WP EN2009-004

Applying Markov Chains For The Determination Of

The Capacity Credit Of Wind Power
P. Luickx, W. Vandamme, P. Souto Prez, J. Driesen, W.
Dhaeseleer

TME WORKING PAPER - Energy and Environment

Last update: April 2009

An electronic version of the paper may be downloaded from the TME website:

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KULeuven Energy Institute

TME Branch

APPLYING MARKOV CHAINS FOR THE DETERMINATION OF THE CAPACITY CREDIT OF WIND POWER

APPLYING MARKOV CHAINS FOR THE

DETERMINATION OF THE CAPACITY CREDIT OF
WIND POWER
P. Luickx, W. Vandamme, P. Souto Prez, J. Driesen, W. Dhaeseleer
AbstractInvestments in wind power occur everywhere in the
world. The value of these investments for integration in an
electricity generation system cannot be determined in the same
way as conventional electricity sources due to the variable and
relative unpredictable nature of wind power. Wind power can
only to some limited extend be centrally dispatched. To look at
the long term value of investments in wind power, the term
capacity credit can be used. It defines the level of conventional
generation that can be replaced by wind power generation. Using
four adequacy indices, namely Loss-of-load Expectancy (LOLE),
Loss of Energy Expectation (LOEE), Loss-of-load Frequency
(LOLF) and Expected Interruption Cost (EIC), the Peak load
Carrying Capability (PLCC) is established for different sizes and
locations of wind power in a system. The PLCC can be seen as a
way to quantify the capacity credit of wind power since it
determines how much the load can be increased for a given level
of wind power investment, while maintaining the system
reliability. The adequacy indices are found to vary depending on
size and location of wind power investments, therefore causing
the PLCC to change accordingly. A Monte Carlo approach is
used for determining the indices. Expected and unexpected
outages of system elements are simulated and evaluated against
system load. Wind power data are generated through Markov
chains, based on actual meteorological data from Belgian
weather measurement sites, thereby preserving the same
statistical properties as the original data.
Index Terms wind power, reliability indices, Markov chain,
capacity credit

I. INTRODUCTION

n electricity-generation system has to be able to provide a

very reliable electricity output at all times. This
requirement is a logical consequence of the inability of
electricity to be stored as such. Careful planning on the long
term is therefore an essential part of electricity provision. In
the last few decades, intermittent sources have been added to
the systems and this has had and will have serious impacts on
the preservation of the adequacy of the system. It is generally
assumed that intermittent sources tend to lower the reliability

P. Luickx, W. Vandamme and W. Dhaeseleer are with the Division of

Applied Mechanics and Energy Conversion TME, University of Leuven (K.U.
Leuven), Celestijnenlaan 300A box 2421 / B-3001 Leuven / Belgium (e-mail:
patrick.luickx@mech.kuleuven.be; william.dhaeseleer@mech.kuleuven.be).
P. Souto Prez and J. Driesen are with the Division of Electric Energy and
Computer Architectures ESAT-ELECTA, University of Leuven (K.U.
Leuven), Kasteelpark Arenberg 10 box 2445 / B-3001 Leuven / Belgium (email: paula.soutoperez@esat.kuleuven.be; johan.driesen@esat.kuleuven.be)

when they are preferred to more conventional power

generation units and when no additional measures are taken.
In the future, significant amounts of wind power will be added
to electricity generation systems all over the world. The
adequacy level however, has to be preserved when wind
power has to meet increasing demand.
The capacity credit of wind power denotes the contribution of
additional wind power to the reliability of the system. Multiple
studies have already approached the calculation of the
capacity credit for a certain country or region. Usually
capacity credit values are found to be between 20 and 30% of
installed wind power capacity [1-5]. Various calculation
methods for the determination of the capacity credit exist. This
paper uses a sequential Monte Carlo approach.
II. RELIABILITY OF ELECTRICITY GENERATION SYSTEMS WITH
WIND POWER

Electricity generation systems have to satisfy load

requirements as economically as possible, while maintaining a
desired level of reliability. Reliability is a general term
encompassing all the measures of the ability of the electricity
generation system to deliver electricity to all users within
acceptable standards and in the amounts desired [6-8]. The
reliability of electricity generation systems can be addressed
by considering two basic and functional aspects of the electric
system, namely adequacy and (operational) security.
Adequacy stands for the electricity generation systems ability
to comply with demand requirements at all times [6, 7, 9].
Security defines the ability of an electricity generation system
to withstand sudden disturbances such as electric short
circuits, unanticipated losses of system components or load
conditions [7].
A. Maintaining the reliability of electricity generation
systems
To evaluate the reliability of electricity generation systems on
the long term, the adequacy of the system is investigated. The
system is evaluated on its capacity to consistently meet the
demand under a range of possible occurring events. The
adequacy relates to both generation and transmission aspects
in the system.
Several indices can be used to quantify the adequacy of an
electricity generation system [1, 9-14]. The most commonly
used are the Loss-of-load probability (LOLP), the
Loss-of-load expectancy (LOLE) and the Loss-of-energy
expectancy (LOEE). The LOLP defines the probability that