This group brings together the best thinkers on energy and climate. Join us for smart, insightful posts and conversations about where the energy industry is and where it is going.

Post

The Western U.S. Has Some Of America’s Strongest Clean Energy Goals. It Needs More Grid Flexibility To Achieve Them.

Western states like California, Colorado, and Nevada have enacted some of the country’s most ambitious climate laws, with at least five aiming for more than 50% clean energy within the decade.

This quilt of climate goals targets 33% and 64% clean energy across the region by 2026 and 2035, according to research prepared for the Western Interstate Energy Board, which finds the West could meet or exceed these targets – but only by boosting electric grid flexibility.

The Western Flexibility Assessment (WFA) conducted by Energy Strategies highlights grid flexibility requirements for a future where large amounts of renewable energy are deployed as states accelerate electricity sector decarbonization. For example, New Mexico would rise from 20% renewables today to 50% in 2030; Colorado would go from 30% to 60%.

California wind farm construction site
California wind farm construction site.  AMERICAN WIND ENERGY ASSOCIATION

So how can policymakers act now to achieve these targets in the future—and is the grid ready for such a big change?

Grid flexibility could push clean energy to 69% of Western U.S. power supply in 2035

While the West is positioned to achieve its near term clean energy targets, flexibility needs will increase over time, according to the study. If the region fails to implement flexibility-boosting solutions, the authors conclude “the West may lack sufficient grid flexibility to achieve state energy goals.”

“The grid” covers physical assets like power plants and transmission lines, as well as the processes for trading energy and regulating consumption, and both must be flexible enough to accommodate more variable generation from wind and solar energy.

But if policymakers across the Western U.S. add grid flexibility via better market coordination, new transmission capacity, load management, and energy storage, among other measures, it could increase clean energy’s penetration across the West to 69% in 2035.

Western Flexibility Assessment Assumed Renewable Portfolio Standards/Clean Energy Targets State
Western Flexibility Assessment Assumed Renewable Portfolio Standards/Clean Energy Targets State. ENERGY STRATEGIES

The case for increasing western grid flexibility sooner rather than later becomes even stronger when you consider some of the study’s input data is already out of date. Solar, wind, and especially batteries are already much cheaper than the study assumes – meaning the clean energy transition could happen even faster than anticipated, leaving grid operators struggling to keep up.

For example, the study assumes hybrid solar-battery systems cost $120/megawatt-hour (MWh) of electricity delivered, but last summer the Los Angeles Department of Water and Power signed a long-term contract with 8minute Solar Energy for a such a hybrid system at a price below $40/MWh.

Modeling grid flexibility requirements

To understand flexibility requirements, the researchers used four different models to estimate the resource mix that reliably covers western states’ energy needs while satisfying public policy requirements: AURORA™, a long-term capacity expansion model, hub-spoke representation of the grid; GENESYS, a stochastic resource adequacy tool customized for the Northwest; GridView™, a nodal security-constrained economic dispatch model with hourly granularity; and PowerWorld™, a power flow analysis software used to perform full AC power flow simulation and steady-state contingency analysis to identify thermal loading violations in the baseline case system. 

The report’s principle metric for determining how flexible (or inflexible) the grid is how much clean zero-cost electricity is wasted (i.e., curtailed) because it can’t be traded, sold, or stored. 

Western Flexibility Assessment Summary of Key Flexibility Results by Study Case
Western Flexibility Assessment Summary of Key Flexibility Results by Study Case. ENERGY STRATEGIES

The study examines three main cases:

  • baseline case, which builds out the requisite renewable resources with a day-ahead and real-time market coordinating resources across the West, but does not add extra regional transmission or push for policies that might add flexibility
  • limited regional coordination case that further decreases flexibility
  • An integration strategies case that adds storage and strategic transmission assets, engages more demand-side flexibility, and re-optimizes the resource portfolio with strategic renewables siting to better complement the production profiles of other energy resources

Existing policies, technologies can increase Western U.S. grid flexibility

One important conclusion from the report is that costs will rise and policy targets will suffer without integration strategies such as coordinated wholesale electricity markets. “It will be very difficult, or at least extremely costly, to achieve Western policy targets without broad coordination of wholesale markets,” says the WFA. “By the 2030’s, not achieving broad market coordination causes significant increases in operational costs and emissions, withholding much needed flexibility from the Western grid.”

Slightly less obvious, but just as important, is the possibility for stimulating extra flexibility without requiring technological breakthroughs for the regional flexibility needed to reach state goals. Time-tested technologies and strategies such as transmission expansion, pumped storage, market coordination, flexible gas units, load management, and resource mix diversity can all help.

Even though the study already has state targets driving ~9 gigawatts of annual wind and solar additions, fast-falling renewable energy prices may spur even more deployment and compress the time frame of the chart above, accelerating flexibility needs.

The addition of cheaper battery storage will help grid flexibility as variable generation increases, but it is not a panacea: Policymakers need to focus on creating a coherent integration strategy, particularly for inter-regional transmission.

Transmission lines at dusk
Transmission lines at dusk. PIXABAY USER FANCYCRAVE1

Western states can blaze the trail to a cleaner future through grid flexibility

The WFA’s robust analysis shouldn’t be ignored. While stronger inter-regional linkages can clearly create benefits and reduce operational costs, planning, siting, and cost-allocation are challenging outside of a regional transmission organization structure – and are hard even within them. The West needs to ensure this doesn’t fall through the cracks, and western policymakers should focus on five options to start procuring necessary flexibility to meet state clean energy goals:

  • Keep working on markets and regional integration. Energy Innovation has proposed two alternative pathways for wholesale markets to evolve: one relies on a central spot market with decentralized forward procurement between buyers and sellers; the other is a hybrid approach between long-term and short-term energy markets. Wholesale market reform is a no-regrets cost-saving strategy that benefits everyone. But on its own, it will not be enough; the strategies below will also be important.
  • Develop a viable framework for ensuring strategic new transmission gets built in a timely manner. Texas accomplished this by establishing Competitive Renewable Energy Zones to prioritize transmission lines connecting its windiest areas with its most energy-hungry locations.
  • Focus more on demand-side strategies. Policymakers can collect lots of low-hanging flexibility fruit because of smart devices and digital meters, but this requires significant institutional work and viable business models for aggregators. We need both load-shaping (i.e., time-of-use rates) and dynamic load response (distributed loads that can change their behavior as a function of real-time grid conditions). The policymaking process does not possess enough urgency to help overcome barriers like this on the electricity distribution network or across the bulk electricity system, even though tools such as performance incentive mechanisms, which reward utilities for investing in efficiency, can be quite effective.
  • Build out flexibility solutions and ways to absorb excess energy. Some curtailment will always be part of managing a clean grid, but as states approach and exceed 65% clean energy, policymakers should create long-term plans maximize variable power generation. Options include stimulating building electrification by requiring all-electric new construction and switching away from gas-burning appliances and equipment, or encouraging a green hydrogen economy to help decarbonize transportation and industry. These measures can create big pools of demand that help soak up excess renewable energy and can be turned down during production lulls.
  • Create transition strategies for stranded fossil fuel assets. The WFA still includes gas capacity that will eventually have to be replaced or mitigated, considering clean energy goals aren’t likely to top out at 65%. Utilities and communities need financial incentives and local investment to help ensure the economic downsides of retiring fossil fuel generation do not outweigh the benefits.

Significant work must be done to boost grid flexibility on the way to a clean energy economy—sooner rather than later, as the WFA makes clear – because the West’s ability to meet its clean energy and climate goals is at stake. But with the right moves from regulators and utilities, the region can not only meet these goals, but exceed them while providing a model for other parts of the country.

Original post.

Discussions

No discussions yet. Start a discussion below.

Get Published - Build a Following

The Energy Central Power Industry Network is based on one core idea - power industry professionals helping each other and advancing the industry by sharing and learning from each other.

If you have an experience or insight to share or have learned something from a conference or seminar, your peers and colleagues on Energy Central want to hear about it. It's also easy to share a link to an article you've liked or an industry resource that you think would be helpful.

                 Learn more about posting on Energy Central »