a tariff for localreactivepower

7/30/2019 A Tariff for LocalReactivePower

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Why do we need

a tariff, contd.? The CAISO load and generation power factorspecifications are not based on local powersystem requirements nor do they accommodate(or compensate) differences in reactive powerdelivery capability.

Having the distribution substations at a slightlyleading PF would improve capacity on thetransmission system.

Providing local supplies of dynamic reactivepower would reduce losses, increase capacity,and increase the margin to voltage collapse.

MVARs

HighImpedanceMountain

Reactive power cannot be effectively

transmitted across long distances due to

high I2X losses.

Transmitting Reactive Power


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Distribution LevelDynamic Reactive

Power May BeProvided by: Engine generators

equipped with 0.8 PFgenerators with exciterscapable of voltageregulation.

Fuel cells, photo voltaicsystems and microturbinesequipped with inverterscapable of operation atreduced PF and voltage

regulation control. Adjustable speed motordrives with active frontends controlled to regulatevoltage.

Generatorand

InverterReactivePower

Limits


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Distribution SystemsShould Properly Regulate

their Own Voltage

The Root Cause Analysis Review Team for the July1999 Low Voltage Condition performed a detailed studyof unpredicted low voltage conditions. The report statedthat VARs from the transmission system should not beused to support distribution voltage.

The distribution system could present a slightly leadingpower factor to the transmission system during times ofsystem stress. This practice would translate to less

reactive support being required from generators andmore efficient system operation.

Customers would also improve their own power qualityand expand the margin to micro voltage collapse.

Costs and SavingsUsing an Analysis ofa Hypothetical Circuit

We find that if the inverters of photovoltaic systems orthe generators of combined heat and power systemswere designed with capability to supply dynamic reactivepower, they could do this quite economically, perhaps ata cost of $5 per kVAR on an annualized basis.

The savings from the local supply of dynamic reactive

power would be in reduced losses, increased capacity,and decreased transmission congestion. The netsavings may be as much as $10 per kVAR on anannualized basis.

A reasonable purchase price or tariff may be somewherebetween these two numbers.


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Distribution Utilities TypicallyRely on Capacitors and Slow

Tap Changers to SupplyReactive Power

Caps are cheap, the annualized net present value, orCapacity Cost, is $2.8/kVAR for reactive powersupplied from distribution capacitors.

However, this is only for static service.

Dynamic reactive power can improve customervoltage regulation, prevent damaging overvoltages,

and help in energy conservation. However, utilities are phasing out synchronous

condensers because of the losses and maintenancecosts.

How Can We Quantify the

Savings for Customer BasedDynamic Reactive Support? The supply of reactive power at the load

will reduce the circuit current. Since thereal power loss is I squared R, the circuitloss will be reduced.

The transmission line flow will be reduced.This is equivalent to having a distributionor transmission line with bigger thermalcapacity rating. The saved line capacitymay be converted to savings for importingmore inexpensive power using this line,compared with dispatching expensive localunits near the load.

An increase in power factor from 0.9 to0.95 can increase the maximumtransmission capacity stability limit - by

15%. The saved line capacity may beconverted to savings for importing moreinexpensive power from this line, the entitythat benefits is the local distributioncompany.

Total annualized savings for a hypotheticalSan Francisco distribution circuit are$2.50/kVAR.


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Total dollar valueof local reactive

supply on anannual basis.

The average gross voltage support rate was found bya survey to be about $4.50/kVAR year annually.

The total value for our hypothetical circuit includingreduced losses, impact to net import and voltagesupport service is then $7/kVAR year.

Annualized CostEstimate for ThreeAlternate Supply

Methods

$19/kVAR to back fit an Active Front Endon ASDs

$5/kVAR (Oversizing the Generator on the

Engine Generator) $6/kVAR (Oversizing the PV inverter)


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What Is an Appropriate

Payment on anAnnualized Basis?

It would be too complicated to attempt to contract with every singleDistributed Energy Resource based on their cost of providingreactive power. One of the biggest complicating factors is thechanging cost of inverters; it is predicted that PV inverter prices aregoing to drop significantly soon. It would be much better to contractbased on a uniform price paid to all distribution company customers.

If adequate dynamic reactive reserves already exist in an area, moredo not have to be purchased. If dynamic reactive reserves areneeded, they can be contracted for at the fixed rate that is known tobe economical for the distribution system operator, but which will stillbe above the cost of supply for the customer, and will help amortizethe cost of his photovoltaic or combined heat and power system.

Midpoint between the lowestcosts and estimated value wouldbe about $6/kVAR.

In Conclusion

There is a growing need for local dynamic reactive power to expandthe margin to voltage collapse, reduce distribution losses, and evensupply reactive service at the transmission substation.

This could be done using a local inverters controlled to a voltageschedule supplied by the distribution company.

At present, using an analysis of a hypothetical circuit, we find thebenefits to sometimes outweigh the costs.

Utilities in need of more dynamic reactive supply on a circuit couldcontract with customers, at a fixed rate, to supply this need asrequired.

As the cost of inverters comes down, this practice could saveenergy, release capacity and enhance reliability, as well asproviding an additional revenue stream for customers consideringalternative energy resources.

a tariff for localreactivepower

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