Developing Smart Grid Technology for Efficient Utilization of Renewable Energy in China

Hongliang Y H li Yang East Asia Department Asian Development Bank

Contents
Challenges in renewable utilization Smart Grid: International practices p Smart Grid in China Ongoing ADB-SGCC Smart Grid TA ADB SGCC International Collaboration

Electricity consumption growth 2007-50 2007 50

Electricity is the fastest-growing component of energy demand. El t i it i th f t t i t f d d

Ratio of renewable generation of electricity

The future electricity supply will need to accommodate a much higher proportion of renewable energy.

Rationale for wind and solar energy

Shares of Carbon Reductions in Power Sector by 2050

Source: ETP BLUE Map Scenario (IEA , 2008).

Challenges on Wind Utilization in China

Targets: by 2020 15% of total primary energy from renewables (i e 2020, (i.e. for wind 150 /200 GW ); The momentum of renewables may be impeded by challenges (e.g. increased demand for adequate spinning reserve capacity)

(Xin, 2010)

Challenges on Wind Utilization in China

Unevenly distributed renewable resources Disharmony between renewable development and grid expansion

(Xue, SGEPRI, 2010)

10GW-Scale Wind Power Bases

Security Concern: Jiu Quan Feb 24 Fault Feb.24

Event: Qi E t Qiaoxi Wi d Farm, 35 kV i Wind F three-phase short-circuit fault Impact: 598 wind u ts d op out, pact d units drop-out, total capacity 840 MW, frequency down to 49.854Hz. Lessons learned: as per SERC SERC, Insufficient understanding on large scale wind integration wind turbines lack of lowvoltage-ride-through capacity low construction quality Insufficient security management system

Security Concern: Scotland April 5/6 Problem y p

Event: high winds and heavy rain overnight on 5 and 6 April produced more energy than the grid could use Impact: 900,000 paid to halt the turbines Lessons learned: grid management problems posed by the variability of wind greater energy storage facilities and greater interconnection with EU grid are needed. d d
Source: BBC News

Nordic Electricity System y y

Fact: wind reaches 20% of Danish market Lessons learned: Significant interconnection between countries Well functioning market system

Security Concerns: Possible Solutions

Ultra high voltage (UHV) transmission channels - balancing electricity across a much-wider region Better forecasting systems for renewables, particularly wind - making the intermittent wind more predictable; - help reduce the cost for spinning reserve; p p g ; Better technical performance of renewable(wind) generators (i.e. low voltage ride through) Smart metering (i.e. making the demand flexible as well) Large energy storage capacity (i e large pump storage electric (i.e. pump-storage, vehicles)

Smart Grid: what ADB thinks

Smart Grid: a grid able to intelligently manage d S t G id id bl t i t lli tl demand and supply d d l across the electricity value chain through two-way communications.

Source of picture: IEA, 2010

Smart Grid: what ADB thinks

Is there one-size-fits-all solution for Smart Grid? No
Smart grid must fit the specific context Clear long-term vision Political consensus Government leadership Stakeholders engagement Successful business model

Smart Grid: Technology Areas

Source: IEA, 2010.

Smart Grid in China: plan

State Grids plan: a strong smart grid by 2020
Phase 1: Planning and pilot (2009-2010) Ph Phase 2 C 2: Construction (2011 2015) t ti (2011-2015) Phase 3: Improving and optimizing (2016-2020) - enable significant improvements in resources allocation
- improve the operational efficiency

2010
Piloting Building Improving

Smart Grid
Leading

Ongoing ADB SGCC Smart Grid TA ADB-SGCC

Strong and clear consistency in strategy between both sides The TA will address key challenges in the SGCCs Smart Grid development plan

First TA of ADB to promote smart grid development

Provide key enabling conditions for larger renewable utilization y g g Help PRC reduce CO2 emissions

Ongoing ADB SGCC Smart Grid TA ADB-SGCC

TA outcome: Improved capacity of renewable integration in the SGCC. TA outputs:

impacts for accommodating more renewable A Assessing the possibility of conducting intelligent DSM through smart i h ibili f d i i lli h h metering and related costs

A Smart Grid road map for a regional grid Evaluating the economic rationale, financial viability, and environmental

Updated technical standards for the renewable integration Optimizing existing technical standards Short-term day-ahead wind power forecasting systems
Upg ad g existing day-ahead Upgrading e s g day a ead wind power forecasting systems d po e o ecas g sys e s

Capacity building and information dissemination

Smart Grid: opportunity for all

Smart grids are essential to achieve shared goals for energy security, economic growth, and climate change mitigation mitigation. Market alone can not ensure a successful deployment of smart grids. The deployment of smart grids provides an opportunity to link interests of all stakeholders together.

Source: IEA, 2010.

Policy Suggestions: renewable energy

Market-oriented electricity reform to enable flexibility Deep trade among regional electricity markets
Timely investment in flexible generation Responsive DSM through smart metering Investment in storage (e.g., pumped hydro, EV) Mechanisms i t M h i internalizing external costs ( li i t l t (e.g. carbon t ) b tax)

Long term strategic policy design Considering renewables as an integral part of power system
evolution, rather than an addition Harmonization between renewables and grid expansion G Geographic hi smoothing of variable output of renewables thi f i bl t t f bl

ADBs Role in China

ADB Operational Priorities in Energy
Supports the Governments 12th Five-Year-Plan priorities to promote the development of low carbon energy technologies New and Renewable energy Technology (e.g. Smart Grid, offshore wind, solar PV, CSP) Energy efficiency and emission reductions Clean coal technologies (e g IGCC) (e.g. Regional cooperation & energy security

Future Collaboration Looking h d L ki ahead

Concessional loans of ADB can be used to support pp commercial-scale demonstration projects (i.e. UHV transmission, energy storage, smart metering, smart dispatching, offshore wind, solar PV, CSP). Technical assistances of ADB can be used to conduct policy and regulatory studies.

Thank you for your attention Questions & comments welcome Q ti t l

For more information, please email: Hongliang Yang hyang@adb.org Asian Development Bank