Graduate student wins best paper award

Alisha Fernandez, a doctoral candidate in energy and mineral engineering and National Science Foundation (NSF) graduate fellow, was awarded the Dennis J O'Brien United States Association for Energy Economics (USAEE) Best Student Paper Award for her paper "Evaluating ecosystem and wind-following services for hydroelectric dams in PJM." The paper also was accepted for publication in of the Journal for Regulatory Economics in 2012.

Fernandez was invited to present her research at the Dennis J. O'Brien Conference held in October in Washington, D.C., along with four other finalists. After her oral presentation, she was selected as the winner.

The paper outlined a two-year research project Fernandez embarked upon after receiving the NSF Graduate Research Fellowship in 2009 and funding from the College of Earth and Mineral Sciences at Penn State. She looked at the balancing of water management goals and energy management goals with in regions experiencing population growth and drought conditions. Her research also explored the environmental stresses that hydroelectric power places on the ecosystem.

Fernandez assessed the possibility of using hydroelectric power produced by dams to provide fill-in power to compensate for intermittent renewable power generation, such as wind power. Wind does not blow constantly and using hydroelectric as a "wind-following" source can create a more reliable electricity grid.

Fernandez simulated the operation of the Kerr Dam in the Roanoke River Basin, which is located in the Pennsylvania-New Jersey- Maryland (PJM) Interconnection's territory in North Carolina. PJM is a regional transmission organization that coordinates the movement of wholesale electricity through 13 states and the District of Colombia. It is a long withstanding deregulated energy market and the largest of its kind in the world.

Over the course of a three-year period reflecting wet and dry years, Fernandez observed that utilizing hydropower to facilitate wind integration presents significant conflict with other goals for managing river systems. These challenges are magnified during drought years, and exacerbated when the need to protect downstream ecosystems is considered. She concluded that the combination of drought risk and demands for ecosystem protection may necessitate a change in how PJM compensates generators for services that support renewable energy integration.

"The system costs of integrating intermittent generation resources like wind and solar are driven by private and social opportunity costs," Fernandez explained. The private costs are the loss of revenue from diverting capacity away from energy markets while the social costs are the conflicts that wind-following creates with environmental management goals related to the dam. Additionally, the market prices for wind-following services needs an associated opportunity cost for the utilities. "We have to find ways to entice them financially to produce power that is profitable for them and for other goals," Fernandez said.

Fernandez said she encountered a challenge in collecting data for the case study. "Water data is well-documented both hourly and yearly, but energy data, specifically wind energy, is new and difficult to obtain," Fernandez explained. Throughout the research Fernandez tried to mimic how power utilities make decisions and doing this realistically and trying to determine the conflict and trade-offs was difficult.

Fernadez worked with her co-advisers, Patrick Reed, associate professor of civil engineering, and Seth Blumsack, assistant professor of energy policy and economics, on the project and she said that the project benefitted from the blended expertise of her co-advisers. "My research has been fascinating work because it attracts economists, hydrologists and the electricity industry," Fernandez explained. In addition to these groups, her findings are important to people because as the country diversifies its energy portfolio, the supply of energy must continue to meet demand for it so that consumers have the power they need.

Last Updated December 13, 2011