Having only skimmed the post and reading none of the previous replies, I recognize this comment may be redundant.
The simplest metric by which we CAN compare wind with dispatchable generation is its guaranteed continuous minimum contribution to serving load across peak demand hours of the year, at some high statistical confidence level. There are several terms out there which approach this definition: capacity value, capacity credit, effective load carrying capability, loss of load expectation, summer capacity and winter capacity, to name a few.
One of the entities which works for FERC as a market monitor, Potomac Economics headed by David Patton, notes in their 2012 Annual Report on MISO that:
“The current capacity credit for wind is likely more than three times higher than a reasonably conservative capacity credit. Such a credit should be
based on the minimum output level one could expect under peak summer conditions.”
https://www.potomaceconomics.com/uploads/reports/2012_SOM_Report_final_6-10-13.pdf (report page vi) and:
” ..[T]his report shows the effects of assuming the lowest quartile
of output during peak hours on the unit-by-unit basis. This methodology would produce an average capacity credit for the wind resources of 2.7 percent for PY 2013–14.” (Same resource, report page 16).
Using the average of the lowest quartile as a measure of capacity value means that wind output would not fall below a 2.7% of its nameplate capacity more than about 12.5% of the time, or that its capacity value would by 2.7% at an 87.5% confidence level. Even this severe trimming of wind’s capacity related “avoided cost of capital” on the system is not conservative enough to be applied to the entire generation fleet. If all generators had their capacity value (credit) rated at an 87.5% confidence level, reserve margins would be severely understated, as Potomac points out in other sections of the referenced report.
To get to the punch line, yes, wind is perhaps a fuel saver but has near zero sway to avoid constructing and maintaining dispatchable plants. Essentially wind’s value cannot exceed the value of the fuel it saves: About $40/MWh for CC Gas, $25/MWh for coal, and less than $10/MWh for nuclear. One need only compare fixed to variable cost ratios of dispatchable plants, then, to calculate wind’s avoided cost including fixed costs, multiplying the dispatchable technolgies’ fixed costs by wind capacity value (2.7%?) divided by the dispatchable source’s capacity value.
We developed a simplified regional market hourly economic/technical re-dispatch model this year. This is a fascinating tool to help interested parties at all levels of technical competency recognize the interdependent impacts of adding intermittent resources into systems with varying amounts of fixed output resources (i.e. nuclear) already participating in their regional markets. Contact me for more information about the release date and venue for this model.
