| Project Detail |
The grid relies on conventional bulk power plants to provide the flexibility to operate power systems reliably. These assets can guarantee available capacity except in rare events. The existing risk management strategy protects against those rare events and aligns well with conventional technologies. New risk management strategies are needed due to the shift in grid resources: intermittent renewable resources, distributed energy resources, and storage technologies. Management systems must be able to leverage all capabilities of these new technologies to maintain an economical and reliable grid. PERFORM projects aim to address that need by developing methods to quantify and manage risk at the asset and system levels for the grid. Project Innovation + Advantages: The power industry sees risk as statistically independent of todays operational practices and regulations. The challenge is convincing the industry to proactively and explicitly study, quantify, price, and incorporate risk into dispatch and response algorithms. Columbia University will develop a risk dashboard to address this challenge that will enable independent system operators (ISOs) of the electrical grid to compute and analyze engineering and financial risks occurring on operational time scales ranging from several minutes to days. This dashboard will facilitate efficient and accurate interpretations of complex scenario-based risk analyses (for both asset and system levels). The dashboard will rely on stress-testing statistical factor models and newly designed energy asset and systemic risk metrics to continuously track system and market conditions and proactively dispatch available resources to avoid insecure operations. This project will develop a risk-versus-cost tradeoff for grid operations and will leverage the flexibility of renewable, demand, and storage resources to reduce risk while compensating these assets accordingly. The team will leverage financial risk management instruments to hedge against losses under severe or complex energy scenarios to reconcile technical risks identified using developed risk metrics. Potential Impact: PERFORM projects will design methods and risk scores to clearly communicate the physical delivery risk of an energy asset’s offer and design grid management systems that organically capture uncertainty. These management systems will evaluate and hedge the system risk position to meet or exceed a baseline system risk index. This pursuit will achieve the following area impacts: |
