An engineer is someone who uses scientific knowledge to solve practical problems, such as implementing plans or building machines. It is not just technical expertise that makes an engineer, but also ability to develop solutions that are sensible and realistic. As I have heard said, an engineer is someone who can build for ten cents what any fool can build for a dollar[i].
This takes us into realms where our actions must impact economic decisions and policies because, without these impacts, our ability to solve problems does not translate into actually solving problems. One of the most powerful tools that engineers have to solve practical problems is cost-benefit analysis (CBA). By giving objective and quantifiable measures of outcomes, we can identify trade-offs between alternative solutions. More importantly, cost-benefit analysis supports selection of better choices by making decisions less dependent on “gut instinct” or on narrow self-interest.
For decades, production cost models (PCM) have been the primary tool used by power-system engineers to perform cost-benefit analysis. Typically, PCM solves hourly security-constrained unit commitment and economic dispatch in order to simulate operational outcomes of alternative planning decisions such as from installation and retirement of generation, construction or re-rating of new transmission, impacts of load growth, or other changes to facilities or policies.
However, traditional PCM does not directly simulate many operational impacts. Because deviations from normal conditions were relatively rare and costs associated with these deviations were modest, PCM did not simulate many sources of variability and uncertainty. Instead, other studies were relied upon to identify ancillary-service requirements that should be enforced. To ensure that limitations of PCM did not lead to power-supply reliability problems, requirements were increased to provide a significant margin of safety in both planning and operations.
With Increasing levels of solar and wind generation, traditional methods have begun to show their limitations. Because variability of solar and wind is large and frequent, deviations from “normal” conditions are becoming larger and more frequent, and costs imposed by traditional ancillary-service policies are increasing. One solution, used throughout the 1900s, is to further increase coordination across interconnections and between interconnections. Advances in information technology, forecasting, and control architectures enable more dynamic control of facilities, distributed control, new ancillary-service providers, and storage. Each of these alternatives come with different costs and risks.
My view is that we have all the tools and technologies needed to integrate high levels of solar and wind while maintaining reliable and efficient power-system operations. However, we have many traditions in operations and planning (including the use of PCM) that need to change. All of us can strive to be good engineers, even if our formal profession has taken us far from technical work. By developing solutions that are sensible and realistic, we can reduce the barriers to necessary changes and support efforts to make better choices.
Polaris Systems Optimization
[i] I’ve recently discovered that credit for this expression goes to Arthur Wellington who wrote the 1887 book The Economic Theory of the Location of Railways. The traditional saying attributed to him is that “An engineer can do for a dollar what any fool can do for two”.