Virtual Power Plants: Replacing Megawatts with Negawatts

Editor in chief TERESA HANSEN

In the first feature story, “Virtual Power Plants Set to Potentially Change Power Structure,” Senior Editor Kathleen Davis explains well the concept of virtual power plants. She points out that the idea is not new, but is gaining recognition as a viable smart grid-enabled feature as more renewable energy sources are added to the generation mix and energy efficiency and demand response technologies grow.

Technology advancements play a big role in propelling virtual power plants from a concept to a reality, but the commitment by utilities to reduce their carbon footprints (some are volunteering to do so and some are being forced by regulations) also plays a role in making virtual power plants a reality.

I recently wrote a feature article for Electric Light & Power magazine, a sister publication to POWERGRID International. The article highlighted the top 20 coal-fired and nuclear power plants based on heat rate, capacity factor and megawatts generated in 2009. The information for the annual article comes from data electricity generators submit to the Energy Information Administration. One interesting statistic was a 12 percent decrease in megawatt hours generated by all reporting coal plants in 2009 compared to 2008. The gentleman who analyzes the data and creates the tables for me each year attributed the decrease in coal generation partly to the recession and partly to the fact that coal units are being dispatched less. They are being displaced by cleaner gas-fired plants and, in some cases, wind generation, he said.

Even without a climate change bill limiting carbon emissions, which probably won’t be passed in the next two years, electricity producers are shutting down their less efficient, dirtier coal units. When I compiled my stories on Nov. 22 (the same day I’m writing this commentary) for the weekly video on the POWERGRID International and Electric Light & Power website, I saw evidence of this trend–three of the five stories mentioned utilities’ shutting down coal-fired power plants.

FirstEnergy Corp. is canceling its plans to repower two units with biomass at its R.E. Burger Plant (312 MW total) and instead permanently will shut down the units by Dec. 31. It cited weak electricity prices.

Calpine just bought nearly 2,000 MW of generating capacity in Delaware and committed to use natural gas as the primary fuel source at the Edge Moor Energy Center, which includes 252 MW of capacity previously fueled by coal.

And Exelon, in an effort to reduce its carbon footprint, will retire four Pennsylvania fossil units with 933 MW of capacity.

This capacity must be replaced or the demand for it must be eliminated. Smart grid technology that will allow distributed generation to be added to the grid while demand response and energy efficiency technologies shed load, creating a virtual power plant, is a plausible, clean, and probably cheaper, alternative to the real thing. Certainly, brick and mortar power plants, including coal-fired plants, will be built to keep pace with demand, but virtual power plants also will have a place in the future electricity industry.

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