What has California Learned from the 2020 Blackouts?
The sweltering heat that raged across thirteen western states from August 14-17, 2020, had a significant impact on the tens of millions of people who experienced record high temperatures well above 100°F. The triple-digit temperatures had an historic effect on California’s electric grid, too. Consider August 17 as a case-in-point in the energy deficiency the state’s grid operator faces.
According to CAISO’s market policy and performance vice president, Mark Rothleder, CAISO had expected the load on its grid to peak near 49,800 MW on August 17 during the 5-6 pm PT hour with available capacity near 46,000 MW, leaving a 3,600 MW shortfall.
By 8 pm PT on the 17th, that gap would grow to more than 4,400 MW as peak load approached 47,428 MW, but capacity had fallen to around 43,000 MW due to solar generation declining with the setting sun.
Faced with more inevitable forced outages on August 17, CAISO’s own CEO, Steve Berberich spoke before the ISO’s Board of Governors and said, “The situation could have been avoided,” and further asserted that the state’s resource adequacy program is “broken and needs to be fixed.”
A proposed decision on the future of resource adequacy in California is due in mid-June 2021.
Lack of Imports During the Heatwave
The scorching temperatures drove a massive demand for energy throughout the western US, resulting in California’s inability to import electricity from neighboring states as it typically does in the evenings when its robust solar resources go offline with the setting sun.
In its official analysis, CAISO detailed a series of events explaining how “realtime imports increased by 3,000 MW and 2,000 MW on August 14 and 15, respectively, when the CAISO declared a Stage 3 Emergency.” but ultimately “the total import level was less than the CAISO typically receives.”
Unable to import needed electricity and hamstrung by rising demand amidst record-high temperatures, the California grid suffered its first blackouts in nineteen years.
The Push to Address Climate Change
Californians, by and large, see the recent wildfires and heat waves that have ravaged the Golden State and wreaked havoc on its grid as events driven by climate change.
The state’s drive toward its energy future subsequently involves not only taking steps toward making its grid resilient but doing so in a way that minimizes its climate impacts.
The state’s three main energy organizations–The California Independent System Operator (CAISO), the California Public Utilities Commission (CPUC), and the state’s energy commission (CEC)–have been closely examining the recent grid failures and have submitted two reports (Preliminary and Final Root Cause Analysis) seeking to establish a root cause for the blackouts .
While they may not agree on any single culprit for California’s grid woes and for the August blackouts, the big three organizations rightfully believe that establishing grid resilience and serving the state’s ratepayers are the priorities.
Balancing Energy, Capacity, and Renewables for Grid Resiliency
California’s renewable energy resources performed as expected in 2020, despite some slanted media coverage that may have tried to pin them with the lion’s share of the blame for the August blackouts in 2020.
California has no intention of veering from the state’s long-traveled path of developing and integrating more renewable energy into its generation mix.
In the wake of the 2020 blackouts, the resource adequacy proceeding in California is looking at how to ensure that the state procures energy sufficiency-–
i.e. electricity needed to serve the state on a day-by-day, moment-to-moment basis–in addition to capacity sufficiency–i.e. reserves that can be called on in the event of an emergency.
The proceeding is trying to establish the optimal balance between energy and capacity that can be procured within state boundaries so it can then be determined just how much reliance should be placed on imports now and in the future.
As is the case with other states in different energy markets around the US, California is at somewhat of a tipping point with so much of its generation mix dependent on renewables with inherent intermittency that renders them unavailable at unpredictable times in the day when the sun isn’t shining or the wind isn’t blowing.
Like many grids facing a similar predicament, California’s grid of today and the future needs to ensure that its load begins to follow its supply, meaning that demand-side resources adopt agile flexibility that can react to sudden disruptions in electricity supply due to intermittency.
Those disruptions and foreboding heatwaves show no signs of diminishing in 2021 and beyond. It’s time for California to shore up its grid’s reliability with an energy marketplace that rewards flexible resources on the demand side.
The grid and the people it serves depend on it.
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What the Electric Grid’s Future and the Internet’s Past Have in Common
In the mid-1960s, a new method for effectively transmitting electronic data over a computer network was born, and with it came one of the quintessential building blocks of what would become the modern internet.
In simple terms, “packet switching” is a routing method whereby data transmitted across a network takes different routes along the network to arrive at its destination. Packet switching allowed for computer networks to become decentralized, ultimately giving rise to the internet and the global connectivity it provides today.
Just as packet switching would help computer networking explode into the future, so too will a similar decentralization usher the electric grid from what it was for the previous century to a more efficient interaction that connects consumers in a cleaner and more collectively beneficial way.
Like most revolutionary ideas, packet switching was not embraced by the established community of experts that presided over the nascent field of computer networking in 1965. That changed, however, when the Advanced Research Projects Agency Network (ARPANET) embraced packet switching as a means to allow multiple computers to communicate on a single network.
Originally funded by the US Department of Defense and widely considered among historians as the first working prototype of the internet, ARPANET would adopt the internet protocol suite TCP/IP on New Year’s Day in 1983, and begin assembling the network that would become the modern internet.
Since its inception, the grid has grown and evolved to become a modern network on the cusp of transitioning to a more efficient future. To get there, the electric grid may borrow a page from the information superhighway and follow a few key transformational lessons.
Consider how information travels on the internet in 2021.
On the internet, every user is a consumer, producer, and storer of information. Send an email from the Northeast US today, and it might route through Canada on its way to a final destination. Send an email to the same person tomorrow, and it might take an entirely different path through a server in New York.
In essence, this is packet switching on steroids.
The pathways that allow for information to travel on the internet are omnidirectional, which has allowed that network to rapidly grow over the last two decades to serve billions of users worldwide.
That was not always the case if you consider how, prior to packet switching, the original computer networks were constructed as a network dominated by central mainframe servers that pushed information and data to users connected at terminal locations.
The electric grid has a similar history to the internet’s in that the grid’s network was centralized from the outset, with large generation sources (power plants) essentially pushing electricity to consumers via transmission and distribution.
The centralized grid conceived by the likes of Thomas Edison and erected by moguls like George Westinghouse served its users well for the better part of the century.
Like the internet, however, the electric grid has evolved to embrace decentralization as it transitions to an omnidirectional network in which generation and distribution are spurred by the very users for whom the grid exists to serve.
Today, for example, the electricity you use to charge, say, your mobile phone may come from the bulk grid. Tomorrow it could come from another consumer on your distribution grid who is not using their own excess generation.
As grid operators and utilities adopt new technologies to enhance their flexibility and optimize the delivery of electricity, the grid will start to follow a similar path the internet embraced in its evolution to the modern wonder it is today. The result will be an energy system whose connectivity drives its efficiency and sustainability for decades to come.
It’s an exciting time for the grid and its users, rife with possibility and opportunity.
Achieving Carbon Emission Goals with Demand-Side Energy Management
A convergence of pressures in recent years has caused organizations across North America to examine how their energy use can be managed to help achieve their carbon reduction goals.
These converging pressures originate from customers, who desire to do business with sustainability-minded companies; investors, who realize the inherent value associated with an organization being carbon neutral; and regulators, who are introducing laws that reflect and address society’s move toward a cleaner energy future.
Since these pressures show no signs of waning, the question of how exactly demand-side energy management can be optimized to achieve carbon goals is becoming a popular discussion in the industry today.
Some of the best practices for carbon-reducing with demand-side energy management are more obvious than others. Adopting energy efficiency measures or installing on-site renewable energy sources like solar are examples of strategies that have been around for decades.
Let’s examine, then, some of the newer concepts on the topic of achieving carbon goals with demand-side tactics.
Consider the drive toward a carbon-neutral future from the grid operator’s perspective. Across the US, grids face the same converging pressures as organizations and have worked to increasingly shift their generation mixes away from fossil fuels and toward renewable sources like wind and solar.
Of course, wind and solar energy sources are inherently intermittent and can subsequently cease generating if the wind stops blowing or the sun stops shining.
But the immutable truth that some days are overcast and others windless doesn’t ease the pressure on the grid and those who run it to drive toward carbon- neutrality! Nor does inescapable intermittency suffice as an acceptable reason for grid operators to sacrifice reliability in the name of sustainability.
So what’s a grid operator to do?
Here is where commercial and industrial organizations can fill the gap from the demand side and help the US electrical grid find its way to the clean and efficient energy future that everyone desires.
That the grid needs flexible resources which can be dispatched quickly to serve load when it’s needed due to wind and solar generation being unavailable is a central point readers of this book should be quite familiar with, given it’s been examined in detail within these pages over the last three years.
The same is true of the role demand response plays in providing that flexibility to the grid.
What’s becoming more apparent is how increased participation in demand response programs at the ISO and utility levels across the US is providing new tools for grid operators to harmonize their grids’ reliability with their drive toward a future of cleaner generation fuel mixes.
In effect, this demand-side participation enables the firming of renewable energy sources, allowing grids to transition toward cleaner fuel mixes. While demand response participation doesn’t directly help individual organizations achieve their own carbon reduction goals, the cumulative effect of all the organizations’ participation does help our society achieve its desired emission goals.
The pressures organizations face from outside entities that we discussed earlier play a role in driving a given company’s carbon-reduction goals.
Unfortunately, in a reward-based world dominated by measurable metrics, there isn’t a practical way to note just how effective a given organization’s demand response participation is in helping contribute to carbon and greenhouse gas reduction.
That’s starting to change.
Organizations like the non-profit WattTime are searching for and establishing ways to help companies receive measurable recognition for doing their part with demand response to help the grid maintain reliability during its transition to the future.
Naturally, how an organization uses energy can have a large impact on carbon emissions, but when energy is consumed can move the carbon reduction needle, too. By shifting energy usage to a time when the grid mix is cleaner—during the middle of the day when solar is more prevalent compared with coal, for example—overall emissions are lowered.
An increasing number of organizations and cities have sought to eliminate their emissions in the time period when they consume electricity, often in hour-by-hour increments. This is a practice called 24/7 Clean Energy.
The more generation mixes shift toward renewable sources and as more DERs integrate into the grid with help of regulations like FERC Order 2222, the more the 24/7 clean energy effect should increase. That is, an increase in peak renewable generation will likely result in a larger potential emission reduction due to the load having been shifted.
Companies, regulators, and markets are in the early stages of ascribing value to 24/7 clean energy practices.
Consider the New York market, where Local Law 97 (LL97) seeks to reduce carbon emissions in the city’s building stock by 80% by 2050. An estimated 50,000 buildings in New York City stand to be affected by the law, with many in the commercial sector currently above the law’s emission requirements. Retrofits are one means of achieving compliance with LL97. Load shifting may be another, albeit one that will require a tangible means of assigning value to the practice.
Here we have an example of a regulation (LL97) creating a need for a possible market incentive (the value assigned to load shifting) as a means to achieve the societal goal of lowering carbon emissions in a densely populated city.
Absent a concrete policy on climate change at the national level, the market is responding. Throughout each of the deregulated energy markets in the US, demand response programs are growing at the ISO and utility level. The markets are becoming more sophisticated with how they incorporate DERs, and they’re doing all of this at the behest of state legislatures as well as the citizens who the market and grid ultimately serves.
Demand-side resources deliver carbon benefits. They always have, but today more opportunities are emerging to earn revenue with these resources.
For years we’ve touted how flexible resources will help drive the US electric grid to a cleaner future. While the ways organizations that provide those resources will be publicly credited are still undecided, the ways they’ll be financially rewarded are apparent.
This post was excerpted from The State of Demand-Side Energy Management in North America Volume III, a market-by-market analysis of the issues and trends the experts at CPower feel organizations like yours need to know to make better decisions about your energy use and spend.
CPower has taken the pain out of painstaking detail, leaving a comprehensive but easy-to-understand bed of insights and ideas to help you make sense of demand-side energy’s quickly evolving landscape.
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