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A Billion Dollar Milestone for the Western Grid

A celebrated political adage goes something like “a billion here, a billion there, and pretty soon you’re talking real money.” Everyone who is part of the giant 14-state western power grid just learned of a $1 billion reduction in their utility bills, courtesy of a regional initiative called the Energy Imbalance Market (EIM).

The announcement came today from the California Independent System Operator (CAISO), which worked with utilities and regulators across the West to create the EIM in 2014 to reduce electricity costs by giving utility customers more access to inexpensive, renewable (and clean) energy. The CAISO announcement also noted that since the EIM’s inception, it has cut carbon pollution by more than half a million tons throughout the region. That’s the same as avoiding the tailpipe emissions from more than 110,000 passenger cars.

Where did these benefits come from? The Energy Imbalance Market is an ingenious way to minimize the cost of balancing electricity use and generation across a giant grid operating at quite literally light speed; the market chooses the least-cost available power generation across a wide area, minute by minute, to fill gaps created by sudden unexpected reductions in output from other generators.

Since renewable power plants invariably have lower operating costs than fossil plants (because the sunlight and wind are free), the EIM results in both lower bills and reduced pollution. As more and more utilities join the market, the benefits steadily increase. My former colleague Carl Zichella recently chronicled the EIM’s rapid growth since 2014, with twenty-one major utilities now enrolled. This broad acceptance (by diverse constituencies) reflects in part an oversight board of widely respected experts based throughout the western grid.

Western Energy Imbalance Market - Active and Pending Participants

CAISO’s billion-dollar announcement represents an important milestone in a regional journey toward a fully integrated Western grid, in which full coordination of power plant operations and transmission management doubles down on the EIM concept.

Today’s announcement also means there’s more clean electricity flowing into western homes and businesses, and more downward pressure on utility bills. There are many more billions of dollars and millions of tons of emissions reduction yet to come, as additional systemwide coordination accelerates our clean energy transition.

Soon we will indeed be talking real money and pollution reductions.

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Joe Deely's picture
Joe Deely on Jul 30, 2020

Great article Ralph.

The good news just keeps on coming for the Western grid...

New Mexico regulators approved PNM plan where they will be investing $1B in solar/storage to replace coal generation from San Juan coal plant.

New Mexico regulators on Wednesday unanimously approved a plan to add renewable energy and storage to replace a portion of the San Juan Generating Station's capacity owned by Public Service Company of New Mexico (PNM).

The portfolio includes 650 MW of new solar resources and 300 MW of battery storage, totaling over $1 billion in investments within the districts impacted by the San Juan plant closure. PNM, the state's largest utility and majority owner of the San Juan plant, had recommended a "hybrid" replacement scenario that would have allowed the utility to add 280 MW of gas-fired power alongside wind, solar and battery storage to replace its 497 MW retail share of the plant.

Regulators' decision to choose the all-renewables portfolio was "basically unavoidable," Public Regulation Commissioner Cynthia Hall told Utility Dive. A 100% renewables portfolio was the only replacement option that fully satisfied the state's Energy Transition Act (ETA), passed last year, which requires the state to make an economically just transition to 100% carbon-free energy by 2045, she said.

EDF announced their large solar/storage project for NV Energy in Nevada.

EDF Renewables plans to build a 200-megawatt solar plant with a 180-megawatt/720-megawatt-hour battery for Nevada utility NV Energy, the developer announced Wednesday, adding to the growing list of large solar-and-storage projects under construction within the state and the broader region.

Switch broke ground on a large behind the meter solar/storage project.

Technology infrastructure company Switch and asset management firm Capital Dynamics have announced the groundbreaking of three developments in Nevada, one of which is claimed to be the largest behind-the-meter solar project in the world.

All three projects comprise Switch’s Gigawatt 1 initiative, which will soon generate 555MW of solar power and create 800MW hours of battery storage.

Work has started on plants in Clark and Storey counties in the state. According to the companies, the Storey County location will be "the largest behind-the-meter solar project in the world", producing 127MW and including a 240MWh battery storage system

By 2030, almost all current coal generation(2019=150TWh) will be gone in the Western US. This will occur with no increase in NG generation - all the coal generation will be replaced by renewables.

Note: highly recommend the article by Carl Zichella mentioned by Ralph.

 

Bob Meinetz's picture
Bob Meinetz on Jul 31, 2020

Ralph, half a million tons of reduced carbon emissions since 2014 is nothing. How much have ratepayers paid in curtailment costs to meet that lofty goal?

Whatever it was, it was a waste of money. Worse than a waste, it helped California's PUC to justify the shutdown of Diablo Canyon Power Plant, the source of 18 trillion watts of clean electricity each year - rain or shine, windy or calm. Do you know how many tons of CO2 Diablo Canyon prevents from warming the atmosphere, Ralph? 9 million tons each year.

If your council really wants to defend natural resources, NRDC really needs to stop playing around with solar panels. At that rate, you'd need over one hundred WIMs just to match the carbon savings of our one little nuclear power plant. There's no comparison.

Joe Deely's picture
Joe Deely on Jul 31, 2020

The Western Grid since 2010:

 In TWh    2010  2019

Solar            1       65

Wind          25      58

Hydro        163     166

Nuclear     73       57  

NG            215     236

Coal          221     150

Solar/Wind were 12% of coal generation in 2010. Solar/Wind should almost match coal generation in 2020.

What will these numbers look like in 2030? Where is the puck going?

 

 

Ralph Cavanagh's picture

Thank Ralph for the Post!

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