When a wind farm owner wishes to connect a project to the distribution network there are clearly costs associated with doing so and it is entirely reasonable that all the appropriate connection costs are borne by the wind farm. This is a similar situation to the connection of any large load. There are two main philosophies in charging for connection of either generation or load to a power system, i.e., 'Deep' or 'Shallow' charging.
In deep charging the embedded wind-farm project will pay for all costs incurred on the power system due to the wind farm. These costs will include the local circuit from the wind farm to the appropriate point of connection on the public distribution network but also for any uprating of plant (e.g., transformers or switchgear) at any point in the distribution network. Deep charging is conceptually simple and is presently applied on UK distribution networks. However, it has a number of significant problems. Perhaps the most important is that it operates on the basis of historical precedent, i.e., first-come, first-served.
As an example, consider that two 30 MW wind farms are to be connected to a public utility circuit with an available capacity of 50 MW. The first wind farm is to be constructed 1 year before the second. As there is adequate capacity, the first wind-farm developer will not pay for the capital assets of this existing circuit but will be allowed to connect. However, if a second wind farm, also of 30 MW, applies to connect to the same circuit then this second developer will incur all the expense of uprating the 50 MW circuit to at least 60 MW and any additional costs for increases in capacity elsewhere in the system. The first wind farm developer will continue to enjoy access to the network purely on the basis of his prior application to connect. The situation is complicated by the fact that distribution network capacity can only be added in discrete amounts and so the second developer may pay for excess capacity which is then available for any subsequent application, perhaps by the first developer expanding his wind farm!
A similar problem arises in the case of wind farms connected to parts of the network where the short-circuit levels are approaching the switchgear rated values. If a wind farm wishes to connect to part of the network and this results in the switchgear ratings being exceeded then the wind farm will be expected to pay for the uprating of the equipment even though most of the short-circuit capacity is being used by other, existing generators. Although a rather unusual problem for wind farms, which tend to be located in rural areas where short-circuit capacities are low, this issue of switchgear uprating causes major difficulties for other embedded generation (e.g., co-generation plant) which is located in towns and cities.
Clearly such arrangements are not equitable and ad hoc agreements are often entered into in order to resolve difficulties. These may include limiting charges to costs incurred one voltage level above that used for the connection or by claw back arrangements so that if a developer pays for excess capacity which is used subsequently by another network user than some repayment is made. However, the basic principles of deep charging lead automatically to such problems.
In contrast, 'shallow charging' involves the generator in paying directly only for that section of network necessary to connect the wind farm to the nearest point on the network. The extent of the network which must be paid for is generally defined by that which is used solely by the generator. Other costs incurred in reinforcing the distribution system are recovered by use-of-system charges. These charges are applied by the owner of the network on all users of the network and should reflect their use of the network assets. Shallow charging has the advantages that it recognizes that the monopoly network owner has a duty to manage the network assets for the benefits of the users and avoids the anomalies of deep charging. However, the difficulty with shallow charging is that as the users change, or the capital base of the network develops, then use-of-system charges may alter. In the UK shallow charging is applied on the transmission (400 kV and 275 kV) system and can result in a generator either paying charges, if they are increasing the overall requirement for transmission assets, or indeed, being rewarded if they are reducing the need for transmission plant. The resulting use-of-system charges are reviewed periodically. Embedded generators do not, at present, pay or receive distribution use-of-system charges in the UK.
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