Right now, Diablo Canyon supplies a large, very inflexible amount of generation onto the grid 24 hours a day, 7 days a week. That consistency used to be a desirable attribute of nuclear power. But integrating significant amounts of renewable energy is made much easier when grids are flexible and can be managed more dynamically. The state will need that flexibility in the future as we prepare to reach 50 percent renewables by 2030.
PG&E supported the bill last year that raised our RPS to 50 percent by 2030 and is now taking another huge step forward as a clean energy leader.]]>
The analysis compares the economic benefits of installing a solar photovoltaic (PV) system coupled with battery storage against a stand-alone solar installation on nine affordable housing units in California. Fifteen-minute interval electricity data from the buildings’ common spaces was used to to model the potential bill savings of both options under current rate structures.
The study found that solar+storage installations can result in significant savings to building owners beyond what can be achieved with solar-only installations if the owners have to pay “demand charges.” These charges are different from the charges associated with the kilowatt hours actually consumed, which can be offset by solar installations through net energy metering (NEM).
Demand charges are tied to the highest level of electricity demand over a billing period and are not usually eliminated by adding solar alone. This is because a building may need to draw large amounts of power when the sun is not shining. The analysis showed that the addition of battery storage can reduce or eliminate demand charges, which results in significant bill savings to the building owner.
The study demonstrates that adding battery storage to a solar PV system can help owners of affordable housing units save money. But what about the tenants of these buildings? California residential rates do not have demand charges, so what’s in it for them?
If building owners can save money using storage, a greater percentage of the solar that would be installed to offset common area load can be used to instead offset residents’ electricity bills. Solar+storage installations can help make buildings more safe and resilient during extreme weather events or other emergencies that bring down the power grid. Finally, coupling solar and storage helps preserve the value of solar as we move away from net metering and towards time-of-use rates that will charge more for electricity when solar PV resources are not generating power.
There is much left to do to make sure the benefits of solar PV reach the communities that are most in need of a clean energy transition. Policies must be in place to make sure affordable housing units are in good physical shape to host solar systems and that residents of these buildings see direct bill savings as a result of going solar. Coupling battery storage with solar can reduce or eliminate demand charges which directly benefits building owners, but if done the right way, these benefits can flow to residents as well.]]>
The UCS analysis assesses states’ overreliance on natural gas that could expose electricity customers to financial risk and prevent states from making deeper reductions in greenhouse gas emissions over time.
California has more online natural gas generation capacity than any other state except Texas. Part of the reason for that is simply because California has such a large population to serve. This gas fleet supplies a large portion of electricity needs: nearly 60 percent of in-state electricity generation in 2014 came from natural gas.
And yet, California has made great strides to reduce its reliance on natural gas, and fossil fuels in general. Renewable energy production has ramped up significantly in recent years, and is now supplying about 25 percent of the state’s retail sales—and lowering reliance on natural gas.
As far back as 2006, the state enacted Assembly Bill 32, which established a program to reduce greenhouse gasses throughout the economy. And Senate Bill 1368, passed the same year, phases out the state’s long-term coal investments.
Just last week, Governor Jerry Brown signed Senate Bill 350 into law, which requires the state to double energy savings in buildings and rely on renewable sources to meet half of its retail electricity needs by 2030.
California’s natural gas fleet provides an important source of generation capacity and flexibility, which can be relied on when renewable energy is not readily available. But the state has to make sure that natural gas doesn’t crowd out renewable energy on the grid.
If large quantities of renewable energy and natural gas resources are generating electricity at the same time, supply could exceed demand, forcing grid operators to curtail some of the excess renewable electricity to maintain grid stability.
That issue—how to use natural gas in smart way—was the subject of a recent UCS analysis. When we looked at scenarios of 50 percent renewable energy on the California grid, we found that renewable energy curtailment will be exacerbated if grid operators continue to rely upon gas for fast-acting grid reliability services. This is because these gas plants have to be online and generating at all times to provide many of these services, crowding out renewables and generating global warming emissions and air pollution.
Fortunately, many of the non-fossil grid management that exist today—demand response, storage, even renewables—are capable of offering grid reliability services; several are able to respond even faster than a natural gas plant. Our 50 percent renewables report shows how we can take advantage of non-fossil sources of flexibility to integrate larger quantities of renewables and maintain grid reliability.
California’s natural gas fleet has helped the state bring on large quantities of renewables in a relatively short timeframe and reduce reliance on imported coal. And although this fleet will continue to play an important role providing power and reliability to the grid, the additional investments we make in non-fossil grid reliability services will help us minimize our use of natural gas and maximize renewable generation potential, which will help the state achieve our long-term carbon reduction goals.]]>
The significance of these clean energy standards should not be underestimated. While the oil industry blocked the proposal to cut the state’s oil consumption in half by 2030, SB 350 will make meaningful reductions in California’s use of petroleum by naming vehicle electrification as a key strategy for reducing air pollutants and greenhouse gas emissions. Electrifying large numbers of light-duty vehicles will reduce oil consumption and carbon pollution.
California’s Renewables Portfolio Standard (RPS), which up to now has required the state to generate 33 percent of its electricity from sources such as wind and solar, has developed the largest clean energy sector in the nation. Boosting the standard to 50 percent will attract even more investments, and by 2030 the electricity generated by California’s RPS will account for over a third of all the renewable energy generated by state standards across the country.
Almost unimaginable a decade ago, transitioning to cleaner electricity sources has happened faster than expected. More renewables on the grid has become an easier choice as the cost of wind and solar have declined dramatically over time and our understanding of how to operate a more flexible grid has advanced. In fact, modeling conducted by UCS shows that California can generate half of our electricity from renewable sources even earlier than 2030 with the technology we have in place now. Showing other states that we have the technical and political will to rely on cleaner sources of energy will encourage other states to follow in our footsteps.
Also, SB 350 will double energy savings in California’s buildings, the largest commitment by any state. Studies show that energy efficiency—using less electricity and natural gas—is the most affordable way to reduce global warming emissions in our electricity sector.
As someone who worked hard on demonstrating to legislators that these goals were possible, I am proud of the bipartisan effort that went into passing SB 350’s clean energy standards. Significantly, the five largest utilities in the state—which account for more than 80 percent of the electricity load in California—supported the bill. These utilities are the nation’s leaders when it comes to providing cleaner electricity to customers while ensuring reasonable electricity rates and grid reliability.
The widespread support for building California’s clean-energy future may not have attracted as much attention as the bitter fight to set a petroleum reduction target, but it is a story worth telling.]]>
California’s economy is the 7th largest in the world. The clean electricity generated by the new 50 percent Renewables Portfolio Standard (RPS) will account for nearly a third of the renewable electricity generated by state standards in the country. Passing SB 350 shows other states and nations that it’s technically and politically possible to take on climate change in a meaningful way. And this action will have ripple effects. As the Speaker of the Assembly Toni Atkins said on the voting floor: “When a state like California leads the way, it pushes others forward.”
Here’s a bit more on what the bill does:
There is still more work to do. No doubt the Legislature will be taking on additional climate issues and policies when it reconvenes in 2016. But for now, let’s celebrate this huge step forward towards a cleaner and safer electricity system. Today, I feel extremely proud to be a Californian.]]>
But not everything is dried up, on fire, or otherwise depressing. Sacramento policy makers are focused on a number of bills that will help California make real and measurable progress towards relying on cleaner, safer, and more renewable sources of energy. For example, Senate Bill 350 (De León-Leno)—the Clean Energy and Pollution Reduction Act—would increase California’s share of electricity from renewable sources to 50 percent, double energy efficiency savings, and cut California’s petroleum use in half. All of these changes would be required to happen by 2030.
To get a better sense of what 50 percent renewables means for California, UCS just released an analysis led by Dr. Jimmy Nelson, Achieving 50 Percent Renewable Electricity in California, which examines how to transform California’s electricity grid to one that relies more heavily on renewable energy. The results, which used a production cost simulation model to mimic operations on the California Independent System Operator grid, demonstrate that reaching 50 percent renewable energy is possible—even faster than the timeline required in SB 350—with the technology we have in place now. The report also suggests that the state’s approach to managing the electricity grid needs should evolve to take full advantage of its low-carbon resources. (In addition to downloading a copy of the report, you can access a slide deck that summarizes the findings.)
It will be especially important to remove as much natural gas generation as possible from the grid in the middle of the day to make room for renewables. Without doing so, electricity produced by natural gas power plants could “crowd out” renewable generation by forcing the grid operator to curtail renewables to avoid a situation in which electricity supply exceeds demand. This can result in a missed opportunity to take full advantage of renewable generation, and creates additional greenhouse gas emissions in the process.
As we reach 50 percent renewables on the grid and strive for even higher levels of carbon-free generation, we need to think about how renewables can help to integrate themselves into the electricity grid by providing significant grid management services as well as energy. This study helps to quantify the value of moving in that direction.
It’s certainty going to be an exciting year for California clean energy—in the next few weeks we may have legislative action on 50 percent renewables; in the coming years we also anticipate and will be working to address the other 50 percent of the grid to make sure it too is supporting efforts to reduce emissions in the electricity sector.]]>
First, on Wednesday Governor Brown issued an executive order that directs California to cut emissions to 40 percent below 1990 levels by 2030. The target will help the state meet its goal of an 80 percent reduction in emissions below 1990 levels by 2050.
On Thursday night, Elon Musk, CEO of Tesla Motors, will tell us about the company’s plans to roll out batteries that will store renewable energy generated on the rooftops of homes and businesses, and larger-scale applications for renewable energy power plants.
This initiative builds upon the “Gigafactory” announced last year and under construction in Reno, Nevada, which is planning to manufacture lithium-ion batteries for at least 500,000 electric vehicles by 2020. As Tesla envisions, the combination of renewable energy, batteries, and electric vehicles will create a constant supply of clean electricity to fuel a new fleet of vehicles that will be able to ditch gasoline altogether.
Energy storage, which captures solar and wind generation for use later on (when the sun isn’t shining and the wind isn’t blowing) will be an important tool to help the world rely on much larger quantities of renewable energy generation.
If Tesla and other companies can dramatically scale up energy storage production and lower costs, it could be a game changer for renewables; imagine supplies of clean energy that could be stored in the way we store natural gas in tanks, or water behind dams (with the added bonus of being drought-proof).
However, storage is just one of the many tools we have at hand to help us integrate renewables, and states do not have to wait for storage technologies to mature before they make greater investments in clean energy. Even though 29 states and D.C. have renewable energy investment programs, most don’t have enough renewables on the grid to require storage right now in order to go further.
As I’ve pointed out in previous blog posts, there are several strategies grid operators can deploy to make the grid more flexible, responsive, and able to absorb more renewables. For example, targeted energy efficiency in the evening hours will reduce the burden to supply electricity when solar power (sans storage) is not readily available.
Demand response programs, which shift electricity load towards favorable times of the day, can help us take advantage of renewables when they are generating the most. Renewable generation facilities can also be equipped to provide some of the grid reliability services currently met by fossil fuels (usually natural gas), making them even more useful to grid operators.
States are increasingly turning to these flexible, non-fossil power management solutions as they strive to cut pollution and rely on renewables to serve their electricity needs. These investment opportunities are perhaps most timely in California, where the state legislature is contemplating two bills—SB 350 (De León/Leno) and AB 645 (Williams/Rendon)—which would increase the state renewable energy program from 33 percent by 2020 to 50 percent by 2030.
Taking this step is not only visionary, it’s achievable. Check out a new UCS fact sheet that summarizes why we think reaching 50% renewables is within reach and will be realized sooner than some may think.]]>
Meeting half of California’s electricity needs with renewables will transform its electricity grid and pave the way for other states and countries to do the same. But with anything transformational, there are new challenges to overcome. Perhaps the most exciting part is that the solutions to integrating large quantities of renewable electricity are actually at hand. Renewable grid integration is not a technical challenge but an economic one; to maximize our future renewable investments, we must deploy technologies that provide grid reliability services while not causing us to waste significant amounts of clean energy. A quick summary of how to do this is explained below, but for additional detail, check out the fact sheet UCS just released.
The challenge grid operators face is to not waste energy created by renewables when the supply of electricity exceeds demand. “Overgeneration,”as energy geeks call it, is most likely to occur in the middle of the day when California’s world-class solar resources really start firing up. To avoid overgeneration, grid operators can curtail the output of renewable energy facilities to reestablish the supply/demand balance. But this option should not be overused. After all, once a renewable generation facility is built, the marginal cost of that generation is very low and we want to use that electricity, not dump it. To minimize curtailment, we need to determine whether it’s possible to turn down other forms of generation instead of renewables.
According to the report, in 2014 the solar industry added workers at a rate that was 20 times faster than the overall economy. There are now more than 170,000 solar jobs across all 50 states. Employment grew between 2013 and 2014 in the categories of installation, manufacturing, sales and distribution, and project development. And the great majority of this growth represents completely new jobs rather than existing employment where solar has become an added responsibility.
This growth in solar employment is unsurprisingly closely linked to the increasing rate of solar panel adoption in the U.S. In 2010, the domestic solar industry had installed about 929 MW of solar generation capacity. That number has grown to 7,200 MW in 2014—an increase of 675 percent!
The report contains lots of great information for data geeks, but if you if you don’t have time to read the entire thing, you can download the 2-page fact sheet to get the gist. And, since a picture is worth a thousand words, I thought I’d share the nifty infographic that was generated to summarize the good news:
Supplying half the state’s electricity needs by 2030 may seem ambitious, but several indicators show that California is already headed in that direction and that 50 percent renewables is ambitious, but possible.
California’s current Renewables Portfolio Standard (RPS) requires all retail electricity providers to reach 33 percent renewables by 2020, and the latest status report from the California Public Utilities Commission shows that we are on track to surpass that goal.
A report from Energy + Environmental Economics (E3) released last January examined the feasibility of a 50 percent RPS and found that there were no technical barriers to reaching that goal. And the state is working with federal agencies to finalize a plan that will guide the development of up to 20,000 megawatts (MW) of additional renewable energy development in California’s desert, which would more than double the generation capacity of renewables currently online for California. This is all on top of the progress California has made to install renewable energy generation—mostly solar PV—on homes and businesses throughout the state.
Although California is already headed towards higher levels of renewables, a strong and clear statement from the governor at this juncture is very helpful. In the next few years, the state’s energy planning agencies and the California Legislature are likely to make decisions regarding the next decade of clean energy policies.
Governor Brown’s message on renewables is an important first step, but concrete policies must follow his words. California’s reputation as a clean energy leader comes from years—decades even—of designing and implementing programs to drive clean energy investments. And in the future, care should be taken to only reinvent the parts of the wheel that are not working properly. When designing California’s next generation of clean energy policies, decision-makers should ensure the new policy or policies accomplish the following:
Many of these principles are already being addressed through new developments in the state’s energy markets, agency planning efforts, and proposed legislation. But until now, we have worked on these issues within the context of achieving policy goals that extend only through 2020. The bold yet achievable clean energy vision outlined by the governor provides us with an important road map for a longer-term vision that will drive the development of California’s low-carbon economy at a time when countries all over the world are developing plans to reduce carbon.
Governor Brown’s speech gives me hope for the new year. He reminds us all that “California, since the beginning, has undertaken big tasks and entertained big ideas. Befitting a state of dreamers, builders and immigrants, we have not hesitated to attempt what our detractors have called impossible or foolish.” And the goals he proposes remind us to keep moving forward: “California feeds on change and great undertakings, but the path of wisdom counsels us to ground ourselves and nurture carefully all that we have started… the challenge is to build for the future, not steal from it.”]]>