Power Sector Modeling 101

Erin Boyd

Department of Energy – Office of Energy Policy and Systems Analysis

erin.boy[email protected].gov

DOE’s Technical Assistance Website

www.energy.gov/ta

Power Sector Modeling 101

Presentation Description – DOE Power Sector Modeling 101

With increased energy planning needs and new regulations, environmental agencies, state energy

offices and others have expressed more of an interest in electric power sector models, both for

(a) interpreting the results and potential applications of modeling from other groups, and (b)

informing future modeling efforts a state air agency may want to initiate. This presentation covers

the basics of power sector capacity expansion modeling, and briefly touches on other types of

modeling and analytical tools available to provide data on the electric power system. Capacity

expansion models simulate generation and transmission capacity investment, given assumptions

about future electricity demand, fuel prices, technology cost and performance, and policy and

regulation.

Capacity expansion modeling topics covered in this presentation include:

• typical model outputs,

• needed model inputs,

• types of questions these models are well suited to answer and those they are not,

• key considerations when selecting a model, and

• key considerations when comparing model results or designing modeling scenarios.

For more information on technical assistance resources available to state, local and tribal officials,

visit DOE’s Technical Assistance website at www.energy.gov.ta, or submit a request at

TechnicalAssistance@hq.doe.gov.

Overview

1. Power System Questions

2. Model Types

• Data and Analysis Tools

• Capacity Expansion Models

• Production Cost (Grid Operations/Unit Commitment and Dispatch) Models

• Network Reliability Models

3. Summary

Key Consideration: Identify the question(s) you want to answer, and

then pick the tool that will most effectively provide this information.

(As opposed to picking a tool, and then finding out its not the

appropriate resource to provide the information you need.)

Examples of Power System Questions

Data and Resource Assessment

What are the local wind and solar resources? How much available natural gas

capacity is in the region? What is the cost of avoided/saved energy consumption?

Generation and Transmission Capacity Expansion

How to plan a resource portfolio for the future (i.e., generation, retirements)?

What type of generation should be built to meet demand? How much of it? Will

it necessitate development of new transmission capacity? How does the optimal

system change with constraints on emissions, or with local economic

development goals? How can the system be optimized to deliver reliable power

at least-cost under specified environmental constraints? What are the costs, rate

impacts, and welfare implications of alternative power sector policies or

regulations? What are the key drivers of the system?

Generation and Transmission System Operation

Given a generation and transmission system what is the lowest cost way to

operate the system while maintaining reliability under uncertainty and meeting

other types of constraints (e.g., emissions)?

Power System Questions

Network Reliability

Will the transmission system work under periods of high load? Will the system

be able to remain stable after a loss of a large power plant? Will a loss of

transmission line or power system cause instability and cause individual

generators or sections of the network to disconnect from the rest of the grid?

Model Types

1. Data and Analysis Tools – generally accessible

2. Capacity Expansion Models

3. Production Cost (Grid Operations/Unit Commitment and Dispatch)

Models

4. Network Reliability Models

Model Types

1. Data and Analysis Tools – generally accessible

2. Capacity Expansion Models

3. Production Cost (Grid Operations/Unit Commitment and

Dispatch) Models

4. Network Reliability Models

Requires expert modeler – to manage inputs,

run the model, and interpret the outputs

8
Data
• Power System Tracking - capacity, generation, fuel use, fuel prices, electricity 
price, electricity consumption, energy efficiency savings, policies (e.g., state 
renewable portfolio standards, state energy efficiency policies)
• Resource Assessment - spatially and temporally explicit assessment of renewable 
energy resources
• Key Resources 
• U.S. Energy Information Agency (EIA)
• Database of State Incentives for Renewables and Efficiency (DSIRE)
• DOE's State and Local Energy Data (SLED)
• National Electric Energy Data System (NEEDS)
• EPA’s Emissions & Generation Resource Integrated Database (eGRID)
• EPA’s Air Markets Program Data (AMPD)
• National Renewable Energy Lab’s Report - Estimating Renewable Energy Economic 
Potential in the United States
• ABB (ASEA Brown Boveri) Velocity Suite
• SNL Energy
Data and Analysis Tools (1 of 2)
Zero Cost

Data and Analysis Tools (2 of 2)

Analysis Tools: spreadsheet tools or simple calculators that allow users to conduct

high-level gross analyses of the power sector

• EPA's AVoided Emissions and geneRation Tool (AVERT) - estimates the emissions implications

of energy efficiency measures and new renewable generation capacity

• ACEEE’s State and Utility Pollution Reduction Calculator Version 2 (SUPR 2) – 19 different

policies and technologies to choose from to build a compliance scenario to EPA’s Clean Power

Plan, including energy efficiency, renewable energy, nuclear power, emissions control, and

natural gas.

• Synapse's Clean Power Plan Planning Tool (CP3T) and MJ Bradley's & Associates CPP

Compliance Tool - both Excel-based spreadsheet tools for performing first-pass planning of

statewide compliance with EPA's Clean Power Plan

• Advanced Energy Economy (AEE) State Tool for Electricity Emissions Reduction (STEER) - an

open access integrated resource planning model that constructs a merit order for dispatch

from generator-level cost data and simulates generation based on least-cost strategies

(currently available for PA, MI, AR, VA, and IL (more will be forthcoming).

These analysis tools are free and publicly available.

Capacity Expansion Models

• Capacity expansion models simulate generation and transmission capacity

investment, given assumptions about future electricity demand, fuel prices,

technology cost and performance, and policy and regulation

• What mix of generators should we build to meet load?

• Does a policy affect cost of service regions and competitive regions in different

ways?

0 2000 4000 6000 8000

1000

2000

3000

4000

5000

6000

7000

Cumulative Hours at Load

Load (MW)

Baseload

Intermediate

Load

Peak Load

Capacity Expansion Models

Typical Outputs

• Annual generation, generation and transmission capacity builds/retirements,

emissions, fuel consumption, electricity prices, credit/allowance prices

Capacity Expansion Models (1 of 2)

• Examples of Capacity Expansion Models:

• National-Scale: National Energy Modeling System (NEMS), Regional Energy

Deployment System (ReEDS), Integrated Planning Model (IPM), Haiku, MARKAL

(MARKet Allocation)

• Utility-Scale: Resource Planning Model (RPM), Aurora, System Optimizer,

Strategist, PLEXOS

• Typically have higher spatial and temporal resolution

• Often used for Integrated Resource Plans (IRPs)

• In addition to having staff or paying an expert to run these models, the

commercial models also require a licensing fee

Capacity Expansion Models (2 of 2)

• What do these models do particularly well?

Examine the impacts of power sector policies (or alternative technology/fuel

trajectories) on the generation and capacity mix in the mid- to long-term

• What don't they do?

Many do not have chronological unit commitment (i.e., every hour of the year

chronologically); some use aggregate (model) plants for dispatch; transmission

and power flow are a stylized representation (pipe flow or DC)

• What kinds of questions/analyses can the model answer/address?

Quantifying the impacts of environmental policies on generation and capacity?

What are the cost implications of alternative pathways to a low greenhouse gas

emissions future? How will alternative future prices of natural gas impact

capacity investment? What is the change in consumption and expenditures?

What are the efficiency and distributional effects of various policy designs?

Capacity Expansion Model Capabilities - Key Considerations in

Model Selection (1 of 2)

• Regionality

• Geographic scope (state, regional, national)

• Cost-of-service vs. competitive regions

• Temporal Resolution

• Time of day, Seasons

• Time Steps

• Building new capacity, dispatch

• Time Horizon

• Near-term: 2015-2020, Long-term: 2015-2050

• Representation of Generating Units

• Individual Plants or Model Plants

• Representation of capital costs and other production costs

• Representation of Transmission and Associated Constraints

• Pipeflow or DC Powerflow; Individual transmission lines or aggregated

Capacity Expansion Model Capabilities - Key Considerations in

Model Selection (2 of 2)

• Representation of Renewable Energy (RE)

• RE technologies represented in the model

• Underlying resource dataset – spatial and temporal resolution

• Accessibility cost (connecting RE resources to load)

• Accounting for variability and uncertainty in generation (e.g., representation

and treatment of curtailments and capacity value of RE technologies)

• Consideration of other parameters (e.g., electric power sector model vs.

economy wide model, representation of environmental constraints)

Capacity Expansion Model Analyses- Key Considerations when

Comparing Model Results or Designing Modeling Scenarios (1 of 2)

• Input Assumptions

• Fuel prices (exogenous or endogenous)

• Technology cost and performance assumptions: e.g., capital cost, fixed and variable O&M

costs, capacity factors (exogenous or endogenous)

• Constraints on deployment or use of specific technologies

• Representation of Electricity Demand

• Baseline

• Exogenous or endogenous; demand elasticity

• Energy efficiency representation

• Cost/Benefit Metrics

• Welfare, total cost, allowance/credit prices

• Distributional impacts - consumer/producer surplus, regional cost metrics

• Electricity Bills and Prices

• Competitive vs. cost-of-service

• Wholesale vs. retail

Capacity Expansion Model Analyses- Key Considerations when

Comparing Model Results or Designing Modeling Scenarios (2 of 2)

• Retirements

• Exogenous or endogenous

• Detailed Representation of Policies

• Ex: Carbon Policies

• Rate vs. mass vs. price

• Covered sources

• Total emissions vs. covered emissions

• Treatment of nuclear plants, existing renewables, biomass, etc.

• National uniform vs. patchwork policy

• Trading parameters

• Over what time period are constraints applied (annually, compliance periods, etc.)

• If applicable, how is auction revenue used?

• If applicable, are allowances freely allocated and to who? On what basis (historic or

updating)?

Energy Efficiency (EE) in Capacity Expansion Models

• EE is an energy planning resources that can reduce energy

bills and lower regulatory compliance costs

• EE representation in capacity expansion models

• Endogenous - rebates

• Exogenous

• Resources: EE Potential studies and EERS Goals

Source: EIA Energy Today 10/23/14; 2013 Annual CO

Analysis

Production Cost (Unit Commitment and Dispatch) Models

• Simulate operation of a specified power system over a relatively short period

compared to Capacity Expansion Model (1-week to 1-year), but at higher temporal

resolution (hours to 5-minutes)

• What is the least cost dispatch of a complex system of interconnected generators

to reliably meet load in every hour of the day at every location?

• Capacity Expansion Output -> Production Cost Input

Production Cost (Unit Commitment and Dispatch) Models

• Typical Outputs: Sub-hourly unit level generation, powerflow, locational

marginal prices, emissions, fuel consumption, loss of load, ancillary service

prices (prices of ancillary services to balance transmission system),

curtailments

Production Cost (Unit Commitment and Dispatch) Models

• Examples of Production Cost Models:

PROMOD, GE-Maps, PLEXOS, GridView

• What do these models do particularly well?

Simulate detailed (hourly to sub-hourly) operation of a given system; Assess

resource adequacy and other aspects of reliability of a system; Analyze the

impact of changes in the system (e.g., retirement/addition of capacity) on system

operation; Assess transmission congestion and locational marginal prices;

Describe the daily pattern of emissions

• What don't these models do?

Build/invest in new generation or transmission capacity; Typically cannot model

the entire US simultaneously - regional focus is required; Do not address all

aspects of reliability

• What kinds of questions/analyses can the model answer/address?

What are the operations, emissions, and resource adequacy impacts of

retirement of coal or nuclear units in a given region? What is the maximum

potential for redispatch from coal steam units to NGCCs? What is the value of

storage, demand response, and solar power to the power system?

Network Reliability Models: AC Powerflow and Dynamics

• Perform “deep-dive” simulations of the transmission network to address

specific situations. Simulates very short time periods (~ 30 sec to 1 min).

Analysis includes:

• AC Powerflow: Simulates the AC transmission network to check operational

feasibility (steady state)

• System Dynamics: Simulates dynamic events in the power system to examine

reliability under fault conditions

• Simulation of contingency events to examine frequency response Example

output: frequency nadir (lowest frequency), settling frequency

• Simulation of transient stability

• Will generators remain

synchronized with voltage spike?

(e.g., lightening)

• Production Cost Output/Input <-->

Network Reliability Input/Output

Network Reliability Models: AC Powerflow and Dynamics

• Network Reliability Models are typically run by ISOs/RTOs, reliability

organizations, large utilities, and consultants

• Examples: Positive Sequence Load Flow (PSLF), Power System Simulator for

Engineering (PSSE)

• What do these models do particularly well?

Detailed simulations of the transmission network including dynamic events that

can occur in seconds (and cause big problems); these models aren't run on a day

to day basis – they are only run to examine significant changes to an existing

system

• What don't these models do?

Anything related to system operation in “economic” time frames (typically more

than about 30 seconds)

• What kinds of questions/analyses can the model answer/address?

Will the system remain able to maintain frequency after retirement of large

synchronous machines with set generation and transmission mix? Will the system

maintain reliability to respond to a voltage swing or other transients?

What Aspects of Reliability do Different Types of Models

Address?

Model Type Generator

(Resource)

Adequacy

Flexibility

Requirement

Transmission

Adequacy

Generator

Contingencies

Transmission

Contingencies

Frequency

Stability

Voltage

Stability,

Voltage Control

Capacity

Expansion

Often Somewhat/

depends

Typically No No No No No

Production

Cost (Unit

Commitment

and Dispatch)

Yes Yes Partially Somewhat Somewhat Somewhat No

Network

Reliability

(AC Power

Flow,

Dynamics)

No No Yes Yes Yes Yes Yes

Summary

• Wide range of tools/models to address a wide range of questions

• Within a particular type or class of model or tool, different models have

different strengths and weaknesses

• Selection of a specific model or tool needs to be closely tied to the analytical

application

• Many assumptions to consider when comparing results from different models

or modeling analyses

• Results of a modeling analysis need to be interpreted in the context of the

limitations of the model

• Questions?

Erin Boyd

erin.boy[email protected]v

DOE Technical Assistance Website

www.energy.gov/ta

Appendix

Key Data Resources (1 of 2)

Key Data Resources

• U.S. Energy Information Agency (EIA) - independent agency that collects, analyzes, and

disseminates independent and impartial energy information

• Database of State Incentives for Renewables and Efficiency (DSIRE) – national and state

incentives and policies that support renewable energy and energy efficiency

• DOE's State and Local Energy Data (SLED) - Get basic energy market information that can

help state and local governments plan and implement clean energy projects, including:

Electricity generation; Fuel sources and costs; Applicable policies, regulations, and

financial incentives

• National Electric Energy Data System (NEEDS) - database contains the generation unit

records used to construct the "model" plants that represent existing and

planned/committed units in EPA modeling applications of IPM

• EPA’s Emissions & Generation Resource Integrated Database (eGRID) - data on the

environmental characteristics of almost all electric power generated in the United States.

These environmental characteristics include: air emissions for nitrogen oxides, sulfur

dioxide, carbon dioxide, methane, and nitrous oxide; emissions rates; net generation;

resource mix; and many other attributes

Key Data Resources (2 of 2)

Key Data Resources

• EPA’s Air Markets Program Data (AMPD) – tool which allows users to search EPA data to

answer scientific, general, policy, and regulatory questions about industry emissions

• National Renewable Energy Lab’s Report - Estimating Renewable Energy Economic

Potential in the United States – geographic economic potential for renewable energy

technologies

• ABB (ASEA Brown Boveri) Velocity Suite – commercial data set that includes fuel

production, costs, electricity generation and capacity, market data, and more

• SNL Energy – commercial energy information that integrates news, data and analytics in

real time on a Web-based platform. Access to comprehensive financials, breaking news,

proprietary regulatory research, market pricing and fundamentals of supply and demand

What Aspects of Reliability do Different Types of Models

Address?

Model Type Generator

(Resource)

Adequacy

Flexibility

Requirement

Transmission

Adequacy

Generator

Contingencies

Transmission

Contingencies

Frequency

Stability

Voltage Stability,

Voltage Control

Capacity

Expansion

Often

Somewhat/

Depends

Typically No

No No No No

Production

Cost (Unit

Commitment

and

Dispatch)

Yes

Yes Partially

Somewhat

Somewhat Somewhat

Network

Reliability

(AC Power

Flow,

Dynamics)

No No Yes Yes

Yes Yes

Yes

Footnotes for Reliability Table (slide 1 of 2)

a) Defined as having adequate capacity to meet demand measured by loss of load probability in each

time interval or cumulative loss of load expectation. Considers resource availability in each time

period but typically does not measure flexibility, or the ability to ramp from one state to another

b) Defined as having adequate generator flexibility to ramp from one demand period to another

c) Defined as not violating transmission thermal, voltage and stability limits

d) Defined as maintaining system reliability upon the failure of large generators, including the single

largest generator

e) Defined as maintaining system reliability upon the failure of transmission lines, including the single

largest line

f) Defined as maintaining system frequency by provision of inertia, primary frequency (governor)

response and regulating reserves.

g) Defined as the ability to maintain system voltage by provision of reactive power. NOTE we are not

including the third leg of the stability trifecta – transient/rotor angle stability. Network reliability

models are the only class of models that do this.

1) Large-area capacity expansion models will often inforce a peak capacity requirement that is a proxy

for resource adequacy. Commercial models may often include resource adequacy calculations

2) Most production cost models can provide full Loss of Load Expectation/Loss of Load Probability

(LOLE/LOLP) calculations. There are also several dedicated models that perform resource adequacy

calculations, including stochastics

3) Most capacity expansion models do not include full chronology. However many have the ability to

capture some aspect of the need for flexibility, by either running chronological dispatch during some

sub set of time periods, or imposing a flexibility constraint in the objective function

4) Most capacity expansion models have a very rudimentary treatment of transmission. However some

will enforce constraints that require additional transmission when new resources are added

5) Most production cost models now include DC optimized power flow which measures some aspects of

transmission adequacy (such as thermal limits on certain lines) However due to computational

complexity, full transmission power flow analysis is not possible

6) PCMs simulate the holding of reserves in each time period. These reserves should be adequate to

meet contingency events, but the actual consequences of contingencies cannot be tested with a PCM.

7) Actually simulates a contingency event to ensure reliable operation

8) As with contingency reserves, PCMs can enforce holding of regulating reserves (and potentially even

primary frequency response) but cannot simulate the operation of reserves to check frequency

stability

9) Most network reliability models don’t simulate regulation reserves, which kick in after inertia and

primary frequency response. There is a limited set of models (I only know of one) that can simulate

the full response to frequency deviations, because they combine physics-based dynamic models with

semi-economics/rule-based automatic generation control models.

Models – writers or owners (1 of 2)

Capacity Expansion Models

• National Energy Modeling System (NEMS) – U.S. Energy Information Agency

• Regional Energy Deployment System (ReEDS) – National Energy Renewable

Laboratory

• Integrated Planning Model (IPM) - ICF

• Haiku – Resources for the Future

• MARKAL (MARKet Allocation) – International Energy Agency

• Resource Planning Model (RPM) - National Energy Renewable Laboratory

• Aurora - EPIS

• System Optimizer - ABB

• Strategist - ABB

• PLEXOS – Energy Exemplar

Models – writers or owners (2 of 2)

Production Cost Models

• PROMOD – ABB

• GE-Maps – General Electric

• PLEXOS – Energy Exemplar

• GridView – ABB

Network Reliability Models

• PSLF – General Electric

• PSSE – Siemens