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6. Balancing electricity generation and load over larger geographic areas. The intra- day, intra-hour variability and uncertainty of variable renewable generation as well as load are reduced when consolidated over larger geographic areas.99 This results in smaller overall fluctuations in demand and supply, which reduces the need for relatively expensive operating reserves to smooth these fluctuations. This decreases variable generation integration and load balancing costs. A variety of physical and virtual methods of consolidating balancing areas have been analyzed.100 Regions with small balancing areas can reduce normal load balancing costs as well as better integrate variable generation through pooling mechanisms with neighboring balancing areas, assuming adequate transmission capacity. Clearly, significant changes to gas and electricity markets and operations can help the energy industry adapt to the twin drivers of shale gas and renewable energy. Many of the changes needed in the electricity market have implications for both natural gas and renewable energy generators along with other electric power stakeholders: The drive to more accurately value flexibility across electricity institutions will directly benefit natural gas generators, while movements to co-optimize gas and electricity markets will have operational impacts on renewable energy generators. Therefore, proactive engagement among the gas and renewable energy industries and other electric power stakeholders to collaboratively resolve the diverse set of issues described above can enable the efficient technical, economic, and environmental utilization of both natural gas and renewable energy in the near, medium, and long term. 3.4 ConcludingRemarks Natural gas and renewable energy technologies offer very different and complementary attributes to consider within a portfolio and integrated systems approaches. These complementarities span the economic, technical, environmental, and institutional. The long-term evolution and structure of the electricity sector depends on the multilayered and compounded uncertainties present within the range of possible industry developments and energy pathways. Further understanding and quantitative analysis of the ability of a diverse electricity portfolio to maximize the benefits and minimize the risks of each portfolio option can help inform stakeholder decisions and allow the development of a solid foundation from which to handle uncertain futures. The dramatic rise of shale gas and growing experience with renewable energy integration have led to deep and still-evolving changes to market structures, physical systems, business practices, and regulatory policies. Both natural gas and renewable energy may play important future roles in the electric power sector. In this critical period of industry adaptation to new energy paradigms, active engagement and partnership between the natural gas and renewable energy sectors can lead to efficient well-designed electricity markets better situated to achieving the long-term energy goals of energy security and climate change mitigation. 26PDF Image | Opportunities Synergy Natural Gas and Renewable Energy
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