For-profit California electric utilities charge high prices and take minimal climate action. Three state-regulated for-profits, PG&E, SCE, and SDG&E, charge two to three times more for the electricity they deliver than large city regulated counterparts charge. The giant for-profits aim for carbon neutrality in 2040 or 2045. Large locally regulated electric utilities, SMUD and LADWP, aim for carbon neutrality by 2030 or 2035.
California and other states need a way to capture the environmental and economic benefits of community solar. Other states have found a way. California’s CCE industry should ask the California legislature to consider allowing California CCEs to use all or a portion of annual CPUC mandated PCIA charges to put local renewable projects on an equal economic footing with projects that require new high voltage transmission capacity to deliver electricity locally. This will increase CCE capacity and flexibility to address local energy resilience needs and to provide equitable access locally to the environmental and economic benefits of solar electricity.
The Colorado Public Utilities Commission (PUC) has been tasked by the Colorado legislature to recommend whether and how to implement Community Choice Energy (CCE).
California’s CCE experience has been rich in diversity and local/state decarbonization impact. California CCE generation portfolios are on track to become fully decarbonized in the next few years. The California CCE model was conceived and adopted two decades ago. It exploits economic options available at the time but allows little flexibility to capture economic, environmental and energy resilience benefits of local supply and infrastructure investment.
Nevertheless, Colorado and other states can adapt and expand California’s CCE model to facilitate 21st century energy policy implementation. Specific adaptations can result in greater reliance on local renewable electricity sources and electrification of local transportation. By adopting them Colorado can take CCE to the next level of public benefits and impact.
If Colorado adopts community choice, it should set a high bar for future local energy collaboration and fair cost responsibilities. This will give Colorado communities a much better way to meet energy and climate challenges of the 21st century.
California has ramped up a seventy-six billion dollar investment in all types of solar generation capacity over the past decade. California’s retail solar industry enabled half of the total investment. Rooftop solar has been a bright spot for California’s renewable energy transition even as state regulators and California utilities continue to make other energy democracy enablers - community choice, community solar, community microgrids - hard or impossible to finance.
Regulators are now considering rule changes that impose punitive “grid access” fees on rooftop solar adoption, plus drastic reductions in compensation for electricity that feeds into the grid from rooftop solar arrays. The future of energy democracy in California hangs in the balance.
[1] The proposed CPUC decision is not accompanied by case studies indicating how it will work out for ratepayers.
I once owned an old pickup truck. It had loose steering, brakes that didn’t like long downhill runs and headlights that would stay on for about 20 miles and then take a break. I could never find the source of that problem. But I loved the truck. I used it mainly for commuting to my job in Washington, DC from my home in the Virginia suburbs. Sometimes on weekends I would use it to haul stuff out to a rustic cabin across a couple blue ridges in West Virginia.
Does common sense apply to energy? Would it be a plus for a community’s economy to shop local for energy?
Let’s take a look at the big picture. Dollars are shipped out of town for each unit of energy that comes in. They flow to regional utilities, wholesale fuel suppliers, then all the way down their supply chains, no part of which is typically local. The outflow is economically significant. When spread over the US population, annual energy costs were $3,461 per person[2]. This is about 10% of the per capita annual income in the little town in the Sierras mentioned above.[3]
When I arrived back in California in 2007, a study was underway to determine whether renewable electricity could feasibly contribute 33% of California’s electricity supply portfolio by 2020. The study had been commissioned in the wake of California’s first renewable portfolio law, which called for 20% of the state’s electricity to be “renewable” by 2010. At the time, according to a definition of “renewable” that excluded the state’s fleet of large hydro-electric power plants, renewable electricity accounted for less than 10% of California’s annual electricity usage. The law was enacted in 2002.
The “Intermittency Analysis Project”, under the leadership of Dora Yen-Nakafugi at the California Energy Commission, had taken a lot of effort and time, due to the complexity of project scoping and modeling necessary for a credible result. Meantime, there had been adjustments in the portfolio standard, in part to lower the bar as to timing, in part to raise it as to percentage. An executive order by California’s governor had added an aspirational standard of 33% by 2020, which eventually became the legal and regulatory standard for to the state’s investor owned utilities. So, part of the project’s challenge also had to do with a moving legislative and regulatory target.
The study concluded that the 33% standard could be met without major changes in the state’s bulk electricity delivery infrastructure, aka the “transmission grid”.[1]
So, state agencies having jurisdiction over grid operation began to consider how their work and responsibilities would be affected if the standard were implemented. In the humorous but all too true “Six Phases of a Project”, the third phase is listed as either “panic” or “total confusion”. Something like this ensued. At the beginning, data was crunched and published emphasizing randomness in the variability of wind power production at a specific site in California. The point seemed to be that some increased level of electricity generation “intermittency” might be feasible, but it would have profound and scary implications for grid operators.
The point of this blog topic is not to analyze intermittency scariness. There are several important and technically sound responses that focus on managing the issue rather than fretting over it. A body of detailed and independent analysis addressing the concern has blossomed and has pointed to important mitigating factors.
One technical point that continues to be overlooked in all of this is that electricity grids have always been designed and operated to accommodate an inevitably high degree of variability in both localized and regional demand. In other words, the state’s grid already handles significant “intermittency” in one fundamental dimension quite satisfactorily. The proper strategy going forward is to deal with overall supply and demand “variability”. For example, it will be quite feasible to expand the use of demand response measures, time of use pricing and smart grid information. These measures can significantly increase predictability and reduce variability in aggregate demand, thus opening a wider window for variability on the supply side.
What I overlooked for a long time was the use of “intermittency” as a political marketing term to discourage policies supportive of renewable energy deployment. The intended message to the public was, “You don’t want your power to be intermittent, do you?” to hark back to an earlier blog, Words Do Matter. At a minimum, people and organizations favorably disposed toward renewable energy should avoid the terms “intermittent renewables” and “intermittency”. They imply a problem for which there is no solution. This is far from the truth.
Yes, it is true that solar and wind resources are variable. Typical levels of variability, and even the occasional “perfect storm” of coincident and compounding supply and demand ramps, are quite manageable in thoughtfully designed market structures using modern information resources. The proper immediate course is to make full use of new solar and wind forecasting tools that enable grid operators to plan for the inevitable and daily variations. (Our compliments to Jim Blatchford at CAISO for leadership in this direction.)
In the US and California, long term electricity supply planning is increasingly neglected under a questionable assumption that market outcomes are unpredictable, and current market structures can continue to serve us well in the long term. This is a mistake. Cost effective strategies will be available to accommodate ever increasing renewable electricity percentages. But these strategies won’t be deployed in 20th century business as usual market structures. They should be the focus of increased attention to long term electricity system planning. Each strategy needs its own discussion. Future blogs will take them on one by one.
For now, let renewable energy advocates agree to stop validating the marketing messages of renewable energy opponents.
– Gerry Braun
© 2012 The IRES Network
In a drawer of my closet is pretty pastel green T-shirt decorated with images of a wind turbine and a bicyclist and the words “alternative energy”. I keep it because it was a gift from a family member who knew of my work in renewable energy. I want to honor the loving thought. I don’t wear it, because it conveys a message I don’t want to endorse.
Companies don’t market their products as the next best thing to someone else’s. The association with the term “alternative lifestyles” was probably intended by whoever coined “alternative energy”. Alternative energy would be associated with the peculiar choices of a small, harmless minority.
The American public is generally unaware of the explosive growth of the global renewable energy industries over the past decade. These industries invest in factories and jobs, and as we are quite well aware, factories, local businesses and jobs are not an alternative in the current economy. Quite possibly the term continues to be used because it is how certain industries want us to think about energy sources that would reduce their market share.
I suggest that renewable energy advocates stop using the term alternative energy. We should do so as a matter of reducing the impediments facing a whole spectrum of industries that needs to coalesce and stay on a fast growth curve, if they are to ultimately win the economic competition with politically powerful incumbents. Those who prefer a more “in your face” approach could start using the term “non-destructive” as a more accurate substitute for “alternative energy”.
I’ve become more conscious of the negative images created by terms used by renewable energy opponents. Each needs its own discussion. Future blogs will take them on one by one.
– Gerry Braun
© 2012 The IRES Network
California leads the US in deploying smaller renewable power systems. The economics are shifting to make the smaller systems cost competitive with the large “utility-scale” generators that have long dominated the power grid. Global market trends now favor decentralized renewable energy deployment, featuring thousands and even millions of individual renewable generators and energy storage devices.
This transformation is forming the basis of a 21st century electricity system that will be increasingly decentralized, enabling local jurisdictions like Davis to have great flexibility. We’ll be able to determine our sources and uses of energy so as to achieve our sustainability goals while keeping energy costs affordable.
With a majority of eligible cities moving forward, Community Choice Energy In California has the vague feel of a third party movement, or even perhaps an insurgency. As yet there is no acknowledged problem to which it presents an obviously necessary solution. As yet there is no clearly articulated statement of the opportunity it creates both the state and its communities. What is local jurisdiction mobilization to decarbonize local energy infrastructure needed?
Problem and opportunity. Best to start looking at both sides of the coin.
Terrorist attacks in Paris. Climate talks in Paris. Which got saturation level media coverage? The terrorist attacks, of course. They were about life and death.
And yet, so were the climate talks. A lot more lives. A lot more deaths. Just not good fodder for action movies and the daily news cycle.
What I know about the Paris conference I learned from colleagues who participated.
Utility contractual obligations to independent generation project owners must be honored and/or renegotiated. Unlike other states, California allows its incumbent for profit utilities to impose “exit fees” on electricity users switching to community choice energy service. In northern California, these fees now add 25% to the cost of newly purchased renewable electricity.
We immediately notice, not one integrated project, but a lot, hundreds, thousands, of aspirational initiatives scattered about. Generally, they aim to reduce “carbon footprints”. For example, some California jurisdictions and agencies have goals to achieve some dimension of “carbon neutrality” by 2050, e.g. in the electricity sector. Many local California jurisdictions have “climate action plans” targeting vehicle miles traveled and other transportation metrics. In the buildings sector, California is working on “net zero” standards that would be applied to new residential buildings as soon as 2020.
I realized it would have to be people individually choosing solar that would propel solar forward. At the time solar resonated with people because they could imagine it as part of their lives, i.e. as an improvement. My company was a monopoly. It would get along just fine without improvements. Yes, of course it could imagine changes in its business environment and needing to navigate them, but it couldn’t imagine actually initiating or creating the changes.
VCAC representatives pointed out that on its current trajectory, The Cannery development will add significantly to the City’s carbon footprint unless a large percentage of initial home buyers opt for necessary upgrades. They further pointed out that, while net zero energy can be cost-effectively achieved during initial construction, later retrofits aiming for net zero will be practically and economically unrewarding. Incremental owner initiated solar array upgrades will be as much as two or three times more costly on a unit energy basis than their cost as part of the new construction process.
Last year the Davis City Council funded work to evaluate the city's long-term electricity service options. The matter was tabled as the June election drew near. Then this summer the city commissioned a resident satisfaction survey that, among other questions, asked if the city should form a municipal utility and purchase PG&E’s distribution system.[1] 46.5 percent of respondents said yes, 34.5 percent said no, and 19 percent were undecided. This result suggests it is time to resume serious public discussion of Davis’s energy future, based on relevant factual information and insights.
Some friends and I recently had a conversation about the future of a volunteer group we helped create. We are concerned about environmental issues, and our group is part of a larger organization that has a much broader and diverse set of concerns. So, how to proceed? Advocate for specific action on specific issues, and someone in the larger group is inevitably going to see the issue another way. Busy ourselves with innocuous individual good-doing, and the group loses cohesion if not a reason to exist.
I offered an observation that might be a good guideline if judiciously applied. My friend, Mike Eckhart, created and developed the American Council on Renewable Energy into a broad based and politically potent coalition. He led the effort according to a principle which flies in the face of our gut political instincts.
