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Interconnection System (SINEA). Likewise, Uruguay has been vocal with respect to the relevance of the interconnection with Brazil to transmit surplus wind power and import in low wind times103. Although there are an increasing number of plans and proposals to connect across international borders, artificial barriers created by mismatched regulations currently constrain trade and will likely continue to do so in the near to mid-term.104 An integrated power system, could be made even more effective through the adoption of complementary measures, including: • Demand response, which consists of mechanisms to incentivize end-use customers to adopt measures or technologies leading to changes in their real-time electricity consumption to match available supply. It can be used as a cost-effective resource to balance variable renewable energy generation, by adjusting in real-time the load curve in response to resource availability.105 • Storage technologies, to provide further system flexibility and thus enable a higher penetration of variable NRETs. Technologies currently being deployed106 include pumped hydro and lithium-ion batteries. Both technologies are already present in the region (the Rio Grande pumped hydro 700 MW plant in Argentina,107 and the two Battery Energy Storage Systems of Angamos and Los Andes in Chile, with a combined capacity of 32 MW).108 Most pumped hydro systems in the world use freshwater, but there is one that uses seawater109 - a technology that could be applied in LAC. Small-scale battery storage systems are another promising technology for the medium term. In particular, electric vehicles will have in the near future the capacity to soak up generation at times of low demand to address two problems at once. Storage technologies serve other purposes in addition to scaling up NRETs (as in the case of the above mentioned systems in LAC), and NRET deployment provides additional reasons to implement them. Water hydrolysis for hydrogen synthesis could also be used to store energy during wet, rainy periods. • Shorter scheduling and dispatch intervals. In wholesale markets, generation dispatch is typically scheduled on an hourly basis. Once generation is scheduled, it is required to hold its output at a fixed level until the top of the next hour. Since wind and solar are more likely to vary within the course of an hour than other resources, this means that they may require higher operating reserves. This type of regulation draws from the most expensive ancillary service resources introducing a further cost barrier for the integration of variable renewable energy into wholesale markets. In order to address this, markets can be designed to schedule generation at sub-hourly intervals, such as 5, 15, or 30 minutes. Shorter scheduling intervals reduce the probability that variable renewable generation will diverge from scheduled output, reduce the need for operating reserves, and therefore reduce integration costs. Market gate closure110 times that occur closer to actual generation delivery time can also help reduce forecast error. Depending on the electricity sector structure, challenges related to the use of market mechanisms to integrate variable renewable energy and introduce analogous ancillary service and regulation functions into electricity systems might differ between countries. In particular, there are not yet well-established Rethinking our energy future p. 23PDF Image | White Paper on Renewable Energy for the 3GFLAC
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