Tulsa, OK -- Utilities are putting a new focus on increasing the amount of renewable energy generation sources in their portfolio, both to provide the best service to their customers and to comply with regulations on the state and federal level. Renewable power resources have many differences from traditional fossil-based generation sources, though, and technology, as well as associated prices, is still unsettled in multiple areas.
Renewable Energy World’s sister publication, Power Engineering, discussed these issues with several executives in the power industry, including: Mario Finis, global director of hydropower for MWH Global; Michael Goggin, senior electric industry analyst at American Wind Energy Association; Ken Johnson, vice president of communications for Solar Energy Industries Association; and Bobby Hollis, vice president of renewable energy and origination at NV Energy.
PE: There has been a sharp climb in the use of renewable energy lately, and many states have instituted renewable energy portfolio standards that require a certain amount of energy to be produced by renewable energy sources. What challenges does this create for the power generation industry?
Bobby Hollis: I would definitely say there are some challenges because you're looking at very different types of energy compared to how utilities have historically operated. We usually want something where you put the fuel in and you get the energy out, and obviously when you're talking about renewable resources you don't have that level of certainty. It's a different kind of planning, and it just requires a different thought process.
You have some opportunities to take advantages of neighboring resources, but for some utilities – even with some interaction with your neighbors – you have some concerns around addressing intermittency in very isolated locations.
The intermittency impact is not one that should be completely discounted, but at the same time I think there are a lot of people rising to the challenge to find ways to integrate renewable energy into their fuel source and supplies.
Mario Finis: I think I would agree with that. The intermittency nature of some renewables is certainly an issue, and when renewables have a penetration that reaches a certain percentage, which varies depending on the particular system you're talking about, it can have an impact on the dependability and stability of the grid and the things a utility needs to do in order to meet their service requirements.
So that is definitely an issue that needs to be addressed, and there are some measures being taken to try to deal with those issues – bulk storage has been one that has been talked about recently as a way to mitigate some of the effects of the intermittency of some of these renewables.
It's interesting that some of the states that have adopted a renewable portfolio standard actually have a very large percentage of renewables in their generation mix already. In the Pacific Northwest, if you look at the percentage of generation that comes from renewables in some of those states, it's already at 70, 80 or 90 percent in some cases. Putting an RPS on new generation in those states has an interesting effect in some cases where you're not displacing what most people would think you'd be displacing, which is coal and gas. You're actually displacing other renewables by having an RPS standard in some of these states that already have very high percentages of generation from renewable sources.
Ken Johnson: Renewable and current baseload facilities complement each other. Solar generates electricity in correlation to when demand is greatest. Utilities can utilize solar to "peak-shave" demand, occurring during a time period when electricity prices are highest. In the long run, with improved storage, which we are seeing now with utility solar, solar will have even more application. Demand often goes into the evening, and the CSP plants now have six hours of storage, which is in nearly perfect correlation with demand.
As you have higher prices for coal – or you are dealing with increased emissions costs, utilities can deploy solar at a much lower cost to the consumer and to future generations. Essentially, solar cleans the portfolio, which is going to be an important consideration under the EPA's 111-D rules.
PE: Although hydropower is considered a clean energy, is it considered a renewable energy under the requirements for renewable portfolio standards?
Finis: It's sort of a mixed bag, depending on the particular state. In some cases, hydro and even hydro up to certain sizes may be considered renewable sources, but then hydro above certain sizes would not be considered a renewable in terms of meeting the definition of renewable for the RPS. You are correct in that it is certainly a clean, sustainable energy source, but it doesn't always meet the policy or regulatory definition of renewable in the sense of meeting the renewable portfolio standard.
Hollis: Here in Nevada we have a 30-MW limit, so hydro counts if it's below 30 MW. We're the host to the Hoover dam and we don't count any of that allocation in the amount of energy we could use in the renewable portfolio standard. I think what you're recognizing there is the policy objective behind the RPS – it really is about developing new, sustainable technologies and primarily new generation sources. In our state, I can absolutely echo the rationale since you could easily swallow up the standard and not do a whole lot of new construction or development if you start counting generators that have been around for decades.
PE: How do renewable energy sources work with the current fossil fuel baseload used by a lot of utilities?
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