Rapid expansion of wind power in the electricity sector is raising questions about how wind resource variability might affect the capacity value of wind farms at high levels of penetration. Electricity storage, with the capability to shift wind energy from periods of low demand to peak times and to smooth fluctuations in output, may have a role in bolstering the value of wind power at levels of penetration envisioned by a new Department of Energy report,“20% Wind by 2030, Increasing Wind Energy’s Contribution to US Electricity Supply”(DOE 2008) released in May, 2008.

Utilities are still experimenting to determine the capacity value-the amount of conventional capacity a given amount of wind capacity can replace-of the wind farms they are building today. No matter how accurate forecasting of wind patterns becomes, the nature of the resource does not allow operators to dispatch wind power to meet load as they can with a conventional plant. Storage technologies provide synergies with wind power either by shifting electricity from periods of low demand to those of higher demand, or by damping out fluctuations in output. This process helps reduce stresses on other plants that would otherwise have to ramp up and down to compensate for the variations from the wind farms. The more wind installed in a system, the more valuable storage becomes–at higher penetrations, wind variations are larger and there is less balance-of-system to compensate. This paper quantifies the value storage can add to wind. The analysis was done employing the Regional Energy Deployment System (ReEDS) model, formerly known as the Wind Deployment System (WinDS) model (http://www. nrel. gov/analysis/winds/). ReEDS, developed at the National Renewable Energy Laboratory (NREL), was used to estimate the cost and development path associated with 20% penetration of wind in the “20% Wind by 2030” report. ReEDS differs from the WinDS model primarily in that the model has been modified to include the capability to build and use three storage technologies: pumped-hydroelectric storage (PHS), compressed-air energy storage (CAES), and batteries To assess the value of these storage technologies, two pairs of scenarios were run:• business-as-usual, with and without storage• 20% wind energy by 2030, with and without storage