Power systems are undergoing a significant transformation as a result of the retirements of conventional coal-fired generation units and the increasing integration of converter interfaced renewable resources. The instantaneous renewable generation penetration as a percentage of the load served in megawatt (MW), in some areas of the United States (U.S.) sometimes approaches over 50 percent. These changes have introduced new challenges for reliability studies considering the two functional reliability aspects, i.e., adequacy and the dynamic security or operating reliability.

Adequacy assessment becomes more complex due to the variability introduced by renewable energy generation. The traditionally used reserve margin only considers projected peak demand and would be inadequate since it does not consider an evaluation of off-peak conditions that could also be critical due to the variable renewable generation. Therefore, in order to address the impact of variable renewable generation, a probabilistic evaluation that studies all hours of a year based on statistical characteristics is a necessity to identify the adequacy risks. On the other hand, the system dynamic behavior is also changing. Converter interfaced generation resources have different dynamic characteristics from the conventional synchronous units and inherently do not participate in grid regulation functions such as frequency control and voltage control that are vital to maintaining operating reliability. In order to evaluate these evolving grid characteristics, comprehensive reliability evaluation approaches that consider system stochasticity and evaluate both adequacy and dynamic security are important to identify potential system risks in this transforming environment.