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California: A case study on DERs’ capability to replace peaker plants for grid support

By Nick Esch and Ryan Edge

The U.S. electricity sector is undergoing a transition from a system based on large, individual power plants to one in which distributed energy resources (DERs) play an increasingly significant role, with major impacts on grid operations. Combined with the continuing overall growth in renewable energy, the emergence of DERs has begun to alter utilities’ and grid operators’ approach to reliability.

Certainly, the deployment of solar on the customer side of the meter raises visibility issues for utilities and can, in turn, strain the legacy grid infrastructure, given sufficiently high levels of solar on the system. However, the deployment of DERs — including solar — can be coordinated to achieve greater operational and financial efficiencies for the grid at large.

These technologies offer a suite of capabilities which in isolation can be used to benefit an individual feeder or customer. Additionally, when aggregated, DERs can offer grid services for the bulk power system, providing an alternative to traditional centralized generators.

Technology is one piece of the energy transition; SEPA has “Blueprints for Electricity Market Reform” here.

More simply put, DER portfolios and strategies can harmonize the interplay of load and nondispatchable generation to insure balance and reliability. Examples might include shifting more load from evening to daytime hours with time-of-use rates, incentivizing more west-facing solar panels, or deploying energy storage that can be charged up by solar during the day and discharge to provide power in the evening. By using DERs to align the demand for electricity with available supply, the result could be a net load shape that is flatter and therefore more economical to serve.

One challenge going forward is to ensure utility planners and grid operators are fully aware of the grid-support capabilities of aggregated or “stacked” DERs — a need that was the impetus for the Smart Electric Power Alliance’s (SEPA) new “Distributed Energy Resource Capabilities Guide.”  The guide provides a straightforward description of the technical capabilities of specific types of distributed resources and how they can support grid operations beyond providing energy alone.

Preview the guide with the free DER Capabilities Executive Summary here.

California provides a graphic example of how this optimization of aggregated DERs might work as utilities in the state rapidly integrate DERs into their generating portfolios. As seen in Figure 1, the number of generating units in the state has exploded, increasing more than 250 times over 15 years, led by small rooftop solar installations averaging 5-10 kilowatts in size. At the same time, overall generating capacity grew 62 percent. Nondispatchable, variable generating capacity — that is, renewable energy — now represents about 22 percent  of the state’s total portfolio. All these numbers will continue to grow as the state moves toward its target of 50-percent renewables by the end of 2030.

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Figure 1: California’s growing solar generation, 2000-2015 (Source: SEPA)

The result of these dramatic changes is that California’s electric grid must be more flexible to efficiently balance load with supply, given that a sizeable and growing portion of the generating mix is no longer directly controllable.

One already-visible impact of the transition is the California Independent System Operator’s ubiquitous “duck curve” (Figure 2). The addition of a large amount of solar is forecasted to depress daytime generation net load from 9 a.m. to 5 p.m., which results in a steeper and more rapid ramp-up between the hours of 5 and 8 p.m., as solar generation drops off. Additional solar installations in subsequent years will exacerbate the magnitude of the ramp. The duck curve is often held up as a cautionary image for other states of what they can expect as the penetration of solar and other variable resources rises in their regions.

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Figure 2: The California duck curve (Source: California Independent System Operator)

A generator-only solution to the curve would require fast-starting natural gas or diesel-fired peaker plants that can rapidly increase output in sync with the load shape during the evening ramp, but could then sit idle the rest of the day. This kind of generator-only solution is not only technically challenging, it is also very expensive.

With the grid getting less dispatchable and more distributed, how can utilities or grid operators ensure reliability at the level Americans have come to expect, without the large centralized power plants they drew from in the past?

As noted in SEPA’s “Distributed Energy Resource Capabilities Guide,” DERs can provide energy, capacity and traditional ancillary services to the grid, playing a more integral role in ensuring system efficiency and reliability than they have to date. Thus, utilities and grid operators could circumvent the need for traditional generation facilities to actively integrate renewable resources through regulation and reserve services.

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Figure 3: DER capabilities matrix (Source: SEPA, “Distributed Energy Resources Capabilities Guide”)

As seen in Figure 3, the capabilities of different DERs are wide ranging and robust when realized. Demand management resources — interruptible load, direct load control and behavioral load shaping — can be used to shape load like never before. New functions from inverters on solar and energy storage installations can be used to regulate voltage and frequency. Battery storage could be the most versatile tool available — providing energy, capacity and ancillary services — if it can be deployed economically.

With an increasingly renewable future will come a need for a new approach to grid operation and planning, one which leverages the greater capabilities from distributed resources while also recognizing the complex technical, regulatory and business issues they raise. Greater innovation and collaboration between utilities, customers and DER providers will also be needed to realize the full potential of these technologies.

What’s important — and what the SEPA guide documents — is that these technologies and resources are available and here today, and their capabilities and possible combinations for grid modernization can only grow.

Nick Esch is a SEPA Research Associate. He can be reached at [email protected].

Ryan Edge is a SEPA Research Analyst. He can be reached at [email protected]