Building Energy Efficiency and Solar-Readiness

It was good to see the Sacramento Bee noticing the positive changes in energy efficiency standards put forward by the California Energy Commission recently. DECA commented on these proposed changes arguing that they did not go far enough – in particular that “solar ready” should include readily accessible mounting hardware for solar installations rather than just southerly orientation and unencumbered roof space. Unfortunately the more expansive definition of “solar ready” will have to wait until the next three year cycle comes into being.
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Los Angeles Times piece on the cost of Net Energy Metering

The LA Times tomorrow publishes an article on Net Energy Metering. The article, by Michael Hiltzik, is pretty good at covering the issues and the big players on both sides of the equation.  One thing that it fails to do is address the disingenuous argument that Net Energy Metering favors the wealthy at the expense of the poor.  In particular there is no reference to Power Purchase Agreement providers who provide the upfront capital costs for installation. The article also fails to rebut the borderline absurd claims that Net Energy Metering discourages conservation.  I’ll likely post more in the coming weeks on the potential role of distributed generation in encouraging conservation so keep your eyes and mind open for that soon. Happily, the piece does provide a link to Tom Beach’s very good research arguing that the “cost” of  Net Energy Metering has been overstated by millions of dollars. If you’re not in California, these issues are still very real – especially for residents of the 46 other states and the District of Columbia that have some form of Net Energy Metering.  Heck, I suppose folks in Mississippi, South Dakota, and Tennessee care too, since they’ve been left out of the NEM fun.
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The grid’s easy button

I read an article today that talked about “difficulty settings” in the game of life, which got me to thinking about how hard or easy it is to do anything. This being the DECA website, I got to thinking about how hard it is to get more distributed generation on the grid. One thing that frankly has gotten much, much easier is getting someone to set up a system at your house. The growth in the green economy has been significant enough that a homeowner has a really wide variety of choices for who can install a PV system on their roof. The same goes for financing that system. Where things get hard are larger distributed generation systems – these aren’t the kinds homeowners put on their roofs or in their backyard, but they’re not much bigger when compared to say a 2000 MW natural gas plant. To be certain the larger a distributed generation system the more potential there is that it can cause problems on the grid, but the process of what is called “interconnection” is certain to not give anyone the warm fuzzies. The other side of that coin is that the size of the switch that gets flipped with residential solar programs (as an example) is pretty big – things go relatively well until they don’t go at all. This is why issues like Net Energy Metering are so important for pro-distributed generation policy advocacy – you might have had no problem getting solar, but six months later your neighbor can’t get it at all. But maybe I’m wrong – if you’ve had bad experiences trying to interconnect a residential distributed generation system we’d like to hear about it – please sign up (if you haven’t already) and comment in our forums to let us know – we might not be able to do anything about something that’s happened in the past, but we’ll try and get involved if there’s an ongoing problem or at least make sure it’s fixed for your neighbor if we can.
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Vote Solar email campaign on Net Energy Metering in California

If you’re a Californian, please take a moment to help Vote Solar let the California Public Utilities Commission that you support an expanded definition of the Net Energy Metering (NEM) cap. Net Energy Metering allows customers to help pay for the cost of their rooftop photovoltaic system by selling electricity back to their utility “netting” their utility bill to zero. Under the current rules the maximum allowed amount of NEM is likely to be reached in the next year, putting a serious damper on a great tool for encouraging solar distributed generation. The Commission is expected to vote on the matter Thursday May 10th 24th, so please visit the Vote Solar site by no later than the 9th 22nd to give the CPUC time to count up all the support. The text of the Vote Solar letter is included below for your convenience, but the automated filing form is on this Vote Solar site. Dear Commissioners: I write today to urge you to adopt the proposed decision issued in Rulemaking No. 10-05-004. I strongly support the methodology outlined in the proposed decision for calculating the 5 percent statewide net energy metering cap and believe the clean energy and new jobs created by this policy will benefit California’s environment and economy. Approving this proposed decision on net metering will help California reduce its reliance on polluting fossil fuels that are imported from out of state, increase job creation, improve grid reliability, and reduce the need for expensive and polluting peaker power plants. More capacity under the net energy metering cap is good for California electricity customers, the economy, public health, and the environment. Please vote yes and continue the PUC’s leadership in advancing California toward a clean energy future. Thank you.
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A reminder to check out your hourly usage data

A lot of us probably could stand to think a bit more about our electronic usage – it turns out that it’s really quite easy to do so. For all the bad rap that smart meters get, they really provide us with a great deal of information about how and when we use electricity. A quick review of my electrical usage reveals that most of my electricity and gas is used at night. Our house generally has good natural light in the rooms we spend the most time in and we have a radiant heat system that we only run at night, favoring retained heat during the morning and building thermal mass from the sun during the brightest part of the day. The exceptions are not, as I thought, the days I accidentally leave lights on but when we do laundry or run the dishwasher during the day. This is actually surprisingly easy to fix, by just putting laundry and dishes into the list of “late evening or early morning activities” (much like taking the trash out, etc.). Our house has a pool, but we have the filter pump set up to only run during “off peak” hours. My utility – PG&E – will calculate which rate is the cheapest based on 9 months of billing data – unfortunately we haven’t been in this house that long yet, but based on my review of our usage it very much seems in our best interest to switch to a time of use tariff – probably PG&E’s E6 tariff. I’ll do some math in the coming weeks and demonstrate the kind of savings we can expect as a result of using our hourly usage data to select the optimal rate structure for our household.
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DECA comments on calculating the California Net Energy Metering cap

Yesterday DECA filed comments at the California Public Utilities Commission on the calculation of the 5% cap on the amount of Net Energy Metering resources allowed in the state. Net Energy Metering (or NEM as it’s called by policy wonks and folks in the industry) is what allows owners of distributed generation (for example solar on your roof at home) to sell electricity that you are not not using back to the utility. It’s a hugely important policy for reducing the cost of ownership for DG systems for DECA members. DECA’s comments were pretty straightforward: 1) When calculating the 5% cap, the utilities shouldn’t be focused on the single moment when electricity use is the highest, but rather they should add every individual user’s highest load. Not surprisingly this results in a higher aggregate load and therefore more NEM that is authorized. 2) Be sure you are counting the reduction in load caused by resources that are behind the meter, meaning resources that are making electricity that is being used on site or being exported to the grid. If the utilities fail to count the load that they don’t see there will be less NEM allowed on the grid than the statute permits.
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A lot of DG in a single place

Okay, not a single place, but in a single transaction. According to a San Francisco Chronicle article, Bank of America has agreed to provide complete funding for Solar City‘s SolarStrong project to the tune of $1B after the DoE failed to secure a loan guarantee for the project. The project is expected to result in around 300MW of PV on the roofs of military housing across the United States. Doing the math in a back of the envelope sort of way the cost of the DG PV comes in at right around twice the cost of a combined cycle natural gas power plant on a MW to MW basis. Of course the PV has no fuel costs (while a combined cycle plant does) but is capable of running only when the sun is up (while a combined cycle plant can run whenever it’s profitable to do so) so it’s hard to make a full comparison in terms of MW-hours or avoided costs. Regardless, it’s a lot of Distributed Generation coming to the grid in the next five years, especially in a single transaction.
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Amory Lovins and Gordon Johnson sort of debate energy issues

Perhaps debate is the wrong word, but an interesting array if issues are raised, especially in the 2nd half of this clip The arguments are a bit complicated, but worth checking out. I will point out that Johnson appears to use the term “distributed” to refer to flexibility around the time of day of production (meaning you can turn on a gas plant whenever it’s needed as opposed to a solar facility only when the sun shines or a wind facility on when the wind is blowing). Unfortunately he’s a little confusing when he talks about wind and solar being “peak” resources and he doesn’t answer the question from the host about storage. It’s noteworthy that there is a great deal of misunderstanding about the intermittent nature of wind and solar because people’s gut instinct is to think about clouds or wind from the perspective they have always experienced them – from a single place in time (we are, after all, all individual people, with our own set of sensory organs). But this is not how the electric grid experiences wind and solar (or the opposite of clouds) – the vast geography of the grid is such that only some of the grid is experiencing windy conditions or cloudy conditions at any given moment. Just as you would never say the entire human race is getting rained on just because at one particular moment you need an umbrella, it’s wrong to think of all intermittent resources as being controlled by a single switch (with the exception, of course, of the sun itself rising and setting for solar). In reality there is a mathematical formula to explain the smoothing effect of distributed intermittent generation. Another way to think of this is if you are in a room with four walls and no ceiling and you flip a 100 Watt light switch on and off randomly you are either experiencing 100 Watts of light or are in darkness. If however you are looking at a grid of 100 rooms with 100 people randomly flipping lights on and off, there is very low probability that you will ever be in total darkness (or that it will ever be totally bright). You can however describe the probability of a particular amount of brightness. Similarly, you can describe the probability of a particular amount of wind or solar electricity even though there are clouds and gusts of wind happening all of the time.
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Renewables surpass fossil energy investments, but take a closer look at the odds

This recent Bloomberg wire story in the LA Times points to research that renewables saw $30B more in investments than fossil fuels this year. The article references a Bloomberg New Energy Finance study, saying “Electricity from the wind, sun, waves and biomass drew $187 billion last year compared with $157 billion for natural gas, oil and coal”. I’ll take that as a step in the right direction, but Ben Stills’ article from earlier in the month points out that worldwide fossil fuels receive six times the subsidies of renewable energy sources. The International Energy Agency report notes that it excluded subsidies to energy producers in that calculation too. While the news about Solyndra’s recent bankruptcy is being spun as a sign that solar and other renewables can’t make it on their own, is it any wonder? While some are busy vilifying solar subsidies in the US for a loan that went bad, Iran ranks as the highest supporter of subsidies for fossil fuels. The Solyndra loan accounts for less than a half of a percent of the subsidies to fossil fuels from Iran. The IEA correctly points out that these massive subsidies for fossil fuels are doing more harm than good. The question from my perspective is what can be done about it? These subsidies are generally fueled by a desire to drive domestic economic growth through artificially low energy prices. The basic thinking of policy makers is essentially a prisoner’s dilemma with each government focused on short term issues and the fear of unfair competition. The problem is the horizon over which they are looking. Subsidies on fossil fuels do long term harm because they are exhaustible. (They also exacerbate the problem of the externalities of carbon, but that is a topic for another day) As demand increases (because of artificial economic growth based on the subsidies) and supplies decrease, the subsidies will either have less effect or cost more. A better investment would be in a technology that is not as dependent on the price of fossil fuels. Even if only .5% of the Solyndras of the world succeed we’d be better off than Iran investing $81B in a technology that is in its demise. Conveniently, individuals can make this choice on their own. Investing in clean, distributed power is well within the grasp of individuals right now. There are even companies willing to extend their access to credit to consumers who want to make this move but don’t have the capital to purchase all of their energy for the next 25 years in a single transaction. Companies like SunRun and Solar City will pay the upfront costs and you pay them back over time. On a shorter time scale but still very real companies like General Motors and Nissan will loan you money to purchase one of their electric vehicles. Others will too. Think of how much easier that would be with six times the subsidies.
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Interesting article on Smart Grid and Smart Meters

The Washington Post’s rather nice “energy” page (which I am fond of) links to a great article on smart grid promises and perils. The article quotes New Jersey PSE&G CEO Ralph Izzo as saying “Somehow all of us collectively decided to skip the low-hanging fruit and go for the top of the tree.” It’s not clear from the quote’s context if Izzo is referencing “smart grid” broadly (meaning any and all things related to “awareness” in the electricity transmission and distribution networks, or smart meters (meaning the “awareness” of end use customers via advanced electricity meters). The article seems to suggest that smart meters are the real focus. But it’s not so surprising that Steven Mufson, the article’s author, points out the problems with opposition to rolling out smart meters in California. I’m a big fan of smart meters, and it pains me to see people who would rather be ignorant of the true costs of their electricity consumption (in both dollars and environmental impact). No, smart meters are not perfect, and neither are the utilities, third party service providers and regulators that utilize them, but as energy consumers I’d hope that we would embrace their potential as tools to help us use electricity more efficiency. Until then maybe Izzo is correct: in the short run energy efficiency spending may prove more effective than smart meters in reducing energy consumption. The answer to that question is one we’re seeking at DECA and when we find it, we’ll be certain to pass it along.
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