Grid Curtailment and Other Ailments

We keep hearing news proclaiming the rise of renewables these days. X number of solar plants or wind farms being built, Y% of increase of RE capacity, so on and so forth. It seems that for as long as nature provides together with proper funding, we should be able to tap on these resources as main power sources, right? The answer’s not so simple. There exists a thing called “Grid Curtailment”, an ailment to the spread of renewable energy usage.

What is this grid curtailment all about? Put simply, it’s a phenomenon of power plants fighting for getting their power on grid. Take for example, wind energy. Energy generated from turbines does not automatically get passed to the grid and end users (or “dispatched”). Because the grid is connected to a network of power plants, there are rules that determine which one gets their power onto the grid during certain periods of time.

Factors determining dispatch:

  • Load Matching (Consumption demand).
  • Supply to the Grid
  • How quickly the power can come on line
  • Cost of dispatch
  • Priority is typically given to renewables, deemed as free energy

California saw an issue of oversupply of renewable energy and insufficient load (demand). This is partially due to the inflexibility that some generators need to constantly be run, such as nuclear, hydroelectric, geothermal and some gas-fired stations. That means the price of electricity will go below zero (generators pay to get their electricity on grid). That will lead to grid curtailment of these REs. There is no compensation for grid curtailment by the operator which means that those power generators will have to suffer a loss of profits.

Solutions to these include signing deals for the export of surplus energy to different regions, storage facilities as well as demand response. Storage facilities are valuable in storing energy during low demand hours for future release during peak demands. In other words, you get charged for storing and when energy is released again you get your money back.

At the opposite end of the spectrum, we see insufficient supply such as the one plaguing the UK. This may be the first time UK cannot meet peak demand, as they are struggling to also meet emission reduction goals. Coal and gas fired plants are being shut down and this results in losses in capacity. Due to lack of foresight in implementing policy of building new plants quickly, the capacity gaps may lead to market fluctuation in pricing. This was the impetus for the crazy 24 billion GBP nuclear deal that was signed in Oct 2015.

Maybe less risky alternatives like demand response may come in to curb the issue of over demand. Governments such as Singapore’s, are trying out demand response programmes to encourage participants to reduce their electricity consumption during peak demands. They receive an incentive for reducing electricity usage during peak demands via the electricity price reduced.

Sources: NA Windpower, The Energy Collective, GTM, Financial Times, Yahoo and others

Solar’s future : wins and loses

An optimistic projection states that by 2030, the solar generation capacity could go up to 250GW. This is a leap of over 100 folds since 2010 where the capacity was only 2GW, meaning that the share of energy pie from solar would rise from 1% to 10-15%. Price wise, cost of solar is now around $1.50/watt from $3.50/watt in 2010.

Here’re some cheerful indicators:

  1. Solar cost is only going to fall more as panels become more efficient and intense competition forces costs of solar projects down.
  2. Reforms in different states on energy are happening. NY’s Reforming the Energy Vision (REV), for example, focuses on creation of distributed service platform providers (DSPPs), where utilities will effectively host mini-marketplaces for energy to and from distributed energy resources.
  3. The Clean Power Plan enacted in Feb 2016. This will force polluting plants to cut down their emissions as well as encourage each state to have their own plan to achieve the emissions targets and encourage cleaner energy.

And then there’re the less sunny reality checks:

  1. The expiration of the investment tax credit (ITC) in 2016, the incentive scheme that applies around a one-third discount off the cost of installing solar and solar-plus-storage. Currently petitioning for extensions.
  2. No ability for solar to be fed into grid based on demand as now it’s still relying on low-storage, not so stable loads which are pretty much at the mercy of the sun’s variability.
  3. The rush to build and supply solar panels may cause an over supply of panels and force solar companies out of business if demand is unable to catch up with supply.

Below is a chart of current state of clean electricity breakdown in USA. Wind is the fastest growing sector and solar is still growing but remains below the levels of wind and hydro power.

San Francisco’s mandatory solar panels in 2017

So San Francisco passed a new law mandating all new buildings below ten storeys high to install some form of solar power: either solar PV or solar thermal. This will come in effect from 2017. This is a welcoming news (any governmental step towards more clean energy is a welcome gesture), indicating the city government is showing vested interest in fulfilling the promise of 100% renewable power in 2020.

Let’s take things apart a little bit and put things in perspective. San Francisco has a land size of 130km2, and around population of 800,000+. The new law is estimated to save around 27k metric tonnes of CO2 / year or equivalent of lifting off 5000+ cars on the road. The average San Francisco-ian uses about 7 metric tonnes of CO2 annually which means that this law will result in an average of per capita reduction of 0.4%. So clearly, the amount of reduction of CO2 is sort of negligent.

There are two things that could be done to improve this:

  1. To increase the mandate of having 15% rooftop space for unblocked sunshine to a greater percentage to say 30% or 40%. This will raise the capacity available for solar panel infrastructure.
  2. To solve the problem of energy demand by building taller residential buildings and encouraging people to move more into city. This will kill two birds with one stone: reducing long-commute hours and reducing apartment unit size which means less energy use.

So I would say if the anyone is really serious about tackling climate change, it would be better to look ahead and consider the bigger picture. That said, let’s hope for more good news to come.

London Tube’s Energy-saving Braking System

The world’s first regenerative braking system has just been officially set up in London’s underground Tube. The breakthrough as a world’s first came after a period of trialing, collecting and recycling waste energy over the brakes.

The inverter system is able to collect 1MWh electricity every day, enough to power the train station for up to 2.5 days, or save up to around 6 million Great Britain Pounds yearly. The technology collects waste heat during braking and feeds back into the battery as electricity.

The beauty of regen braking with trains is that you don’t necessarily have to store the power onboard, which means that you don’t have to carry the weight of a battery pack around.

Singapore’s Future in Solar PV

Energy Studies Institute organized a one-day conference which brought together experts from government agencies, research institutes and solar companies on a common discussion topic of the future of Solar PV, internationally, regionally and locally.

The IEA started the day with a comprehensive discourse on the trends in solar energy for the next few decades, outlining the fastest growth in capacity of both solar and wind energy in countries like China, Japan and USA. Outside of Europe and in emerging economies like Africa, there has been significant reduction in cost of capital, allowing speedy expansion of solar. Key elements to success in solar include good financing and PPAs (Power Purchasing Agreements).

The presentation was substantially flavoured with insightful statistics and figures backing up the predictions: Projection of solar energy growth of 400 GWp to 500 GWp by 2020 and 560GWp by 2025 to meet climate change objectives. And with conservative calculations, to reach 16% of energy market in 2025. However, further actions are needed for the estimations to be precipitated. For example, system integration, policy framework and financing as well as government setting aside long-term targets to help finance, distribute and facilitate uptake of solar in a larger scale.

Solar leasing is a crucial way of encouraging the uptake of solar installations. Through shifting of risks and financial burden of capital costs to the lessor, building or house owners have an added incentive to join the game. Not only are the modules financed by investors, lessees get to reap rewards of harvesting solar energy by being green with zero or low cost.

Currently in Singapore, town councils are managing the solar leases with HDB flats and paying for the power generated at lower than retail rate. The latest tender awarded Sunseap with 38MWp for 680 HDB flats and HDB-owned buildings with the cost fully borne by the developers.

The situation in Singapore
Phoenix Solar came in to shatter myths hindering solar developments in Singapore, busting old-aged tales of how intermittency will cause solar power to be unreliable to deploy on national scale. Blessed with plentiful rain throughout the year, intermittency during days of storm can cause intensive drop in aggregate output. However, data showed that the average monthly fluctuation is around 20% which was claimed to be an insignificant cause for worry. Now, installation of solar panels is decentralised and diverse across Singapore, totaling around 9 MWp. It was predicted that solar could contribute up to 2 GWp by 2025 (1/3 of total demand in Singapore) and 600 MWp by 2020, as grid parity has already been achieved ($0.23KWh for solar and $0.21KWh for gas).

Singapore is particularly blessed with government support and efficacy in facilitating the growth of solar industry locally. In countries such as Thailand, hindrances such as lack of government funding, prohibitive rules and inefficacy in pushing out key projects remain as reasons for falling behind. For example, inflexible rules such as the need for a factory license before installing a solar panel with 10KWp capacity occludes solar PV installation on residential roof tops.

The top three PV Success factors include having i) a good business model, ii) cost of equity, debt and construction capital and iii) refinancing and/or exit plans. One of the ways to achieve ii is to get investments. Though solar PV is already traded as a commodity in the markets and repackaged as financial instruments globally, Singapore does not have a large enough pool for securitization. Thus, one of the ideas which sprang up in the conference was to make Singapore a secondary market for the region.

From a regulator’s standpoint, their role was to reduce as much barriers as possible for solar to enter Singapore’s market. Energy Market Authority reduced the number of days from 27 to 7 days to join the power grid locally. It also created a 1-stop PV information sharing website for people to exchange ideas and knowledge. To hedge the problem of solar intermittency affecting stability of power in Singapore, the Intermittent Generation Threshold (IGT) has been set. Basically, this implied the maximum amount of solar energy produced which does not incur additional cost to carry on the existing system. The IGT is now 600MWp (previously 350MWp).

The Future of PV
Due to the unique constraint of land area in Singapore, there needs to be innovations in the usage of solar PV as an energy source. These are already present and are in stages of testing and development, including: floating PV panels (5KWh by Phoenix Solar), using Pulau Semakau as a PV bed as currently they are using diesel to generate power for waste facilities, and Building Integrated PVs (BIPVs) whereby solar panels are placed vertically on buildings like windows. However, some challenges like time-sensitivity of BIPVs and high installation costs remain to be resolved. Without subsidy from government, solar companies need to think of ways to build business models which will thrive in an island with a small land area, in order to propel a faster growth of solar industry here.

Energy capacity and energy parity

According to the ear-pleasing Renewable Power Generation Costs in 2014 report by IRENA, there’re plentiful reasons why anyone in the right mind would be rooting for renewable energy in coming years. Data has irrevocably shown that even without financial aid or incentives, renewables are successful in playing catch-up with costs of traditional fossil fuels. Take some time to chew on these figures:

  • In many countries, including Europe, onshore wind power is one of the most competitive sources of new electricity capacity available. Individual wind projects are consistently delivering electricity for USD 0.05 per kilowatt-hour (kWh) without financial support, compared to a range of USD 0.045 to 0.14/kWh for fossil-fuel power plants
  • The average cost of wind energy ranges from USD 0.06/kWh in China and Asia to USD 0.09/kWh in Africa. North America also has competitive wind projects, with an average cost of USD 0.07/kWh
  • Solar PV module prices have dropped 75% since 2009 and continue to decrease.
  • When damage to human health from fossil fuels in power generation is considered in economic terms, along with the cost of CO2 emissions, the price of fossil fuel-fired power generation rises to between USD 0.07 and 0.19/kWh.

IRENA has also brilliantly came up with a very insightful and easy-to-use online tool displaying statistics and data visualisation on renewable energy usage and ranking by region and countries. Stats junkies can start squealing now. Of note-worthiness are sections on country rankings of installed RE capacity (China of whopping twice the amount of USA) and RE tech employment by country (Why’re UK and US so low on their employment numbers?).



Fun Facts

1. What’s the difference between Solar PV versus Concentrating Solar PV (CSP)?

Answer: CSP refers to solar thermal energy through the use of mirrors or lenses to concentrate a large area of sunlight on a small area.

2. What’s LCOE?

Answer: Levelised cost of electricity, a ratio of lifetime costs to lifetime electricity generation.

COP20 / CMP10 Lima Peru In Summary

The COP20 CMP10 had just ended in Lima, Peru on 12 Dec. I was nominated to join as a youth delegate but was unfortunately unable to attend. However, I’ve heard many things from people about this year’s conference. Quite frankly, whenever it comes to UN conferences on climate change, my skeptical mode switches on. From last few years’ learning from conferences such as the one in Copenhagen, it seemed like all talk, little achievements and no solid conclusions. It has been notoriously known that countries come together not to work in peace and harmony on a coordinated plan to mitigate climate change but rather to pit against each other with their own interests.

What have been agreed

  • US: Committed to cut their emissions (Also first time that the US Secretary of State engaged directly in climate talks, giving a lot of teeth in the negotiations) by shuttering hundreds of coal-fired plants
  • China: Offered to set date of 2030 for peak emissions
  • EU: 40% cut in emissions by 2030 and new targets w.r.t. renewable energy.

What haven’t been agreed

  • No obligation from BRICs to cut emissions, but accepted that world needs a cap as whole
  • Developed countries’ commitment to the emerging economies to assist and provide funds for their carbon-cutting initiatives

The Kyoto Protocol was set in 1997 to engage countries (mostly developed) in the common bid to fix global temperature rise to 2 degree celcius and 350ppm as carbon output level. The commitment will expire on 2020. The 194 countries who attended the Lima conference reached key decisions that will influence the climate change pact for the 2015 Paris conference, and hopefully by 2020 the world shall see the results that it had set out to achieve more than 20 years back.

DNV GL’s Wind-Powered Water Injection Tech

On 10 November, DNV GL gathered in Norway for a launch meeting on their industry project, wind-powered water injection system. In this fairly cosy setting, the industry leaders and experts came together to explore possibilities of expanding this line of business as future development of combining the technologies of water injection and wind energy (in particular, offshore wind). The ultimate goal is ironically, to lower the cost and raise efficiency of extracting oil reserves near the shore. I’m unsure what the environmental offsets to such a technology is. This is clearly a hybrid of both clean technology and traditional one, with the latter being the main driver (and the former as a tool to support this).

DNV GL suggest new EOR concept: wind powered water injection

The main challenge the project seeks is: how to lift the oil off the ground with reduced CO2 emissions and lower cost. I watched the video from DNV GL’s website and learned quite a fair bit about the wind technology portion. Here are some of my takeaways:

Wind is the largest energy source in energy storage capacity. Then, 30% is PV (Solar) and 5% is coal. In China, it is targeted to increase to 200 Gigawatt by 2020. The technology now is gearing towards floating wind turbines. However, the dominating one is still onshore wind which stands about 85% now. Offshore taking about 10-15% of the pie.

Offshore wind turbines can generate about 3 times the energy of onshore ones. The benefits of offshore ones are that bigger components can be used. There are 3 types of offshore turbines: 3 MW, 3.6MW and 5MW with tripods.

The focus is increasingly on floating offshore turbines as opposed to fixed offshore ones. Floating offshore turbines are made of stronger materials and can go deeper into the waters, allowing for bigger blades, higher capacities. Prototypes of floating offshore turbines are already installed in various countries like Norway (forefront), Scotland, Spain France and Portugal. USA and Japan as well. Japan is slightly special due to Fukushima incident and loss of major nuclear plant. 7MW turbines were since installed there.

It was difficult to perform a cost analysis on this new technology. Questions were mostly centered on how much cost savings it can achieve. There are also other things to consider such as regulatory requirements and commercial frameworks (buying equipment vs renting), system reliability and uptime.

Deloitte’s survey: what motivates Greening?

The buzzword is Greenovate. The shift of creation and usage of technology to help processes and systems, corporations and consumer lifestyles become more “green”. Deloitte published an interesting read on why it’s not easy being green. It all boils down to cost-benefit analysis at the end of the day. It is about weighing how risky the investment of time and money is into greentech and what the ROI and benefits in the long-run would be for the company. Some companies decide that adoption of greentech is costly in the beginning especially when there are few players doing so, and think it to be better off to wait a year or two.

Bets are mainly placed on two developments: solar and electric vehicles. In China alone, USD$294 billion would be invested by 2015 in renewable energy sector. The main propeller would still be regulations.

Here we glean some insights on the top motivators for companies to adopt a Resource (specifically energy resource) Management System. Unsurprisingly, priority is given to saving costs.

To view the full survey by Deloitte on energy customers, click here.

Q: What is the primary driver for you to implement a resource management system? 

1. Cut Cost – 63%

2. Internal Motivation – 50%

3. Just the right thing to do – 43%

4. Betterment of corporation – 39%

5. Regulatory Requirements – 36%

Singapore removes cap for solar energy supply to grid

Great news for solar! The energy authority decided to remove the 600 megawatt-peak (MWp) cap of solar energy that can be supplied to our national grid.

Why was there a cap in the first place?

  • Softens the impact on the grid in case of unpredictable reduction in solar supply caused by factors such as cloud covers.
  • Reduces the reliance on reserve powers.

Why are they removing it now?

To encourage more generation of solar energy in the Singapore energy market.

What are the impacts?

  • For companies, there may be added costs due to the need for increased reserve capacity
  • Smaller consumers who install solar generation sources will find it easier to be paid for supplying excess electricity they sell to the national grid.
  • Come 2015, consumers can be paid the energy cost of electricity they export into the grid, currently, 25.68cents per KWh directly through SP.

What proportion is the solar energy output in the overall scheme?

  • The total power generation capacity is 10,000 MW which is more than the peak electricity demand of 6,000 MW.
  • Solar output would then be around 10% of total.
  • In Singapore, the only intermittent energy source connected to the national grid is solar. 85% of the energy it uses is generated through natural gas.

Sources: ChannelNewsAsia, abc carbon, pacific light