NewEnergyNews: ORIGINAL REPORTING: New Energy Is The Solution To Reliability Challenges

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    Founding Editor Herman K. Trabish

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    Wednesday, August 12, 2020

    ORIGINAL REPORTING: New Energy Is The Solution To Reliability Challenges

    Increasing renewables and DER demand new reliability approach, but California is falling short, groups say; Resource adequacy's planning reserve margin worked when supply and load were stable, but new system dynamics demand a more dynamic solution to protect reliability, groups say.

    Herman K. Trabish, April 15, 2020 (Utility Dive)

    Editor’s note: Demand is becoming less predictable and reliability solutions need to be available to meet the changes.

    Investor-owned utilities (IOUs) are keeping final responsibility for maintaining a reliable power system as California pursues new resource adequacy (RA) solutions to address the challenges from rising renewables penetration.

    System operators have long relied on reserve generation to supplement basic capacity for meeting system peak demand. A new law and a new regulatory proposal are allowing the state's three dominant IOUs to remain final backups. But renewable generation's variable supply and a shifting customer load due to increased adoption of distributed energy resources (DER) demand new solutions to protect reliability California power system stakeholders agree.

    Today's RA paradigm "is based on central generation to meet a few predictable peaks," Energy Innovation Senior Fellow Eric Gimon told Utility Dive. "Today's digital economy makes a new approach possible. But implementing that approach could threaten [to create] turmoil that is self-defeating unless policymakers see that implementing flexible demand can produce rewards without excess risk." California's energy transition includes another disruptive force, the proliferation of load serving entities (LSEs). Changes in resources, demand and providers have accelerated the state's need to protect reliability.

    Many stakeholders have urged the state's policymakers to set a national precedent by balancing the IOUs' traditional centralized solutions with a bigger role for DER in maintaining reliability. The new law and regulatory proposal don't do that but stakeholders say the debate is not over.

    RA "is pretty much a universal concept in electricity planning," Energy Innovation Vice President Sonia Aggarwal told Utility Dive. "All generation is counted in some kind of resource adequacy framework, and most are based on capacity plus a reserve margin."

    California's RA program was put in place following the state's 2000-2001 energy crisis. The California Public Utilities Commission (CPUC) requires all Load Serving Entities (LSEs) under CPUC jurisdiction, including IOUs, energy service providers (ESPs), and community choice aggregators (CCAs) must meet three resource adequacy obligations. System RA obligations, which apply to the 80% of California load served by the California Independent System Operator (CAISO), require procurements to meet the annual system demand forecast plus a 15% reserve margin. Local RA obligations require capacity to meet a 1-in-10-year weather event and an N-1-1 contingency event determined by the CAISO. Flexible RA is to meet an LSE's biggest monthly three-hour ramp… click here for more

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