• Effects of wind energy utilization on long-run fuel consumption in remote Alaska microgrids

      Vaught, Laura K.; Little, Joseph; Baek, Jungho; Pride, Dominique (2019-12)
      This paper presents an empirical analysis of the long-run reduction in diesel fuel consumption driven by wind energy utilization in remote Alaska electrical grids. Models control for other fuel consumption determinants including customer base and transmission and distribution system efficiency. Fourteen rural communities that integrated wind energy into their diesel powered electrical grids are analyzed within a dynamic panel framework using monthly utility data spanning sixteen years, from 2001 to 2017. An auto-regressive distributed lag approach is taken to address cointegration and presence of a unit root in the data. Long-run parameters are estimated for the full dataset as well as for four sub-samples to compare impacts on microgrids with high and low average renewable utilization and with large and small customer bases. Results indicate that fuel consumption is reduced by an estimated 68 gallons on average for each one percent increase in wind energy penetration on the electricity grid. Beyond 30% average penetration, however, additional wind energy generation leads to increased fuel consumption as turbine curtailment methods must be employed to maintain grid stability, indicating that this is a fuel-offset constraint point in low and medium penetration wind-diesel hybrid systems. High penetration-capable wind-diesel systems with energy storage capabilities may allow utilities to increase utilization rates beyond this threshold to capture additional fuel savings and carbon emissions offset.