The Race For The "Holy Grail" Of Renewables

Authored by Irina Slav via OilPrice.com,

In February, AES Energy’s Escondido battery storage facility in California was hailed as the largest one to date, with a capacity of 30 MW/120 MWh. Now, Tesla is building a bigger one—100 MW/129 MWh—in Australia.

On the face of it, it’s a race for the bigger battery storage system. But there’s much more to it than that.

The race is on for increasingly reliable, grid-scale, quick-to-install energy storage solutions that will make the shift to all-renewable power much more realistic. In this, factors such as renewable-friendly regulation and integration of storage systems with renewable power generation capacity can tip the energy transformation scales.

California is one of the places to be if you’re a renewables fan. Its authorities have ambitious plans in this regard, eventually hoping to replace all fossil-fuel generation capacity with renewables. Wholly reliable grid-scale storage systems are crucial for this strategy, and they are becoming increasingly popular in the state.

Unfortunately, the initiative to make the 100-percent renewable plan a law fell through. Unions, worried about possible job losses, pulled their support. Legislators themselves tweaked the bill, so its goal is now to produce 100-percent greenhouse-gas-free energy. The debate about the feasibility of the plan and how fast it could become a reality continues. California is a cautionary tale for other ambitious clean energy proponents. 

Meanwhile, the leaders of the battery pack are expanding. AES recently teamed up with Siemens on a joint venture, Fluence, focusing specifically on energy storage system development. Fluence will deal in AES’ Advancion and Siemens’ Siestorage platforms, the companies said, adding it will target the development of new energy storage capacity across 160 countries worldwide.

Tesla is looking in another direction. It already has the largest portfolio of completed energy storage projects globally, at 300 MWh. What it is looking for now is integrating future storage systems with wind and solar electricity producers.

When Tesla said it had won a deal for the construction of the world’s biggest lithium-ion battery storage facility in Australia, it noted that the deal involves partnering with local wind power producer, Neoen, which will supply the battery complex with electricity.

At the same time, AES is working mainly with traditional utilities to supply them with energy storage capacity, focusing on constantly improving the energy density and efficiency of its arrays. Tesla’s all-renewables focus is well documented, and now it could give it the lead in the energy storage race.

Earlier this month, Tesla closed another partnership, with wind power leader Vestas, to develop integrated wind power-energy storage solutions. The Danish company announced earlier this year that it has big plans for energy storage, with Chairman Bert Nordberg telling Reuters that the company had 3.2 billion euro (US$3.84 billion) in cash and no debt, so it could afford some good investments. So far this year, Vestas has invested in almost a dozen battery storage makers.

Energy storage, according to AES’ CEO Andres Gluski, is “the Holy Grail for renewables.” It is the key to the renewables kingdom of the future, eliminating the adverse effects of renewable power’s intermittency. Integrating this Holy Grail with the clean energy producers is the next step. Tesla and other battery makers have already made it. Yet staying with traditional utilities might not be a bad strategy either: it will be some time before renewables become the predominant energy source in the world.

In Florida, You Can't Use Your Own Solar Panels In A Crisis

Authored by Mike Krieger via Liberty Blitzkrieg blog,

When it comes to the U.S. economy, the “con” part offers the best description of the current relationship between business, government and the preyed upon consumer.

The way things work in early 21st century America is large businesses bribe politicians in a variety of ways at both the local and federal level, and the end result is laws that are designed to increase corporate profits at the expense of the wellbeing and freedom of the American public. Politicians end up with financial war chests to run their next campaign, while bureaucrats see a lucrative opportunity to swing through the ever spinning revolving door should they play ball with lobbyists and their patrons. Yes, there’s always some degree of corruption within any society of humans, but there are peaks and valleys in such cycles. I’d argue we are somewhere in the peak corruption phase.

Today’s article focuses on one of the most highly regulated industries in the country, electric utilities. It’s one of the most boring businesses in America. I know this because it fell under the umbrella of my responsibilities during my last Wall Street job, and I could barely read a utilities research report without immediately falling asleep. Nevertheless, as you’ll see in today’s piece, the industry still finds a way to generate large profits while simultaneously harming the people its supposed to service.

When I think about solar panels, its not just the use of a renewable resource I find appealing, but also the potential to take energy generation into your own hands; something that can prove quite useful in a major global crisis, or even something more minor like Hurricane Irma’s impact on Florida. The latter could’ve be a lifesaver for some Florida residents recently, but a local electric utility has done everything in its power to deny its customers such freedom.

Here’s some of what we learned about this situation from a fascinating article published by the Miami New Times, Why Didn’t FPL Do More to Prepare for Irma?

Hurricane Wilma, the last ‘cane to hit South Florida, tore through the area in 2005 and killed power to 3.24 million of FPL’s then-4.3 million customers (75 percent of the grid). Many of those customers had to wait up to two weeks for power to return. Since then, the company has spent more than $2 billion supposedly girding itself against the next storm, according to a Sun Sentinel piece published before Irma hit.

But after Irma, which by most reports brought only Category 1-strength winds to South Florida, by some measures the company did even worse. Despite all of those upgrades, an even larger percentage of FPL’s customer base — 4.4 of 4.9 million customers, almost 90 percent — lost electricity this past weekend.

FPL and its parent company, NextEra Energy, have for years heavily influenced state and local politics through donations, making billions in profits each year ($1.7 billion alone in 2016) thanks to favorable state laws that are sometimes literally written by the power company’s own lobbyists.

FPL’s lobbying wing has fought hard against letting Floridians power their own homes with solar panels. Thanks to power-company rules, it’s impossible across Florida to simply buy a solar panel and power your individual home with it. You are instead legally mandated to connect your panels to your local electric grid.

More egregious, FPL mandates that if the power goes out, your solar-power system must power down along with the rest of the grid, robbing potentially needy people of power during major outages.

“Renewable generator systems connected to the grid without batteries are not a standby power source during an FPL outage,” the company’s solar-connection rules state. “The system must shut down when FPL’s grid shuts down in order to prevent dangerous back feed on FPL’s grid. This is required to protect FPL employees who may be working on the grid.”

Astoundingly, state rules also mandate that solar customers include a switch that cleanly disconnects their panels from FPL’s system while keeping the rest of a home’s power lines connected. But during a disaster like the aftermath of Hurricane Irma, FPL customers aren’t allowed to simply flip that switch and keep their panels going. (But FPL is, however, allowed to disconnect your panels from the grid without warning you. The company can even put a padlock on it.)

The law winds up forcing residents to remain reliant on the state’s private power companies. For now, solar-panel owners can still get something out of the law, in that the “net-metering” provision lets you sell excess power back to the company. The provision also lets power companies charge a $400 or $1,000 application fee for consumers who want to install systems more powerful than 10 kilowatts.

But if power companies had their way, the net-metering law would vanish tomorrow. Both FPL and its trade association, the Edison Electric Institute, have spent millions trying to kill that net-metering law and instead win the right to charge you for installing your own solar-panel system. In 2016, FPL spent more than $8 million on Amendment 1, a ballot initiative that industry insiders admitted was written to trick customers into giving up their rights to solar power. The law’s language would have paved the way for Florida to kill net-metering rules.

This past April, the Energy and Policy Institute caught an FPL lobbyist straight-up drafting anti-solar laws for Fort Myers state Rep. Ray Rodrigues, who also took a $15,000 campaign contribution from FPL this year.

Thanks to power-company influence, one of America’s sunniest states lags far behind the rest of the nation when it comes to solar adoption.

Does this sound like an industry looking out for the best interests of its customers? Does it sound like the behavior of an industry where heavy regulation has successfully ensured that corporate interests are aligned with the general public?

No it doesn’t, and it makes me wonder how common this sort of behavior is across the country. I encourage readers to share knowledge of their own local utilities in the comment section.

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Will EVs Break The Grid?

Authored by Tsvetana Paraskova via OilPrice.com,

While the UK government has vowed to end the sale of all new conventional gasoline and diesel cars by 2040, as part of a wider plan to fight air pollution, there is talk that electricity demand will lead to a fast and dirty response to a strained power grid.

But here’s what everyone’s missing in that debate: While EV sales are going to rise and electricity demand to power them will strain the grid and lead to less-than-ideal power generation solutions, the whole plan will help clean power generation to increase its market share.

Nothing is black and white. And big transformations are never immediate. We’re not talking about an overnight elixir that will magically clean up the air; we’re talking about a step-by-step process that is gradually less dirty.

Overloading the Grid (Mind the Gap)

The UK’s National Grid anticipates peak demand from electric vehicles alone being around 5 GW, which represents an 8 percent increase from today’s peak demand.

This peak demand forecast assumes what the National Grid calls the “Two Degrees” scenario, in which most cars would be EVS, with only 6 percent of them hybrids. But by 2045, only pure EVs would be on sale.

According to Wood Mackenzie, the UK plan to ban the sale of new gasoline and diesel cars by 2040 “will have a massive impact on the refining sector and the oil markets.”

To handle the extra peak demand, the most flexible way is to build open-cycle gas power plants.

One of the options for a “rapid response” plug-in capacity to make up for shortfalls could come from certain open-cycle gas-fired plants that are more polluting and less efficient.

So, while it’s still better than burning coal, the massive anticipated demand for energy to power up EVs on British roads may require some additional environmental triage - but, again, this is to be expected if renewables are ever to gain the market share they need to bring prices down and make it all mainstream. 

The first step is dealing with coal-fired plants, which the UK is proposing to close by 2025. And open-cycle gas-fired plants are certainly cleaner than coal, even if they aren’t the end-all ideal.  

Coal is rapidly losing share in the UK electricity generation fuel mix, while natural gas and renewables are boosting their respective shares. Coal’s share dropped to 11.3 percent in Q1 2017 from 15.9 percent in Q1 2016, government figures show.

At the same time, natural gas boosted its share to 39.9 percent from 37 percent a year earlier, while the renewables share increased to 26.6 percent in Q1 2017, from 25.6 percent in 2016.

Open-cycle plants may be more polluting than combined-cycle gas power generation, but their flexibility could help keep the system stable while increasing the share of renewables, according to Drax Group plc which is responsible for generating 7 percent of the UK’s electricity.

Drax is developing four rapid response gas power plants to increase the flexibility, Drax Power CEO Andy Koss said earlier this month. Once the plants are given consent, they will secure Capacity Market contracts and become operational in the early 2020s.

A spokeswoman for Drax told Bloomberg that under UK environmental regulations, such plants are allowed to be operated for a maximum of three months a year, and the company doesn’t expect to operate the units for that long. 

The UK subsidiary of Germany’s utility RWE plans to submit proposals to redevelop the former site of coal-fired and biomass plants in Tilbury, Essex, into a CCGT with capacity of up to 2,500 megawatts, 100 MW of energy storage facility, and a 300-MW open-cycle gas turbines plant.

No Fighting the EV Wave

Across Europe, EVs are on the edge of a major breakout—and they have a lot of help from the government and an excited auto industry.

But it’s also getting a boost from European Union regulations, which dictate that by 2021, the average emissions of all new cars sold must be 40 percent less than today—a challenge that can only be met with EVs.

In the meantime, Norway leads the way, with almost 40 percent of all new registered passenger cars now EVs. The country also now boasts the biggest fast-charging station in the world (28 cars can be charged in 30 minutes).

The Netherlands is the No. 2 leader in EVs, and is phasing out all conventional cars by 2025.

In July, plug-in EV sales hit a record 1.50 percent market share in Germany.

This is the new era in ‘electromobility’, and 2017 is a definitive one. Though questions remain about powering up these vast new fleets of EVs, we’re not at the finish line yet. Norway, for one, isn’t concerned in the least: 98 percent of its electricity comes from hydropower, so it’s about as clean as it can be.

Denmark has also come up with a creative solution … it’s using parked EVs to feed back into its grid--and even paying EV owners to do it. Vehicle-to-Grid (V2G) models working under the Parker Project in Denmark, and in collaboration with Nissan, Mitsubishi and others—can both receive grid electricity and give it back, helping to solve the peak demand issue. According to Bloomberg New Energy Finance, owners are earning up to $1,530 per year doing this.

At the end of the day, the UK, too, will find an answer, but the EVs have to come first because the market must dictate terms.