CAISO Report - Integration of Renewable Resources

CAISO - the California Independent System Operator - is constantly worrying about the impact of renewable wind and solar generation on the California grid. It's their job as the grid operator - gotta keep the grid stable and the lights on. The problem with intermittent - oops, sorry, variable generation - "variable" is the new PC term for intermittent - it just sounds so much better - the problem with variable generation is that it is "variable". The grid can't dispatch it when it is needed, like a natural gas peaker plant. It just happens when it wants to happen, whether it is convenient or useful or not.

As a result, CAISO is always studying the problem, and the latest report just came out. Here are some of the highlights:

• First, you'll be happy to know, is that the California grid can handle 20% penetration of renewable resources. Of course, there are some caveats. For example, the increased production of solar and wind energy will displace traditional thermal generators, so their revenue will decrease. In other words, we are likely to put the current generators out of business. Hope you are not invested in one!
• At the same time, we are going to need to keep those plants that are now uneconomic, because we need them to balance out the rapidly changing wind / solar PV generation.

"The integration of variable energy resources will require increased operational flexibility—notably capability to provide load-following and regulation in wider operating ranges and at ramp rates that are faster and of longer sustained duration than are currently experienced. Forecast uncertainty associated with wind and solar production will increase the need for reservation of resource capacity to ensure that these requirements are met in real-time operations...In providing these capabilities, the existing and planned generation fleet will likely need to operate longer at lower minimum operating levels and provide more frequent starts, stops and cycling over the operating day."

Exec. Sumary, pg. iii.

Again, the existing fleet of generators is going to loose money, "The lower capacity factors combined with the reduced energy prices under 20 percent RPS may result in a significant drop in energy market revenues for the gas fleet in all hours of the day and in all seasons." - pg xiv, but we need the entire fleet to keep renewables from crashing the grid, "The additional regulation requirements appear to be well within the capabilities of the existing generation fleet."

So, as long as we keep the current, money - loosing generators, and work them harder, for less money, we can add variable wind and solar without black-outs. Of course, ramping them up and down so much will increase their cost - for less revenue - and increase their emissions - adding pollution when the renewables are supposed to be reducing emissions.

The trade-off on emissions is supposed to come from lower over-all energy generation. Since they will produce less energy, the increased emissions from inefficient ramping will still be less than if they were at full production, although the impact from this type of operation was not calculated."The table also shows a reduction in CO2 emissions from combined cycle generators due to the reduction in operations, although this was calculated using a single emissions factor multiplied by energy output, and did not consider the potential for higher emissions at less efficient levels of operations." pg.86.

And the report made certain assumptions about the status of this generation fleet, that it will increase in capacity, not decrease:

• "Table 2.10 shows the new and planned thermal resources that were included in the analysis. These resources were included as they are currently under construction and have little or no risk of not being available in the 2012 timeframe. No resource retirements were modeled, nor were sensitivities conducted for the status of once-through cooling (OTC) plants. OTC plants are slated to be retrofitted or shut down after 2013 and are not expected to affect the 20 percent RPS integration. However, they could affect renewable integration after 2013, and hence are being examined in the ISO’s 33 percent RPS operational study."

So, the bottom-line seems to be that we should be okay until 2012, because we can thrash our current peaker plants up and down and avoid grid collapse. But all bets are off for any increase over that.

We think increased penetration of energy storage is a better balancing strategy then building more natural gas peaker plants. Using energy storage, like the VRB-ESS™, allows variable resources to be fully integrated without increasing emissions. As we plan for 2020, we hope the regulatory agencies will continue to look toward clean technology resources to integrate renewables, and keep clean energy "clean".