In mid-August, California experienced rotating outages and associated grid stress throughout the state. No one factor was at fault. According to California regulators, the outages were a result of a climate-induced extreme heat storm across the western United States, resource planning targets that have not kept pace with California’s resource mix, and some market practices that exacerbated supply challenges under highly stressed conditions.[1] While many factors contributed to the outages, what is clear is that we can assume extreme heat events will be more common with climate change and that current resource planning practices are not appropriately calibrated for the full effects of changing weather patterns.
In addition to the expected increase in extreme heat events, customers are facing other reliability challenges exacerbated by climate change, including outages from Public Safety Power Shutoff (PSPS) events due to high winds, wildfires, and other natural disasters. As California continues to pursue its path to 100% clean energy by 2045, energy efficient and energy storage technologies will be critical for grid reliability.
Energy efficiency is an important component in developing a comprehensive reliability strategy and yields multiple benefits for the customer and the grid.* Energy efficiency reduces operational costs through lower energy bills and lower operations and maintenance costs. Energy efficiency also reduces the size, cost, and complexity of needed electrical infrastructure and other supporting technologies and reduce ongoing energy costs. For example, investing in energy efficiency will decrease the amount of back-up power or system size required to keep a building or load operational. Efficient systems may cost more up-front than typical systems, but this cost is paid back over time through lower utility bills. For instance, high-efficiency and right-sized HVAC units will save money over the operating life of the equipment. Efficiency measures can also provide grid services like demand response, peak shaving, as well as load flexibility. Reducing energy consumption can help organizations meet objectives that are parallel to resiliency goals, including energy, budgetary, carbon, or sustainability goals.
Energy storage can be charged in the middle of the day when the grid has significant solar resources and discharge this emissions-free energy in the evening peak when maintaining reliability is most challenging. These highly flexible resources will contribute to integration of intermittent renewable resources as well as contribute to reliable operation of the grid. California is expecting to bring at least 11,000 MW of new battery storage resources online by 2030, with large investments in storage being made by both investor-owned utilities (IOUs) and community choice aggregators (CCAs). CCAs throughout California are investing heavily in large scale and customer sited storage systems. Over the past 18 months, CCAs have completed agreements to add 882.5 MW of battery storage and 1,700 MW of new renewable energy. [2]
Distributed energy resources (DERs), such as customer-sited or “behind-the meter” storage and electric vehicle (EV) chargers, are local, geographically dispersed energy resources or technologies that enable customers to increase, shift or reduce load during certain times of the day. DERs can be used to lower customer electricity bills, including the reduction of costly demand charges, while also being harnessed by the grid during times of reliability need. CCAs and utilities offer uniquely designed programs for commercial and residential customers to shift energy loads during event periods, such as extreme weather or poor air quality days. If customers can reduce loads during high energy-demand events, by discharging batteries or modulating EV chargers, they can receive incentives such as bill credits. Since these DER technologies are relatively new, rebates and incentives are typically provided to increase adoption. Clean Power Alliance (CPA) just completed the first year of its Power Response Program pilot, which included a solar plus storage track for commercial and residential customers, including those located in disadvantaged communities. Based on promising results of the pilot, CPA plans to implement a broader Power Response Program in 2021 including a focus on providing enrollment incentives to customers who install new storage systems.
Beyond programs available to CCA customers, California is also offering rebates for installing energy storage technology that can function during a power outage for both residential and non-residential customers through the Self-Generation Incentive Program (SGIP)[3]. In preparation for the next wildfire season, California has authorized funding of more than $1 billion through 2024 for SGIP. This funding includes prioritization of communities living in high fire-threat areas, communities that have experienced two or more utility PSPS events, as well as low income and medically vulnerable customers.
Along with transportation and building electrification, the development of clean and reliable distributed energy resources will be a key factor in ensuring customers have a reliable power supply. CCAs are developing programs to empower customers to contribute to this vision of a reliable, affordable, and clean energy future. As large commercial business owners make investments to make their energy supply more sustainable, consider investment in battery storage, which not only provides direct cost savings on customers’ bills, but also contributes to grid reliability overall.
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*USGBC-LA Editor’s Note: To learn more about the basics of sustainability and an overview of the essential strategies and work practices that make buildings more efficient, check out USGBC-LA’s next GPRO training on Feb. 5th.
[1] On October 6, 2020, the California Public Utilities Commission (CPUC), California Energy Commission (CEC), and the California Independent System Operator (CAISO) (Joint Agencies) released their preliminary root cause analysis of the rotating outages, which describes the event and causes in more detail.
[2] https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/calif-aggregators-to-seek-up-to-20-gw-of-renewable-energy-storage-by-2030-61247574
[3] More information on the SGIP program can be found here: https://www.cpuc.ca.gov/sgipinfo/
