The stories behind the numbers: SEPA’s Top 10 lists track solar and storage growth in unexpected places

U.S. utilities put close to 8 gigawatts of new solar on the grid last year; so a relatively small project —  27.3 megawatts — installed on a sparsely populated corner of northwest Arizona may not seem like a big deal.

But for the Navajo Tribal Utility Authority (NTUA), the 27.3-megawatts (MW) Kayenta Solar Project — which went online last August — is a major turning point for the tribe and for solar development on tribal lands across the country. Kayenta is one of the first utility-scale solar projects on Native American land in the U.S. It also provided special job training and well-paid temporary jobs in solar installation for about 270 tribal members.

Revenue from the project will help NTUA bring electricity to 92 Navajo families who have never been connected to the grid. And, last but not least, the project earned NTUA the No. 8 spot on the Smart Electric Power Alliance’s (SEPA) Top 10 list of utilities that put the most new solar watts per customer on the grid in 2017.

The solar watts per customer Top 10 is one of four Top 10 lists SEPA recently announced at its Utility Conference in Rancho Mirage, California. Based on SEPA’s annual Utility Market Survey, the Top 10 lists recognize the utilities that connected the most new solar megawatts and watts per customer, and the most new storage megawatts and watts per customer.

SEPA’s survey is the only industry analysis that draws solely from actual interconnection numbers provided by utilities, which are then validated by SEPA researchers. This year’s survey gathered solar data from 423 utilities, representing 114 million utility customers across the United States. Storage data came from 169 utilities, representing 70.7 million customers.

Based on these figures, the close to 8 GW of solar U.S. utilities connected to the grid last year included about 290,000 installations, 96.6 percent of them on residential rooftops.

But to gauge the impact of solar and storage, one has to look behind the numbers. For example, while California continues to lead the nation in total megawatts of solar, the biggest year-over-year growth in local markets was seen in some unexpected places — Missouri solar grew more than 100-fold — from less than 1 MW to 141 MW — Mississippi, more than 10-fold; and New Mexico, more than fourfold.

Similarly, a dynamic energy storage market is emerging in Texas, where the survey found 52 MW of storage colocated with wind farms.

The growth of solar in small towns and rural areas is another strong trend flying under the radar. Nine of the 10 utilities on the Top 10 list for solar watts per customer are, like NTUA, small public power utilities or electric cooperatives, many of them on the list for the first time.

“In addition to the new utilities on this year’s lists, we’re also seeing some utilities ranked on two or more Top 10 lists, reflecting the convergence and optimization of distributed energy resources,” said Daisy Chung, a SEPA Research Manager. “The focus clearly is on providing benefits to customers and the grid.”

The NTUA — ‘Renewable energy can exist here’

The Navajo Tribal Utility Authority — No. 8 on the Top 10 solar watts per customer list — was established in 1959, with the vision of providing power, water and other essential services to residents on tribal lands. It covers a service territory of 27,000 square miles in northern Arizona, northwest New Mexico and a small corner of southwest Utah — an area the size of West Virginia.

The overall unemployment rate in the region is about 42 percent; median income, $20,000; and around 15,000 of the Navajo Nation’s 356,890 residents still live with no power.

“They want power to store food,” said Deenise Becenti, NTUA’s Government and Public Affairs Manager. “Some of these families drive daily to buy ice at local convenience stores 20 miles away — a 40-mile round trip” to keep their food fresh.

The NTUA has an off-grid solar program, which provides small systems — with enough power to run a refrigerator — to more than 200 families who live in remote areas and have strong cultural connections to the land.

“It’s easy to say (these) families should move closer to the grid, to urban centers,” Becenti said. “But our families have grown up on these homesteads where their families have been for generations.”

Derrick Terry, who manages the off-grid program, said the for NTUA developing Kayenta was a moral imperative. In recent years, a number of developers had proposed renewable energy projects — wind or solar — on Navajo land, but none had ever actually been built, leaving many residents skeptical and wary of such projects in general, he said.

The completion of Kayenta last year was, Becenti said, “a demonstration that (utility-scale) renewable energy can exist here; it opens the door for renewable energy development.”

Terry said that so far, the project’s output is exceeding original estimates, generating enough electricity to power up to 13,000 homes. It also provides the NTUA with backup power to smooth over power fluctuations and brief outages on its distribution systems, Becenti said.

To maximize revenue from the project, the NTUA is also selling Kayenta’s renewable energy credits (RECs) to the Salt River Project, and using the money to get more families connected to the grid — 92 families to start.

Next up, the NTUA will be partnering with Salt River on an expansion of the project — Kayenta II — adding another 27.3 MW.

Madison Municipal Light — The power of replicable models

One of the goals of SEPA’s Utility Survey and Top 10 lists is to provide replicable models for others to follow.  Madison, Maine — No. 1 on this year’s solar watts per customer list — is a case in point.

The town of just under 5,000 residents had been considering renewables for more than a decade, said Calvin Ames, Superintendent of Madison Electric Works, the town’s municipal utility. Once a regional manufacturing center, the town had, in recent years, lost one of its last big employers, a paper mill, and few of Ames’ customers could afford rooftop solar.

The turning point came when Ames went to a regional energy conference and started talking with Sean Hamilton, General Manager of Sterling Municipal Light, a small-town municipal located in Massachusetts, which topped SEPA’s solar watts per customer list in 2014.

The result was Madison’s 5-MW solar field that, when it went online in October 2017, was the largest in the state (since superseded by a 9.5-MW project near Pittsfield, Maine). It provides about 25 percent of the town’s power, Ames said, though on a sunny, clear day, “it covers almost all our needs.”

IGS Solar, an Ohio developer, built and owns the project, selling the power to the town under a 26-year contract at a fixed price of just under 8 cents per kilowatt-hour — “the exact same price we are paying for the rest of our energy,” said Ames.

After six years, Madison will have the option to buy the project, which would cut the cost by about 2 cents per kilowatt-hour, Ames said.

Whether the solar project will attract new business to Madison remains an open question, Ames said. But he’s still talking with Hamilton, who has since added storage to Sterling’s solar project — and made SEPA’s Top 10 storage watts per customer list in 2017. Ames said, Madison is working on a plan to add storage to its solar project as well.

KIUC — Storage as a necessity

For the Kauai Island Utility Cooperative (KIUC) in Hawaii — No. 1 on the Top 10 list for storage watts per customer — battery storage is no longer an add-on; it is a necessity, said Supply Manager Brad Rockwell.

“We have so much solar that on most days, when the sun is out, about 80 percent of mid-day generation is coming from solar,” he said. “You can’t go much higher on an island system. We can’t export; we need to be able to store hours and hours of mid-day solar.”

Such problems will likely intensify as KIUC and Hawaii move toward their 2045 goal of running 100 percent on clean energy — which is why the electric cooperative has partnered with Tesla on a 52 megawatt-hour storage project paired with 13 MW of solar.

The storage is providing KIUC with long duration backup power and grid firming, Rockwell said.

“It’s going really well, better than we expected,” he said. “We tell the plant how many megawatts we want — to store every bit of solar energy or, if the batteries are full, to dispatch it. It gives us exactly what we want.”

KIUC still sees some solar overproduction, which means occasional curtailment of its own utility-scale projects, typically on weekends, Rockwell said. The utility has had to adjust its own internal operations as well.

Equally important for KIUC and its members, the Tesla project is structured as a power purchase agreement (PPA), with no upfront costs and significant savings.

“The PPA prices come in cheaper than oil-fired power,” Rockwell said. “We’re lowering electric rates and improving the grid.”

As KIUC continues to plan for more storage, including a pumped storage facility, it is also working to improve its forecasting tools, he said.

“Very localized, short-term forecasting makes the most sense for us — a box camera and processor to track clouds, and artificial intelligence to determine in 5, 10 and 30 minute intervals if you will see solar output drop,” he said. “That’s the kind of stuff we’re working on.”

“When looking at the growth and change in solar and storage markets, the focus is often on larger, investor-owned utilities,” Chung said. “Their achievements are impressive — as seen in their rankings on the Top 10. But the smaller municipals and co-ops have become increasingly important in bringing innovation to rural and remote areas. Before they were dots on a map; now they are players.”

In the coming months, SEPA will release a series of Market Snapshot reports — on solar, storage and demand response — containing more data, analysis and insights from the 2018 Utility Survey. To receive alerts on these and other SEPA publications, contact us at [email protected].