democratizing the electricity system: a vote for local solar

Democratizing the Electricity SystemA Vote for Local Solar

John Farrell, DirectorEnergy Self-Reliant States and Communities program

[email protected] x210

Presentation on Nov. 18, 2011

mailto:[email protected]


ILSR’s Unique Perspective

Centralized PowerYesterday Tomorrow

Transmission network

Distribution network

House

Storage

Local CHP plant

Commercialbuilding

Factory

Storage

Storage

Storage

Solar PV power plant

Windpowerplant

House with domestic CHP

Clean, local power

Enormous Solar Potential

Enormous Solar Potential

Most states could get 20%

Rooftops Alone

Solar Fits AnywhereHighway

ROW

Parkinglots

TransmissionROW

100%

1%

4%

10%U.S.

The U.S. could get 100%

Overview

• Electricity system in transition

• Economics of distributed solar

• Scale (doesn’t) matter

• Barriers are surmountable

• Policies (do) matter

Retail Electricity Price

State average residential retail rate

Solar Cost : Grid Price

avg. residential retail rate

$4.25/W- 30% ITC÷25 yrs. v.


50% or better

95% to 105%

150% or more

2011

avg. residential retail rate

$4.25/W- 30% ITC

1 state


2012

50% or better

95% to 105%

150% or more

-7% +2%

3 states


2012

50% or better

95% to 105%

150% or more

-7% +2%

3 states

57 million


2013

50% or better

95% to 105%

150% or more

-7%

7 states

+2%


2014

50% or better

95% to 105%

150% or more

-7%

11 states

+2%


2015

50% or better

95% to 105%

150% or more

-7%

18 states

+2%


2016

50% or better

95% to 105%

150% or more

-7%

22 states

+2%

167 million

•avoided cost•on-site/near demand•lower transmission losses•reduce dist. system stress•hedge against fuel prices•prevent blackouts•reduce pollution•create jobs

-20 cents

-15 cents

-10 cents

-5 cents

0 cents

5 cents

10 cents

Cost Energy value Grid benefits Social benefits

Electricity

Report: Solar Power Generation in the US: Too expensive, or a bargain?

4 cents

20 cents

Value of Local Solar

$4.25/W

•avoided cost•on-site/near demand•lower transmission losses•reduce dist. system stress•hedge against fuel prices•prevent blackouts•reduce pollution•create jobs

-20 cents

-15 cents

-10 cents

-5 cents

0 cents

5 cents

10 cents


Grid Benefits

4 cents

8.5 cents



20 cents

-20 cents

-15 cents

-10 cents

-5 cents

0 cents

5 cents

10 cents


Social Benefits•avoided cost•on-site/near demand•lower transmission losses•reduce dist. system stress•hedge against fuel prices•prevent blackouts•reduce pollution•create jobs

12.5 cents

$4.25/W



4 cents

8.5 cents

Example: Grid Benefits6 cents per kWh

in addition to electricity

Palo Alto, CA, municipal utility

$0

$0.03

$0.06

$0.09

$0.12

$0.15

Avoided costTime-of-deliveryEnvironmentalAvoided transmission accessAdditional local value


Part 3: Scale




• Barriers are surmountable


$0

$2.50

$5.00

$7.50

$10.00

Under 2 kW 5-10 30-100 250-500 over 1000 kW

Economies of Scale20092010

Installed cost per Watt

Lawrence Berkeley Labs: Tracking the Sun IV

$3.75$4.25

$0

$2.50

$5.00

$7.50

$10.00

Under 2 kW 5-10 30-100 250-500 over 1000 kW

Economies of Scale20092010

Lawrence Berkeley Labs: Tracking the Sun IV

Installed cost per Watt

FERC

Small PV is Fast (SEPA)• PV projects...have much shorter planning

horizons and project completion times, along with lesser siting, permitting, financing and transmission requirements at these small- and medium-sized scales.

• Larger PV and CSP projects (those greater than 50 MW) require overcoming financing, siting/permitting, and transmission barriers that might emerge at these larger sizes.

Germany: Boots on Roofs

80%

3 gigawatts in 2009

Part 4: Barriers?




• Barriers can matter


15??

Distribution Grid

• Utilities in California (and elsewhere) generally agree that 15% distributed generation on a local distribution circuit is the threshold for any problems.

• Many places (Nevada, Hawaii, elsewhere) are already beyond the minimum.

Democratizing the Electricity System (ILSR, 2011)

Barriers?

Intermittency

$0

$0.01

$0.02

$0.03

$0.04

1 location 5 locations 25 locations

$0.00

$0.01

$0.04

Geographic Dispersion Lowers Solar Backup Costs

$ per kWh

Implications of Wide-Area Geographic Diversity for Short- Term Variability of Solar Power (Lawrence Berkeley National Laboratory)

Barriers?

Sun is predictableBarriers?

Weather is tooBarriers?

Weather is too

Nov. 10, 2011 BOULDER, Colo. Advanced Wind Forecasts Save Millions of Dollars for Xcel Energy

Barriers?

Part 5: Policy




• Barriers can matter


Local BenefitsLocal Ownership Boosts Impact of Renewables

Economic Development Impacts of Community Wind Projects: A Review and Empirical Evaluation (NREL)

Solar Policy Matters

Public Support

Attitude towards increased use of local wind energy


No local ownership

Local ownership

0 25 50 75 100

very negative negative neutral positive very positive

45% positive

60% negative

Political Support

2 kilowatts

2 VOTERS


Problems with Tax Incentives

I want youif you have taxable income

City

School

Cooperative

Non-profit


RoadblocksSolar Policy Matters

Ownership = Market SecuritySolar Policy Matters

The Future...

Centralized PowerYesterday Tomorrow

Transmission network

Distribution network

House

Storage

Local CHP plant

Commercialbuilding

Factory

Storage

Storage

Storage

Solar PV power plant

Windpowerplant

House with domestic CHP

Clean, local power

Thank you!

John Farrellenergyselfreliantstates.orgjfarrell@ilsr.orgjohnffarrell612-276-3456 x210



democratizing the electricity system: a vote for local solar

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