Assessing the Impact of Wind Power Generation on Operating Costs

Wind power generation is taking an increasing share of the overall energy production in many power systems. While its low marginal operating cost reduces the overall cost of meeting the demand for electrical energy, the stochastic and intermittent nature of wind generation increases the uncertainty that the system operators face and obliges them to procure additional reserve capacity. This paper presents a methodology for quantifying fully the effect of wind power generation on the various components of the cost of operating the system.