuente: Presentaciones CNE y Min. http://www.minenergia.cl/documentos/estudios/2014.html


Energa:
www.coordinadorelectrico.cl
CHALLENGE INTEGRATION NCRE

FLEXIBILITY CHALLENGES

1) Conventional power plant


operation regime
FLEXIBILITY
2) Environmental Regulations

3) Others flexibility sources


CHALLENGE INTEGRATION NCRE

FLEXIBILITY
CHALLENGE INTEGRATION NCRE

INTERCON
NECTIONS
HYDRO
RESERVOIR
THERMAL
POWER

FLEXIBILITY
PUMP
STORAGE
STORAGE SYSTEM
TRANSM.
SYSTEM

BATTERIES
DEMAND
SIDE RESP
Handle lack of transmission
capacity for RE
In the northern part of SIC (800 km, 220
kV system):

Norte Grande
Local Demand: 1000 MW

Install Capacity (Wind+PV): 2200 MW


Norte Chico
Coal Power generation: 750 MW (5 units
Zona Central
150 MW, minimum load (40%) 25% to
Northern SIC 36% )

Zona Sur Transmission capacity North-->South :


224 MW, N-1 criteria.

In normal operation it is necessary to


Zona
order curtailments.
Austral
zero marginal cost during day hours.
www.coordinadorelectrico.cl
Lack of transmission capacity for RE
The main objective of the
scheme is to increase the use of
transmission capacity from
NORTH SOUTH, allowing
maximum generation from
NCRE sources.(N-1 to near N)

Reducing operation costs of the


whole system without affecting
security constraints.

A design for an automatic


scheme for
reduction/disconnection of
power generation is available.
Basically, the scheme will allow
transmission levels reduction
under contingencies in the
Northern SIC and a fine-tuning
of power transmission levels
under normal operation.
www.coordinadorelectrico.cl
CHALLENGE: INTERCONNECTION THE GRIDS
Coordination, Security, Stability, Reactive power control,
Variability of power flows
CHALLENGE: INTERCONNECTION THE GRIDS
Coordination, Security, Stability, Reactive power control,
Variability of power flows.
CHALLENGE: INTERCONNECTION THE GRIDS
Coordination, Security, Stability, Reactive power control,
Variability of power flows.
RAMPING CONTROL
Summer day: 2021
RAMPING CONTROL
Summer day: 2021
Agenda
National Electric Systems in Chile
Electricity Market Framework, History and Context
Main challenges in V-RE Integration
Lack of transmission capacity for RE
Interconnection the National Electric Grid
Ramping control for net load demand.
Final Comments

2 www.coordinadorelectrico.cl
Final Comments:
The fast integration of renewables energy in the Chilean power system
is bringing new challenges in order to keep the reliability standards
and guarantee an efficient operation.
The interconnection SING-SIC (2017-2018) will be a valuable support
to face these challenges (flexibility from hydro reservoir) but it could be
not enough. We have to think, for instance, in redesign the A/S market
National and regional control centers
System Resilience (forest fires, hydrology variability, drought conditions
prolonged 7 years)
Integration of high levels of renewables (high potential wind&solar)
Centralized forecasting V-RE, National AGC, situational awareness
NCRE: Grid friendly
Implementing new functions (Law 20,936)
LARGE SCALE GRID INTEGRATION OF RENEWABLE
ENERGY IN INDIA
September 2017

Challenges and Solutions for System Operations with high share


of RE Chile Experience
National Electric Coordinator (Chilean ISO)
www.coordinadorelectrico.cl
Ernesto Huber, Operation Manager www.coordinadorelectrico.cl

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