The impact of short-term variability and uncertainty on long-term power planning

TY - JOUR

T1 - The impact of short-term variability and uncertainty on long-term power planning

AU - Bylling, Henrik C.

AU - Pineda, Salvador

AU - Boomsma, Trine K.

PY - 2020/1/1

Y1 - 2020/1/1

N2 - Traditionally, long-term investment planning models have been the apparent tool to analyse future developments in the energy sector. With the increasing penetration of renewable energy sources, however, the modelling of short-term operational issues becomes increasingly important in two respects: first, in relation to variability and second, with respect to uncertainty. A model that includes both may easily become intractable, while the negligence of variability and uncertainty may result in sub-optimal and/or unrealistic decision-making. This paper investigates methods for aggregating data and reducing model size to obtain tractable yet close-to-optimal investment planning decisions. The aim is to investigate whether short-term variability or uncertainty is more important and under which circumstances. In particular, we consider a generation expansion problem and compare various representations of short-term variability and uncertainty of demand and renewable supply. The main results are derived from a case study on the Danish power system. Our analysis shows that the inclusion of representative days is crucial for the feasibility and quality of long-term power planning decisions. In fact, we observe that short-term uncertainty can be ignored if a sufficient number of representative days is included.

AB - Traditionally, long-term investment planning models have been the apparent tool to analyse future developments in the energy sector. With the increasing penetration of renewable energy sources, however, the modelling of short-term operational issues becomes increasingly important in two respects: first, in relation to variability and second, with respect to uncertainty. A model that includes both may easily become intractable, while the negligence of variability and uncertainty may result in sub-optimal and/or unrealistic decision-making. This paper investigates methods for aggregating data and reducing model size to obtain tractable yet close-to-optimal investment planning decisions. The aim is to investigate whether short-term variability or uncertainty is more important and under which circumstances. In particular, we consider a generation expansion problem and compare various representations of short-term variability and uncertainty of demand and renewable supply. The main results are derived from a case study on the Danish power system. Our analysis shows that the inclusion of representative days is crucial for the feasibility and quality of long-term power planning decisions. In fact, we observe that short-term uncertainty can be ignored if a sufficient number of representative days is included.

KW - Generation expansion

KW - Investment

KW - Power planning problems

KW - Uncertainty

KW - Variability

UR - http://www.scopus.com/inward/record.url?scp=85056826355&partnerID=8YFLogxK

U2 - 10.1007/s10479-018-3097-3

DO - 10.1007/s10479-018-3097-3

M3 - Journal article

AN - SCOPUS:85056826355

SN - 0254-5330

JO - Annals of Operations Research

JF - Annals of Operations Research

ER -