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One of the major issues with the integration of the DER such as solar power, wind power, etc. is the uncertain nature of such electricity resources. This uncertainty can cause a few problems in the distribution system: (i) it makes the supply-demand relationships extremely complex, and requires complicated optimization tools to balance the network, and (ii) it puts higher pressure on the transmission network,<ref>{{Cite journal|last1=Mohammadi Fathabad|first1=Abolhassan|last2=Cheng|first2=Jianqiang|last3=Pan|first3=Kai|last4=Qiu|first4=Feng|date=2020|title=Data-driven Planning for Renewable Distributed Generation in Distribution Systems|url=https://ieeexplore.ieee.org/document/9112707|journal=IEEE Transactions on Power Systems|volume=35|issue=6|pages=4357–4368|doi=10.1109/TPWRS.2020.3001235|s2cid=225734643|issn=1558-0679|via=}}</ref> and (iii) it may cause reverse power flow from the distribution system to transmission system.<ref>{{Cite journal|last1=De Carne|first1=Giovanni|last2=Buticchi|first2=Giampaolo|last3=Zou|first3=Zhixiang|last4=Liserre|first4=Marco|date=July 2018|title=Reverse Power Flow Control in a ST-Fed Distribution Grid|journal=IEEE Transactions on Smart Grid|volume=9|issue=4|pages=3811–3819|doi=10.1109/TSG.2017.2651147|s2cid=49354817|issn=1949-3061|url=https://nbn-resolving.org/urn:nbn:de:gbv:8-publ-14890}}</ref>
 
[[Microgrid]]s are modern, localized, small-scale grids,<ref>{{Cite journalbook|last1=Saleh|first1=M.|last2=Esa|first2=Y.|last3=Mhandi|first3=Y.|last4=Brandauer|first4=W.|last5=Mohamed|first5=A.|datetitle=October 2016 IEEE Industry Applications Society Annual Meeting |titlechapter=Design and implementation of CCNY DC microgrid testbed |journaldate=2016 IEEE IndustryOctober Applications Society Annual Meeting2016|pages=1–7|doi=10.1109/IAS.2016.7731870|isbn=978-1-4799-8397-1|s2cid=16464909|chapter-url=https://academicworks.cuny.edu/cgi/viewcontent.cgi?article=1722&context=cc_pubs}}</ref><ref>{{Cite journalbook|last1=Saleh|first1=M. S.|last2=Althaibani|first2=A.|last3=Esa|first3=Y.|last4=Mhandi|first4=Y.|last5=Mohamed|first5=A. A.|datetitle=October 2015 International Conference on Smart Grid and Clean Energy Technologies (ICSGCE) |titlechapter=Impact of clustering microgrids on their stability and resilience during blackouts |journaldate=October 2015 International Conference on Smart Grid and Clean Energy Technologies (ICSGCE)|pages=195–200|doi=10.1109/ICSGCE.2015.7454295|isbn=978-1-4673-8732-3|s2cid=25664994|chapter-url=https://academicworks.cuny.edu/cgi/viewcontent.cgi?article=1623&context=cc_pubs}}</ref> contrary to the traditional, centralized [[electricity grid]] (macrogrid). Microgrids can disconnect from the centralized grid and operate autonomously, strengthen grid resilience, and help mitigate grid disturbances. They are typically low-voltage AC grids, often use [[diesel generator]]s, and are installed by the community they serve. Microgrids increasingly employ a mixture of different distributed energy resources, such as [[solar hybrid power systems]], which significantly reduce the amount of carbon emitted.
 
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{{ISBN|1-118-02901-1}}, pages v-x</ref> As a result, [[smart grid]] functions, [[virtual power plant]]s <ref>[https://www.researchgate.net/publication/270821401_Decision_Making_Tool_for_Virtual_Power_Plants_Considering_Midterm_Bilateral_Contracts/ Decision Making Tool for Virtual Power Plants Considering Midterm Bilateral Contracts]</ref><ref>[https://www.researchgate.net/publication/279849005_The_Design_of_a_Risk-hedging_Tool_for_Virtual_Power_Plants_via_Robust_Optimization_Approach/ The Design of a Risk-hedging Tool for Virtual Power Plants via Robust Optimization Approach]</ref><ref>[https://www.researchgate.net/publication/296307377_A_Medium-Term_Coalition-Forming_Model_of_Heterogeneous_DERs_for_a_Commercial_Virtual_Power_Plant/ A Medium-Term Coalition-Forming Model of Heterogeneous DERs for a Commercial Virtual Power Plant]</ref> and [[grid energy storage]] such as [[power to gas]] stations are added to the grid. Conflicts occur between utilities and resource managing organizations.<ref>{{cite web |last1=Bandyk |first1=Matthew |title=Propelling the transition: The battle for control of virtual power plants is just beginning |url=https://www.utilitydive.com/news/propelling-the-transition-the-battle-for-control-of-virtual-power-plants-i/581875/ |website=Utility Dive |archive-url=https://web.archive.org/web/20200819022737/https://www.utilitydive.com/news/propelling-the-transition-the-battle-for-control-of-virtual-power-plants-i/581875/ |archive-date=19 August 2020 |date=18 August 2020 |url-status=live}}</ref>
 
Each distributed generation resource has its own integration issues. Solar PV and wind power both have intermittent and unpredictable generation, so they create many stability issues for voltage and frequency. These voltage issues affect mechanical grid equipment, such as load tap changers, which respond too often and wear out much more quickly than utilities anticipated.<ref>{{cite journal|last1=Agalgaonkar|first1=Y.P. |display-authors=etal |title=Distribution Voltage Control Considering the Impact of PV Generation on Tap Changers and Autonomous Regulators|journal=IEEE Transactions on Power Systems|date=16 September 2013|volume=29|issue=1|pages=182–192|doi=10.1109/TPWRS.2013.2279721|hdl=10044/1/12201 |s2cid=16686085 |hdl-access=free}}</ref> Also, without any form of energy storage during times of high solar generation, companies must rapidly increase generation around the time of sunset to compensate for the loss of solar generation. This high ramp rate produces what the industry terms the ''[[duck curve]]'' that is a major concern for grid operators in the future.<ref>{{cite web|title=What the Duck Curve Tells Us About Managing A Green Grid|url=https://www.caiso.com/Documents/FlexibleResourcesHelpRenewables_FastFacts.pdf |website=caiso.com|publisher=California ISO|access-date=29 April 2015}}</ref> Storage can fix these issues if it can be implemented. Flywheels have shown to provide excellent frequency regulation.<ref>{{cite journalbook|last1=Lazarewicz|first1=Matthew |last2=Rojas|first2=Alex |title=IEEE Power Engineering Society General Meeting, 2004 |chapter=Grid Frequencyfrequency Regulationregulation by Recyclingrecycling Electricalelectrical Energyenergy in Flywheelsflywheels |journal=Power Engineering Society General Meeting|volume=2|date=10 June 2004|pages=2038–2042 |doi=10.1109/PES.2004.1373235|isbn=0-7803-8465-2|s2cid=20032334 }}</ref> Also, flywheels are highly cyclable compared to batteries, meaning they maintain the same energy and power after a significant amount of cycles( on the order of 10,000 cycles).<ref>{{cite web |title=Flywheels |url=http://energystorage.org/energy-storage/technologies/flywheels |publisher=Energy Storage Association |access-date= }}</ref> Short term use batteries, at a large enough scale of use, can help to flatten the duck curve and prevent generator use fluctuation and can help to maintain voltage profile.<ref>{{cite web|last1=Lazar|first1=Jim |title=Teaching the "Duck" to Fly|url=http://www.ripuc.ri.gov/eventsactions/docket/4443-EERMC-Presentation2_5-8-14.pdf |publisher=RAP|access-date=29 April 2015}}</ref> However, cost is a major limiting factor for energy storage as each technique is prohibitively expensive to produce at scale and comparatively not energy dense compared to liquid fossil fuels. Finally, another necessary method of aiding in integration of photovoltaics for proper distributed generation is in the use of [[intelligent hybrid inverter]]s. Intelligent hybrid inverters store energy when there is more energy production than consumption. When consumption is high, these inverters provide power relieving the distribution system.<ref>{{cite web|title=Smart Grid, Smart Inverters for a Smart Energy Future|url=https://www.nrel.gov/state-local-tribal/blog/posts/smart-grid-smart-inverters-for-a-smart-energy-future.html |publisher=National Renewable Energy Labortatory |access-date= }}</ref>
 
Another approach does not demand grid integration: stand alone hybrid systems.
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* [[OLE for process control|OPC]] is also used for the communication between different entities of DER system.
*[[Institute of Electrical and Electronics Engineers]] IEEE 2030.7 microgrid controller standard. That concept relies on 4 blocks: a) Device Level control (e.g. Voltage and Frequency Control), b) Local Area Control (e.g. data communication), c) Supervisory (software) controller (e.g. forward looking dispatch optimization of generation and load resources), and d) Grid Layer (e.g. communication with utility).
*A wide variety of complex control algorithms exist, making it difficult for small and residential [[Distributed Energy Resource]] (DER) users to implement energy management and control systems. Especially, communication upgrades and data information systems can make it expensive. Thus, some projects try to simplify the control of DER via off-the shelf products and make it usable for the mainstream (e.g. using a Raspberry Pi).<ref>{{Cite journalbook|last1=Fürst|first1=Jonathan|last2=Gawinowski|first2=Nik|last3=Buettrich|first3=Sebastian|last4=Bonnet|first4=Philippe|datetitle=2013-09-25 IEEE Global Humanitarian Technology Conference (GHTC) |titlechapter=COSMGrid: Configurable, off-the-shelf micro grid |date=2013-09-25|chapter-url=https://www.researchgate.net/publication/259157235|journal=Proceedings of the 3rd IEEE Global Humanitarian Technology Conference, GHTC 2013|pages=96–101|doi=10.1109/GHTC.2013.6713662|isbn=978-1-4799-2402-8|s2cid=19202084}}</ref><ref>{{Cite web|url=http://www.cet.or.at/pdf_files/Paspberry%20Pi%20Microgrid%20Controller.pdf|title=A flexible low cost PV/EV microgrid controller concept based on a Raspberry Pi|last=Stadler|first=Michael|date=2018|website=Center for Energy and innovative Technologies}}</ref>
 
== Legal requirements for distributed generation ==