California is set to become the first US state to require virtually all new homes to include solar panels from 2020

Tuesday, July 24 2018

California is doubling down on its commitment to clean energy. In May, the California Energy Commission (CEC) unanimously approved rules requiring virtually all new residential homes built in the state to be fitted with rooftop solar panels. The new rules will apply from 2020.

The move, which could see 65,000 solar installations a year in the so-called Golden State, won plaudits from the construction industry, and more cautious praise from environmentalists, amid hopes that it would curb statewide carbon emissions and boost values for homeowners.

“This adoption of these standards represents a quantum leap,” California Building Industry Association engineer Robert Raymer told the CEC. “You can bet every state will be watching to see what happens.”

Yet the decision is not universally popular. Adding solar panels will increase the cost of a new home by an estimated $9,500 (£7,131), and while homeowners should recoup twice that amount in energy savings over the course of a 30-year mortgage, there are fears that the mandate could exacerbate California’s housing crisis.

Others say the new policy might not deliver significant carbon savings: the state already plans to obtain half its electricity from zero-carbon sources by 2030, so the new rules could potentially boost rooftop solar at the expense of other renewable options, without increasing overall low-carbon generation.

“There are quite a few people, especially environmental economists, who want to do something about the climate but think this might not be the right thing to do,” warned Georgia State University economist Garth Heutel.

On the plus side, increased solar generation might force utilities to solve problems they have been avoiding, such as how to feed surplus rooftop energy back into the grid, or how to store daytime solar energy for use during peak hours. Those are pressing issues: California already gets 16 per cent of its electricity from solar, and the state sometimes has to shut down renewable energy facilities, or give away energy to other states, to avoid overburdening its grid.

For now, solar energy advocates are bullish about California’s gamble. If it pays off, it could encourage other states to try bold climate strategies, noted Adam Browning, executive director of advocacy group Vote Solar. “Building smarter is an unambiguous good that should be embraced,” he said. “Things like this will not only push the envelope for solar, but also for other collective solutions to large problems.”

Other states might decide that wind power or heat pumps work better for them, Browning added. What is important is that planners seek innovative ways to reduce emissions. “I don’t think it’s going to be ‘Hey everyone, let’s do what California does!’” he said. “But the idea of pushing the envelope, and seeing the benefits of planning for the future, will gain speed.”

Distributed solar saved California over $650 million from 2013-2015

Monday, July 16 2018

A new study finds that from 2013 through 2015, distributed PV reduced peak solar hour mean wholesale electricity prices by 8–9%, avoiding costs of $650–730 million.

One of the most important aspects of the solar power revolution is how it is making daytime electricity cheaper, and thus lowering wholesale electricity prices more broadly. This becomes evident when electricity utilities project no new thermal electricity as the 'lowest cost option'. More evidence of this are contracts being signed today at 2.3¢/kWh, for delivery in just a few years. And this is before we note that distributed solar is saving billions in grid upgrades.

Researchers from Carnegie Mellon and the National Renewable Energy Laboratory (NREL) have come together to present a new report which puts numbers on these savings. A retrospective analysis of the market price response to distributed photovoltaic generation in California focuses on the wholesale electricity market in California governed by the California Independent System Operator (CAISO) that represents about 80% of the electricity usage in the state.

The research found that distributed PV reduced the ‘hourly mean whole electricity price’ by up to 2.9-3.2¢/kWh, 8-9%, during the peak period of 12-1 PM. This extrapolated to mean that throughout the day, utilities spent between $650-730 million less procuring electricity to provide to their customers. The analysis looked at 15-minute solar electricity production estimates, as this is the interval that generators bid for in the day-ahead market.

The researchers looked across many system sizes and many regions of the state to make sure their data was accurately depicting a broad cross-section of distributed solar power in the state.

The end argument put forth by the authors is that not only will utility scale solar power lower the price of electricity, but so will the many gigawatts of solar power distributed on homes and businesses. This is something we in the field have always known, but now our industry has been around long enough to show it in hard numbers, based on actual data.

Residential storage hits new record, deploying 36MWh in Q1

Wed, July 25 2018

Residential energy storage deployments hit a record in the first quarter, according to the latest U.S. Energy Storage Monitor report from GTM Research and the Energy Storage Association.

There was as much grid-connected residential storage deployed in the first quarter, 36 MWh, as was deployed in the previous three quarters, according to the report.

Much of the increase in residential energy storage deployments can be attributed to changing policies in California and Hawaii, which together accounted for 74% of the residential deployments in the quarter, according to the report.

Both California and Hawaii have made changes to their solar programs over the past few years that resulted in reduced net metering compensation, which consequently increases incentives for energy storage.

Hawaii, for example, capped its consumer grid supply program and placed an export moratorium on its consumer self-supply program. Both programs were put in place as alternatives to the state's net metering program, which was canceled in 2015.

California is transitioning to time of use (TOU) rates, causing greater customer demand for storage because it will give them greater control over their electricity bills, a senior analyst on energy storage at GTM, Brett Simon, told Utility Dive via email.

The combination of California's TOU rates and the state's Self Generation Incentive Program (SGIP) makes solar-plus-storage almost competitive with solar-only, based on 2018 assumptions, Simon said, adding that solar-plus-storage will be the superior choice for homeowners on TOU rates within a few years.

Solar-plus-storage is, in fact, emerging as a key driver in the growth of the energy storage market. “More than 95% of all residential storage is solar-paired,” Simon said. It is also an important factor in the commercial and industrial and the front-of-the-meter markets (FTM), he said.

Residential storage systems accounted for 28% of the megawatt hours deployed in the first quarter, but the residential segment was second behind the FTM segment, which accounted for 51% of deployments. The non-residential segment, meanwhile, accounted for only 21% of the deployed MWh.

Overall, 126 MWh of energy storage were deployed in the first quarter, a 26% increase from fourth quarter 2017, but a 46% decline year-over-year. But GTM analysts say fourth quarter 2017 was an anomaly because that is when many of the large energy storage projects needed to offset the gas leaks at Aliso Canyon in Southern California came online.

GTM Research sees the energy storage market approaching the 1 GW mark in 2019 and crossing it in 2020. By 2023, BTM energy storage deployments will account for 47% of the annual market, GTM estimates.

Reverse power flow: How solar + batteries shift power from utilities to consumers

For 100 years, most decisions about the U.S. electric grid have been made at the top by electric utilities, public regulators, and grid operators. That era has ended.

Sun, July 22 2018

Small-scale solar has provided one-fifth of new power plant capacity in each of the last four quarters, and over 10 percent in the past five years. One in 5 new California customers of the nation’s largest residential solar company are adding energy storage to their solar arrays. Economic defection––when electricity customers produce most of their own electricity––is not only possible, but rapidly becoming cost-effective. As the flow of power on the grid has shifted one-way to two-way, so has the power to shape the electric grid’s future.

The shift of power into customer hands is already having three, unintended consequences:

Legacy, baseload power plants are becoming financially inferior to clean energy competitors. Electricity sales have stagnated as customers reduce use and produce electricity for themselves. Communities are reaping greater economic rewards from power generation, as electric customers, individually and collectively, produce more locally.

Almost no utility or utility regulator is adequately planning for this fundamental shift. Dozens of utilities across the country have proposed new gas-powered generation that has little chance of remaining online through the end of its economic life due to stiff competition from solar-plus-storage. Some have been approved despite substantial gaps in the economic analysis.

Utility have also made reactionary moves, or made gestures inadequate to address the magnitude of system change. There tend to be three inadequate utility responses to the reversed flow of decision-making power:

Utilities have damaged their reputations by resisting customer interest in distributed energy resources, sending lobbyists to preempt or curtail policies that reward customer-sited and customer-owned power generation. Utility investments in large-scale renewable energy have addressed environmental concerns, but these low-cost power purchases have not delivered reduce electricity prices for end users nor assuaged the interest in over 70 cities of reaching 100% renewable electricity more rapidly.

Utilities have deployed utility-owned distributed energy resources, but in ways that withhold much of the economic or financial benefit from customers.

Regulators and state legislators cannot expect incumbent utilities to respond adequately because the rise of economical solar-plus-storage challenges the century-old assumption of a natural electricity distribution monopoly. Instead, electricity market rules should facilitate fair compensation for distributed energy resources and market participants where technology already allows them to compete.

This report details recommendations for changing utility oversight and modifying electricity markets to transition from the dying utility distribution monopoly to a vibrant, democratic energy system where customers have the opportunity to choose distributed energy options that benefit themselves and the greater grid.

Utilities don’t have time to prepare for a future with economical, distributed energy storage because it’s on the doorstep. In 2016, the first hints of a storage-driven transformation of the electricity business came as a “postcard from the future” in Hawaii. Sunrun offered their Brightbox, a combination solar-plus-battery product with a price of 19 cents per kWh, almost 50 percent cheaper than grid electricity. Sunrun began offering its Brightbox service in California in December 2016. By 2018, 1 in 5 new residential Sunrun solar customers in California were choosing to add storage.

These early adopter states just scratch the surface of the competitive landscape.

Based on a proxy measure of electricity prices, the combination of on-site solar and energy storage can already compete with the price of serving nearly 26 million residential electricity customers in 19 states.1 The ILSR model compares customers installing a 7-kilowatt-hour Tesla Powerwall and a 5-kilowatt solar array to utility electricity prices, with the percentage of each state’s customers who can generate cheaper power themselves shown on each state:2

ILSR’s analysis isn’t alone. According to McKinsey, within three years an Arizona electric customer would be able to serve 80 to 90% of their electricity needs with solar and battery storage, at a lower price than by buying electricity from the utility company.

Storage prices have fallen remarkably fast, as illustrated by the remarkable price declinesfor battery battery storage for solar - prices droppingstorage technology in the last three years (measured in the cost of energy averaged over the expected life of the battery).