What is the point?
To make sure that generation and load can be balanced at any moment, the required
dispatchable generation capacity
needs to be scheduled.
For that reason we need an estimate of the expected residual load, i.e.
the likely load and the contribution from vRES generation.
Forecasts are uncertain and subject to deviations. This has to be taken into account in scheduling and
allocation of balancing ancillary services.
In the past, there was only the forecast error related to the load.
Additionally, the dispatchable generation capacity online was not reduced by vRES.
More power plants were available to mitigate forecast errors.
Like vRES fluctuations, forecast errors affect the need for balancing ancillary services and for flexibility.
Still, these are two different things!
Why is this important?
Forecast errors mean that the system as a whole will not operate at the intended economic dispatch.
The utilisation of reserves increases and this introduces extra costs to generation.
If forecast errors are much larger than foreseen, insufficient reserves may be available to make up
for the deviation between schedule and real power capability of power plants.
In this case system balance and, hence, security of supply may be compromised.
As a consequence, there is a relationship between the forecast error to be expected
and the volume of reserves to allocate. Both values vary as the weather varies.
Where is this relevant? - Country characteristics
Specific meteorological conditions make it more difficult to produce good forecasts.
Challenging conditions in the case of PV are dust, snow or fog.
In case of windpower, steep gradients caused by approaching storm fronts introduce major errors.
Looking at the forecast for the day, the generation profile might be quite correct.
But when the storm arrives one hour later than expected, in this very hour, the error may be huge.
In both cases, a high spatial concentration of installed capacity in areas with favourable resources
makes the effect more problematic.
When is this relevant? - Stage of development
Forecast errors and the resulting imbalances, more precisely their compensation, causes costs.
For that reason, good forecasts offer economic benefits from the very beginning of vRES development.
Starting from phase 2
they are one of the inevitable preconditions of reliable and secure system operation.
Also with dispatchable plants only, system operators always had to be prepared for forecast errors:
if a power plant unexpectedly trips, for example due to a technical problem, the associated sudden deficit
has to be compensated as well.
The likelihood and the value of the error in such a case is different than scheduling vRES.
However, because reserves are allocated based on likelihood and not for a specific purpose or event,
the required amounts do not necessarily grow with vRES capacity.