(November 2006)Our annual return on equity (ROE) survey broadly shows a continuing decline in the level of debate over issues specific to restructuring of the electric market. It also...
Renewable Reality Check
How solar PV could redraw the map for green energy and grid investment.
if all the best REZs turn out to be located in only a few of the 11 states and provinces? Is each state guaranteed at least one REZ, even if that means mapping out the second- or third-best resource areas?
Moreover, should each REZ be ranked by gross energy value and bottom-line cost metrics (the strongest winds, the highest-intensity solar insulation, the lowest capital installation cost), or should other factors be considered such as resource diversity and availability? Should some of the best resources be sacrificed to ensure a useful mix of day- and night-peaking wind, or to combine night-peaking wind with day-peaking solar?
On May 1, the chairman and vice-chairman of the WGA (Governors Jon Huntsman, Jr. and Brian Schweitzer, of Utah and Montana) sent a letter to Senate Energy & Natural Resources Committee Chairman Jeff Bingaman to make sure Congress won’t overturn the WREZ findings.
Noting the huge commercial interest in new investment among western grid developers (See Fig. 2—Proposed Regional Transmission Projects) , the Western Governors urged that any federal legislation that creates interconnection-wide planning to foster renewable energy must ensure federal agency actions “comport” with the Governor-approved transmission plans coming out of WREZ. In addition, the Governors want “right- sizing” of all grid additions “to capture the significant economies of scale.”
Thus, despite the widely acknowledged need to centralize grid planning across the largest possible geographic area, so as to address problems such as climate change that are national or even global in scope (see Fortnightly’s April Commission Watch column, “ Federalizing the Grid ”), and the Obama Administration’s strong support for such measures, it would appear that the Western Governors want to preserve their right to re-balkanize the grid.
A Technology Tug-of-War
In California, by contrast, the players are fighting not so much over politics, but over land use, cost metrics, and technology choices. Two basic questions have emerged.
For example, should planners weigh environmental factors equally with economic analysis in measuring the value and cost of discrete renewable resources? Such factors might measure the surface footprint (acres per megawatt) or water usage (acre-feet per megawatt) required to develop a given resource, irrespective of transmission needs or energy or capacity value. Or, in the alternative, should planners continue as usual to evaluate resources only in terms of economics ($/kW of installed capacity), and then consider environmental issues (including preservation of wildlife and state and national parklands) only in the context of the zonal ranking and the mapping of rights-of-way?
The California process, RETI, is a statewide collaborative initiative designed to help identify grid projects needed to accommodate the state’s renewable energy goals. RETI is charged with mapping, assessing and ranking all competitive renewable energy zones within the state, and preparing detailed transmission plans. The RETI effort is led by a stakeholder steering committee (SSC) comprised of representatives from the state PUC, the California Energy Commission, the California Independent System Operator (CAISO), and various publicly-owned utilities, with technical aid provided by the Black & Veatch engineering firm.
To date, the SSC has signed off on final reports for