JawadAhmed_Assignment2

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ENSY5700 Renewable Energy Development Assignment 2 Jawad Ahmed (002826942) Q1) You now know the reasons why a Capacity Market exists in ISO NE. The annual cost of such a market to all New England consumers is around $2.5B. Are we better off or worse off with a Capacity Market? Compare your findings to ERCOT, which does not have a Capacity Market and estimate the net cost or benefit to the consumers. The Capacity Market is designed to ensure that enough capacity is available by providing advance payment to encourage investment in the new capacity or for existing capacity to remain open [1]. In the ISO NE region, electricity costs are generally higher for consumers than in areas served by ERCOT, primarily because ERCOT offers electricity at wholesale rates directly within the energy market. For instance, in 2020, the average cost of wholesale electricity in New England was recorded at $23.38 per MWh, whereas in the ERCOT region, it was slightly higher at $25.73 per MWh [2] . This increase, despite a 45% reduction following a 20% decrease in natural gas prices, indicates that ERCOT's wholesale pricing still surpasses that of ISO NE. However, in February 2021, ERCOT customers experienced shockingly high electric bills, some reaching $15,000, due to the volatility of wholesale electric prices, which fluctuate based on demand and can soar during peak hours or extreme weather conditions, at times hitting $9000 per MWh [3] . In ERCOT's competitive wholesale market, various companies vie to supply electricity, which is then purchased by retail entities at these fluctuating wholesale rates. These retailers, including five regulated electric utilities and numerous unregulated retail providers, then sell the electricity to end-users, adding additional fees for transmission and distribution. Although ERCOT's model can lead to brief price surges, it's seen as a way to promote energy conservation among consumers. Contrastingly, the capacity market model employed by ISO NE stabilizes prices by charging consumers a premium upfront to guarantee a consistent energy supply, mitigating the risk of sudden price spikes. This system allows generating companies to invest in advancements or additional facilities to meet growing demand, a flexibility not afforded by ERCOT's reliance on market-driven price incentives for generator improvements. The energy-only market model, like ERCOT's, poses long-term stability challenges by potentially deterring investment in new generation capacity due to the absence of assured returns provided by a capacity market, leading to potential instability and unpreparedness among consumers facing abrupt, sustained price increases amidst rising demand.

Q3) Read the first three chapters of the book Photovoltaic Systems (by J. Dunlop) and write a short para on what should be the optimum tilt angle and orientation for a solar project in Boston, MA. Solution: As per the first three chapters of Photovoltaic Systems by J. Dunlop it can be deduced that t he positioning of a solar array is determined by two key factors: the array tilt angle and the array azimuth angle. The array tilt angle represents the vertical angle between the horizontal plane and the array surface, while the array azimuth angle is the horizontal angle between the reference direction (typically true north or due south) and the array's facing direction. Given that the New England region is situated in the Northern Hemisphere, the optimal azimuth angle for maximum energy gain is due south. The specific coordinates for New England are approximately 43.9654°N latitude and 70.8227°W longitude. Utilizing computer models and considering average climatic conditions from various weather stations, the optimum tilt angle factor for New England is determined to be 8. Consequently, the recommended Optimum Tilt Angle for solar arrays in New England is approximately 35.96° (43.96° - 8°). References: [1] https://www.emrsettlement.co.uk/about-emr/capacity-market/ [2] https://www.iso-ne.com/markets-operations/markets/forward-capacity-market [3] https://www.eia.gov/todayinenergy/detail.php?id=47876

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