Category Archives: Grid integration

Green power dispatch in China – here is how to do it!


“China will promote green power dispatch, giving priority, in distribution and dispatching, to renewable power generation and fossil fuel power generation of higher efficiency and lower emission levels”.

These are the words in the U.S.-China Joint Presidential Statement on Climate Change that was released during President Xi’s visit at the White House on 25 September. And this is good news for integration of renewable energy in China. The curtailment of wind and solar power is a big problem for the further development of renewable energy, a waste of money for the society, and it creates local and global pollution, which could have been avoided.

However, the implementation of the priority dispatch is crucial for the success. It is not sufficient just to give orders to the Chinese dispatch centres to give priority to renewable energy (RE); it will only put the dispatch operator in an situation, where they have conflicting goals to fulfil without any real change to implement an efficient dispatch. Instead, a number of measures should be taken into play to ensure that all stakeholders pull in the same direction.

In my mind a coordinated action plan is necessary to ensure a proper green power dispatch. Here is my take on the elements in such a plan:

1. Stop for new coal fired power plat from 2020 and slow the pace before that
Firstly it should be clear, that there is not need for new coal fired power plant in the long run if China wants to have a sustainable energy system. Already today too many new coal-fired power plants are being build. The slow-down in electricity consumption growth is not a temporary issue – it’s also part of the long-term transition of the Chinese industry from heavy industry to light industry and services. And still coal fired power plants are being build at the same pace as before, resulting in significantly lower utilisation of the capacity, but also putting pressure on the use of power from renewables. So latest by 2020 new coal fired power plants should be banned. It should be decided now in order to give the industry sufficient time to change direction, and a strong cap for new coal power plants should be in place soon in order to slow down the pace until the full-stop in 2020.

2. Remove the priority dispatch for power plants
Today, in many provinces the coal fired power plants have a de facto priority in the dispatch by having the right to produce a certain amount of hours each year, the so-called “planned full-load hours”. These full-load hours are strong guidelines for the dispatch operators in the daily dispatch and by the end of the year the planned full-load hours should be fulfilled for each power plant. The rights were introduced to ensure the economic viability of the investments in new power plants in a situation where there were a strong need for new capacity due to soaring power consumption. Today, these rights gives a strong disincentive for integrating renewables and strong disincentives for the coal power plants to operate in a flexible way. Therefore the rights should be removed, and it seems reasonable to start with the old power plants which should have been able to have a reasonable pay-back time. It could be for power plants build before 2000.

For the power plants build after 2000 it might be difficult in one step to remove the right to produced a certain amount of hours for economic reasons. But the physical right to produce could be substituted by e.g. tradable production rights, which could allow for others, including new wind farms and solar power plants to have access to the dispatch. But of course other compensation mechanisms could be used instead, and most importantly, the compensation should be reduced gradually.

3. Loosen the ties between heat and power production
Combined production of heat and power is an efficient way to utilise the fuel, but when the power production from coal fired combined heat and power plants (CHP-plants) substitutes power from wind and solar, it’s less efficient, more polluting and more expensive than letting heat-only boilers cover the heat demand. Therefore, loosen the ties between heat and power production when there is sufficient power production from renewables to cover the consumption. Large heat storages at the CHP-plants will allow for more flexibility, and they can also be used to convert electricity to heat, if the production from variable power production is bigger than the consumption. But it should also be allowed to use efficient heat-only boilers, it should be encouraged to introduce large solar heating plants as part of the heating system etc. Flexibility is the keyword here.

4. Make the grid work for integration of variable power production
Today the dispatch of the interconnectors between provinces and between power regions are not very flexible, which is a major barrier for RE-integration. Therefore, flexible use of the existing transmission grid is a precondition for a priority dispatch of RE. The exchange of power from one province to another should be part of the daily dispatch, not determined by long-term, inflexible agreements and settlements.

Furthermore, a plan for a rapid and strong expansion of the regional interconnectors should be set-up, based on systematic assessment of the potentials for deployment of RE power production. This would ensure a much better use of the variable power production through the “smoothing effect” of larger system areas and the better relation between power production and power demand in larger regions.

Finally, it is necessary to re-evaluate the strategy for long-distance high-voltage transmission lines. Currently these lines are primarily designed for base-load operation, which creates in-flexibility both in the supply end and the receiver end of the lines. Also the long-distance transmission lines should be dispatched according to the daily needs for matching production and consumption on an sub-hourly basis.

5. Encourage demand side flexibility and promote storage technologies
The variability of the power production from wind and solar is a challenge for the integration of RE, which in the short run can be solved by the above mentioned measures. However, a more flexible use of electricity and introduction of electric storage will in the long run be part of the solution. Therefore, economic incentives for flexible use of electricity should be introduced; plans for rapid development and deployment of electric vehicles should be prepared – with incentives for flexible charging; and R&D support for long-term development of electric storage should be encouraged.

6. Introduce a national-wide power market as tool for green power dispatch
Introduction of a Chinese power market is the last of my bullet point. Not because it is the least important measure, on the contrary; a well-design power market would be the right tool to ensure the implementation of the other measures. A dynamic price-setting of power production would create economic incentives for the power generators to operate their power plants in a flexible way; it would give incentives to flexible use of electricity; and it would take care of the daily dispatch based on least-cost principles. Combined with a carbon tax (or by an efficient implementation of a carbon emission trading system) it would be sufficient to create a green dispatch. One the other hand it is clearly a long-time project to create an efficient national-wide power market, while most of the other measures could be implemented immediately or in a shorter time horizon, so there is no reason to wait for power market to start getting greener in the dispatch.

See more about renewable energy in China on


China wind power development back on track, but…..


The latest market report from GWEC is encouraging reading for the Chinese wind industry, but the main challenges for the future development are still not solved.

The new Global Wind Statistics 2013 from Global Wind Energy Council shows a global recession in the wind power development with the Chinese market as a remarkable exception. After two years with lower new installed capacity than the previous year, 2013 gave 16 GW new capacity in China, now reaching a total installed capacity of 91.4 GW wind power.

Annual installed wind power capacity in China in MW.

Annual installed wind power capacity in China in MW. Source: GWEC.

The un-official NEA target for 2013 was 18 GW and this is probably the level of new capacity NEA would like to see for the years to come for on-shore turbines. The peak in installed capacity was in 2010 with almost 19 GW, while 2011 and 2012 showed a decrease (17.5 GW and 12.9 GW).

For the Chinese wind industry this is good news. The Chinese wind manufacturers are totally depended on the Chinese market – only the biggest companies have succeeded in global activities on a small scale – and the last couple of years have been a nightmare for a number of companies with Sinovel as the most known. And a level of around 18 GW annually would give new wind to at least the biggest and most competitive companies.

But the crisis in the Chinese wind industry is probably not finished yet for several reasons.

Firstly, the main barriers for integration of wind power into the Chinese energy system have not be removed. In average more than 20% of the potential wind power production is curtailed on a yearly basis, and some wind farms experience more than 40% of the yearly production is curtailed. Needless to say that this is jeopardizing the economy of the wind farm projects if this continue. The integration issue is first and foremost a question about the right incentives for the thermal power plants to be more flexible – the cure is quite clear, but such institutional changes require a strong hand from the whole government and coordinated effort from a number of different ministries.

Secondly the Chinese government aims to gradually reduce the size of the Feed-In-Tariff, which again puts strong requirements on the future development of the wind turbines to lower the total cost of energy – both the investment cost but not least improving the reliability and reducing the operational costs.

Thirdly the requirements from the grid to the wind turbines are increasingly strong. This is necessary in order to technically integrate a larger share of wind power and also in line with the global development, where wind turbines more and more is considered as “normal” power plants with requirements or delivering different types of services to the power system. This put even more pressure on the Chinese wind manufacturers to be innovative and deliver with high quality. On the other hand – if the Chinese manufacturers can deliver to the future Chinese market they will also be able to compete on the global market to the benefit of the global development and deployment of wind power.

So let us enjoy the revival of the Chinese wind power market in 2013, but let us hope the Chinese wind turbine manufacturers and the Chinese government will be able to act quickly on the current challenges. Failure to act will be a serious threat to the future for the Chinese wind power industry and for the global wind power development as such.


Integration of RE – made simple


“Why make it complicated when it is simple” might be the motto of – the Danish Transmission System Operator, at least when it come to explain the fundamentals regarding integration of variable renewable energy. But of course the have the experience, with 55% of the electricity consumption in December 2013 delivered by wind power.

At the IRENA assembly in Abu Dhabi, Peter Jørgensen, Vice President for International Relations, gave a short, but very clear presentation of the challenges, means and the preconditions for a successful grid-integration.

The main challenges for variable RE compared to conventional power production is how to develop the energy system to maximize the value of the generation as it come. The characteristics for these RE technologies – the variability of the renewable resources, the location of the energy production – which might be far from load centres or as household connector photovoltaic, and the cost structure with large upfront investments and almost zero marginal energy costs – stresses the “old” energy system and the “old” thinking about how to run the power system and power markets.

The Danish energy system a January night with high wind power production

The Danish energy system a January night with high wind power production

In order to solve this challenge, focus should be on grid development and flexibility measures. Peter Jørgensen underlined at the presentation the fact, that investments in transmission lines are much cheaper than investments in power generation, and strong transmission grids will be able to balance RE sources in larger areas. Furthermore competitive electricity markets are necessary to ensure optimal utilization of the transmissions grid in a flexible way.

The flexibility measures includes grid codes to ensure stability, and clear price signals reflecting the system balance to incentivize dynamic response. The SmartGrid concept should be replaced by SmartEnergy to optimize RE utilization across energy sector and support price flexibility. Last but least, new operational procedures and forecasting tools are needed to ensure efficient system balancing and security of supply.

To make this happen, a political commitment and regulatory framework is a prerequisite, together with long term grid planning and a similar coherent energy system planning to ensure the optimal use of RE in all sectors. And a new paradigm for system operation is a must, ensuring the right price mechanisms for flexibility in generation and demand, and ensuring a dynamic and efficient system balancing and security of supply

Ok, implementation of means and preconditions might not be simple but a clear picture of what is needed and why, must be the starting point. And I think that Energinet’s presentation hit the nail here!

See the presentation here.


Time for more flexibility in the Chinese power system


Lack of flexibility is one of the biggest obstacles for integration of fluctuating renewable energy in the Chinese power system. The thermal power plants and the transmission grid are currently operated too inflexible, which especially in North China results in massive curtailment of wind power.

Looking more into the problems reveals both technical challenges, lack of economic incentives and regulatory issues as the main reasons for this inflexibility, which damages the further development of renewable energy in China.

Fortunately experiences from other countries show that these problems can be overcome. In Europe curtailment of renewable energy is very small, even in areas with much higher share of renewable energy that in the Northern China.

One of the secrets behind Denmark’s large share of wind power is the extreme flexibility of the thermal fossil fired power plants. Due to years of continuous effort, most of the Danish power plants have very low minimum capacity output for on-grid operation, they have fast up and down regulating capabilities, and they are able to have a quick start-up from zero to full load, compared to power plants in other countries. Establishment of a time-dynamic pricing for power purchase via a well-functioning market has been a strong motivator for this development. The dynamic pricing, with high prices when the demand is high and uncontrolled power supply is low and visa versa, send a clear signal to the power producers when to produce and when to avoid producing.


Danish experiences were presented at a CNREC-RED expert meeting on flexible power plants 4 December 2013

Danish experiences were presented at a CNREC-RED expert meeting on flexible power plants 4 December 2013

Flexibility for the thermal power plants was the topic to an expert meeting on 4 December 2013, arranged by CNREC and the Sino-Danish RED program. Experts from Denmark shared their experience in how to make coal-fired power plants more flexible. The meeting also discussed the lack of economic incentives for the Chinese power producers to operate more flexibility.

You can find more information about the meeting and the presentations from the meeting here.


Danmark 2012: 30% wind power and no curtailment at all – how is it possible?


2012 was a new record year for wind power in Denmark. Last year the wind power production in Denmark amounted to 30% of the Danish electricity consumption, while in 2011 the figure was 28,2%. This is of course good news for the global environment but due to Denmark’s small size the biggest contribution to the global environment might not be the CO2 reduction itself but the Danish showcase: It is possible to have a high share of fluctuating electricity production in the energy system without curtailment at all. And 30% is only a step towards the even more ambitious target of 50% in 2020. Right now the next off-shore wind farm is being established in Denmark – see the pictures here. (The picture below is the Danish wind farm Middelgrunden near Copenhagen on a cloudy October day in 2012).

Middelgrunden near Copenhagen

But what is the secret behind the large share of wind power, and what can China learn from Denmark?

A number of factors enables the high wind power penetration. Denmark has strong transmission lines to the neighbouring countries and access to hydro power storage in Norway. And a well functioning electricity market ensures optimal use of these interconnectors and the optimal combination of wind power and hydro power. The dynamic pricing of electricity created by the electricity market send price signals hour by hour to the producers and consumers. When the electricity production is high due to wind power and combined heat and power production (CHP), the electricity price is low; and when the wind power production is low (or zero) the price gets higher. This system also gives strong incentives for the power producers to make their thermal power plants more flexible. In facts, some of the coal fired power plants in Denmark can produce electricity and heat at a level of 10% of their maximum capacity. In China the requirements for minimum production is 50% of the max. capacity for the coal-fired power plants. All Danish CHP plants have also heat storage attached, which makes it easier to decouple heat and power production. When the electricity price is high, the CHP plants produces electricity and surplus heat can be stored in the heat storage, which basically is a large water tank. When the electricity price is low, the heat consumption is covered by the heat storage alone. And when the electricity price is very low, it can be beneficial to use electricity to warm up the water in the heat storage instead of running the thermal CHP plant. The combination of wind power, hydro power and thermal CHP plants with heat storage gives a very flexible system which is the physical explanation behind the high RE share in the Danish electricity supply.

To fully understand the Danish success of integrating wind power, you should also take into account the institutional and the “mental” framework for the electricity supply sector. In many countries – also in China – wind power is often regarded as an “add-on” to the “normal” electricity supply based on thermal power plants – fossil fuel or nuclear. The add-on RE power then is supposed to take care of its own problems, e.g. balancing the fluctuating production, and if it is not possible, then the easy solution is to curtail it, e.g. to stop the production from the wind farms, because the wind farm is causing the problem. But in Denmark, wind power is regarding as an integrated part of the electricity supply. Balancing problems is therefore a system problem, not a problem for the wind farms. This mental change in the perception of the electricity system is important for solving the integration challenges. Also the institutional set-up is important. Years ago the electricity sector was one integrated monopoly. Today the Danish grid operator (or Transmission System Operator – TSO) have been totally independent of the electricity producers for more than 12 years and it acts totally neutrally towards all power producers. Furthermore the large power producers in Denmark owns a large share of the wind power plants and integrate them into their portfolio of power plants in the daily operation. And by setting ambitious goals for the further development of RE power in Denmark (50% in 2020, 100% in 2050) the Danish government encourage both the TSO and the power producers to integrate RE in their planning process. The long term grid planning is thereby targeted at making these goal feasible, not only in Denmark but also in a European context, where the European TSO’s makes 10 years grid plans every second year.

And what are the lessons learned for China?

Firstly it is important to start considering RE power as part of the whole electricity system, not as an add-on to the thermal power system. Secondly it is urgent to setup economic incentives for flexibility for the power producers and for the use of local and regional transmission lines. Dynamic pricing is essential, but it is not necessary to introduce a complete market-setup to create this – a system with the system dispatch centres as vehicles for flexibility could be establish without a full market, like in Denmark where the electricity market evolved over a number of years, starting with more simple measures. When such economic incentives are in place, I am quite sure that the technical solution like flexible thermal power plant and heat storage at the CHP plants would develop rapidly.

Also an integrated planning process combining grid planning with planning for energy efficiency and energy supply would strengthen the integration of renewables, the development of smart grids and the use of the energy demand as part of the overall system flexibility. Maybe China could get inspiration from the European approach with the 10 year grid development plans and market studies with an even longer time horizon.

Of course China is China, and she has to develop her own solutions to the energy challenges. The Danish experiences and lessons in integration of RE can however support the analytic development of measures, methodologies and processes, which are necessary for the development of a sustainable energy system with a high share of RE in China. The Sino-Danish RED program is one example on how China and Denmark work together on such a development.


The biggest obstacle to wind power development in China


Curtailed wind power gives record loss for wind power producers in 2012. Recent estimates reveals that 20 TWh or between 20 and 30 percent of the total Chinese wind power production was curtailed in 2012, according to Qin Haiyan, secretary general of the Chinese Wind Energy Association as cited in Windpower Monthly. The curtailed electricity has the value of CNY 10 billion, and the producers have not been compensated for the loss. The curtailed electricity could lower the local and global pollution and for the society as a whole it would be cheaper to curtail the coal fired power plants instead of the wind farms. To put it simple: Curtailed wind power = more pollution + more costs + less incentives for new wind power.Jilin_wind_farm

The large amount of curtailed wind power is in my opinion the biggest obstacle for the Chinese government’s ambitious plan for wind power deployment. It is difficult for wind power developers to justify investments in new wind farms if you know that up to 40% of the annual production will not be sold. And if you are forced to establish new wind farms due to quota system or similar, you will tend to invest in cheap wind turbines with low efficiency, since high efficiency will be punished by even more curtailment.

So it is absolutely necessary to improve the situation for the wind farms quickly in order to get the benefits from wind power and encourage more investments.

Then what should be done? Well in principle the solution is straight forward: The electricity system must be more flexible and regard wind power (and solar PV) as an integrated part of the system – not as an add-on to the thermal system. Today the thermal power plants have no or few  economic incentives for being flexible, since the income is almost solely depending on sale of electricity. Also the dispatch centres should have better possibilities and incentives for a more dynamic use of interconnectors to neighboring areas. When the economic incentives are in place the technical obstacles would soon disappear – all experiences from e.g. Europe show this.

In practice it might not be as simple. It is alway difficult to change the division of benefits and costs between different stakeholders and the thermal power plants would potential have difficulties in recovering investments if they have to cut down on the number of hour they can produce during the year. But if the Chinese government want to fulfill it’s ambitions on renewable energy, a solution must be found quickly. My guess is, that this issue is on top of the agenda for the NEA this year.

PS: The picture is from a large wind farm in the North West of Jilin, one of the provinces with most curtailment.


Grid Integration of RE – lessons learnt from Europe


This week I had the pleasure to visit the International Solar Energy Center (ISEC) in Lanzhou in Gansu and give a presentation ath the 9th International Summit on Solar and Wind Energy in Western China. The presentation gives a short overview of flexible energy systems and the latest development in trans-national grid planning in Europe.

The main messages are

  1. Flexible thermal power plant and flexible operation of the electricity and heating systems are key to integration of fluctuating wind and solar energy
  2. Institutional and economical barriers are serious challenges for a flexible energy system in China
  3. European experiences from the use of visions, scenarios and market studies before more detailed assessment of new grid project could be transferred to a Chinese context
  4. The challenges regarding grid planning and grid development in Europe and China are quite similar and mutual exchange of experience and solution would be benificial.

Find the presentation here: RE_integration_July_2012


Wind energy status in China


My good friend, Jiang Liping, Vice president at State Grid Energy Research Institute, has an excellent blog with reflections on the development of energy in China. Recently she published an article which gives a status and prospects for wind energy in China. The article is written by leading wind energy experts and it gives a comprehensive overview of the development of wind energy, relevant regulation and support incentives, as well as an overview of current challenges regarding wind power integration. A must-read if you are interested in wind energy development!


My top 5 list for wind power integration in China


30 March 2012 I had the pleasure to give a presentation on integration of renewables at the 2nd Grid Integration China week 2012.

My top 5 priority action list for improving integration of renewables looks like this:

  1. Incentives for a flexible energy system: Flexible thermal power plants, Flexible use of district heating, Better use of interconnectors
  2. Good wind power forecasts integrated in the system dispatch
  3. Reliable wind turbines: Grid code, Testing and certification
  4. New transmission grids
  5. Smart grids

My main point is, that the current challenges in wind power integration in China are linked to the incentives or rather the missing incentives for integration. Neither the dispatch centre nor the power producers have sufficient incentives to do an effort for integration of the electricity from wind power plants. If such incentives were put in place it would be fairly easy to make the existing system more flexible, and no new technology development is needed to ensure integration of up to at least 20 percent wind power into the electricity system. So this is my priority no 1.

If (or when!) these incentives are in place then of course it is very important to have reliable wind power prognoses in order to be able to make the right system dispatch and prepare for the use of regulating units in the operation hour. So good wind power forecast for system dispatch is my priority no 2.

Thirdly the wind farm should be able to enhance the system security, not to lower it. Therefore appropriate grid codes and certification of the wind turbines are essential for the further deployment of wind power. Luckily China recently approved good national grid codes for wind turbines, and certification has high priority.

Fourthly development of the grid is necessary to ensure a larger share of wind power and power from renewables in general. But notice that this in not the first priority. Nevertheless, grid development is a long-term discipline, so grid planning and timely development of the grid is very important, also in the short run.

Finally development of “smart grid” concepts should be promoted. The smart grid do not need to be smart-smart, but especially with focus on the demand side flexibility and the use of electricity for transport and heating require a more advanced information flow about prices to work dynamically. In the long run, the system security would need more advanced control mechanisms to ensure the dynamic security of supply.

You can download my presentation here: RE_integration_March_2012 (2.4 MB).

The presentation gives a short wrap-up of the conclusion from the two recent reports on wind power: the China Wind Energy Development Roadmap 2050, developed by Energy Research Institute and IEA, and the report on Integrated Solution Strategies, developed by SGERI and VESTAS. And a short introduction to China National Renewable Energy Centre :-).