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Techno-Economic Analysis of Compressed Air Energy Storage and Hydrogen Production from Variable Renewable Energy

This study presents the techno-economic analysis (TEA) results of integrating electrolysis hydrogen (H 2 ) production, compressed air energy storage (CAES), and H 2 -fired combustion turbines in a high variable renewable energy (VRE) market environment. The inconsistent nature of VRE creates challenges for power producers in maintaining a stable electrical grid as it is increasingly utilized. The mission of the National Energy Technology Laboratory (NETL) is driving innovation and delivering energy solutions, and a multiangle approach involving H 2 production, energy storage, and next-level H 2 -fired combustion turbine generator (CTG) technologies could provide one solution for the nation’s growing electrical grid issues with increasing VRE sources. The H 2 production and CAES concept were investigated due to its ability to provide utility-scale H 2 -fueled power generation with large-scale energy storage capabilities. Two facilities with CAES and natural gas-fired CTGs (in McIntosh, Alabama, and Huntorf, Germany) have been operating for decades. In contrast, this study investigates the potential to replace the natural gas fuel with H 2 fuel. This concept has been publicly presented by both Siemens Energy and Bechtel Global Engineering, Construction & Project Management (Bechtel) at two different power generating levels. The CAES and air expansion/combustion turbine power generation in this study are primarily based on the Siemens Energy system (Bailie, Aug. 10-11, 2021) (Scheller, Feb. 21, 2023). The inclusion of a H 2 turboexpander generator is from Bechtel (Gülen, Sep. 6, 2022). A block flow diagram of the proposed process is illustrated in Exhibit ES-1.

08 HYDROGEN

Integrating Variable Renewable Energy Into the Grid: Key Issues

To foster sustainable, low-emission development, many countries are establishing ambitious renewable energy targets for their electricity supply. The variability of solar and wind compared to traditional sources, coupled with growing demand for electricity, requires changes to power system planning and operations to meet these targets. Grid integration is the practice of developing efficient ways to deliver variable renewable energy (VRE), primarily wind and solar, to the grid. Good integration methods maximize the cost-effectiveness of incorporating VRE while maintaining or increasing system stability and reliability. To inform decarbonization strategies, policymakers, regulators, and system operators consider a variety of costs and opportunities associated with VRE integration, which can be organized into five topics: New renewable energy generation and transmission; Power system reliability; Transmission and distribution coordination; Cross-sectoral decarbonization opportunities; Energy equity and justice.

ENERGY PLANNING, POLICY, AND ECONOMY

Value of Geothermal Energy Storage for Supply-Side and Demand-Side Applications

This report presents the results of a study examining the value potential for geothermal energy storage (GES), a long-duration energy storage resource that stores thermal and/or geomechanical energy in the subsurface. GES could benefit the overall U.S. power system by temporally shifting electricity generation (supply-side) or meeting building heating and cooling load (demand-side). This report analyzes supply-side and demand-side opportunities independently because of differences in applications and models. Currently there is significant uncertainty about the development costs for GES, with only a limited number of demonstration plants for electric energy storage and building heating and cooling storage developments. In this report, we estimate the value of supply-side and demand-side GES to the bulk power system in the contiguous United States. Because of the significant uncertainty about GES development costs, this analysis does not consider GES deployment costs but instead focuses on the value of GES to the U.S. electricity system. The estimated values of GES provide reference points for economically competitive commercial cost targets. Supply-side GES is modeled as part of an enhanced geothermal system (EGS) generation plant in NREL's Regional Energy Deployment System (ReEDS) capacity expansion model (Ho et al. 2021). In contrast to conventional geothermal plants, which generate constant power, EGS plants have unique features that may allow for in-reservoir energy storage for flexible generation. Demand-side GES for heating and cooling, including seasonal hot and cold storage and short-duration heat pump storage, is incorporated into a price-taker model using Cambium electricity marginal cost projections. To establish an upper bound for the value of GES, analysis focused on favorable scenarios for storage with high generation from zero marginal cost, variable renewable energy resources. High penetrations of variable renewable energy generation can increase hourly electricity price variability, which increases the value of temporal energy arbitrage for storage technologies like GES.

15 GEOTHERMAL ENERGY

Energy, economic, and environmental tradeoffs at run-of-river hydropower facilities

Hydropower’s ability to quickly adapt to variability from wind and solar generation by fluctuation flow rates can allow the electricity grid to integrate more renewable capacity. However, these rapid flow fluctuations, required to meet variability needs, can negatively impact aquatic ecosystems. In this study, we quantified energy-economic-environment tradeoffs at five conventional hydropower facilities (i.e. hydropower produced ad a dam on a river channel) across the United States to identify a mix of operational regimes that can provide flexibility to support variable renewable energy integration and environmental protections. Model results show a range of ability to meet demand from 4.7% to 97.8% depending on which case study is considered. Additionally, when modeling the case study facilities on a range of RoR conditions, allowing a % of inflow as discharge, we found the range of 140–200% of inflow allowed as discharge lead to lowest environmental impact while meeting the highest amount of demand. Our sensitivity analysis results demonstrated the Richard-Baker Flashiness Index, used to measure flowrate changes, and Revenue, were negatively correlated with the percent of hydropower generation within the defined Regional Energy Deployment System balancing area (i.e. region in which energy demand and energy supply is balanced based on the Regional Energy Deployment System model) yet positively correlated to the variable renewable energy generation percentage in the defined balancing area. In conclusion, our results suggest hydropower operations can aid in increasing renewable energy generation while limiting environmental impacts when considering a holistic analysis of energy-economic-environment tradeoffs.

Economic impact

Hybrid Energy-Powered Electrochemical Direct Ocean Capture Model

Offshore synthetic fuel production and marine carbon dioxide removal can be enabled by direct ocean capture, which extracts carbon dioxide from the ocean that then can be used as a feedstock for fuel production or sequestered underground. To maximize carbon capture, plants require a variety of low-carbon energy sources to operate, such as variable renewable energy. However, the impacts of variable power on direct ocean capture have not yet been thoroughly investigated. To facilitate future deployments, a generalizable model for electrodialysis-based direct ocean capture plants is created to evaluate plant performance and electricity costs under intermittent power availability. This open-source Python-based model captures key aspects of the electrochemistry, ocean chemistry, post-processing, and operation scenarios under various conditions. To incorporate realistic energy supply dynamics and cost estimates, the model is coupled with the National Renewable Energy Laboratory’s H2Integrate tool, which simulates hybrid energy system performance profiles and costs. This integrated framework is designed to provide system-level insights while maintaining computational efficiency and flexibility for scenario exploration. Initial evaluations show similar results to those predicted by the industry, and demonstrate how a given plant could function with variable power in different deployment locations, such as with wind energy off the coast of Texas and with wind and wave energy off the coast of Oregon. The results suggest that electrochemical systems with greater tolerances for power variability and low minimum power requirements may offer operational advantages in variable-energy contexts. However, further research is needed to quantify these benefits and evaluate their implications across different deployment scenarios.

16 TIDAL AND WAVE POWER

What Is Power System Curtailment?

Curtailment is the intentional reduction of instantaneous power from non- dispatchable variable renewable energy (VRE) resources like wind and solar photovoltaics relative to what would naturally be available from the wind and the sun. This curtailed energy is the difference between the total available energy and actual production. This fact sheet provides a summary of curtailment in power systems and presents selected insights into specific ways in which curtailment is implemented by a selection of System Operators.

curtailment

Renewable Energy Contingencies in Power Systems: Concept and Case Study

This paper introduces the concept of renewable energy contingencies that represent long-term/extended variability of variable renewable energy (VRE) resources, namely, significant periods (e.g., days/weeks) of low wind/solar availability. These contingencies have not received much attention to date but are likely to emerge as a major issue in some countries such as India as the share of VRE increases. Using 38 years of climate model reanalysis data for wind over India, we demonstrate that low periods of wind contingency below long-term (Indian) national average of 5 m/s can extend for more than 100 days in several zones some of which are deploying large wind farms. Even in some of the best wind resource areas in India with long term average wind speed close to 7 m/s, low wind days (e.g., 5 m/s which is substantially below average) can extend up to 60 days. We propose a four-step methodology around a co-optimization based energy-ancillary services dispatch model to assess the impact of renewable contingency and implemented it for the state of Tamil Nadu, the most wind-rich state of India. We have estimated that annual renewable contingency cost impact of 5 GW additional wind in Tamil Nadu to be in the range of US$27-76 million pa. Planning analysis should embrace the concept of renewable contingency to recognize these costs and put in place necessary spinning reserve and back-up generation resources.

Mohar Chattopadhyay

Loss of Glen Canyon Dam Hydropower Plant Capabilities

The power grid in the western United States is undergoing a major transformation, driven by technological advancements, power markets, policy shifts, and evolving energy demands. The integration of variable renewable energy (VRE) resources, such as wind and solar, into the power grid has become a major driver of change. Between 2018 and 2023, about 19 gigawatts (GW) of new solar capacity and 14 GW of new wind capacity was built in the Western Interconnection (WI) region. These two VRE resources accounted for the majority of WI capacity additions. The Western Interconnection is expected to host 30 GW of wind, 40 GW of solar, and 14 GW of energy storage by 2030 (Western Electricity Coordinating Council n.d.).

13 HYDRO ENERGY

Facets of hydro power and future trends in a Nordic Context

Hydropower technologies bolster high penetration of variable renewable energies (VREs) in the net zero emissions scenarios. Nevertheless, there are various challenges to meeting the ambitious goal, such as stability, reliability, resiliency, security, lack of reactive power, voltage support and inertia, large-scale storage deployment and coordination, interconnectedness, demand-side response, higher thermal cycles with increased start/stops, and inadequate Levelized Cost of Energy (LCOE) for system-wise VRE integration and profitability. This survey conducts a bottom-up analysis to unveil the opportunities to utilize hydropower facilities and disentangle the nested problem for intertwining design features, control algorithms, operation, optimization approaches, incentives, services, and market mechanisms using a three-pillar framework perspective: grid owners, power producers, and machine designers. The survey identified emerging trends in real-time and capacity markets, flexible power systems, and enhanced grid capabilities, including advanced voltage support and updated grid codes. These developments present significant opportunities for hydropower, such as achieving super-flexibility through hybridization, expanded reactive power capabilities, and advanced operational modes like a synchronous condenser and power adequator functionalities. These opportunities require novel design philosophies — including new winding, stator, and rotor configurations, optimized ventilation, and active cooling systems — to enhance performance under stressed grid and climate conditions. Finally, integrating climate and energy models for multi-basin optimization with finer spatial and temporal granularity enhances the planning accuracy for water management of hydropower while addressing environmental challenges. The review delivers helpful prospective suggestions and tools that would serve researchers, power engineers, and stakeholders in making decisions about hydropower technologies and services in 2050 and beyond.

13 HYDRO ENERGY

Synergies and trade-offs between storage, transmission, and sector coupling in high renewable energy systems

Energy storage, transmission, and sector coupling are some prominent flexibility solutions to support variable renewable energy (VRE) integration. However, investment cost uncertainties and public acceptance could hamper the deployment of these flexibility solutions. This raises questions about the development and cost-effectiveness of future energy systems, especially on how the dependence on local and cross-border solutions of flexibility would evolve if the uptake of these solutions is restricted. In this context, this paper identifies the synergies among flexibility options under restrictions on transmission expansion or increased costs of energy storage. It contributes to determining whether investments in energy storage and/or transmission expansion offer the least-cost transition and investigates the impact of sector coupling on these solutions. A long-term energy system planning and optimisation model towards 2050 is developed using the open-source energy system optimisation tool Balmorel, and a case study of the countries surrounding the Baltic Sea and the North Sea is established. Five cases with restrictions imposed on transmission expansion and higher energy storage technology costs are analysed at different levels of sector coupling. The results highlight the importance of transmission expansion at all levels of sector coupling. As the level of sector coupling increases, uncertainties around the cost of energy storage drive the least-cost pathways. Optimal investment solutions are found to have a mix of transmission and energy storage in capacity expansion at all levels of sector coupling.

24 POWER TRANSMISSION AND DISTRIBUTION

Hybrid Power Purchase Agreements for Flexible 24/7 Energy Delivery – A Comprehensive Review of Current Practices and Research Pathways

Power Purchase Agreements (PPAs) are becoming increasingly preferred among large energy consumers, such as data centers, to secure cost-effective energy and meet accelerating demand growth. Traditionally, variable renewable energy (VRE)-based PPAs operate on a pay-as-produced basis, balancing supply and demand for a relatively longer duration (e.g., annually). However, the focus is shifting toward matching supply and demand on an hourly basis to fully meet energy needs. This shift requires the integration of flexible energy resources, such as hydropower, thermal generation, and energy storage, to complement VRE sources like wind and solar, forming the foundation for 24/7 PPA. This work contributes by: (i) reviewing emerging market trends and current practices in PPA procurement, supported by data on PPA prices and technology portfolios; (ii) synthesizing the existing literature on modeling approaches for contract pricing, quantities, hybrid resource procurement, and risk management in 24/7 PPA design, while identifying key research gaps; and (iii) proposing an integrated 24/7 PPA design framework along with two contracting mechanisms from the perspectives of both PPA providers and consumers. The proposed framework highlights critical modeling challenges, risk-allocation issues, and future research opportunities for 24/7 PPA design.

24/7

A review of Geological Thermal Energy Storage for seasonal, grid-scale dispatching

Energy storage is essential for the decarbonization of the U.S. energy grid, especially with the increasing deployment of variable renewable energy sources like solar and wind. Geological thermal energy storage (GeoTES) has emerged as a promising long duration, grid scale solution, providing stability and security through flexible operations and valuable grid services. GeoTES utilizes subsurface reservoirs to store thermal energy for power generation and direct-use heating and cooling. This approach significantly enhances the use of low-temperature reservoirs, which would otherwise be unsuitable for geothermal power plants. It also aligns well with depleted oil and gas reservoirs, concentrating solar power, non-flexible renewables (photovoltaic and wind), and geothermal-related power cycles. Given the favorable marginal costs of GeoTES as storage duration increases, it becomes particularly competitive for seasonal, grid-scale dispatch, where few technologies are viable. This paper provides a comprehensive review of GeoTES systems and the research underpinning itsr development. This analysis begins by defining and categorizing the unique characteristics of thermal energy storage techniques, setting GeoTES apart from other technologies. The various components, configurations, subsurface characteristics, and modeling efforts that guide GeoTES development are then explored. Finally, challenges in GeoTES research, development, and deployment are discussed, along with mitigation strategies and lessons from related technologies. Beyond their economic benefits, GeoTES systems support grid resilience and decarbonize industrial processes. Their scalability, broad distribution, seasonal storage potential, and flexible dispatch capacity make GeoTES a valuable tool for expanding renewable energy deployment and addressing climate change.

15 - GEOTHERMAL ENERGY

Comprehensive assessment of deep reinforcement learning approaches for economic dispatch in nuclear-driven microgrids

As the electrical grid integrates more variable renewable energy sources such as wind and solar, the demand for distributed and flexible systems to address this increased variability becomes critical. Nuclear-driven microgrids provide a promising solution by offering stable generation to complement intermittent renewables, ensuring grid reliability and operating efficiency. This paper proposes a recurrent deep reinforcement learning framework for optimal economic dispatch in a nuclear-powered microgrid integrating renewable energy sources, small modular reactors, battery storage systems, and balance-of-plant dynamics. A three-agent control architecture is developed, where demand and renewable energy agents act as forecasters, and a reinforcement learning-based dispatch agent performs real-time energy allocation. A nonlinear programming formulation is first used to generate an optimal baseline for benchmarking. The proposed dispatch controller, based on Proximal Policy Optimization enhanced with Long Short-Term Memory networks, exploits temporal correlations in system dynamics by taking advantage of the time series used as inputs to improve policy robustness under uncertainty. Comparative analysis against established deep reinforcement learning methods, including Proximal Policy Optimization with a feedforward architecture, Soft Actor-Critic, and Twin Delayed Deep Deterministic Policy Gradient, demonstrates superior performance. Numerical results indicate that the proposed controller achieves a 0.39% cost reduction relative to the nonlinear programming benchmark and outperforms other learning-based methods by generating additional revenue of up to 0.35%. All reinforcement learning controllers compute dispatch actions in less than 0.3 s, resulting in a computational speedup of more than three orders of magnitude over the nonlinear programming baseline. The findings of this paper highlight their applicability for real-time operation and control in nuclear-integrated microgrids under volatile operating conditions.

24 POWER TRANSMISSION AND DISTRIBUTION

Simulation & Analysis of the Hydronic Shell Retrofit System as a Solution for Deep Energy Retrofits and Electrification of Large Multifamily Housing Communities in Cold Climate

According to the 2020 residential energy consumption survey, there are 32 million multi-family buildings in the United States, and approximately 42% of these have poor or no insulation (US EIA 2020). Electrification of buildings with heat pump is one of the key strategies to achieve the goal of 90% reduction of greenhouse gas emissions in buildings by 2050 (U.S. Department of Energy 2024a). Building electrification will also enable greater penetration of variable renewable energy sources. However, replacing the natural gas dominated heating system by electrical appliance will increase the electrical load in heating dominated climate. It is crucial to well-insulate the building envelope to mitigate the stress in the grid from electrification. The hydronic shell (HS) system discussed next can achieve dual objective of envelope retrofit with space heating system electrification.

32 ENERGY CONSERVATION, CONSUMPTION, AND UTILIZATI

Lower Snake River Dams Contribution to Grid Services

Hydroelectric generation and water storage have long been components of the clean energy mix, providing both reliable steady output and operational flexibility. As variable renewable energy sources such as wind and solar increasingly replace traditional generation, the role of all flexible resources—including hydropower—in balancing supply and demand continues to evolve. This study examined the contribution of the Lower Snake River (LSR) Dam plants to Bonneville Power Administration grid services in maintaining power system reliability within the Western Interconnection. By analyzing publicly available data, the study evaluated various reliability services through performance metrics including energy capacity, balancing and ramping, voltage and reactive power support, frequency response, and transmission impact. Results indicated that the LSR plants deliver services as expected based on their size, contributing to the balancing process, ramping capabilities, and operational reserves, particularly during peak load conditions and weather events, while also providing measurable frequency and voltage support to the grid.

13 HYDRO ENERGY

Intensifying Renewable Energy Droughts in the Western U.S. Amid Evolving Infrastructure and Climate

If renewable energy resources continue to become a larger part of the generation mix in the United States (U.S.), so does the potential impact of prolonged periods of low wind and solar generation, known as variable renewable energy (VRE) droughts. In such a future, naturally occurring VRE droughts need to be evaluated for their potential impact on grid reliability. This study is the first of its kind to examine the impacts of compound VRE energy droughts in the Western U.S. across a range of potential future climate and infrastructure scenarios. We find that compound VRE drought severity may increase significantly in the future, primarily due to the dramatic increase in wind and solar generation needed in some future infrastructure scenarios. We find that in our future climate scenario, the variability of energy drought severity increases, which has implications for sizing energy storage necessary for mitigating drought events. We also examine the spatial patterns of compound VRE drought events that effect multiple regions of the grid simultaneously. These co-occurring events have distinct spatial patterns depending on the season. We observed overall fewer connected events in the future with the combined effect of potential climate and infrastructure changes, although in the fall we observe a climate-induced shift toward events which impact more regions simultaneously.

29 ENERGY PLANNING, POLICY, AND ECONOMY

Exploring the Future Energy Value of Long-Duration Energy Storage

Long-duration energy storage is commonly viewed as a key technology for providing flexibility to the grid and broader energy systems over a multidecadal time frame. However, prior work has typically used present-day grid infrastructures to characterize the relationship between the duration and arbitrage value of storage in electricity markets. This study leverages established National Renewable Energy Laboratory grid planning and operations tools, analysis, and data to execute a price-taker model of an energy storage system for several 8760 h price series representative of current and future contiguous United States grid infrastructures with varying shares of variable renewable energy (VRE). We find that the total value of energy storage typically increases with VRE shares, but any increase in the relative value of longer storage durations over time depends on the region and grid mix. Some regions see incremental value increasing notably, up to 20–40 h in 2050, while others do not. The negative effect of lower roundtrip efficiency on value is also found to be scenario-dependent, with the energy value in higher VRE scenarios being less sensitive to roundtrip efficiency and more supportive of longer storage durations. Long-duration storage value and deployment potential are a function of evolving electricity sector infrastructure, markets, and policy, making it critical to consistently revisit potential long-duration storage contributions to the grid.

14 SOLAR ENERGY

Impacts of Alternative Operations and Renewable Energy Deployment on Columbia River Hydropower

The Columbia River Treaty Tribes in the Pacific Northwest - the Nez Perce, Umatilla, Warm Springs, and Yakama - hold treaty-reserved fishing rights for the Columbia River, one of the world's most productive salmon rivers and a critical resource for these tribes. However, the tribes have expressed that current operating regimes of hydropower dams throughout the Columbia River Basin (CRB) do not fully account for tribal fishing rights and have negatively impacted fish populations. Four tribes acting together through the Columbia River Inter-Tribal Fish Commission (CRITFC)'s 2022 Energy Vision stated that current power system models often do not fully account for the many constraints faced by hydropower facilities in the CRB. As the deployment of variable renewable energy (VRE) like solar and wind continues to increase, power system flexibility will become increasingly important. As a result, there is a growing need to better understand the true capabilities of the hydropower generation fleet while accurately accounting for ecological constraints (Northwest Power and Conservation Council 2022). Understanding hydropower's role in a future grid with a higher share of VRE can inform water resources planning to address ecological needs. The goal of this study is to examine the impacts of alternative hydropower operation rules and weather variability on hydropower generation and grid operations in VRE and transmission infrastructure deployment scenarios. The study evaluates how hydropower scheduling practices can reduce ecological impacts to the region's salmon populations. More specifically, the study examines the impact of today's dam water release rules (called "adjusted base water rules" in this study) and new, ecologically informed water release rules (called "ecosystem water rules" in this study) on two VRE scenarios (current renewable energy levels and higher renewable energy levels) using six weather years for each scenario (2008-2013). CRITFC developed the ecosystem water rules, which capture a portion of the changes they recommend for CRB hydropower operations. These analyses use a water resource planning model (OASIS) and a production cost model (PLEXOS) to simulate CRB reservoir cascade and Western Interconnection power grid operation.

13 HYDRO ENERGY