Now that renewable energy has established its cost advantage over fossil fuels, the industry’s next challenge is to show grid planners they can decarbonize without jeopardizing the reliability of their systems, climate consultant Eric Gimon writes in an analysis for Greentech Media.
“For the first time in 130 years, renewables surpassed coal as a U.S. energy source, and the trend is projected to persist as solar and wind prices plummet,” Gimon writes. “With renewables now cheaper than new fossil capacity, the clean energy industry anticipates a renewables majority by 2030.”
But the shift to 100% clean power “is more complicated than adding renewables and storage,” he explains. “Solar and wind are transforming how we power our economy, creating sustainable jobs and improving public health. But adding variable, fuel-free resources to the grid also requires major changes in power system planning to ensure reliability—what grid operators call ‘resource adequacy.’”
While everyone rightly expects power supplies to be reliable, Gimon says outdated resource adequacy models put the transition at risk, even in faster-moving U.S. states like California. “Incumbent fossil fuel generators, no longer the cheapest option available in many parts of the U.S., have defined ‘resource adequacy’ in ways that leave out innovative new market entrants in order to maintain market share.”
Gimon notes that grid operators match electricity demand and supply “on a moment-to-moment basis”, and always need to have enough supply on hand—not only to meet foreseeable demand, but to handle unexpected peaks due to weather extremes. The shift to grid-scale and distributed renewables challenges that model in two ways—by driving more expensive but less intermittent power sources like coal and nuclear off the system, and creating a requirement for fossil resources to ramp up in response to shifting demand, more frequently and flexibly than they’re meant to.
But the “planning reserve margin” that grid planners traditionally use to make sure they have access to enough backup power is poorly suited to a more distributed system. “The wrong resource mix can leave more than enough on hand for anticipated peaks but still face reliability challenges at other times,” he writes. “An over-reliance on the traditional planning mindset can lead to a failure to plan holistically for a least-cost solution using a broader portfolio of resources.”
While the challenges in the transition are real, incumbent fossil generators “exploit them to delay the clean energy transition,” Gimon contends. “Challenges are mischaracterized as fundamental reliability threats rather than problems that are solvable through new metrics, models, planning design, and technology advances such as longer-duration storage and demand response. Exaggerating technical issues as ‘insurmountable barriers’ and pointing to immediate job losses or reliability considerations often compel regulators and legislators to pay attention to one party’s preferred solution.”
Ultimately, “decarbonization requires building a larger, cleaner electricity grid without sacrificing reliability,” he says, and “resource adequacy concerns threaten to slow the transition. The clean energy industry must prioritize changing policy-makers’ perceptions of resource adequacy and the development of new planning models that allow all technologies capable of providing reliable service to compete on an equal footing.”
Read Eric Gimon’s full analysis here.