The Impacts of Distinct Flexibility Enhancements on the Value and Dynamics of Natural Gas Power Plant Operations

The rapid increase of renewable generation and its anticipated continued growth requires greater operational flexibility in modern power systems. Previous studies explored the addition of more flexible resources to improve system flexibility, but this may also be achieved at lower cost by enhancing existing power plants via flexibility retrofits. Potential flexibility upgrades to existing thermal plants include modifications that enable faster ramp rates, increase maximum load levels, decrease minimum load levels, and provide faster and lower cost startup operations. In this paper, we focus on improvements to existing natural gas combined cycle generators, and apply a unit commitment model to analyze the impact that each specific upgrade has on their operational dynamics and profitability from both the system perspective and from the asset owner perspective. We show that the value of each type of flexibility improvement varies depending on the capacity factor and usage pattern of the generator before the upgrade, and that the relative benefit of each type of flexibility varies. We demonstrate diminishing returns to increased flexibility when upgrading multiple generators simultaneously. Sensitivity tests for several shares of renewable generation, different generation mixes and different net load realizations confirm the generality of the results shown.