Generation portfolio analysis for low-carbon future electricity industries with high wind power penetrations

This paper employs a Monte Carlo based decision-support tool to assess the expected overall generation costs and risks of different thermal plant portfolios with high wind power penetrations. In particular, we present a case study of an electricity industry with Coal, CCGT, OCGT and Wind generation options that faces uncertain future fuel prices, carbon pricing, demand, and plant capital costs. The tool uses half-hourly demand and wind generation data from South Eastern Australia, and Australian estimates of new-build thermal plant costs. It incorporates a Monte-Carlo extension to standard optimal generation mix methods combined with risk weighting techniques from portfolio theory. The implications of different wind penetration levels on the expected costs and risks, and associated emissions of different thermal plant portfolios are explored. Results from the case study highlight the potentially complex interactions between high levels of intermittent generation and the costs, risks and emissions of future electricity industries with different portfolios of Coal and Gas-fired plants.