A. R. Fernandez, S. A. Blumsack, and P. M. Reed
Environmental Research Letters (2013)
Climate change mitigation will require rapid adoption of low-carbon energy resources. The integration of large-scale wind energy in the United States (US) will require controllable assets to balance the variability of wind energy production. Previous work has identified hydropower as an advantageous asset, due to its flexibility and low-carbon emissions production. While many dams currently provide energy and environmental services in the US and globally, we find that multi-use hydropower facilities would face significant policy conflicts if asked to store and release water to accommodate wind integration. Specifically, we develop a model simulating hydroelectric operational decisions when the electric facility is able to provide wind integration services through a mechanism that we term ‘flex reserves’. We use Kerr Dam in North Carolina as a case study, simulating operations under two alternative reservoir policies, one reflecting current policies and the other regulating flow levels to promote downstream ecosystem conservation. Even under perfect information and significant pricing incentives, Kerr Dam faces operational conflicts when providing any substantial levels of flex reserves while also maintaining releases consistent with other river management requirements. These operational conflicts are severely exacerbated during periods of drought. Increase of payments for flex reserves does not resolve these operational and policy conflicts.