CEP Renewable Energy Technologies & Integration 1 — Questions and Answers
Question 1: Which capacity factor range is most typical for utility-scale solar photovoltaic (PV) installations in the U.S. Sun Belt region?
- 10–15%
- 20–30% (Correct answer)
- 40–50%
- 60–70%
Correct answer: 20–30%
Utility-scale solar PV in the U.S. Sun Belt typically achieves capacity factors of 20–30%, reflecting the ratio of actual output to rated capacity over time.
Question 2: What is a Power Purchase Agreement (PPA) in the context of renewable energy procurement?
- A short-term spot market transaction for electricity
- A long-term contract to buy electricity at a fixed or indexed price from a specific generator (Correct answer)
- A federal subsidy program for renewable developers
- An interconnection agreement between a generator and a utility
Correct answer: A long-term contract to buy electricity at a fixed or indexed price from a specific generator
A PPA is a long-term contract in which a buyer agrees to purchase electricity at a negotiated price from a renewable generator, providing revenue certainty for project financing.
Question 3: Which federal tax incentive directly reduces the tax liability of a renewable energy project developer based on a percentage of qualified capital costs?
- Production Tax Credit (PTC)
- Investment Tax Credit (ITC) (Correct answer)
- Renewable Portfolio Standard (RPS)
- Accelerated Cost Recovery System (ACRS)
Correct answer: Investment Tax Credit (ITC)
The Investment Tax Credit (ITC) allows developers to reduce their federal tax liability by a percentage of the eligible capital cost of a qualifying renewable energy project.
Question 4: What does the term 'curtailment' mean in renewable energy integration?
- The scheduled maintenance downtime of a renewable plant
- Reducing a generator's output below its available capacity due to grid constraints or oversupply (Correct answer)
- The process of disconnecting a generator from the grid permanently
- Increasing renewable output to meet peak demand
Correct answer: Reducing a generator's output below its available capacity due to grid constraints or oversupply
Curtailment occurs when a grid operator instructs a renewable generator to reduce output below what it could produce, typically due to transmission congestion or excess supply.
Question 5: Which technology is primarily used to store electricity generated by intermittent renewables for later dispatch?
- Combined heat and power (CHP)
- Lithium-ion battery energy storage systems (BESS) (Correct answer)
- Demand-side management programs
- Peaking natural gas turbines
Correct answer: Lithium-ion battery energy storage systems (BESS)
Lithium-ion battery energy storage systems are the dominant technology for storing renewable electricity and dispatching it when generation is unavailable or demand peaks.
Question 6: In a Virtual Power Purchase Agreement (VPPA), what does the buyer receive from the renewable generator?
- Physical delivery of electrons at a specific site
- Renewable Energy Certificates (RECs) and a contract-for-difference on electricity price (Correct answer)
- Direct equity ownership in the renewable project
- A fixed monthly capacity payment with no energy component
Correct answer: Renewable Energy Certificates (RECs) and a contract-for-difference on electricity price
In a VPPA, the buyer receives RECs and a financial settlement based on the difference between the contracted strike price and the market price, without physical power delivery.
Question 7: What is the primary advantage of an onshore wind project over an offshore wind project in the U.S. energy procurement market?
- Higher capacity factors in all regions
- Significantly lower levelized cost of energy (LCOE) due to reduced installation and O&M costs (Correct answer)
- Greater energy output per turbine
- Access to larger federal subsidies
Correct answer: Significantly lower levelized cost of energy (LCOE) due to reduced installation and O&M costs
Onshore wind projects have substantially lower LCOE than offshore because installation, cabling, and ongoing operations and maintenance costs are far lower on land.
CEP Renewable Energy Technologies & Integration 1
Which capacity factor range is most typical for utility-scale solar photovoltaic (PV) installations in the U.S.
Sun Belt region?