Tesla’s Insane Button
This is fun. From DragTimes via YouTube
Gleanings from the web and the world, condensed for convenience, illustrated for enlightenment, arranged for impact...
WEEKEND VIDEOS, January 19-20:
This is fun. From DragTimes via YouTube
It is so difficult to talk sense to deniers because they are programmed by some of the best hucksters around. From Film Festivals and Indie Films via YouTube
Advanced Rail Energy Storage could be a flight of fantasy or one of the most interesting energy storage concepts to come along. That will be clear this spring when California utilities announce their first choices for meeting the state’s new storage mandate. From ARES via Vimeo
Report: achieving renewable energy targets could address water challenges
Charlotte Malone, January 29, 2015 (Blue and Green Tomorrow)
“Meeting renewable energy targets could significantly cut the amount of water used for generating electricity as [climate change-induced] water scarcity becomes a bigger risk…[A report last year] warned that half of the world could face extreme water scarcity by 2095…Renewable energy in the water, energy & food nexus [from the International Renewable Energy Agency (IRENA)]…argues that using wind or solar to generate energy uses up to 200 times less water than a coal plant to produce the same amount of electricity. It adds that during the power generation stage, water needs for solar and wind are negligible compared to conventional generation, which can require substantial amounts of water for cooling…” click here for more
Chinese wind output falls in 2014
Jianxiang Yang, 27 January 2015 (Windpower Monthly)
“…The amount of electricity generated by Chinese wind projects fell by 5.92% in 2014, according to the National Energy Administration (NEA)…[T] he average uptime for projects of 6MW and over across China was 1,905 hours. The decline was largely down to curtailments and weaker wind conditions in the northern provinces of Jilin and Gansu…China's wind capacity rose by [18.81GW] during 2014…[and overtook] nuclear energy to become the country's third largest energy source, after coal and hydropower…[G] rid-connected wind installations totalled 95.81GW by the end of 2014, up 25.6% on the previous year…Hebei, Shanxi, Inner Mongolia, Ningxia and Xinjiang all performed well, with the latter area registering an average uptime of 2,094 hours...The coastal province of Fujian in southeast China scored the highest figure of 2,530 hours…” click here for more
Africa's new breed of solar energy entrepreneurs
Tom Jackson, 26 January 2015 (BBC News)
"African economies may be booming, but continued growth and quality of life are being jeopardised by lack of power…[An estimated] 585 million people in sub-Saharan Africa lack access to electricity, with the electrification rate as low as 14.2% in rural areas…[O]nly 23% of Kenyans; 10.8% of Rwandans; and 14.8% of Tanzanians have access to an electricity supply…[A] new breed of ‘solar-preneurs’ is emerging, increasing access to power and generating revenues at the same time…[M-Kopa Solar] provides ‘pay-as-you-go’ renewable energy for off-grid households in Kenya, Uganda and Tanzania…Off-grid households in East Africa, which also are largely low-income households, spend about $0.50-$0.60 (33p-40p) per day on kerosene lighting and basic charging costs…M-Kopa Solar provides power to more than 140,000 households in East Africa for $0.45 per day, and is adding over 4,000 homes each week…[Its] revenues are nearing $20m per year…[Juabar] builds and operates a network of solar charging kiosks in Tanzania which it leases to entrepreneurs, who then offer electricity services to their communities…[and earn] profits of between $75 and $150 per month…” click here for more
Electric Drive Trucks and Buses; Market Data for Medium and Heavy Duty Commercial All-Electric, Plug-In Hybrid Electric, and Hybrid Electric Vehicles
1Q 2015 (Navigant Research)
“The global medium and heavy duty vehicle (MHDV) market is changing…[but electric] power for commercial vehicles has always been a challenge because of the size of the battery packs required to store and deliver enough energy to drive heavy vehicles over practical distances. It is not just the cost; the size and weight can also significantly reduce the payload, which is a major concern for fleet operators…Electric hybrid vehicles are now being used in commercial applications where the improved technology offers major benefits for specific drive cycles that involve city driving in stop-start traffic…[and] niche applications that can use onboard electrical energy to replace idling diesel engines or provide temporary power to buildings or tools at remote sites. Low-emissions zones in cities are being introduced that will result in greater demand…According to Navigant Research, global sales of electric drive and electric-assisted commercial vehicles are expected to grow from less than 16,000 in 2014 to nearly 160,000 in 2023…” click here for more
Distorting Climate Change Threats, Solutions
January 28, 2015 (FactCheck.org)
“…Rick Santorum falsely claimed that U.S. policies aimed at reducing greenhouse gas emissions “will have zero impact” on climate change. The U.S. is the world’s second-biggest emitter of carbon dioxide, and a reduction in its GHG emissions could slow global warming…[Emissions reductions by the U.S. could indeed play a role in slowing the rise of global temperatures. The U.S. could also have an indirect impact, because its leadership on the issue could spur a global movement to cut down on the carbon dioxide emissions that are warming the planet]…
“Mike Huckabee said Islamic extremism poses a greater threat than climate change. That’s his opinion. But in expressing it, he grossly understated the potential impact of climate change by saying it threatens to give Americans “a sunburn” — an issue almost entirely unrelated to climate change. Military leaders have long warned that climate change poses a national security threat…In a report released in October 2014, the Pentagon wrote that “rising global temperatures, changing precipitation patterns, climbing sea levels, and more extreme weather events will intensify the challenges of global instability, hunger, poverty, and conflict. They will likely lead to food and water shortages, pandemic disease, disputes over refugees and resources, and destruction by natural disasters in regions across the globe…”
“Mike Huckabee said Islamic extremism poses a greater threat than climate change. That’s his opinion. But in expressing it, he grossly understated the potential impact of climate change by saying it threatens to give Americans “a sunburn” — an issue almost entirely unrelated to climate change. Military leaders have long warned that climate change poses a national security threat…In a report released in October 2014, the Pentagon wrote that “rising global temperatures, changing precipitation patterns, climbing sea levels, and more extreme weather events will intensify the challenges of global instability, hunger, poverty, and conflict. They will likely lead to food and water shortages, pandemic disease, disputes over refugees and resources, and destruction by natural disasters in regions across the globe…”click here for more
American wind power rebounded in 2014, adding over four times as much as year before; Stable policy needed for investment in U.S. capacity to pay off, say industry leaders
January 28, 2015 (American Wind Energy Association)
“…The American Wind Energy Association (AWEA) [Q4 report] shows the U.S. industry’s rebound in 2014, with over four times more new wind energy coming online than in 2013…[bringing the 2014 total to] 4,850 megawatts (MW) in generating capacity, with cumulative installed capacity increasing eight percent to a total of 65,875 MW…equal [over a full year] to taking 28 million cars off the road…However, the amount installed in 2014 still falls far short of the record 13,000 MW that the U.S. wind energy industry was able to complete during 2012…Industry leaders blamed uncertainty over…[the production tax credit (PTC) which has encouraged $125 billion dollars of investment across America, creating 500 U.S. manufacturing facilities and technological innovations that lowered the wind power's costs by more than half in the last five years…Nearly 30,000 well-paying jobs and tens of billions of dollars in private investment were lost due to the PTC lapse at the beginning of 2013…”
“Wind projects were completed in 19 states in 2014…[T]he industry continues to see near-record levels of under construction activity, with over 12,700 MW of wind under construction [in 22 states] as 2015 began… Utilities continue to sign some of the lowest cost long-term contracts ever seen for wind energy. Since the beginning of 2014, there have been more than 3,300 MW of power purchase agreements (PPAs) for wind power signed across 14 states. In total, over 12,000 MW of long-term contracts for wind power have been signed since the start of 2013…Utilities continue to highlight wind’s ability to keep costs low for consumers…Wind power saved consumers $1 billion over just two days across the Great Lakes and Mid-Atlantic states during the 2014 “Polar Vortex” event…” click here for more
New-generation solar panels far cheaper, more efficient: scientists
Magdalena Mis, January 27, 2015 (Reuters)
“A new generation of solar panels made from a mineral called perovskite has the potential to convert solar energy into household electricity more cheaply than ever before, according to [Exeter University research]…Super-thin, custom-colored panels attached to a building's windows may become a "holy grail" for India and African countries [by shading windows and producing electricity]…With a thickness measured in billionths of a meter, solar panels made of perovskite will be more than 40 percent cheaper and 50 percent more efficient than those commercially produced today…Unlike other solar panels, those made of perovskite can absorb most of the solar spectrum and work in various atmospheric conditions, rather than only in direct sunlight…Researchers have already tested the material in the Americas, Asia, Europe and the Middle East…” click here for more
To reassure electric car buyers, combine battery leasing with better charging, study says
January 28, 2015 (PhysOrg)
“…[In] Toward Mass Adoption of Electric Vehicles: Impact of the Range and Resale Anxieties…[researchers offer] two models…[In the first model] battery enhanced charging service is made available through additional support infrastructure…In the second model, consumers lease the batteries and are also offered enhanced battery charging services…[T]heir impacts on electric vehicle adoption can be quite different. While range anxiety typically hurts adoption, resale anxiety can actually help adoption (depending on the EV production cost level)…[A]nxieties do not necessarily harm consumers…[and] typically benefit consumers since the presence of anxieties forces the firm to cut vehicle prices and invest more in public charging infrastructure…The battery leasing service improves the firm's profit at the expense of total adoption and consumer surplus, when not offered with the public charging option…Most importantly, increasing the driving range of electric vehicle through public charging infrastructure typically yields more socially desirable adoption outcomes (greater adoption and emission savings) than increasing the battery capacity…[T]he first model provides the highest benefit (electric vehicle adoption, emission savings, profitability, and consumer surplus) unless resale anxiety is high…” click here for more
National Solar Jobs Census 2014
January 2015 (The Solar Foundation)
National Solar Jobs Census 2014 is the fifth annual update of current employment, trends, and projected growth in the U.S. solar industry. Data for Census 2014 is derived from a statistically valid sampling and comprehensive survey of 276,376 establishments throughout the nation, in industries ranging from manufacturing, to construction and engineering, to sales. Rapid change in this industry has warranted annual examinations of the size and scope of the domestic solar labor force and updates on employers’ perspectives on job growth and future opportunities.
This year’s Census found that the industry continues to exceed growth expectations, adding workers1 at a rate nearly 20 times faster than the overall economy and accounting for 1.3% of all jobs created in the U.S. over the past year. Our long-term research shows that solar industry employment has grown by 86% in the past five years, resulting in nearly 80,000 domestic living-wage jobs. The installation sector, made up of men and women placing these systems in service, crew managers or foremen, system designers and engineers, and sales representatives and site assessors, remains the single largest source of domestic employment growth, more than doubling in size since 2010.
With leading market analyses continuing to project record-breaking increases in annual installed solar capacity before the 30% federal investment tax credit (ITC) expires at the end of 2016, it is very likely that the national solar workforce will continue growing at its remarkable pace in the short term. However, if the ITC reverts to the 10% level in 2017, solar employment growth is likely to slow or may even experience significant job losses. As of November 2014, the solar industry employs 173,807 solar workers, representing a growth rate of 21.8% since November 2013. Throughout 2014, U.S. businesses as a whole added nearly 1.8 million jobs at an annual growth rate of 1.1%, meaning employment in the solar industry grew nearly 20 times faster than employment in the overall economy.
Over the next 12 months, employers surveyed expect to see total employment in the solar industry increase by 20.9% to 210,096 solar workers.
This report includes up-to-date information on the solar industry, quantifying employment growth since last year’s study and trends since the publication of Census 2010. These research findings also provide stakeholders with current information on the potential for further growth and the factors that are likely to impact the industry over the coming years.
Based on the observed growth in solar employment in this and previous Census reports, we draw the following conclusions.
As of November 2014:
• Solar industry employment increased by nearly 22% since November 2013, which is almost twenty times the national average job growth rate. There are 173,807 solar workers in the U.S., up from 142,698 for the previous year. 2014 was the second consecutive year in which solar employment both grew by approximately 20% or more and exceeded Census growth projections.
• Employment in the U.S. solar industry increased nearly 86% over the past four years. Since the first National Solar Jobs Census was published by The Solar Foundation in September 2010, the solar industry increased 85.9%, adding over 80,000 workers.
• Solar is a major source of new U.S. jobs. Of the more than 31,000 new solar jobs added since November 2013, 85 percent are new jobs (rather than existing positions that have added solar responsibilities), representing approximately 26,600 new jobs created.
• The solar industry created 1.3% of all new U.S. jobs. One out of every 78 new jobs created in the U.S. since Census 2013 was created by the solar industry –representing 1.3% of all new jobs.
• The solar industry expects to add over 36,000 solar jobs over the next 12 months. If realized, this 20.9% growth rate would make 2015 the third consecutive year that annual solar job growth was near or above twenty percent. This estimate compares with a projected 1% increase in employment in the overall economy over the next year.
• Of the 173,807 solar workers in the United States, approximately 157,500 are 100% dedicated to solar activities. The “all-solar” percentage of workers is effectively unchanged since 2013.
• The U.S. solar industry is becoming more efficient, to less than 15.5 jobs per megawatt of installed capacity. This is down from 19.5 jobs per megawatt in 2012.
• Including indirect and induced impacts, the solar industry supports approximately 700,000 U.S. jobs. Census data include occupations critical to meeting domestic installation demand. These include most of the direct jobs and many of the indirect jobs in the solar industry, with the exception of some indirect jobs in the component and materials supply chain. Those jobs, combined with induced impacts of the industry, support an additional 531,200 jobs, bringing the total employment impact for the U.S. solar industry to over 705,000.
• Wages paid to solar workers remain competitive with similar industries and provide many living-wage opportunities. Solar installers pay an average wage of $20-24 per hour, with the mean wage for these workers rising by 1.6% over the previous year. Manufacturers pay their assemblers nearly $18 per hour, while internal sales people at these firms earn approximately $44 per hour. Overall, salespeople have a wide range of pay, from about $30 to more than $60 per hour, and solar designers receive between $30-40 per hour.
• Solar workers are increasingly diverse. Demographic groups such as Latino/Hispanic, Asian/Pacific Islander, and African American, along with women and veterans of the U.S. Armed Forces now represent a larger percentage of the solar workforce than was observed in Census 2013. These higher percentages, coupled with overall growth in solar employment, means workers from these groups are growing in number as well as percentage of the workforce. Women account for over 37,500 solar workers – 21.6% of total – up from around 26,700 in 2013. Nearly 17,000 veterans are employed by solar establishments, compared with just over 13,000 the previous year.
National Solar Jobs Census 2014 continues to demonstrate that the U.S. solar industry is having a positive and growing impact on the national economy and supports jobs across every state in the nation.
As with the previous Census studies, this report includes information about all types of companies engaged in the analysis, research and development, production, sales, installation, and use of all solar technologies – ranging from solar photovoltaics (PV), to concentrating solar power (CSP), to solar water heating systems for the residential, commercial, industrial, and utility market segments.
The findings presented herein are based on rigorous survey efforts that include 66,986 telephone calls and over 25,655 emails to known and potential solar establishments across the United States, resulting in a maximum margin of error for employment-related questions of +/- 2.03%.
Unlike economic impact models that generate employment estimates based on economic data or jobs-per-megawatt (or jobs-per-dollar) assumptions, the National Solar Jobs Census series provides statistically valid and current data gathered from actual employers. This analysis also purposefully avoids artificially inflating its results with questionable multiplier effects often found in analyses of other industries.
No Quick News Today.
How solar owners can be 'good citizens of the grid'; A new SunPower Roadmap points to solutions for the PV challenges utilities face.
Herman K. Trabish, November 19, 2014 (Utility Dive)
A major force in the solar industry just sent a message to utility regulators—with an attachment.
The message: Solar can be part of the solution instead a part of the problem. The attachment: A Roadmap to where utilities and owners of distributed solar can partner in a shared and reliable grid.
“Both utilities and the solar industry have a lot to gain by collaborating on how to use the technology,” explained SunPower VP of Policy Tom Starrs of the basic intent in “Bridging the Divide: A Roadmap to Integrating Distributed Generation.” The Roadmap is the thinking “of most of SunPower’s strategic leadership,” Starrs said.
Sun Power is one of the vertically-integrated Big Four in U.S. solar, along with SolarCity, First Solar, and SunEdison. It is the second biggest U.S. module manufacturer, makes one of the highest efficiency mass-market modules in the world, has consistently ranked among leading installers in solar leasing, and supplied modules for the MidAmerican Energy-owned 579-megawatt Solar Star Projects, the world’s biggest utility-scale photovoltaic installation.
The premise in the roadmap, which was sent to state utility commissioners who are members of the National Association of Regulatory Utility Commissioners (NARUC) ahead of their annual meeting, is that the solar and utility industries must work together. “We all share a common interest in ensuring a reliable and resilient utility grid,” CEO Tom Werner pointed out in the cover letter.
“The PV industry is recognizing we can’t go it alone and finding ways to work with utilities instead of being antagonists is crucial to our long term success,” Starrs said. “And utilities are recognizing that PV, including distributed PV, is here to stay. Efforts to undermine it are not going to be successful anyway. They might as well find ways to work toward solutions with the industry.”
A shared understanding
Utilities are concerned that grid integration of distributed generation (DG) is eroding their ability to provide basic grid services and SunPower understands the concern, Starrs said, because utilities are among its key customers and because it must work closely with utilities on interconnections. But, he said, the right response to that concern is not to limit solar.
“The U.S. can have a strong, smart 21st century utility network in which solar power can reach its full potential while addressing grid integration concerns,” Werner wrote in the cover letter. “Achieving that goal will be extremely difficult, however, without a shared understanding.”
The Roadmap specifies 8 principles:
Innovate alternative distribution utility business models and regulatory frameworks for cost effective deployment and management of distributed energy technologies with new smart tools that improve grid performance.
Keep solar growing with net energy metering until solar penetration levels affect distribution utility fixed cost recovery or impose distribution system upgrade investments.
When solar penetration rises, implement a gradual transition to new rate structures and service arrangements that send price signals that improve grid efficiency, reliability, and resilience.
Develop transparent, predictable, and consistent rate structures and market services that allow customers the opportunity to adapt to them.
While alternative rate structures are developed and implemented, minimum monthly bills are preferable to fixed charges as a way of ensuring that all customers contribute fairly to the costs of operating, maintaining, and improving the distribution system.
Customers’ rights to acquire, deploy, own, operate, and interconnect behind-the-meter technologies, including energy efficiency and management, storage, and clean generation, must be protected.
Interconnection of distributed generation should be streamlined with simple, uniform standards that protect the safety and reliability of utility networks and personnel.
Distribution system operators should make public where grid upgrades will be cost effective and where distributed resources can be built without compromising reliability or imposing network infrastructure costs and reward those who relocate distributed generation accordingly.
Using the Roadmap
Starrs described two different kinds of issues that he says can be resolved by applying Roadmap principles.
One is the saturation of a local feeder system by high PV penetration. It isn’t widespread yet, he explained, but HECO, Hawaii’s electric utility, was forced to impose forceful interconnection constraints against the threat of outages earlier this year.
Another is the saturation of a system with PV. The California Independent System Operator’s infamous duck curve is a forecast of that possibility.
“The ISO is anticipating California will have too much solar on the grid in the middle of the day and not enough solar on the grid to meet the evening peak,” Starrs explained, and its suggested remedies are more gas-fired generation to firm and shape the renewables output, and more transmission to move power, including the new gas-fired generation, across broader regions.
The Roadmap points to solar being efficiently integrated using new technologies. “PV is the core technology,” Starrs said, “but storage is the game changing opportunity. And there are other new hardware and software tools.”
Smart inverters and smart transformers can prevent feeders from being saturated. Smart meters and smart charging systems can allow utility customers “to do demand response, to do load shifting, and to sell excess and stored solar generation into ancillary service markets.”
Stakeholders in Hawaii, including HECO, the Public Utility Commission, and the solar industry, could have and should have anticipated the penetration growth and worked together to create longer term solutions, Starrs said.
By contrast, California’s AB 327 is an example of forward-thinking. “It isn’t a law about what will be changed immediately. It is a law that proposed a 5-year plan and laid out a process to start creating solutions,” Starrs said.
High penetration issues are inconsequential while PV systems remain scattered, Starrs explained. But according to solar growth projections, solar penetration will rise and become consequential. “It is much better for us to develop solutions in advance rather than wait until problems become real,” he said.
The new attitudes and technologies envisioned in the Roadmap, Starrs said, can “enable PV system owners to become good citizens of the grid.”
GOV CHRISTIE’S WHITE HOUSE BID AND NJ OCEAN WIND Christie's 2016 ambitions are stalling N.J. wind energy project, Sweeney says
Matt Friedman, January 26, 2015 (NJ.com)
“…Gov. Chris Christie's presidential ambitions are holding up a wind energy project his administration once championed…[according to State Senate President Stephen Sweeney…who is considered a likely 2017 Democratic candidate for governor…[T]he Senate Environment and Energy Committee voted 4-1 to approve a bill (S2711) that would force the Board of Public Utilities to approve a proposal for a wind farm off the coast of Atlantic City that it has rejected twice…Sweeney also complained that the BPU has also been slow to issue regulations on wind energy, even though Christie signed a 2010 law intended to jump start the industry in New Jersey…At issue is the proposed 25-megawatt Fishermen's Energy wind project, which would consist of turbines about three miles off the coast of the resort…In rejecting the project most recently in November, the BPU — whose members are nominated by Christie and approved by the state Senate — said it ‘has not demonstrated financial integrity.’…Environmentalists and Democrats said the BPU was making excuses to hold the program up…The BPU evaluated the plan with a price of $263 per megawatt hour. But Fishermen's Energy said that was a much higher figure than it proposed, which was $199.17. It has appealed the decision…” click here for more
MILITARY GOES SOLAR IN FLA Gulf Power, military bringing large-scale solar power
January 22, 2015 (Pensacola News Journal)
“…[T]he utility [Gulf Power] submitted [plans] to the Florida Public Service Commission (FPSC) for approval [of three solar projects in Northwest Florida]. The projects could be in service as early as December 2016…This is Gulf Power's second alternative energy project since launching the 3.2-megawatt Perdido Landfill Gas-to-Energy facility in 2010. Together, these new solar facilities, which will be developed by HelioSage Energy, could produce enough energy to power approximately 18,000 homes for one year…Once approved by the FPSC, the solar energy farms will be constructed at Eglin AFB in Fort Walton Beach (30 megawatts), Holley Field in Navarre (40 megawatts) and Saufley Field in Pensacola (50 megawatts). Gulf Power will serve customers across Northwest Florida with power from these renewable energy-generating facilities…[T]he solar farms will not replace Gulf Power's generation plants, but will have the capability to provide energy that will diversify the power supply and provide a cost-effective alternative during peak energy usage…” click here for more
THE MONEY IN EV FAST-CHARGING Can Electric-Car Fast Charging Be Profitable? Answer: Unclear
Stephen Edelstein, January 26, 2015 (Green Car Reports)
“DC fast charging helps alleviate one of the major roadblocks to electric-car adoption--limited range--by giving drivers more ability to travel longer distances…That's why carmakers and other entities back the installation of more and more DC fast-charging sites…The benefits of a quicker charge are obvious for electric-car owners, but...providing power free to entice drivers…[can make operating one financially challenging]…A for-pay market in fast charging hasn't yet emerged…[but] businesses that operate charging stations on their property have to deal with [$20,000 to $60,000 installation costs as well as operating costs so] electric-car drivers could charge for free…[It is not clear that fast charge volumes are high enough to make it a profitable business if the operater charges drivers and it is not] clear what will happen to those hoping to make a profit off fast charging.” click here for more
Fossilized Asset Allocation Still Mis-Pricing Energy And Risk
Hazel Henderson, January 22, 2015 (Ethical Markets via Seeking Alpha)
-All energy sectors are still treated alike, dominated by fossil fuels. Energy assets based on commodities: coal, oil, gas, uranium are confused and conflated with energy technology stocks.
-Energy technology stocks in solar, wind, batteries, efficiency, hydro, ocean-based and other emerging technologies are drowned out in this oil-dominated model.
-Oil price volatility will continue as a wild card and presents an opportunity to address today’s massive mispricing of energy and risk.
-Disaggregation and granulation of data is needed while splitting fossilized asset allocation buckets into newer energy commodities and energy technology classifications.
As I wrote in 2008 in Updating Fossilized Asset-Allocation Classes, all energy sectors are still treated alike, dominated by fossil fuels. This means that energy assets based on commodities: coal, oil, gas, uranium are confused and conflated with energy technology stocks in solar, wind, batteries, efficiency, hydro, ocean-based and other emerging technologies which are drowned out in this oil-dominated model. Even as oil prices fluctuate wildly, dipping below $50 in January 2015, this commodity price volatility affects both other commodities' asset values as well as highly leveraged producers and refiners, since 16% of junk bonds are energy-related. While macroeconomic effects are very real and wildly divergent between countries and sectors, this focus is on data, models and metrics. Oil prices primarily affect and misprice the energy technology players whose sunk or securitized capital costs are now producing fuel from the sun's daily photons which are free.
Oil price volatility will continue as a wild card in 2015 and presents an opportunity to address today's massive mispricing of energy and risk. Confusion and misallocation of investments in the energy sector now can only be clarified by further disaggregation and granulation of data while splitting fossilized asset allocation buckets into newer energy commodities andenergy technology classifications while including subsidies across all energy sectors.
● Energy commodities should be split from other commodities - particularly food affected by unsustainable land-based biofuels. Separate "buckets" are needed for fossil-based fuels: coal, oil, gas, uranium and mining with fossil fuel-producing equipment and refining companies also treated separately. Photon-based energy captured by solar, thermal, photovoltaics, wind, ocean turbines, wave power, all of which are free after sunk or securitized capital investment, are covered by Ethical Markets and in Bloomberg New Energy Finance. These sources should be broken out for comparison with fossilized fuels and nuclear fuel (uranium).
● Energy capital requirements for non-renewable fossil fuel production, refining and marketing should be broken out such as by Carbon Tracker. Photon-based renewable energy should be separately tracked and accounted for - so actual comparisons can be calculated.
● External costs of production of all energy sources should be calculated, such as by Trucost, and stated in shadow pricing: e.g., water use comparisons between nuclear, coal, oil and gas electricity versus solar thermal, PV, wind, hydro and low-head hydro. Safety costs should also be calculated.
● Energy efficiency and storage technologies need separate classification to capture the real price of waste and inefficiencies. These and subsidies, calculated by energy and exergy experts, waste up to 40% of possible productivity across entire economies in the USA, China, India, Canada, Russia and Eastern European countries.
● Sustainability Sector - Lastly, we need a new asset allocation bucket for the burgeoning green sectors and technologies we cover in our Green Transition Scoreboard®: solar, wind, geothermal, efficiency, storage, wave power, hydro, biofuels from seawater-grown algae, electric vehicles, green infrastructure, green bonds, yieldcos and fossil-free portfolios. Such private investments since 2007 currently total $5.7 trillion worldwide. We project that these current levels of $1 trillion or more annually can leave the fossil fuel era behind by 2020 as humanity enters the knowledge richer, cleaner, greener, more equitable societies of the Solar Age.
BUILDING THE SOLAR TO BUILD SOLAR Solar energy: building a new industry in WNY from the ground up
David Robinson, January 23, 2015 (The Buffalo News)
“…With SolarCity pledging to create 2,900 new jobs from its new factory now under construction…and with Japanese-manufacturer Solar Frontier studying the feasibility of opening a plant here, state officials are optimistic the [Buffalo] region is moving toward becoming a center for solar energy manufacturing…To do it, the state is pledging to invest $750 million from Gov. Andrew M. Cuomo’s Buffalo Billion economic development initiative to build and equip SolarCity’s factory. It also would provide millions of dollars in support for Solar Frontier, if the company decides to build a plant here…[T]he SolarCity plant, scheduled to open sometime during 2016, would be one of the world’s biggest factories, with the annual capacity to make enough solar modules to generate 1,000 megawatts of electricity. SolarCity executives have said they need the Buffalo plant’s capacity to meet what they see as the continued rapid growth in the demand for new solar energy systems…SolarCity has agreed to give the state an exclusive four-month window to negotiate a potential expansion of its Buffalo manufacturing capacity, to as much as 5,000 megawatts…” click here for more
WHAT WIND NEEDS The Key To Making The Most Of Rising Wind Energy Production Is…
Alfredo Parres, January 23, 2015 (Clean Technica)
“…Global wind power capacity is set to grow by a further 50 to 100 percent by 2020, so it’s well worth considering how to make the most of these wind resources and the challenges that must be faced…Denmark produced 39.1 percent of its electricity from wind, with its most productive month exceeding 60 percent. One some blustery days, the country sourced more than 90 percent of its electricity from wind…[T]he United Kingdom and Germany also set record highs for wind energy…In Texas, regulators say turbines in the state set a new wind power record, 10,296 megawatts, on March 26, 2014. This accounted for nearly 30 percent of the 35,768 megawatts of electricity coursing through the grid…By the end of 2013, China had an installed capacity of more than 90 gigawatts…From a technical point of view, the intermittent nature of wind presents challenges…Grid operators demand stability. Poor power quality can lead to instability and outages…[T]here is no single solution…[One is the] ability to import and export electricity…[Another is that wind farms must] ensure their output meets grid code requirements by mitigating the impact of transient voltages and power dips…[Finally, adequate transmission reduces curtailments and wind-related negative electricity pricing]…” click here for more
NEW DIRECTIONS FOR BIOFUELS Biofuel industry at crossroads awaiting EPA ruling
James Osborne, January 20, 2015 (The Dallas Morning News)
“Seven years ago President George W. Bush signed a law mandating refineries blend fuels derived from corn, animal fat and plant waste into the nation’s fuel supply. But the industry it spawned says it’s on the verge of plant closures and layoffs if the federal government doesn’t clear up uncertainty about future fuel standards…The renewable fuel standard, which sets year by year mandates for ethanol, biodiesel and other biofuels, has come under debate in Washington over concern there is already too much ethanol within the nation’s gasoline supply…At the same time, U.S. oil production has increased 80 percent since 2010…[Ethanol is no longer needed to reduce] U.S. oil imports…That has left the biofuel industry in regulatory gridlock. The EPA has not updated the renewable fuel standard since November 2013. That year biodiesel production hit 1.8 billion gallons. But with no new standard, that number fell to 1.75 billion gallons in 2014…” click here for more
President Obama explains why the Republicans’ “I’m not a scientist” dodge for dealing with climate change doesn’t work. From CleanEnergySACE via YouTube
Calling out the world’s wealthiest. From Comedy Central
Climate change inaction pushes 'doomsday clock' closest to midnight since 1984; Symbolic clock is now at three minutes to apocalypse, the darkest hour for humanity since the cold war
Suzanne Goldenberg, 22 January 2015 (UK Guardian)
“The symbolic doomsday clock moved to three minutes before midnight… because of the gathering dangers of climate change and nuclear proliferation, signalling the gravest threat to humanity since the throes of the cold war…It was the closest the clock has come to midnight since 1984, when arms-control negotiations stalled and virtually all channels of communication between the US and the former Soviet Union closed down…The move came as scientists sounded a warning about climate change for the second time in three years…2014 was the hottest year in 130 years of systematic record keeping. Nine of the 10 hottest years on record have occurred since 2000…But the scientists suggested that the greater danger lay in the failure of leaders to recognise and act on climate change…The greenhouse gas emissions that cause climate change have risen more since 2000 than in the three previous decades combined…[Yet, negotiators have] steadily lowered their ambitions for a global climate deal…In 1991, when the threat of nuclear annihilation receded with the end of the cold war, the clock stood at 17 minutes to midnight…” click here for more
Solar Panels Floating on Water Will Power Japan's Homes; More solar power plants are being built on water, but is this such a good idea?
Bryan Lufkin, January 16, 2015 (National Geographic)
"…[F]loating solar structures have been announced in, among other countries, the United Kingdom, Australia, India, and Italy…The biggest floating plant, in terms of output, will soon be placed atop the reservoir of Japan'sYamakura Dam in Chiba prefecture, just east of Tokyo. When completed in March 2016, it will cover 180,000 square meters, hold 50,000 photovoltaic solar panels, and power nearly 5,000 households…The Yamakura Dam project is a collaboration byKyocera (a Kyoto-headquartered electronics manufacturer), Ciel et Terre (a French company that designs, finances, and operates photovoltaic installations), and Century Tokyo Leasing Corporation…Placing the panels on a lake or reservoir frees up surrounding land for agricultural use, conservation, or other development…[but] floating solar energy plants present relatively new difficulties. For one thing, everything needs to be waterproofed, including the panels and wiring…[There must be] adherence to regulations on water quality…[Testing is necessary to] make sure the platforms could withstand the whims of Mother Nature [like typhoons, earthquakes, landslides, and tidal waves…Many nations [with limited available land] could benefit from floating solar power. And Japan is their poster child…” click here for more
Germany more than doubled its offshore wind power capacity in 2014
January 19, 2015 (ZME Science)
“In 2014, Germany installed 543 offshore wind turbines, reaching a capacity of 2.35 gigawatts (GW), getting closer to their plans of having 6.5 GW of wind energy infrastructure installed and connected by 2020…[Germany’s] renewable energy sector has grown from 6.4% in 2000 to just over 30% in 2014. For the first time, non-hydro renewables (wind, solar and biogas) accounted for a larger portion of net electricity production than brown coal. While peak-generation from combined wind and solar reached a new all-time high of 74% in April 2014, wind power saw its best day ever on December 12, 2014, generating 562 GWh. Germany is already being called ‘the world’s first major renewable energy economy’…Wind is a major player in the increasing renewables…The offshore energy sector has more than doubled in 2014 alone,..Unlike onshore farms, offshore parks face no limit on turbine size, while steady sea winds allow them to turn about 42 percent of the time, about double the “load factor” onshore…” click here for more
China Nears Publication of Plan to Guide Geothermal Developments
Jannuary 21, 2015 (Bloomberg News)
“China could be nearing publication of a plan to guide the development of geothermal energy resources over [the years 2016 to 2020 as soon as July] as it plunges ahead with efforts to get more of its energy from renewable sources…according to Liu Jinxia, head of the geothermal research institute at Sinopec Star Petroleum, which acts as a government think tank and is authorized to research geothermal energy…The National Energy Administration and the Ministry of Land and Resources are currently reviewing the geothermal development plans from dozens of local governments…A detailed plan would map out China’s geothermal resources and outline how companies and governments could commercialize the energy source…China has one-sixth of the world’s geothermal resources, according to Sinopec Star Petroleum. Even so, the country had just 28 megawatts of geothermal generating capacity at the end of 2014, or 20 times less than neighboring Japan…The government’s current plan is for geothermal energy by 2020 to replace 50 million metric tons of coal a year and account for about 1.3 percent of China’s energy mix…” click here for more
US Senate refuses to accept humanity's role in global climate change, again; Senators accept global warming is not a hoax but fail to recognise human activity is to blame, nearly 27 years after scientists laid out man’s role
Suzanne Goldenberg, 22 January 2015 (UK Guardian)
“It is nearly 27 years now since a Nasa scientist testified before the US Senate that the agency was 99% certain that rising global temperatures were caused by the burning of fossil fuels…And the Senate still has not got it…The Senate voted virtually unanimously that climate change is occurring and not, as some Republicans have said, a hoax – but it defeated two measures attributing its causes to human activity…Only one Senator, Roger Wicker, a Republican from Mississippi, voted against a resolution declaring climate change was real and not – as his fellow Republican, Jim Inhofe of Oklahoma once famous declared – a hoax. That measure passed 98 to one…But the Senate voted down two measures that attributed climate change to human activity – and that is far more important…Unless Senators are prepared to acknowledge the causes of climate change, it is likely they will remain unable and unwilling to do anything about it…Democrats had planned the symbolic, “sense of the Senate” votes as a way of exposing the Republicans’ increasingly embarrassing climate change denial. Further climate votes will come up…” click here for more
Google’s new wind turbine; Makani, a 600kW wind turbine based on the concept of kiteboarding, is currently under development at Google's R&D lab, Google X.
January 21, 2015 (Today’s Energy Solutions)
“Google X's Makani X is working to…[develop] energy kites, a new type of wind turbine that uses lightweight electronics, advanced materials, and smart software to generate more energy with less materials – all at lower cost…While wind turbines have reduced wind energy costs, they don’t make economic sense in [some] places…[It] is made possible by recent technological innovations. Computers have become smaller and more powerful, while carbon fiber has become stronger, lighter, and less expensive. These breakthroughs replace tons of steel and concrete with lightweight electronics, advanced materials, and smart software…By using a strong flexible tether, energy kites can reach higher altitudes (80m to 350m) and eliminate 90% of the materials of conventional wind turbines, resulting in lower costs. Because they are more aerodynamic and can access stronger winds in more locations, each individual energy kite can generate 50% more energy…The Makani energy kite system consists of four parts: the energy kite, the tether, the ground station, and the computer system…” click here for more
Why cheap gas can’t kill the electric car
Levi M. Tillemann, January 16, 2015 (Washington Post)
“From 2010 to 2014, U.S. electric car sales surged from almost nothing to about 120,000 per year. But the haters and doubters persist…[and now gasoline] prices have plummeted…[to near] $2 per gallon nationally…[A] key selling point for electric vehicles — low fuel costs — is gone [but EVs are not in trouble because] today’s electric car boom isn’t really about oil prices at all; it’s about clean air. Under the leadership of California, a group of environmentally progressive states (Oregon, New York, Maryland, Massachusetts, Vermont, Rhode Island and Connecticut) has created market-based mandates that set a floor under the electric-vehicle market…The goal is to have 3.3 million of them on their roads by 2025. Thanks to clever policy design, the survival of electric cars doesn’t depend on the vagaries of the global oil market…For more than a century, electric cars have repeatedly lost out to oil…[But California’s electric-car program isn’t tied to oil prices...Implementing the mandate was a long, iterative process…But California kept going. Because the state was America’s largest auto market, it was too big for carmakers to abandon…Today America is the world’s largest market for electric cars, and about 90 percent of them are sold in states following California’s program…The electric-car effort is just the kind of strategic planning that will be needed to transition away from fossil fuels, avoid the next oil shock and drive America toward a clean-energy economy…” click here for more
Enhancing microbial pathways for biofuel production
January 21, 2015 (Phys Org)
“Researchers from the DOE JGI and the Joint Bioenergy Institute identified genes in an E. coli microbial metabolism pathway that could improve the production of terpenes…Terpenes are high-energy compounds produced in microbes and plants that could be used for producing biofuels. Enhancing terpene yields could lead to commercial-scale production of these biofuels…Terpenes are hydrocarbons in plants such as conifers that act as a self-defense mechanism against pests, among other functions. Bioenergy researchers [from from U.S. Department of Energy Joint Genome Institute (DOE JGI) and the Joint Bioenergy Institute] see terpenes as high-energy metabolites that could be used for producing biofuels from plant feedstocks…[T] he biochemical pathway [of terpene production] in eucalyptus leaves [could help] develop a sustainable alternative to jet fuel…” click here for more
Is South Carolina solar about to explode?; A comprehensive solar law due by March 2015 could make the state ready for a solar boom.
Herman K. Trabish, November 18, 2014 (Utility Dive)
South Carolina’s solar advocates, utilities, electric cooperatives, and regulators are doing something almost no other state has done: Getting ready for high solar penetration before it hits.
Many think the preparation will lead to something unprecedented: Booming solar growth without bitter utilities.
“In other states there has been a lot of adoption, and then they discovered they had policies that were causing big fights,” explained Electric Cooperatives of South Carolina Government Relations Vice President John Frick. "As use increases, rate structure issues get bigger and technical issues come quickly, like a tipping point, at higher penetrations. Our idea was to get ahead of mass adoption so it would not be necessary to correct messy policy later.”
South Carolina’s electric rates have long been among the lowest in the country. But two of its three leading utilities—South Carolina Electric and Gas, a subsidiary of SCANA Corporation, and the publicly-owned Santee Cooper—partnered on two new units for the V.C. Summer Nuclear Station.
Seven rate increases to pay for construction costs followed. And in-service dates, once thought to be 2016 or 2017, are now expected to be nearer 2019 or 2020. Meanwhile, the installed cost of solar dropped 19% in 2013 and is expected to drop another 14% in 2014.
Act 236: The law to change it all for solar
To study the emerging solar opportunity, a South Carolina General Assembly-created oversight group organized a coalition of environmentalists, solar advocates, and utilities and electric cooperatives into an Energy Advisory Council. Act 236 was formulated out of its report.
Passed unanimously, Act 236 promises major changes for South Carolina solar, Frick said.
First, it requires regulators to approve a Value of Solar (VOS) methodology. “We wanted a methodology or equation with some durability that utilities could use in developing rate structures,” Frick explained. “The methodology was to value what DERs [distributed energy resources] are worth to the system.”
A second provision establishes the legality of third party ownership (TPO) of rooftop solar. South Carolina is one of the first states in the Deep South to allow solar leasing. With TPO financing, large funds own solar and lease it to homeowners on whose roofs it is built. The funds take all ownership responsibilities and the homeowners get discounted utility bills with little to no upfront costs. TPO has driven solar booms in every state where it is used.
A third provision of Act 236 requires that SCE&G and Duke Energy Carolinas commit to getting 2% of their 5-year rolling peak load average from renewables by the end of 2020.
Half of that has to be DERs. “Even the utility-scale generation cannot be over 10 megawatts,” Frick said, “so the utility cannot just build a 100 megawatt project and be done.”
The Act also expands restrictions on the cap and commercial system size of covered installations under whatever net metering-type rate structure emerges from the VOS proceeding, said South Carolina Coastal Conservation LeagueEnergy and Climate Director Hamilton Davis
“We had a 0.2% cap on the total capacity of any utility’s peak capacity that could be net metered," Davis told Utility Dive. "The legislation increased that to 2%. And the commercial system size was capped at 100 kilowatts. That was moved up to 1 megawatt.”
Finally, the act requires regulators “to harmonize rate structures with the new environment of increasing levels of DER,” Frick said. “The current rate structure is a remnant of an old system. The big question is how to structure rates in a world of people putting energy back into the system and using less from the system.”
Utilities weigh in
One South Carolina utility executive believes Act 236 can work and be fair.
“The way I read the legislation is ‘Let’s figure out the new net metering equation and not have one customer subsidizing another. But, since we need to encourage early adoption of DERs, we will limit what we are asking of consumers,’” explained CEO Robert Hochstetler of Central Electric Power Cooperative, which distributes about a third of South Carolina’s generation through the state’s 20 electric cooperatives.
“The Act limits the monthly burden on IOU ratepayers to $1 for residential consumers, $10 for commercial consumers, and $100 for industrial consumers,” Hochstetler said. “Coops are only required to report potential impacts of the Act to the commission. But we will need to do something similar because things go wrong in the coop world when they aren't relatively similar for the people we serve and other consumers.”
“One thing we have to be very careful of is cross-subsidization,” said York Electric Cooperative CEO Paul Basha, who is not sure about the new law. “We want to offer solar but we cannot subsidize it because the vast majority of our members do not want solar and the last thing we want to do is put charges on their bill to subsidize somebody else.”
The value of solar methodology and the solar 'land grab'
The VOS methodology debate will determine whether there is a cross subsidy. It will also inform future rate structures and the new net metering provision. It is ongoing. Participants, including many who helped write Act 236, will soon know if they can sustain the collaborative spirit that produced the law. If a completed VOS methodology appears unlikely to be achieved by the March 31, 2015, deadline, a contested regulatory proceeding will be necessary. Testimony and filings will begin December 11.
“Net metering is a tough issue,” Hochstetler said. “This proceeding will determine what should be included in costs and benefits. They have to be quantifiable and measurable. Defining those terms for use in formal proceedings is intended to give regulators and stakeholders less to argue about.”
York Electric owns an 8-kilowatt system for its offices and serves surburban Charlotte, where interest is higher in solar than in rural parts of the state. But Basha has seen little interest in offers to provide members with preferred vendors, new system quality assurance, or system maintenance. There has been some interest in community solar.
“Some folks say solar will bust open when the details of Act 236 are worked out,” he said. “But some say it will be a lot more subdued. I don’t know. We are going to sit back.”
Hochstetler, on the other hand, is concerned for his members because representatives of solar companies are aggressively pursuing landowners.
They represent “big reputable companies that want to build massive utility-scale projects and smaller companies planning 1-megawatt and 2-megawatt installations,” he said.
“It feels like a land-grab. Farmers are finding flyers on their cars when they come out of church that say, ‘if you have 200 acres near a power line, call me.’”
Their land could be valuable, Hochstetler tells members, but they better check the company making the offer and get legal advice.
“We definitely have uncertainty right now and essentially everything is at a standstill,” Davis said. “But there are expectations about the utility programs offering better incentives and better investment opportunities. I think we will have a lot of activity in solar once this Act is implemented next year.”
NEW ENERGY, OIL TO RECONCILE? The End of the Partisan Divide Over Climate Change
Tom Zeller, Jr., January 18, 2015 (Forbes)
“… From the stock markets and Wall Street to the boardrooms of Big Oil — and even the living rooms of Republican voters — the era of reflexive skepticism and denial of basic climate science appears to be coming to a close…That won’t likely mean an end to partisan bickering…[But amid the American Petroleum Institute annual State of American Energy Report’s] bullish assessment of the nation’s ongoing boom in shale oil and gas, the leading fossil fuel trade group clearly and unequivocally acknowledged the threat of global warming, and highlighted — at some length — the steady rise of solar power as an encouraging sign…The report goes on to note that the solar power sector has shaved installation costs and enjoyed over 40 percent growth over the last year…[It also] savages the Environmental Protection Agency’s Clean Power Plan, which seeks to cut carbon pollution from existing power plants, arguing that it will kill the coal industry and cause significant harm to the nation’s economy…[Yet the] nation’s largest and most powerful oil lobby [stated] in no uncertain terms that climate change is real, that it’s a threat to American prosperity, and that clean energy technologies promise a solution…” click here for more
SOLAR APPLAUDS OBAMA SOTU SUPPORT President Praises Solar Progress in State of the Union Speech
January 20, 2015 (Solar Energy Industries Association)
Citing its continued growth, President Obama once again has singled out solar energy in his annual State of the Union (SOTU) speech. Afterward, Solar Energy Industries Association (SEIA) President/CEO Rhone Resch applauded President Obama for making the development of solar energy a top priority when he first took office six years ago and for never abandoning his beliefs in its importance. Resch added that there is an estimated 20 gigawatts (GW) of installed solar capacity nationwide and another 20 GW in the pipeline over the next two years, benefitting both the economy and the endangered environment. There are also, he said, 173,000 Americans currently working in the U.S. solar industry. Growth, Resch pointed out, has been driven by effective and forward-looking public policies, such as the solar Investment Tax Credit (ITC), net energy metering (NEM) and renewable portfolio standards (RPS). click here for more
WIND PRAISES OBAMA SOTU, CALLS FOR PTC EXTENSION President Obama’s State of the Union: U.S. leads world in wind energy production
January 20, 2015 (American Wind Energy Association)
President Obama highlighted U.S. wind energy as an American success story, noting that the U.S. produces more wind energy than any other country in the world, a dominance due to U.S. wind turbines’ being nearly twice as productive as those in China and Germany…Iowa is helping the nation achieve this global leadership position by leading the U.S. in the percentage of electricity the state generates from wind power…and wind is one of the few things newly elected Sen. Joni Ernst (R-IA) and President Obama agree on…Late last year, the key federal incentive for wind investment, the Production Tax Credit (PTC), was extended for only two weeks before expiring again on December 31. Wind’s costs have dropped more than 50 percent over the past five years, thanks to the productivity and innovation driven by performance-based incentives like the renewable energy PTC. Uncertainty about it is harmful for business, and puts 50,000 U.S. wind industry jobs, with 500 manufacturing facilities in 43 states and an annual average investment of over $17 billion, at risk, especially because wind will be key in states’ compliance with the Environmental Protection Agency’s (EPA) first-ever proposed rule to reduce carbon pollution at existing power plants. click here for more
Big storage procurements leave more questions than answers; If storage is such a good idea, why is SoCal Edison buying so much natural gas?
Herman K. Trabish, November 13, 2014 (Utility Dive)
November has been energy storage's month, with big purchase announcements captivating the energy industry and its media. Utility Dive was not alone in past weeks expressing excitement and optimism that two big buys out of California and Texas could mean that storage is ready for the big leagues.
But might it be too soon to celebrate?
Oncor’s proposed $5.2 million battery purchase for the Texas grid is greatheadline fodder, but it is far from a done deal and could require storage costing $350 per kilowatt-hour.
Southern California Edison's (SCE) purchase of five times the storage it was obligated to acquire was similarly eye-catching, but looking deeper into the same procurement tranche raises questions about price and storage's ability to assist in decarbonizing the energy system.
And while California's IOUs—SCE and PG&E principally—are bullish on solar, the same certainly cannot be said for the state's municipally-owned utilities.
“It is good news that Edison bought more storage than they were required to,” said Center for Energy Efficiency and Renewable Technologies (CEERT) Executive Director V. John White. “Storage has great value to the power system, especially when it is deployed with other things. But why are they buying so much combined cycle natural gas capacity?”
The SCE Local Capacity Requirements (LCR) buy of 1,892 megawatts was to replace generation from the shuttered San Onofre Nuclear Generating Station and planned closures of once-through-cooling natural gas plants required by water conservation measures.
What Southern California Edison bought
Through a competitive bidding process, SCE acquired 130 megawatts of energy efficiency, 75 megawatts of demand response, 44 megawatts of customer-sited renewables, 261 megawatts of energy storage, 1,284 megawatts of combined cycle natural gas capacity, and 98 megwatts of peaking natural gas capacity. The energy storage purchase represents five times more storage capacity than SCE was obligated to purchase under California law.
“This is a historic event in the history of the grid. We have definitely reached a turning point, or a no-turning back point!” celebrated California Energy Storage Alliance co-founder Janice Lin. “AB 2514 and the subsequent Petermen decision to require California’s IOUs to procure energy storage required stakeholders—the utilities commission, utilities, industry—to focus on how it can be used on the grid. And guess what? They are.”
Though not a big chunk of California’s electric power system demand, which can be over 50 gigawatts, the 1.325 gigawatts of energy storage by 2020 mandate is big for the storage industry, Lin said. "It is enough to have utilities learn by doing.”
“We need to try some things out and see how they work and recalibrate,” White agreed. “We need to show regulators and grid operators that preferred resources—renewables, efficiency, demand response, storage—may be pretty and green but they are also smart and capable of supplying a large fraction of the reliability services the system needs.”
But, White added, “we have heard from the CPUC and CAISO and the utilities that we don’t need base load. Yet SCE is buying combined cycle natural gas capacity, the very thing they said they don’t need. It seems odd.”
“Because they typically have 20 year to 25 year contracts with a utility, new gas plants create long-term commitments to fossil fuels that interfere with California's ability to rapidly decarbonize its energy system,” Sierra Club Environmental Attorney Matt Vespa noted.
There has been pressure from the Governor’s office to make sure SCE does not compromise reliability in this procurement, said a California utility industry veteran who asked not to be named. But the fact that AES Energy Storage won so much of the battery storage and so much of the combined cycle capacity raises questions. “Was there some tie-in bid so they (SCE) got a good price?” the source wondered.
It also raises questions because SCE bought the minimum capacity and maximum amount of natural gas under the LCR parameters, the source added.
“They did the least they had to do, but used the procurement to obtain a big portion of their mandated storage.”
On the other hand, the source said, “Edison embraced the storage mandate early and bought stuff that could make a difference, and they bought enough of it to test at scale.”
The cost of storage and California's public utilities
The estimated $350 per kilowatt-hour price mentioned for the Oncor proposal from a Brattle Group report is very high, the source said. “Batteries are still out of the money. People talk about the prices coming down but they have a long way to go.”
“By 2018 the cheapest commercial-scale storage options will run about $244 per installed kilowatt-hour,” according to a report from Energy Strategies Group. If that projection is realized, it would be significantly lower than the report’s estimated $348 per installed kilowatt-hour for natural gas peaker plants.
That is not the collective conclusion of California’s publicly owned utilities (POUs). While AB 2514 mandated that the state’s IOUs acquire storage, it only required the POUs to assess and report by October 1, 2014. Of 31 reports, 29 rejected storage. Burbank Water and Power found it not fully developed and not cost-effective. Sacramento Municipal Utility District found it “not cost effective at this time.”
On the other hand, Los Angeles Department of Water and Power announced its own target of 178 megawatts of storage by 2021, Lin said. More importantly, she explained, “the competition is not on price, it is on value.”
Both peaker gas turbines and stored energy provide peaking capacity but storage can be positioned close to load and so delivered more quickly, Lin said. “And when it is not providing capacity, storage could provide frequency regulation, spin, non-spin, and voltage support, and without emitting greenhouse gases. If it is stored renewables generation, there are no emissions at all.”
Capacity, not energy
“We are not selling energy, we are selling capacity,” explained Ice Energy CFO James White, whose unique Ice Bear storage technology was awarded 25.6 megawatts of the SCE procurement. “For the higher penetrations of wind and solar being mandated by renewables and emissions policies, you need storage even if it doesn’t beat the price of gas. The economics are not the driver.”
Renewables and storage can do whatever gas can do and if the economics are competitive, it will make things go faster, White said. “The CPUC order was that technologies should be selected on a price-competitive basis. That SCE took 261 megawatts when its requirement was 50 megawatts shows the storage market is starting to evolve much more quickly than expected. That will push costs down.”
“It will be cheaper,” Lin said. “When you have inventory in the system, all the fixed assets can be run a lot more efficiently. And if you use the stored energy to meet the peak, you don’t have to have so much excess capacity that is not used. That is going to be a huge savings. It will also result in a more reliable grid because when you have a little storage you are less at risk to things going bad.”