Grid Parity - Tipping Point For Change

   While grid parity is where things are headed there are still many obstacles - starting with dollars and dollars of utility money to fight it. Start in Arizona to see the aggressive tactics used by utilities against grid parity. Grid parity will allow on-site power generation by independent and very small producers (a household) to be part of the discussion of the future of energy production in the United States, instead of  beening dismissed as insignificant. 
   Quality improvements and cost declines in batteries, as the article reports, are a major tipping point to make on-site surplus power generation practical for a growing number of people and businesses. While not mentioned in the article, there are recent significant performance improvements in small scale wind power production systems designed for residential rooftop mounting. With further price drops, a system that combines rooftop solar and wind electric production with battery backup becomes a practical goal for an urban dweller - not just off-the-grid back-to-the-hills people. Adding a solar hot water component further reduces off-site power needs.
    As more individual households become energy producers, the two-way potential of the grid begins to be realized. Up until now, the grid is primarily seen as a one-way street to the consumer. Deregulation has divided distribution from production but a lot of the same folks are still around and they would be happy if it stayed a one-way street. The continuing rise in on-site power production pushes the envelope though. I see two basic realities - first, less distributed power means less revenue and taxes and second, if a micro power producer wants to sell their power, they must be connected to the grid. Connection will cost money. Clearly a realignment of the present utilities vs. solar people paradigm is needed - the grid needs re-imagining with an emphasis on who is to receive the benefit - is it a democratic thing because everyone basically needs it or is it prone to corporate bottle-necks or choke points? 
   The inherent benefit of household power production is people keeping their money - the elimination of the massive wealth transfer from individuals to the corporations that control electricity production and distribution. People do not give up money streams without resistance. Corporations will go to great lengths to protect what they consider to be theirs. Grid parity is change - for forward looking people, it is a key element in a tipping point that can have significant effects on corporate and government revenues. Just as there are currently winners and losers, there are winners and losers to come. Hopefully these issues will soon be more commonly part of the discussion for everyone.
      

Grid parity: Why electric utilities should struggle to sleep at night

By Matt McFarland, Updated: March 25 at 9:02 am

What’s good news for those concerned with climate change, and bad news for electric utilities? That’s grid parity, which is sometimes called socket parity. It exists when an alternative energy source generates electricity at a cost matching the price of power from the electric grid.

As grid parity becomes increasingly common, renewable energy could transform our world and slow the effects of climate change. Advances in solar panels and battery storage will make it more realistic for consumers to dump their electric utility, and power their homes through solar energy that is stored in batteries for cloudy days.

“I think the grid gets disrupted,” said NRG Energy chief executive David Crane. “The only question is do you want to be the disruptor or do you want to get disrupted.”

Our world is increasingly cordless, and power appears likely to follow. While we’re not there yet, the momentum behind distributed energy is building.

The Rocky Mountain Institute has said that tens of millions of commercial and residential customers will have grid parity by 2030 and perhaps 2020. Hawaii is already there as a result of high energy costs associated with being an island.

Other estimates are more aggressive. A 2013 Deutsche Bank report said that 10 states are currently at grid parity: Arizona, California, Connecticut, Hawaii, Nevada, New Hampshire, New Jersey, New Mexico, New York and Vermont. According to a 2013 note by Citi Research, Germany, Spain, Portugal and Australia have reached grid parity.

This shift has benefited from a dramatic drop in the price of solar panels, which dropped 97.2 percent from 1975 to 2012, according to GTM Research.

For electric utilities to truly be challenged, batteries are just as important as solar panels. With batteries excess energy could be stored. Tesla announced in February it’s building a gigafactory, which it envisions producing more lithium ion batteries by 2020 than were produced worldwide in a 2013. The scale of the operation should drive down prices further (Tesla estimates over 30 percent). Some of these batteries will be used by SolarCity, a leader in installing residential solar panels.

SolarCity has a pilot program in California, in which batteries store solar power. It has complained that electric utilities are slowing its rollout. NRG Energy hopes to have a similar product available by the end of 2014.

If utilities are dragging their feet on SolarCity’s initiative, it’s easy to understand why. As solar energy gets cheaper, traditional electric utilities are doing the opposite. The cost of maintaining the electric grid has gotten more expensive, but reliability hasn’t improved. The investments of electrical utilities appear to be poorly spent.

If customers leave electric utilities, it starts a downward spiral. Fewer customers will mean higher rates, which encourages remaining customers to jump ship for a solar-battery system.

Electric utilities appear poorly equipped for how technology will transform the energy industry. For years there hasn’t been an incentive to innovate, in part due to a lack of competition. Plus, making their product cheaper means less revenue, so why innovate?
Meanwhile, energy upstarts are led by forward thinkers with disruptive track records and eyes on society’s big problems, such as climate change and our dependence on fossil fuels for energy. SolarCity chairman Elon Musk co-founded PayPal and leads Tesla, which could transform the auto industry.
NRG’s Crane speaks of having his company mentioned in the same breath as Amazon, Apple, Facebook and Google. It’s radical to imagine anyone feeling passionate about their source of power, but environmental concerns may make it common soon. New devices such as Nest’s popular thermostat are making consumers rethink what to expect from the companies and gadgets that manage their energy.
Crane highlighted the climate change concerns in a recent letter to shareholders: “The day is coming when our children sit us down in our dotage, look us straight in the eye, with an acute sense of betrayal and disappointment in theirs, and whisper to us, ‘You knew… and you didn’t do anything about it. Why?’”

© The Washington Post Company

http://www.washingtonpost.com/blogs/innovations/wp/2014/03/25/grid-parity-why-electric-utilities-should-struggle-to-sleep-at-night/

The Battle To Control Solar Power

     A number of years ago when I told friends with solar power interests that I wanted my system to have batteries, some would question my sanity - you live in the city, connecting to the grid is easy, they would say. I tried to tell them that they were missing something - even though I live in the urban core, being capable of being powered completely from off the grid is a worthy goal with numerous advantages. The most basic is that allows one to be a true producer - relying on the grid at night should be seen as a back-up, not a first line strategy.
    In this article from Bloomberg, we are shown California electric utilities that are rejecting battery supported solar electric systems from grid inter-connections on technical reasons when more likely their objection is rooted in a non-ability to envision a different business model that includes micro users/producers. That smart meter is not so smart.

Battery-Stored Solar Power Sparks Backlash From Utilities

By Ehren Goossens and Mark Chediak - Oct 8, 2013

California’s three biggest utilities are sparring with their own customers about systems that store energy from the sun, opening another front in the battle that’s redefining the mission of electricity generators.
Edison International (EIX), PG&E Corp. and Sempra Energy (SRE) said they’re putting up hurdles to some battery backups wired to solar panels because they can’t be certain the power flowing back to the grid from the units is actually clean energy.
The dispute threatens the state’s $2 billion rooftop solar industry and indicates the depth of utilities’ concerns about consumers producing their own power. People with rooftop panels are already buying less electricity, and adding batteries takes them closer to the day they won’t need to buy from the local grid at all, said Ben Peters, a government affairs analyst at Mainstream Energy Corp., which installs solar systems.
“The utilities clearly see rooftop solar as the next threat,” Peters said from his office in Sunnyvale, California. “They’re trying to limit the growth.”
California is the largest of the 43 states encouraging renewables by requiring utilities to buy electricity from consumer solar installations, typically at the same price that customers pay for power from the grid. The policy, known as net metering, offers a way for households to reduce their bills. It underpinned a 78 percent surge in the state’s residential installations in the second quarter from a year earlier, according to the Solar Energy Industries Association.

Battery Costs

Solar systems with batteries attached have gained a foothold in the market as costs fall, allowing customers more flexibility for using their own power at night or when local supplies fail. The systems average about $12,000 to $16,000, adding about 25 percent to the cost of rooftop power plants, according to Outback Power Inc., an Arlington, Washington-based provider of battery-backed solar systems.
Matthew Sperling, a Santa Barbara, California, resident, installed eight panels and eight batteries at his home in April.
“We wanted to have an alternative in case of a blackout to keep the refrigerator running,” he said in an interview. Southern California Edison rejected his application to link the system to the grid even though city inspectors said “it was one of the nicest they’d ever seen,” he said.
“We’ve installed a $30,000 system and we can’t use it,” Sperling said.
Utilities say the storage systems open the possibility of fraud. The issue is whether all the electricity being sold through the net metering program is generated only by renewable sources, as required. Consumers in theory can fill the batteries with power from the grid and then send it back designated as renewable energy. With the solar-battery systems, there’s no way to determine the source of the energy. Solar suppliers say that’s not happening.

Storage Rules

Power-market regulations and the industry’s ability to monitor flows from solar systems haven’t kept pace with the technology, said Gary Stern, director of regulatory policy at Southern California Edison, a unit of Edison International.
“Our rules are not really caught up to effectively include issues with energy storage,” Stern said in a phone interview from Rosemead, California.
The company doesn’t want to “discourage solar” and is working with regulators to come up with “reasonable policies” for battery-storage systems, said Vanessa McGrady, a Southern California Edison spokeswoman.
State regulators are aware of the problem and are working on guidance to offer both solar installers and utilities, according to Terrie Prosper, a spokeswoman for the California Public Utilities Commission in San Francisco.

‘Some Complaints’

“There have been some complaints from developers in Southern California Edison’s territory that Edison has inconsistently applied the benefits of net energy metering to energy-storage projects,” Prosper said in an e-mail. The commission is working with all three utilities “to provide formal direction on these issues in the coming months.”
The utilities said they would approve systems that have panels and batteries if they had two meters to verify that only solar energy is sold to the grid. Such a configuration would boost installation costs by at least $1,300, according to Neal Reardon, the state utility regulator’s interim supervisor of customer generation.
The dispute is expanding as California promotes wider use of batteries. Regulators in June proposed that the top three utilities procure 1.3 gigawatts of storage capacity by 2020. The state has set a goal of obtaining 33 percent of its power from renewables by 2020, the nation’s strongest requirement. With more electricity coming from intermittent sources such as wind and sunlight, storage systems will be an important tool to manage the grid.

Falling Prices

Demand for the systems may grow as prices decline. Battery costs are forecast to fall 57 percent to $807 a kilowatt-hour in 2020 from $1,893 for a kilowatt-hour of storage capacity now, according to data compiled by Bloomberg. The global market for solar systems combined with energy storage will rise to $2.8 billion in 2018 from less than $200 million this year, according to Boston-based Lux Research Inc.
About 391 megawatts of solar panels were fitted at customer sites across the state last year, according the California Solar Initiative. The price to install residential projects has declined 15 percent to $3.71 a watt in the second quarter from $4.35 a year earlier according to the Washington-based trade group SEIA.
Battery systems are the latest innovation that’s unraveling the traditional monopoly utilities have enjoyed in supplying consumers with electricity. Two decades ago, federal regulators opened the system to independent power producers, eating away at the utility’s control of generation. The battery systems will put more customers out of reach.

Rejected Applications

“What we are seeing now as a fairly rare event may be more common by the end of the decade,” said Southern California Edison’s Stern.
Mainstream began hearing in May that Southern California Edison was rejecting some of its clients from the net metering program. As many as 60 projects with panels and batteries have been turned down by California utilities, the company estimated.
PG&E Corp. (PCG), the owner of California’s biggest utility, has also rejected standard net metering applications from customers with both panels and batteries, and referred them to another program that requires an interconnection fee.
“The key is that the full retail net energy metering credits and subsidies are only available to renewable facilities,” Lynsey Paulo, a PG&E spokeswoman, said in an e-mail.
San Diego Gas & Electric, a unit of Sempra Energy, said it hasn’t received any such applications, and it would deny them if it did. Sempra slipped less than 0.1 percent to $85.43 at the close in New York. PG&E climbed 1.5 percent and Edison gained 1.1 percent.

‘State of Flux’

“Technically, a customer who now has a combined system that includes both rooftop solar panels and battery storage, the battery storage may not qualify for net energy metering under current rules,” said Stephanie Donovan, a spokeswoman for San Diego Gas & Electric. “The rules are in a state of flux.”
Mainstream’s Peters said Southern California Edison is now rejecting systems that are identical to ones it had approved in the past. The developer had been installing two to three solar-storage projects a week in Southern California at the start of this year. That’s dropped to zero in recent weeks, and some orders have been canceled.
“Net metering is the lifeblood of solar in America,” Peters said. “That’s why this seemingly inconsequential issue is getting so much attention.”
Solar panel owners aren’t trying to “game the system,” said Adam Browning, executive director of the San Francisco-based lobbying group Vote Solar Initiative. “The next step is that people with solar and batteries will find a way to make it work without utilities.”
To contact the reporters on this story: Ehren Goossens in New York at egoossens1@bloomberg.net; Mark Chediak in San Francisco at mchediak@bloomberg.net
To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net

http://www.bloomberg.com/news/2013-10-07/battery-stored-solar-power-sparks-backlash-from-utilities.html

Net Metering On The Island In The Sun

From Jamaica - large scale net metering:

OUR drags on private use of JPS grid

BY CAMILO THAME Business co-ordinator thamec@jamaicaobserver.com

Wednesday, March 02, 2011

Read more: http://www.jamaicaobserver.com/business/OUR-drags-on-private-use-of-JPS-grid_8416797#ixzz1FSFURLte

THE Office of Utilities Regulation (OUR) has pushed back by more than a year the date to make a determination on a new regulatory mechanism that will give private entities access to Jamaica Public Service Company's (JPS') distribution lines to provide its own electricity at several sites across the island.

The delay has left at least one interested entity — Jamaica Broilers — dissatified with the pace at which government has been approaching critical changes to energy policies.

"Our energy policy and the strategies we pursue are the most important things that this country faces at this time," Jamaica Broilers Group president and CEO, Chris Levy told the Business Observer. "It is absolutely necessary to be taking the big strategic decisions now."

Also, in commenting on the slow pace of Government to introduce alternative fuel sources for electricity generation, such as coal, Levy said the country "cannot delay these decisions any longer".

Initially the OUR aimed to conduct public consultations and issue a determination on 'wheeling', by June 2010 but the new date to issue a determination is set for November 2011.

The process to reach a determination now involves cost analysis and consultancy to determine wheeling charges.

Wheeling concerns the development of terms and conditions that would allow a private entity to provide its own electricity at multiple geographical locations transiting JPS' network, a scenario that is contemplated by Condition 2 clauses 11 and 12 of the JPS All-Island Electricity Licence.

In its corporate plan for the next three years -- currently available on the regulator's website for public comment -- the OUR said it "is aware that there is some interest among private entities to self generate electricity for supplies at disparate geographical locations and that this can only be facilitated if there is in place some kind of wheeling arrangement with JPS. In view of the potential that this holds for driving incremental expansion, creating greater diversity and perhaps efficiencies, the Office is keen to facilitate this option."

Among interested entities is Jamaica Broilers, which, with its co-generation facility at Spring Village in St Catherine, would seek to provide electricity to other sites from which it operates, such as its ethanol plant and feed mills located in Old Harbour.

"We have the installed capacity at our co-generation plant... which is considerably more efficient than buying it from the grid," Levy said.

The cogeneration plant consists of three medium speed diesel engines (rated at 5 megawatts each), two Caterpillar engines for stand-by purposes, one heat recovery steam generator (HRSG) that utilises the hot gases from the engines to produce steam for the chicken processing facility, and an auxiliary boiler.

At present, Levy says the excess electricity is sold to the grid at dumped rates, which doesn't provide a "good business option" for the company.

Read more: http://www.jamaicaobserver.com/business/OUR-drags-on-private-use-of-JPS-grid_8416797#ixzz1FSFFiEtd

Net Metering In Massachusetts

Mass. homeowners can now sell back electricity

By STEVE LeBLANC, Associated Press Writer Steve Leblanc, Associated Press Writer – Mon Nov 30, 5:49 pm ET

BOSTON – Homeowners tired of paying high electricity bills can now turn the tables by selling excess electricity back to power companies at more lucrative rates.

The hitch? Homeowners need a way to generate power on their own, either by installing solar panels on their roofs or planting wind turbines on their property.

It's called "net metering," and beginning Tuesday, property owners can submit the applications needed to begin earning credits on their electricity bills if they generate more energy than they need on any given day or week.

To sweeten the deal, the state's 2008 Green Communities Act requires utility companies to pay their customers for the excess electricity at a retail rate rather than a lower wholesale rate.

Property owners still would need to be connected to the utilities-owned grid for cloudy days or during the dark, cold winter months when they likely will use more energy from a power company than they would produce on their own.

"Your utility is tracking how much energy you are buying and how much energy you are delivering back," said Ann Berwick, the state's undersecretary for energy. "You'll have meters tracking it in both directions."

The law also lets customers allocate their credits to other customers, allowing those without the ability to generate solar or wind power to take advantage of the change.

The benefits aren't limited just to homeowners. The law lets businesses and even cities and towns sell excess electricity back to utilities. Several municipalities are moving ahead on solar and wind turbine projects.

Before the change, net metering was limited to solar arrays or wind turbines capable of generating just 60 kilowatts or less, and customers were able to sell their power back to the grid only at the wholesale rate.

Under the new law, customers who own wind turbines or solar power installations up to 2 megawatts — even larger for municipal and state installations — can sell excess power back to the grid at the higher retail rate.

The state is working on another plan to bring down the cost of electricity — this time by saving power rather than increasing energy production.

The state Department of Public Utilities is weighing proposals requiring electric and gas utilities to ramp up their energy efficiency efforts.

That includes providing incentives for energy consumers to buy high efficiency lights, appliances, heating and air conditioning, and insulation and air sealing.

The changes also call on the utilities to boost their outreach efforts, especially to minority communities and small businesses.

Like net metering, the focus on energy efficiency is part of the Green Communities Act. The proposed changes are designed to help reverse the state's electricity demand.

Currently that demand increases at a rate of about 1 percent annually. Under the changes — set for final approval by the end of January — that demand would decrease by about 1.4 percent a year.

That's enough of a savings for the state to meet 30 percent of its electricity needs through improved energy efficiency, rather than additional power generation, by 2020, officials said.

A similar set of natural gas efficiency programs are expected to save $1.2 billion in energy costs over the next three years.

Gov. Deval Patrick said the changes will save electric and natural gas customers up to $6.5 billion over the next three years while creating new jobs.

http://news.yahoo.com/s/ap/20091130/ap_on_bi_ge/us_renewable_energy_massachusetts

July 02, 2008 - For immediate release:

Governor Patrick Signs Energy Bill Promoting Cost Savings, Renewable and Clean Energy Technology

Legislation will hold down electric bills, promote the development of renewable energy, and stimulate the clean energy industry

BOSTON – Wednesday, July 2, 2008 – Governor Deval Patrick today signed the Green Communities Act, a comprehensive energy reform bill resulting from close collaboration with House Speaker Salvatore DiMasi, who filed the bill in 2007, and Senate President Therese Murray, who led the Senate to pass its version in January.

“Today, Massachusetts has taken a giant step forward toward a clean energy future,” said Governor Deval Patrick, who signed the bill at a ceremony at the Museum of Science. “This legislation will reduce electric bills, promote the development of renewable energy, and stimulate the clean energy industry that is taking root here in the Commonwealth.”

“This new law puts Massachusetts in the lead nationally in crafting bold, comprehensive energy reform," said House Speaker Salvatore F. DiMasi. "This law will spark a significant increase in the use of renewable energy that will significantly curtail our use of fossil fuels, improve our environment and save us all money in the long run. Working together, we in the House, Senate and Patrick administration have much to be proud of."

“With the cost of energy skyrocketing, this legislation comes at a critical time and puts Massachusetts at the forefront of clean energy policies and the development of alternative fuel sources,” Senate President Therese Murray said. “With this landmark legislation, the Commonwealth will tip the scales away from fossil fuels in favor of more efficient and affordable energy alternatives. Emerging technologies and conservation are major parts of this effort, and Massachusetts will lead the way.”

Lower Energy Costs
Under the new law, the state will make energy efficiency programs compete in the market with traditional energy supply. Utility companies (NSTAR, National Grid, Western Mass. Electric, etc.) will be required to purchase all available energy efficiency improvements that cost less than it does to generate power, ultimately saving money on consumers’ electricity bills.

Utility companies will offer rebates and other incentives for customers to upgrade lighting, air conditioning, and industrial equipment to more efficient models, whenever those incentives cost less than generating the electricity it would take to power their older, less-efficient equipment.

Existing efficiency programs have already shown savings at 3 cents per kilowatt-hour versus 9 cents for power generation. Customers who take advantage of these incentives will save money as they reduce how much energy they use. The incentives will encourage more efficient energy use, lowering the overall demand on the system and reducing greenhouse gas emissions.

Promoting Renewable Energy
The Green Communities Act promotes renewable energy in a number of ways. The law requires utility companies to enter into 10- to 15-year contracts with renewable energy developers to help developers of clean energy technology obtain financing to build their projects. The agreements will target Massachusetts-based projects.

The law also makes it possible for people who own wind turbines and solar-generated power to sell their excess electricity into the grid (“net-metering”) at favorable rates, for installations of up to 2 megawatts (up from 60 kilowatts currently).

The measure also authorizes utility companies to own solar electric installations they put on their customers’ roofs – a practice that was previously prohibited – up to 50 MW apiece after two years. If utilities take full advantage of this new opportunity, it will poise Massachusetts to meet Governor Patrick’s goal to harness 250 megawatts of installed solar power by 2017.

Making State and Municipal Power Greener
A new Green Communities program comes into effect under the new law, offering benefits to municipalities that make a commitment to efficiency and renewable energy. The state Division of Energy Resources, which is expanded and elevated into the Department of Energy Resources, will now include a Green Communities Division to provide technical and financial assistance to municipalities for energy efficiency and renewable energy efforts. The program will receive $10 million in funding from a variety of sources, including emissions allowance trading programs, utility efficiency charges, alternative compliance payments generated by the Renewable Portfolio Standard, and the Renewable Energy Trust Fund.

In addition to these provisions, the new energy law doubles the rate of increase in the Renewable Portfolio Standard from 0.5 percent per year to 1 percent per year, with no cap. As a result, utilities and other electricity suppliers will be required to obtain renewable power equal to 4 percent of sales in 2009 – rising to 15 percent in 2020 and 25 percent in 2030, and more thereafter. In addition, the Massachusetts Renewable Energy Trust Fund, which is administered by the Massachusetts Technology Collaborative, comes under the direction of a new governing board chaired by the Commissioner of the Department of Energy Resources.

The law also requires the State Board of Building Regulations and Standards to adopt, as its minimum standard, the latest edition of the International Energy Conservation Code as part of the State Building Code. This will keep Massachusetts building standards at the highest international levels of energy efficiency.

The Green Communities Act gives final legislative approval to the Commonwealth’s participation in the Regional Greenhouse Gas Initiative (RGGI). Substantially all of the emissions allowances issued under the program will be auctioned – in accordance with the policy announced by Governor Patrick in January 2007 – allowing the proceeds to go toward reimbursing municipalities that lose property tax receipts as a result of RGGI mandates, funding Green Communities, providing no-interest loans for municipal energy efficiency projects, and promoting energy conservation.

“With this legislation, Massachusetts takes its rightful place as a national leader in energy reform and environmental protection,” said Secretary of Energy and Environmental Affairs Ian Bowles. “This legislation will help businesses and residential consumers fight rising energy costs, reap the benefits of renewable energy, and grow our clean energy industry.”

http://www.mass.gov/?pageID=gov3pressrelease&L=1&L0=Home&sid=Agov3&b=pressrelease&f=080702_bill_energy_clean&csid=Agov3