Scaling Up Renewable Energy Generation: Aligning Targets and Incentives With Grid Integration Considerations

Countries around the world have established ambitious targets for increasing the contribution of renewable energy toward meeting their national energy demand. At low penetrations of wind and solar (e.g., below 5%–10% of annual electric demand), impacts to the power system are likely to be minimal. However, as the proportion of variable renewable energy (VRE) connected to the grid increases, power system planners will increasingly need to evaluate and manage the impact of increased variability and uncertainty on system operations. They will also need to ensure that the policy and regulatory environment offers sufficient certainty and revenue streams to encourage investment in new VRE generation. To address these needs, power system planners can take several steps to align targets and incentives with grid integration considerations.