Category Archives: Energy innovation

Emerging technologies and institutional change to meet new challenges while satisfying consumer tastes

A brief reply to “Real” Electricity Still Comes from the Grid

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Source: “Real” Electricity Still Comes from the Grid

Catherine Wolfram at UC Berkeley posted about their paper looking at costs of distributed energy systems in Kenya and concluding that these were too expensive for households compared to connecting to the grid. However, the paper came under immediate criticism.

Here’s my thoughts based on her representation of the paper’s findings, some of which are mirrored by other commentators:

First, the paper talks about costs on one side, but doesn’t put them in perspective to the alternatives. The post lists the cost of the individual systems, but not the expected connection costs to the grid.

Further the paper takes a static look at current costs and doesn’t account for the differential trends in the sets of costs for an home-based system versus connecting to the grid. The latter costs can be expected to be steady or even rising, while it’s well known that both solar and storage costs have fallen rapidly.

Different scales of “grid” also are important. For example, solar projects show scale economies up to about 3 MW but then modular construction flattens the per kW cost. A village microgrid separate from a national central grid may be quite cost competitive.

Finally, the paper appears to lump large hydro in with other utility-scale renewables. The environmental (and economic development) record for large-scale hydro projects in the developing world is dubious at best. There is evidence of significant methane emissions from tropical reservoirs. Habitat is destroyed and poorly designed projects don’t deliver expected benefits. Hydro is by far the largest energy supplier on these grids, and they may be little better than coal from an overall environmental perspective.

Getting EV owners to participate in electricity storage

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Reblog: If you like your time-invariant electricity price, you can keep it

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Severin Borenstein at the Energy Institute at Haas makes the case for giving customers the choice of TOU or fixed price rates. I’ve commented several times on the Energy Institute blog about this approach, and blogged myself about the need for this option.

Source: If you like your time-invariant electricity price, you can keep it

An economically attractive environmental solution in peril

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The agreement to take down PacifiCorp’s dams on the Klamath River is in peril. In 2006 we showed in a study funded by the California Energy Commission that decommissioning the dams would likely cost PacifiCorps ratepayers about the same as relicensing. That mitigated the economic argument and opened up the negotiations among the power company, farmers, tribes, environmentalists and government agencies to came to an agreement in 2010 to start decommissioning by 2020.

The agreement required Congress to act by the end of 2015 and that deadline is looming. Unfortunately, there are still opponents who mistakenly believe that the project’s hydropower is cheaper than the alternatives. In fact, the economics are even more favorable today whether PacifiCorp uses natural gas or renewables to replace the lost power. And this analysis ignores the benefits to the Klamath fisheries from decommissioning. It’s too bad that bad simplistic economics can still get traction in the legislative process.

The decisions utilities must make soon

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Jeff McMahon at Forbes wrote a nice two-part series on the existential decisions that utilities face going forward. Part 1 is here, and Part 2 here. I posted earlier a longer article from the New Yorker looking at the changing landscape.

Energy Institute @ Haas takes on DOE weatherization study

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Are the Benefits to the Weatherization Assistance Program’s Energy Efficiency Investments Four Times the Costs?

The authors of a study questioning the net benefits of the Weatherization Assistance Program critique the use of non-energy benefits to swing the program assessment to a net positive results. (The authors have responded to some critiques here.) Given the recent revelation that asthma is more likely to be caused by early childhood care decisions, that particular benefit may be quite vulnerable. The biased representation of other benefits undermines the DOE study as well.

I’ve posted some of my own comments on the Energy Institute blog.

Study shows investment and reliability are disconnected

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Lawrence Berkeley National Laboratory released a study on how utility investment in transmission and distribution compares to changes in reliability. LBNL found that outages are increasing in number and duration nationally, and that levels of investment are not well correlated with improved reliability.

We testified on behalf of the Agricultural Energy Consumers Association in both the SCE and PG&E General Rate Cases about how distribution investment is not justified by the available data. Both utilities asked for $2 billion to meet “growth” yet both have seen falling demand since 2007. PG&E invested $360 million in its Cornerstone Improvement program, but a good question is, what is the cost-effectiveness of that improved reliability? Perhaps the new distribution resource planning exercise will redirect investment in a more rationale way.

Do we really need more storage for our renewables?

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PG&E has been running a series of “advertorials” on clean energy in the Sacramento Bee and other papers. Today’s on the need for electricity storage caught my eye. I’m not sure that we need new storage in California, at least not large-scale, in the immediate future.

The PG&E article describes an event in February 2014 when California generated more energy, much of it from solar and wind, than consumers were using. PG&E raises this as a concern that should be addressed so as not to lose that energy. But PG&E’s premise ignores one critical point–California is not isolated–it’s connected to many other states.

California is the largest electricity consumer in the Western Interconnection (with 10 other states and parts of Canada and Mexico). However the state only represents 30% of Western load. All of those states have weaker directives on renewables and greenhouse gas emissions, and most have much larger portions coming from high-emitting coal-fired plants.

When California overgenerates from renewables, it exports that power to those other states. This leads to a reduction in natural gas and coal use. When California needs power, it imports power as it has been doing for decades. In other words, the rest of the Western Interconnect is already acting like a storage device. The Southwest utilities have long exported excess coal-fired power overnight to California at low prices. Now California can turn the tables. PG&E may not be getting renewable portfolio standard (RPS) or greenhouse gas reduction credits for those exports, but they reduce GHG emissions in other states.

This situation is similar to the recent rise in petroleum production in the U.S. The country now exports refined products thanks to advances in extraction technologies. Congress is considering whether to allow the export of crude oil.  For both California and the U.S., the concept of exporting energy has been inconceivable up to now. Time to rethink our paradigms?

The utility revolution hits the mainstream

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This New Yorker article, “Power to the People,” is one of the first mainstream press articles discussing how the energy utility landscape is being transformed. (This was sent to me by one of my non-energy clients.) It prompted one thought: the “death spiral” only occurs if we hold on to the traditional model of utility investment and regulation. Allowing utility shareholders to participate in the transformation through their unregulated holding companies can mitigate much of the potential for a death spiral.

How Should Distributed Generation be Distributed?

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Bruce Mountain observes in the Comments that Australia already is experiencing deep solar penetration, but is not find extensive disruptions in the distribution networks.