Renewable power – more than a passing trend
In March 2017, for the first time ever, solar and wind energy accounted for 10% of the country’s electricity generation (8% wind and 2% solar), according to the U.S. Energy Information Administration.
Let’s unpack that statistic with a couple more from the Solar Energy Industry Association:
Installation of solar generation capacity has grown on average 54% annually since 2006, while solar costs have come down 70% since 2010, making them increasingly cost-competitive with other resources. That’s why nearly 60% of installed solar capacity last year was utility-scale.
It’s also why some industry projections have solar and wind generation surpassing coal and nuclear on a combined basis by 2030.
These numbers and trends should not come as a surprise to anyone. The more pressing topic is how utilities are going to evolve their planning, operations and business models to enable this profound change and turn it into a growth opportunity.
Renewables come with mighty challenges
As with any opportunity, embracing solar and wind energy comes with its own set of challenges:
- Renewable resources are intermittent. When the sun sets or goes behind a cloud, or the wind stops blowing, there’s no production, affecting up to 100% capacity.
- Renewable resources tend not to be coincident with peak load.
- Renewable resources are often located long distances from the loads they serve.
While 10% renewable penetration is proving entirely manageable, increasing to 30%, 40% and even 50% penetration (the goal of many state-level standards) compounds the challenges of forecasting, operations and planning.
In an electricity market rich in renewables, it’s difficult to overstate the importance of an accurate and timely demand forecast. The technical stakes (grid stability and power quality) and the economic stakes (the costs of procuring and summoning alternative generation resources) are significant.
Accurate forecasting (including system-wide and localized impacts of distributed generation) daily, hourly and even in near-real-time, becomes an operational and business imperative. With high-resolution data sets, better algorithms and statistically adjusted modeling tools, it’s now possible to gather and apply this business intelligence at both bulk-power and distribution-system levels, significantly mitigating these risks.
To manage the challenges posed by intermittent and distributed energy resources (DERs), distribution utilities need to extend visibility, intelligence and control to the edge of the grid. That means:
- Deploying connected, intelligent and secure devices–from distribution automation equipment to grid sensors to smart meters–ubiquitously throughout their networks.
- Enabling IoT capabilities such as distributed computing, artificial intelligence and machine learning to not only sense changing grid conditions and load volatility in real time.
These devices and capabilities can quickly take appropriate and coordinated corrective action autonomously, which will be critical in the management of an increasingly distributed and intermittent resource portfolio.
After rising continually over the past two decades, investor-owned capital expenditures are projected to level off and even trend downward a bit in the next few years. That has big implications for grid planning. Depending on the location, you can either create problems or solve problems by deploying DERs. Utilities are going to have to migrate from a static to a dynamic grid planning approach that accurately reflects the impact and business value of renewable energy based on location.
To do that, they’ll have to adopt new planning tools and high-performance computing capable of modeling:
- Grid behavior and DER impacts, both systemwide and localized
- Business cases that capture the true value of renewables across a full spectrum of metrics
Utilities will then be able to transition from mitigating renewable impacts to actually leveraging these assets to improve grid resiliency and reliability.
For more information, please visit: https://engage.atos.net/nao-iot-utility-2019.