Three studies: solar-plus-storage ... the technology will disrupt the power sector

[kristopher]

Is grid defection still a threat to the utility business model?
Three studies debate solar-plus-storage economics, but all agree the technology will disrupt the power sector

Peter Maloney@TopFloorPower
April 18, 2017

Grid defection has become a much discussed topic in the energy storage world. It has been the subject of academic papers, including a recent paper by researchers from the University of Texas at Austin and another paper by researchers from the Rochester Institute of Technology, that examined the economics of combining energy storage with rooftop solar panels.

Those papers referenced an earlier 2014 paper on the Economics of Grid Defection by analysts at the Rocky Mountain Institute. The key points of the RMI paper were that solar-plus-storage technology has reached grid parity in some locations and continued technology cost declines will lead to wider adoption and, as a result, further utility “revenue decay” as customers reduce their reliance on the grid.

These changes are all happening within most utilities’ 30-year planning horizon, RMI said, and, therefore, grid defection could disrupt their business models and leave them with stranded investments in outdated assets.

... more at http://www.utilitydive.com/news/is-grid-defection-still-a-threat-to-the-utility-business-model/440272/

[ccarrick]

1. I have seen the future

But, wait, where's NNadir to tell us how these scholars aren't real scholars and the RMI is a bunch of bourgeois brats who want us to drive electric cars and power then with solar PV, when it's really nuclear that's going to save us, just don't worry about the nuclear waste that will stay poisonous for tens of thousands of years, but never mind that because it's really the renewable energy advocates who are arrogantly trying to trick us into melting the polar ice caps?

[NickB79]

2. How do we keep the grid operating for those not off-grid when revenue collapses?

Is there a danger of power company's leaving customers without power if their profits drop to the point they declare bankruptcy? Or are there government subsidies that prevent this from happening?

[ccarrick]

4. they'll be fine - and so will we

solar + storage actually provides value to utilities and non-solar customers by providing clean energy closer to its point of consumption, at the times when it is needed most and during off-peak hours.

states like New York are already devising new ways of compensating solar customers so that these kinds of value streams can be adequately accounted for, through the Value of Distributed Energy Resources (VDER) tariff proceeding. other states are working on similar mechanisms.

keep calm and relax!

[NickB79]

5. Then why do they use the phrase "revenue decay"?

That sounds like the polar opposite of "fine" for for-profit utility companies...

[ccarrick]

6. Imagine that

Gee, I dunno it's not like for profit companies ever lied before. Methinks you're on the wrong site. Why don't you run along to red state?

[OKIsItJustMe]

7. One could check out the story

http://www.utilitydive.com/news/is-grid-defection-still-a-threat-to-the-utility-business-model/440272/

[font size=3]…

The fact of the matter is that relatively few customers are looking to add storage to their solar systems in order to cut the cord with their utility. Grid defection is neither viable as an investment decision nor as a business model for most companies.

But some companies are exploring the possibilities of combining storage with rooftop solar panels. In Ontario, Alectra Utilities, the third largest municipal utility in North America, began exploring solar-plus-storage about a year and half ago through its Power.House pilot program.

Through the program, Alectra aggregates residential solar-plus-storage installations to create a virtual power plant. The original program, since expanded, encompassed 20 houses, each with a 5-kW solar array and 6.8-kW, 11.4-kWh lithium-ion battery.

Alectra owns and operates the Power.House installations and guarantees customers savings of $100 a month in exchange for an ongoing service fee and a $3,500 upfront payment. The company also promises customers that at least 50% of their energy storage capacity will be available as backup power.

…[/font][/font]

Solar does not mean the end of the grid or the end of utilities.

[kristopher]

10. keyword: microgrid

The role of microgrids is under-appreciated in most studies. There is great potential for stacking multiple profit streams in the design of a microgrid and its relation to the distribution system.
That economic element is best appreciated by dipping into the research on electric vehicles' role in vehicle-to-grid.
A key point to bear in mind is that there is vast potential for various end users to design their microgrid in a manner that integrates profitably with the local system. In some cases, even H2 will be the key to making it work.

[kristopher]

8. Do you understand the way our power system works?

No snark, but your question points to a fundamental lack of familiarity with the system.

In a nutshell, "power companies" encompasses several types of different economic entities; especially since market reforms emerged in the past 20 years. Essentially, vertically integrated utilities were encouraged to split off those business segments where effective competition could be brought to bear.
Transmission, generation and ancillary services were some sectors that now have significant private ownership instead of public utility ownership.
All types of ownership are still tightly regulated at the state and federal level.

If any segment or provider of services can't continue to compete in a condition where the need still exists, they will either be replaced, reorganized, or eliminated - just as they've been for the past 75 years.

Will there be government subsidies involved?
Absolutely. Whether those subsidies involve supporting forward thinking investments or backward looking pork will depend (as now) on politics.

But mostly the process should be one of evolution. Business planning usually isn't done in accordance with blind ideological fervor. One of the lesser known tricks of policy is that more than being strictly proscriptive, it uses proscribed changes as a way of showing businesses the path forward. Early adopters that exceed incremental mandates are common.

For example, if you look into it, you'll find strong industry support for the Clean Power Plan among large power users and many, many utilities. They will continue to use that as a template for what the future holds no matter what flimsy roadblocks the energy oligarchs manage to erect.

The economic tide is bringing in a low carbon global culture. There is nothing I can envision that can derail the change.

[GliderGuider]

3. Only if the Russians don't disrupt solar-plus-storage first.

Hints of a weaponized grid:

https://www.democraticunderground.com/1127109905

[kristopher]

9. You really should post most of your contributions in creative speculation

Given that our centralized grid now is vastly more vulnerable than a distributed energy resource system of interconnected microgrids would be, I'd suggest your hints reek of your typical antirenewable horse shit.