Solar PV Integration Cost Variation due to Array Orientation and Geographic Location

Background: As solar photovoltaic (PV) technology reaches price parity in the Electric Reliability Council of Texas (ERCOT) and other electricity markets, it is important to understand the cost of integrating it into the electric grid. This study shows how the orientation and geographic location of large PV arrays affects wholesale energy prices, generator dispatch, emissions production, and operating costs in the ERCOT market. Methods: A west-facing PV array located in west Texas, an east-facing PV array located in east Texas, and a south-facing PV array located in central Texas were selected to illustrate the bounds of PV generation in ERCOT. An hourly generation curve for the entire year was created for each PV array. These generation curves were utilized by a unit commitment and dispatch (UC&D) model of ERCOT that optimizes the hourly dispatch of each power plant in ERCOT over the entire year to minimize total system cost. By comparing the results of these simulations, we show how net load flexibility requirements, wholesale energy prices, fuel mix, emissions production, and other market characteristics change depending on the orientation and geographic location of solar PV resources. Each scenario is also compared with a ‘no solar’ scenario representing the 2011 ERCOT marketplace, which was used as the test year for the analysis. Results: The total operating costs for the west, south, east, and no solar simulations were $7.90, $7.94, $7.98, and $8.81 billion, respectively, with west-facing solar creating the greatest reductions to overall system cost. West-facing solar had a higher average annual ramp-up rate (4.6 GW/hr) and volatility (32.6 GW/(hr-day)) than south-facing solar (4.1 GW/hr and 28.3 GW/(hr-day)). It also utilized more coal (124,100 GWh) and natural gas combined cycle (107,300 GWh) generation and less natural gas boiler (2,350 GWh) and open cycle gas turbine (3,440 GWh) generation than south-facing solar (123,500; 106,800; 3,050; and 3,700 GWh). All three scenarios reduced emissions. Conclusions: The results suggest that, even though west-facing solar introduced more ramping and volatility to the electric grid, it yielded lower operating costs overall. This phenomenon is explained by observing the utilization of existing generation resources that meet the balance of the load. When compared to the more costly south-facing solar, west-facing solar used more of the inexpensive coal and combined cycle generation and less of the expensive gas boiler and open cycle generation. Solar PV integration costs can be categorized as “increased flexibility requirements” and “underutilization of existing generation.” The results suggest that west-facing solar has higher flexibility costs and lower generator utilization costs than south-facing solar, and that the lower generator utilization costs were more influential in determining the total operating costs of the overall system.