Sammy Roth

The Desert Sun

A month ago, California broke its all-time solar record, with nearly 8,800 megawatts of solar power flooding the state's main electric grid on a Friday afternoon. The record stood until the following Wednesday, when more than 9,000 megawatts of solar powered the Golden State, according to the California Independent System Operator, which runs the grid.

That record didn't even last 24 hours.

With the costs of solar continuing to fall, and wind still one of the cheapest sources of new electricity around, California should have no problem hitting its 50 percent clean energy target by 2030.

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But getting to 100 percent — the goal floated by Senate leader Kevin de León in a bill last month — would be more complicated. That's because solar panels only generate electricity when the sun shines, which doesn't always match up with when people use energy. As a result, officials have increasingly been forced to shut down solar farms in the middle of the day, when they're producing more energy than people need. At the same time, solar falls short in the evening. The sun goes down just as electricity demand goes up, forcing the state to fire up polluting, gas-fired power plants.

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A new bill in the state Legislature could help solve those problems.

Introduced by Assemblymember Kevin Mullin, D-San Mateo, the bill would create a "clean peak energy standard" for California utilities. By 2029, utilities like Southern California Edison, PG&E and SDG&E would be required to get 40 percent of their energy from clean sources during "peak demand" periods — the handful of hours each day when homes and businesses use the most energy — on at least 15 days each month.

That requirement would encourage the development of battery storage systems, which could soak up excess solar generation during the middle of the day and release that energy onto the grid after sundown, reducing the need for gas plants. The bill could also speed the adoption of energy efficiency and conservation programs that reduce electricity use during peak periods. Geothermal power plants, which are more expensive than solar and wind but provide clean electricity at all hours of the day and night, could also be a winner.

California's push for renewable energy has been driven by a desire to limit greenhouse gas emissions from fossil fuels, which are the primary driver of climate change. State lawmakers have set an ambitious target of reducing emissions 40 percent below 1990 levels by 2030, then 80 percent by 2050. If California is going to meet those goals, policymakers need to think about how clean energy can run the power grid without help from fossil fuels, rather than just mandating higher and higher levels of renewables, said Andrew Zingale, Assemblymember Mullin's legislative director.

"We can't just load up on more renewables that are happening at the middle of the day, and just keep loading up on (gas-fired) peaker plants to run at the end of the day," Zingale said.

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Is Mullin's bill the wrong approach?

California having "too much solar" during the middle of the day is far from a crisis at this point, but it's getting worse as more solar comes online — and officials are trying to figure out how to deal with it. Stephen Berberich, president of the California Independent System Operator, said recently the grid operator may have to "curtail," or turn away, as much 8,000 megawatts of power at times this spring, most of it solar.

"We've been seeing the oversupply increasing faster than our forecast said it was going to increase," said Steven Greenlee, a spokesperson for the independent system operator.

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California will need to solve that problem, but some experts say Mullin's bill is the wrong approach.

Among them is Eric Hittinger, a public policy professor at the Rochester Institute of Technology, and an expert in the economics of clean energy. If policymakers want to fight climate change, he said, they should mandate reductions in emissions, or increases in renewable energy. Encouraging the development of energy storage, he said, is a strangely indirect way to address climate change, especially when storage is still relatively expensive.

In some ways, Hittinger's argument is classic economic theory: The government should set the end goal, then let the market figure out the cheapest way to solve the problem. Incentivizing utilities to pay for energy storage before it's needed could raise electricity prices unnecessarily, Hittinger said.

"The market will correct itself. If the (over-generation) problem gets worse — and it will — storage will become a natural solution, and people will naturally put storage on the grid," he said.

Arne Olson, a partner at the San Francisco consulting firm Energy + Environmental Economics, made a similar point. As more solar and wind farms are built, and the mismatch between supply and demand grows, the economic case for battery storage will improve.

"These kinds of questions really come down to economics. If there’s a binding (renewable energy) target, or a binding (greenhouse gas) target, then you can work out from there what the most cost-effective, optimal way is to meet that," Olson said.

'They don't have time to let the market figure it out'

Mullin's bill — and a similar measure in the state Senate, introduced by Sen. Nancy Skinner, D-Berkeley — were inspired by a white paper from Strategen Consulting, a Berkeley-based clean energy policy firm. While the paper was commissioned by government officials in Arizona, its lessons apply to California, according to Strategen's Lon Huber, the paper's lead author.

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Huber pushed back against the idea that utilities will start buying energy storage the moment it makes economic sense.

"I'm a markets guy more than anything. But the way that California is going, they don't have time to let the market figure it out and have years of committees and everything," Huber said. "They're already experiencing a massive amount of curtailment (of solar power), and every year it gets substantially worse because they have to meet the 50 percent target by 2030."

Batteries are still too expensive for widespread adoption. But California has a long history of incentivizing technologies that aren't quite ready for prime time, said Sonia Aggarwal, vice president of Energy Innovation, a San Francisco-based policy research group. Legislative action to encourage batteries could spur further cost reductions, leading to benefits down the road, Aggarwal said.

"You're paying for future possibilities. It's not like everything needs to pencil out in the very first year," she said.

More than just batteries

The U.S. added a record 221 megawatts of energy storage in 2016, according to a recent report from the clean-tech consulting firm Greentech Media and the Energy Storage Association, a trade group. A big chunk of that growth was in Southern California. In Los Angeles County, utilities scrambled to bring new storage online to make up for the loss of the Aliso Canyon gas field, which has been shut down since it sprung an enormous leak in late 2015. In the desert, the Imperial Irrigation District debuted a 30-megawatt lithium-ion battery, one of the largest such facilities in the country.

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Zingale, Mullin's legislative director, said the energy storage industry has a significant presence in the assemblymember's Silicon Valley district. He said Mullin's office learned about Strategen Consulting's "clean peak" proposal from people in the storage industry. But he expects Mullin's legislation, Assembly Bill 1405, to do more than just encourage storage.

Indeed, there are plenty of ways for California to increase its reliance on clean power during periods of high demand, from reducing overall energy use to using electricity at different times of day. Aggarwal mentioned demand response programs, which can pay people to shift their energy use toward times when solar and wind are plentiful. Companies are developing creative ways to automate those shifts, so that individual homes and businesses don't have to think about them.

"Batteries are coming down in price extremely quickly, but they're not the cheapest flexibility resource at the moment," Aggarwal said.

Sammy Roth writes about energy and the environment for The Desert Sun. He can be reached at sammy.roth@desertsun.com, (760) 778-4622 and @Sammy_Roth.

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