Technological impact of Non-Conventional Renewable Energy in the ...

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Abstract- Renewable energy has had a steady growth in power systems worldwide. .... renewable energy. This law, known as Short Law 1, and Law 20257 have.
Technological impact of Non-Conventional Renewable Energy in the Chilean Electricity System Juan D. Molina C. GSM Victor J. Martinez A. GSM Hugh Rudnick, Fellow Department of Electrical Engineering. Pontificia Universidad Católica de Chile. [email protected] [email protected] [email protected] Abstract- Renewable energy has had a steady growth in power systems worldwide. The high uncertainty about what type of renewable technology meets technical and economic variables of the energy markets and what could be the participation in the energy matrix are important long term energy planning challenges that need to be identified and evaluated. This work assesses different scenarios of future development of the Chilean electricity matrix and the technological contribution of renewables. They are formulated within the Chilean Central Interconnected System and determine the evolution of technological diversity variables, costs, CO2 emissions and energy injection. The scenarios illustrate the need to strengthen the transmission system and the importance of improving and / or incorporating mechanisms to reduce dependence on fossil fuels and the maximization of renewable resources in Chile. Future work will establish the impact of intermittent renewable technologies on power system operation.

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INTRODUCTION

nergy strategic analysis has transformed into a essential task for sustainability country assessment, particularly linked to security supply energy and generation matrix diversity. The energy supply is a complex subject with a wide range of political, economic and environmental variables. The need exists to assess energy planning scenarios, both on supply and demand of energy, as well as the supply technologies to consider and balance. Basically, the main objectives focus on: reducing uncertainty through the availability of energy and primary sources, increase efficiency in the power system and consider technical and economic aspects that impact the social, political and environmental dimensions. Energy strategic analyses have used various computational tools. The applications are classified by type of methodology and analysis of the energy sector, considering whether they are simulation models and / or optimization algorithms [1]. In relation to the type of analysis of variables, there are top-down models, which use aggregate data to make predictions and do not explicit technologies, using macroeconomic variables such as Gross Domestic Product (GDP). Furthermore, there are bottom-up models, that use disaggregated data, such as detailed description of technologies and their costs, allowing a better assessment at that level and the option to evaluate the impact of renewable technologies [1]. In the context of energy policy assessments worldwide, there has been an increase in the support of renewable energy. Latin America has not been unconnected with this development, important if one considers that the

region has presented a rate of 5% growth in energy demand [2, 3]. In particular, Chile has developed a mechanism for renewable energy, defining an obligatory quota of 10% of the energy sold in 2024. Discussions develop on which would be the most appropriate technologies and how they will affect energy supply, the power capacity required, the impact on the environment [4] and finally, how to evolve to a cleaner energy matrix, eventually 100% renewable [5]. This paper makes an assessment of energy scenarios in the Chilean Central Interconnected System (CCIS). Four possible scenarios are assessed and their implications for supply variables (energy mix), investment and operating costs, technological diversity, CO2 emissions and the injected power capacity into the power system. Section II summarizes the Chilean energy policy, the Central Interconnected System and the development of renewable energy in Chile, as well as the projection of technologies to be installed. Section III assesses the proposed scenarios regarding the evolution of the energy matrix. Basically, it considers the system expansion plan and the guidelines of energy policy on renewable energy and the incidence of large blocks of wind, geothermal and solar energy technologies. Finally conclusions are presented in Section V. II. ENERGY SYSTEM OF SIC The Chilean electricity market is mainly composed of four activities: generation, transmission, distribution and end users (regulated and free customers). At present, the CCIS covers from Taltal to Chiloé with 9400 MW installed capacity at December 2008. This represents 71.4% of the total installed capacity in the country. A. Energy Policy The Chilean energy policy essentially lets the market interact to determine which energy technologies develop, according to a competitive framework where investors face unregulated prices. In electricity, a spot marginal price model is used, with contracts of generators with large consumers and distribution companies. The present government, reacting to a severe electricity supply crisis that started to develop from 2004, has been orientating energy developments, by starting the analysis of

different strategic options, considering diversification of sources and suppliers, minimizing environmental impacts, strengthening energy efficiency programs and technology development, especially regarding alternative energy technologies [6]. The policy seeks efficient allocation of resources by promoting free competition, institutional strengthening (establishment of the Ministry of Energy), improving management capacity, strengthening of international relations and the promotion and encouragement of the energy efficiency. Besides, it has supported the creation of mechanisms for increasing non-conventional renewable energy (NCRE, which encompasses all renewable, except large hydro) and feasibility studies for nuclear power as an option for diversifying the energy matrix and the strengthening of energy integration. Thus, the policy seeks to contribute significantly to the efficiency (economic and environmental) through energy availability at lower cost, considering security of supply, to exploit complementarities in supply and demand. This policy foresees a change in the energy matrix, particularly in the electricity sector, where energy efficiency becomes an important player, accounting for nearly 20% reduction of the additional energy requirements for the period 2008-2020, with NCRE representing about 20% of the increase in coal supply [6]. B. Renewable technology The electricity business in Chile is governed by different regulatory statements. Mainly, with Law 19940 of 2005 a thrust was given to the incorporation of non-conventional renewable energy. This law, known as Short Law 1, and Law 20257 have defined NCRE as including: biomass (organic and biodegradable), geothermal, wind, solar (solar concentrators and photovoltaic), mini hydro (installed power