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PLANET OF THE HUMANS: FACT OR FICTION – HOW TO MOVE FORWARD…FROM AN ENERGY INSIDER

Does it make sense, even for solar PV, that we keep resorting to utility-scale power plants with ever larger footprints and increasingly higher capacities? Are we doing enough to clean our electric grid without harming Nature? Are we even making any effort to do more with less?


Attention clean energy investors, well-meaning regulators, climate activists and market participants.


The next chapter of cleaning the grid and electrifying transportation needs unfailing commitment for holistic solutions. True 21st century solutions must have minimal physical footprint and material content that deliver substantial positive environmental and economic impact.


There is a lot of confusing data out there, which can pose a real challenge to navigate for even the most well-intentioned critics. Arguably, understanding the core messages in the film is far more important than getting caught up in the data.


We remain distracted by focusing on centralized photovoltaic (PV) systems and products that only increase physical footprint and material content. The much-ballyhooed benefits of utility-scale solar power plants are not what they appear to be. Utility-scale renewables are actually prolonging the timeframe to transform our energy grid to clean power. They encourage vested interests to maintain the status quo. Instead, the next chapter of clean electricity generation and clean transportation needs to double down on solutions that double up on their intended purpose. It can and must be done.


True, utility-scale solar PV power plants are cheaper to build than rooftop solar, but not without exacting a steep price in other ways. This is typically missed. They are continually aided by natural gas power plants or large energy storage or both as buffer to stabilize the electric grid. Without storage and/or gas turbines massive power fluctuations can occur due to continually varying cloud cover and the intensity of the sun. As end users, we not only pay for the central solar power plants but also to mitigate their potential for disrupting the stability of the electric grid.


THE FOMO TRADE


The last decade saw unprecedented deployment of utility-scale solar PV in California where oversubscription and increased competition led to the classic fear of missing out (FOMO) situation. Utility-scale solar PV deployment increased more than 200-fold and constitutes two-thirds of all solar energy net generation in the state (US EIA database). Power Purchase Agreement (PPA) prices plummeted 80%. However, consumers kept paying higher and higher electricity rates. Between 2010 to 2019, the increase in California’s average retail electricity price was more than three times the increase in the national average. Far from benefitting from the significant cost reductions of these central solar power plants, consumers were burdened with the significantly higher additional costs of integrating these utility-scale resources. What’s worse is that when the utility regularly shuts off the transmission lines their contribution to reducing green-house gas (GHG) emissions and electricity generation are dismal. The Golden State’s unforeseen turn of events is a double whammy of resource underutilization, which further corroborates the messages in the documentary.Only localizing the power sources at the point of consumption – or in behind-the-meter (BTM) systems – will deliver the missing resiliency to the overall system while cleaning the electric power.


Source: California State Solar Spotlight, www.seia.org/states; March 17, 2020.


Utility-scale energy storage will hardly help the consumers or the system when the transmission lines are powered off. In California it’s the wildfires, in the Northeast it’s devastating snowstorms. California’s wildfire-driven power shut off predicament may be Nature’s last warning for us to correct course.


It is imperative that we avoid compounding the misery by repeating the same distractions – with a mad rush for utility-scale energy storage.


There are two simple messages in the documentary:

  • We must do more with less without harming Nature: Minimize material content and miniaturize our footprint – or dematerialize.

  • Storage will remain key in sanitizing the electric grid and reduce our dependence on fossil fuel – or fully decarbonize.

We can and must do both – NOW!


In order to make both happen, though, we must accomplish one more objective: localize the power source – or have the electric grid decentralize.


ELECTRICITY – ON A CLEAN GRID?


The continued myopic focus on centralized utility-scale deployments is on a collision course with the objectives of dematerialization and decarbonization. How else could one justify these bulk solar generation when the utilities in California regularly turns off the transmission lines?


Coincidentally, a historic drought turned parts of the region into a tinderbox. Winds toppled dry trees on to transmission lines and poles carrying them, knocking them down causing devastating fires. Hundreds of thousands of acres were set ablaze. Thousands of properties burned to the ground. Over a hundred people died. Inconceivably, Nature dealt a Faustian bargain for the Golden State’s electric grid – the nation’s leader with the most solar deployment. In dry windy conditions, the utility has no choice but to de-energize the transmission lines leaving large swaths of the population hung out to dry without electricity for days.Wildfire victims are treated as second-class claimants over those from the utility investors. Regrettably, the unacceptable situation is now being normalized for the next decade while at least one of the utilities is driven to bankruptcy. Imagine we were asked to wait ten years for the COVID-19 vaccine developed by financially strapped biotech firms. We, in the power community, seem to think that the utility equipment-related fires are just a set of one-off events and we can all go back to business as usual.


The Wall Street Journal blames the utility instigated wildfires and the utility’s bankruptcy on California’s overemphasis on renewable energy targets. Apparently, the regulators took their eyes off the ball on the required safety for the centralized grid platform. As The Journal articles explain, “it was tough to get Sacramento lawmakers excited about funding safety” because “‘Safety is not a glamorous thing.’” First, neither safety of power delivery nor renewable energy is a badge of honor for their proponents; they are both necessities. Second, The Journal has it both right and wrong as does the documentary. Both are correct to identify real issues with the centralized electric grid as well as the challenges of integrating intermittent generation resources into the grid. Nevertheless, they cannot be more wrong in blaming renewable energy as the culprit.


DISTRACTIONS OF SIZE


“Economies of size” is the overarching goal for utility-scale solar PV power plants. Larger capacity (wattage) power plants benefit from lowered fixed costs of plant construction – on a $/W basis. While the models delivered the desired financial outcomes (returns on investments) the spreadsheets did not account for externalities. The incomplete modeling painted a rosier picture for investors. For them and the industry, the utility-scale paradigm remained the same. Instead of fossil fuel power plants they now invest in solar. We all ignored the caustic bag of high material infrastructure, waste and inefficiency. Delivering electricity from the generation plants to the homes, offices and factories in cities and towns is complex and lossy. Centrally generated clean solar power is also made to hurtle down hundreds and, in most cases, thousands of miles of transmission power lines. Its generation efficiency of low to mid-teens now becomes single digit by the time it reaches us. It’s time we challenge the efficacy and environmental impact of utility-scale solar PV – not the motivation for clean energy. 


Nature doesn’t review spreadsheets to correct course.She always exposes the weakest link in the system. The overhead transmission lines are the Achilles Heel of the centralized infrastructure. No amount of band-aids – sensors and/or predictions – can stop dry, arid conditions and winds from wreaking havoc. When utilities turn off the transmission lines, homeowners and businesses are forced to fire up generator sets that run on fossil fuel. Ironically, the tide then turns on the very definition of “stranded assets”.


When the grid lines are shut off, the clean energy assets on the bulk power systems get “stranded” and become the equivalent of the stranded fossil fuel assets.


The centralized deployment of renewables and its infrastructure remains problematic in two areas: dematerialization and decarbonization.


The documentary offers us a valuable moment of soul-searching for the industry. Watch it and make up your own mind. For me, it was a sobering experience.


Ignoring the “distributed” aspect of distributed energy is not what Nature is teaching us. Rather, it is a wake-up call for government agencies that are enabling the entrenched industry to maintain status quo.


Energy VC firms, climate activists and project financiers may want to reevaluate the impact of their portfolio and embrace the mission to dematerialize. Continuing to apply traditional models and analysis without accounting for the externalities only helps perpetuate our stagnation.


It is an opportunity for us all to question our decisions and their impact on future generations.


THE SOLUTION – STRENGTH IN NUMBERS


Nature always has the final say. Renewables deployed on the bulk power systems fail to dematerialize, effectively decarbonize and reduce costs for the consumer. Ironically, the road to the clean grid may originate at the grid edges of behind-the-meter (BTM) systems which deliver inherent “distributed-ness” along with the added benefits of resiliency and reliability for the electric grid.


We need far more investment in developing and commercializing technologies to usher grid platforms that coexist with bottom-up microgrids along with nanogrids of homes, buildings and high-power bidirectional electric vehicles on the distribution network. Technology already exists for residential and commercial building solar to be cost competitive without incentives. Technology also exists to efficiently fast-charge electric vehicles that, when parked, can double up on their vast battery storage capacities, making vehicle-based storage far more cost competitive than centralized storage or peak power plants. It is time to seriously do more with less…to decentralize in order to dematerialize and decarbonize.


TRANSPORTATION – IN A DECARBONIZED WORLD


Today’s EV infrastructure platforms are also on a collision course with the objectives of dematerialization and decarbonization.

The sheer material wastage alone associated with storage for fast chargers and the fast chargers themselves is mind-boggling. Take for instance electric vehicle projections from IEA. Their New Policies Scenario estimates 135 million EV stock consuming 640 TWh of electricity in 2030. To put that number in perspective –there is more than enough roof surface in the US alone that if installed with PV can supply about twice the electricity demand of the entire global electric transportation sector...on Seattle’s annual solar insolation profile.The study also estimates passenger EVs accounting for 60% of the total EV stock. Consider that a typical passenger EV-owner only needs about 10% of the vehicle’s battery capacity for daily driving. That conceivably allows up to 90% battery capacity available for grid energy storage as the vehicles remain parked for well over 96% of their lifetimes. A daily nominal 30% capacity allocation for energy storage and delivery will result in an annual demand serving storage capacity of 1,110 TWh.


As projected for 2030, only a third of the capacity of the batteries in passenger light duty EVs alone, plugged in at home or at the workplace, would be sufficient to store and supply almost twice the annual electricity demand of the entire EV stock of the terrestrial transportation sector.


Electric vehicles can be made high-power bidirectional power flow and fast charge capable at no additional cost to the vehicle and the electric infrastructure. With million-mile batteries on the horizon (announced by at least two OEMs), there is simply no excuse not to do so. Many of the incidental problems mentioned in the documentary and identified in the IEA report regarding additional carbon emissions to support electrification of transportation will dissipate without burdening society. In the post COVID-19 era, when Nature demands doing more with less and a dematerialized world, it is unconscionable for us for failing to enable high-power bidirectionality of EVs.


DOUBLE DOWN ON “DOUBLE UP” – A CLEAN ENERGY MANIFESTO


With the appropriate powering and grid coupling solutions, building rooftops and batteries in vehicles double up as highly cost competitive generation and storage resources. As a result, we simultaneously significantly reduce our physical footprint and the material content and its wastage.


It’s time for us to fully embrace technological progress and avoid sinking into old tried and failed methods. It’s time for us to innovate and adopt new solutions with substantial environmental and economic impact.


We can and must make behind-the-meter systems that serve everyone’s purpose and from which all stakeholders will profit.


We can indeed do more with less. It’s time for us to earnestly decentralize the grid to dematerialize and decarbonize.


As cited by both the documentary and The Journal, integration of intermittent renewables generation into our electric grid remains a significant challenge. The industry’s chronic aversion for disruptive solutions and their short-term objectives with short-sighted benefits are holding future generations hostage. Lacking effective solutions, we are made to believe burning trees is “clean” biomass.


Unlike their portrayal in the documentary, Billionaires and the climate activists are not into some form of cynical collusion aimed solely at making gobs of money in the name of saving the planet. I suspect they are simply being misled with misinformation. Regardless, it is imperative for the industry – utilities, utility equipment vendors, automotive OEMs – to facilitate the innovation required and usher in fundamental progress. I cannot help but note that even the major energy VC funds and governmental agencies tasked to stimulate disruption in the energy sector seem to steer clear and prefer not to upset the applecart with meaningful innovation for behind-the-meter solutions.


Nature has spoken. We should heed her. Fortifying the transmission lines alone does not guarantee safe 24/7 electricity anymore. Neither do we decarbonize the electric grid when we deploy centralized solar, storage or peaker power plants. We cannot afford to wait any longer.


The time for a decentralized, dematerialized and decarbonized grid is now. The solutions already exist.


Make EV-based ample storage high-power, bidirectionally accessible for the distribution network and allow our creativity and ingenuity to reshape and reform the 21st century clean electric grid for electrified transportation.


About me: I am Shiba Bhowmik. I specialize in clean energy and powering solutions. I like to find and paint the big picture of our endeavors and assess their impact and consequences. I believe that Nature has given us the tools for the solutions we need if we know where and how to look for them with an open mind. During breaks, I can be found on the hiking trails with my 5-old boy or flying kites with him in our backyard.


References

  1. Wall Street Journal October 12, 2019: PG&E’s Big Blackout Is Only the Beginning by Katherine Blunt and Rebecca Smith; https://www.wsj.com/articles/pg-es-big-blackout-is-only-the-beginning-11570909816?mod=article_inline

  2. Wall Street Journal January 13, 2019: PG&E Sparked at Least 1,500 California Fires. Now the Utility Faces Collapse by Russell Gold, Katherine Blunt and Rebecca Smith. https://www.wsj.com/articles/pg-e-sparked-at-least-1-500-california-fires-now-the-utility-faces-collapse-11547410768.

  3. The Wall Street Journal Feb. 13, 2020: PG&E’s Fire Victims Are Set to Become Its Biggest Shareholders by Katherine Blunt; https://www.wsj.com/articles/pg-es-fire-victims-are-set-to-become-its-biggest-shareholders-11581592571

  4. Wall Street Journal October 18, 2019: PG&E CEO Says It Could Impose Blackouts in California for a Decade by Katherine Blunt. https://www.wsj.com/articles/pg-e-ceo-says-it-could-impose-blackouts-in-california-for-a-decade-11571438206.

  5. Wall Street Journal January 18, 2019: PG&E: The First Climate-Change Bankruptcy, Probably Not the Last by Russell Gold. https://www.wsj.com/articles/pg-e-wildfires-and-the-first-climate-change-bankruptcy-11547820006.

  6. Wall Street Journal December 8, 2019: ‘Safety Is Not a Glamorous Thing’: How PG&E Regulators Failed to Stop Wildfire Crisis by Katherine Blunt and Russell Gold. https://www.wsj.com/articles/pg-e-caused-over-400-fires-in-2018-where-were-the-regulators-11575834385.

  7. CNBC October 25, 2019: This generator maker’s stock just soared to a record as PG&E power cuts cause business to boom by Pippa Stevens. https://www.cnbc.com/2019/10/25/generac-soars-to-a-record-as-pge-power-cuts-cause-business-to-boom.html.

  8. The London School of Economics and Political Science: What are stranded assets? http://www.lse.ac.uk/GranthamInstitute/faqs/what-are-stranded-assets/.

  9. Financial Times February 4, 2020: Lex in depth: the $900bn cost of ‘stranded energy assets’ by Alan Livsey; https://www.ft.com/content/95efca74-4299-11ea-a43a-c4b328d9061c.

  10. International Energy Agency May 2019: Global EV Outlook 2019 Scaling up the transition to electric mobility. https://www.iea.org/reports/global-ev-outlook-2019.

  11. AAA February 27, 2019: American Driving Survey: 2014 – 2015; https://newsroom.aaa.com/tag/american-driving-survey/; http://publicaffairsresources.aaa.biz/wp-content/uploads/2016/09/AmericanDrivingSurvey2015_FactSheet.pdf

  12. Electrek January 24, 2020: VW deploys first electric car charging stations with giant integrated batteries. https://electrek.co/2020/01/24/vw-electric-car-charging-stations-with-giant-integrated-batteries/.



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