Optimization modeling of frequency reserves and inertia in the transition to a climate-neutral electricity system

Licentiate thesis, 2022

The ongoing transition towards electricity production systems that are dominated by wind and solar power challenge both the traditional strategy for meeting a varying electricity demand and the traditional way of controlling the AC frequency of the electricity grid. This work investigates how frequency reserves (FR) and inertia, as well as inter-hourly variation management interact in the transition to a climate-neutral electricity system. For this purpose, a linear optimization model is developed to co-optimize investments in and operation of generation capacity and storage, as well as the supply of inertia and FR. The model is applied to three European geographic contexts, northern Europe, the British Isles, and the Iberian Peninsula, with different availability levels of wind, solar and hydro power resources. In addition, the model is applied to four separate indicative years, representing the current system and near-, mid- and long-term futures.

 

The results indicate that while FR and inertia may increase the total system cost and investments, this will not decrease the cost-optimal share of renewable energy as the electricity supply-side transitions away from fossil fuels. Instead, the modeling shows that double-use of battery investments for FR and inter-hourly variations slightly increases the share of electricity supplied by wind and solar power. It is also shown that an electrified car fleet has the potential to eliminate all system costs associated with FR and inertia if a sufficient share of vehicles (30%) participates at no cost.

 

The importance of specific technologies used for FR and inertia is investigated by excluding one-by-one the batteries, power-to-heat, and wind and solar power from the inertia and frequency reserve supply. The findings indicate that batteries confer the greatest reduction in the cost of FR and inertia, with wind and solar power and power-to-heat having system cost impacts only in the northern Europe case.