SOLAR 2020 Emerald City 100% “VIRTUAL” Renewable Energy Plan CONFERENCE June 24 ... · 2020-07-22 · June 24 –25, 2020 American Solar Energy Society Washington, DC. ... •CHP

EmeraldCity100%RenewableEnergyPlan

StevenB.Smiley

Email:[email protected]

SOLAR2020“VIRTUAL”CONFERENCEJune24– 25,2020AmericanSolarEnergySocietyWashington,DC

EnergyandEconomicPhilosophy

• “Allenergychoicesandpricesarebasedonpoliticsandpolicy”- JohnPestle(MIenergyattorney(ret.)

• “Makethemarketyourslave,notyourmaster”FredeHvelplund;AalborgUniversity,Denmark

• 21st Centuryeconomy:Mustbe“Regenerativeanddistributive”- KateRaworth;“DoughnutEconomics”2017>>

• “Wealthisregeneratedsolarradiation”-R.BuckminsterFuller– “OperatingManualforSpaceshipEarth”

SummaryConclusions• Backbygreenbonds,greenbanksandon-billutilityfinancing,thecapitalbottleneckwillberemovedreleasingthetremendous“latent”demandbylocalcitizensofallincomelevelsandthemuniforcleanenergy.

• Newwindandsolargenerationwillberoughly3timesthepresentelectricconsumption,and3timesthepeak.

• Unlimitedsolarnetmeteringwith<1%impactonutility• Flexibleandtargetedcarbonfees,negativeatoff-peak,willdriveoutnaturalgas.

• CHPquickresponsebiogasengines(enoughtorunthecityonaverage)andasback-upintheeventofgridfailures.

• ElectricbatterystorageandEV’swillbephasedinwithincentivesandlow-costTOUcharging.

Conclusions(cont.)• Distributiongridmodernizationwillbeconducted.Thisincludesretrofittingdistributionsubstationsforbi-directionalcontroland+100MVAofrenewableenergysub-station(s).• 1,000’sofelectrichotwaterandotherthermalstorageunitswillbeintegratedintothesystemandmanagedwith“gridharmonization”.LargethermalstorageassociatedwithsomeCHP/districtheat• Excessenergycanbesoldintotheregionalgrid,avoidingcurtailment.• Energycostswillbelowerthanpresentandfixedindefinitely.

EmeraldCity– GeographyandResources

• Humidcontinentalclimate:7,794HDDand458CDD(degF)

• 44degreesNlatitude

• Population:15,000

• Area:8.7sq.miles(22.5sq.km)

• 640feetmeansealevel– 1,000feet(300m)elevationmax.

• Solarresource:1,350kW-hourspersq.meter/yr.

• Windresource:IECClassIIIonsurroundinghills

• Biomassandbiofuelsfeedstockavailable

Energy- EconomicProfile(w/otransport)

• Annualelectricandgasexpense:$55million• Annualelectricexpense:$35million• AnnualNaturalgas:$20million• 93%ofenergysupply(non-transport)iscoalandnaturalgas

• Annualelectricconsumption:310millionkW-hours

• Summerelectricpeak:70MW• Baseloadelectricdemand:25MW• Averageelectricdemand:40MW• AnnualNaturalgasconsumption:560millionkW-hours

• Averagecustomerelectriccost$0.11/kW-hour

CustomerEconomic/ElectricProfile– ImportantDistinctions:87%ofcustomers– residential- 80%ofelectricrevenuesnon-residential

CustomerClassBreakdown(87%Residential) CustomerRevenueBreakdown(80%Non-residential)

ElectricLoadProfile

SolarNetMeteringExpansion• CriticaltostartASAPtopushsolarenergyfrominsideout

• Netimpactonutilityrevenues<1%• Remove20kWlimitonindividualsolarnetmeteringinstallationsolargercommercialcustomerscanbenetzero

• RemovenetmeteringtotalsystemkW-hourcaps(MIhas1%cap)

• Conductlocalized“valueofsolar”studywithalldirectandindirectbenefitsaccountedforandadjustnetmeterpricebyeconomiesofscale(i.e.largersystemspaidlessthansmallresidentialsystems)

• Providelongtermon-billfinancingforsolarelectricsystems

• Providerebatesforsolarinstallations• Noaddedfixedmonthlyfeeforsolarnetmetering!

• Providelong-term(20years)contractguarantee

Netmetered9kWwithEV

CommunityandCooperativeSolar

• Solarforcitizensthatwantto“own”ashareofsolarwithon-billfinancingandcredits• Buildsonexistingmodelsthatareinplace• Tapsintolocalcitizenfinancialresources• Providesfortargetedsystemlocationstobalancecitywidesolarloads– i.e.neardistributionsubstations• Providesforutilityengineeredandmanagedstoragesystemstooptimizeanddispatchdistribution

TargetedVariableCarbonFeesandDistribution• Variablecarbonfee:(Withseniorandlow-incomecitizensprotected)• Targetcarbonfeeswithtime-of-useelectricrates• Highfeeduringpeakperiods(i.e.+2cents/kW-hour• Negativefee(i.e.– 1cent/kW-hour)onoff-peakratestoout-competenaturalgas(i.e.<4centsperkW-hour),andtoencouragefuelswitching,storage,EVcharging,etc.

• Phasedownfeeascarbonemissionsarereduced• Wherepossible,putcarbonfeeonnaturalgasuseincity• SomeMuni’sthatdistributegascandothis• Thosecitiesthatdon’tdistributegas(EmeraldCity)canprovidethecompetitivebasisforeliminatingnaturalgaswithlowoff-peakrates,fuelswitching,heatpumps,andthermalstoragethatout-competesnaturalgas

On-billfinancingforefficiency,solar,storage,fuelswitching,EVcharging,controls…• Variablefinancetermlengthsappropriatetobalanceagainstsavings,solarsystemcosts,storage,fuelswitchingcosts– withtermsbasedoncustomerpreference• Includebenefitofnaturalgassavings(avoidance),inloancalculationandabilitytopay• Lowinterest,backedbyautilityloanguarantee.• Noqualificationsotherthanelectricbill– nocreditcheck,beneficialforlowincome• ASourceofutilityrevenuesforservice

RebatesforEfficiency,Solar,Storage(thermalandelectric),FuelSwitching,DemandControls,EV• GoodRebateProgramInPlace• LED,refrigeration,HVAC,ECMefficientmotors,solar($90/kW– couldbehigher)

• Needtoaddenergystorageandelectricvehiclerebateincentives• Needtoaddfuelswitchingrebates

Ban/EliminateNewNaturalGasConnections

NaturalGasPhaseOutProcess

• StepOne:makeelectricitycompetitivewithnaturalgasforthermalenergy--spaceandwaterheating—soeconomicincentivetochange

• Onlyallowspecialexemptionsfornewnaturalgashookups

• Donotrepairorreplaceoldgaslinesasit’slowercosttoretrofittogreenelectricitythantorepairand/orreplaceaginggaslines

• Inanyevent,aging(60years+)gaslinesareleakinganddangerousandmustbeabandonedforsafetyreasons

Transition

• StepTwo:TransitionnaturalgasCHPsystemstobio-gasandelectricstoragesystems(especiallylargethermalstorage)duringten-yearplan

• Note:Localeconomicbenefitsofkeepingnaturalgasmoneyathomeexceed$20millionperyear,plusmultipliereffects,airqualitybenefits,etc.

ProjectSummary:Wind/Solar/Storage/CHP• Wind• Est.28windturbines1– 4persurroundingtownships• Approx.400millionkW-hr/year• 100+/- MWPeakCapacity• Solar• 800acres– 1.25sq.miles– incityandsurroundingopenland• Approx.300millionkW-hrs/year• 160+/- MWPeakCapacity• CHP– Biogas• 150millionkW-hrs/year• 35MWPeakCapacity• Battery/ThermalStorage– (Withmarket-basedincentives– customerchoice)• EVImplementation– (Withmarket-basedincentives– customerchoice)

Wind:UtilityScale

• Largerotor– 4MW+• ClassIII– low-windresourceturbines• Highcapacityfactor:40%– 50%• Generating90%+oftime• Twotofourturbinespersurroundingtownships– sharingenergybenefits(i.e.LeelanauandGrandTraverseCounties,forex)• Least-costenergy• Locallyowned– public/private

Projects:SolarTechnology

• PhaseI:Insidethedistributionsystem• Distributed,netandvirtualmetering• Community/CooperativeSolar• Schools,hospital,publicfacilities• Utility“distribution”sub-stationbased,projects• Industrialsites

Projects:CombinedHeatandPower• Insidethedistributionsystem—”merchantpowerplants”

• Loadbalancingandemergencyback-upfeatures—ratedataveragecityelectricload(35– 40MW)

• Largethermalstorage(r.inphoto)bothwithCHPandwithwind/solarelectric

• Combinedinconjunctionwithcriticalfacilities,hospital,schools,publicworks(water/sewer/criticalfacilities)

• Beginwithnaturalgasenginesifnecessary,thenphaseinbio-gasoverten-yearperiod

• Note:CHPgasshouldbe80%- 90%efficient,nolessthatotherdisplacednaturalgassystems

• Afewchimneysversus1,000’sofchimneys

LemvigDenmarkBiogasCHP– GoodExample

FinancingandEconomicsFinancing(multiplesources)• GreenBonds(Emphasisonlocalbondbuyers)

• On-billutilityfinancing

• Carbonfees• Community/CooperativeProjectFinance

• HabitatforHumanity– Solar“Depot”Financing

• Consumerself-financing(cash&credit)

• PACEfinancing(propertyassessedcleanenergy),MichiganSaves..

• Contractor/projectdeveloperfinancing(solar,wind,mechanical,electrical,etc.)

• EnergyServiceCompanies(sharedsavings)

• Bankfinancing,constructionloans,mortgage,etc.

Revenues• 100%distributionandsaleofgreenelectricity– whatthecustomerswantandwillingtopayfor

• UtilitykW-hour“sales”tripled–earnmoneyonQUANITY!

• Carbonfeerevenues• On-billutilityfinancing(feesandinterest)revenues

• Community/Cooperativeprojectrevenues• Salesofexcesswindandsolartogridandneighboringutilities

• Technicalservices• Localmultipliereffects– keeping$$athome- 2Xmultiplier

MarginalCostofWindBeatsNaturalGas

$-

$0.020

$0.040

$0.060

$0.080

$0.100

$0.120

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

MarginalCostofBigWTG's$perkW-hourvs.PercentOutput

• Ataveragecapacityfactorof40%-50%MC=<4cents/kW-hour• OnawindynightMCapproaches2cents/kW-hour• Ifinstalledinthe“distributionsystem”grid,thereos noorlowtransmissionexpense• Iflocallyowned“merchantplant”MCvaluationapplies• Thelow-costwindelectricityvalueforheatingcanbeleveragedbyafactorof2+withheatpumps;out-competingnaturalgasat<2cents/kW-hour

DistributionGridHarmonization

• C.Gruenwald:“LinkandSync”–“VirtualBattery”

• Smiley:GreenRE-Heat

• BrattleGroup–GridHarmonization

SummaryTake-awayThoughts• Unlimitedsolarnetmetering,affectingutilityrevenues<1%• Carbonfeepositiveonpeak,negativeoffpeak,outcompetingnaturalgas,knockingnaturalgasoutofthemarket

• Utility“merchant”windpowerat2cents/kW-hourmarginalcostenergybeatingnaturalgas

• On-billfinancingandincentivesforsolar,storageandEV’s,lettingthemarketpickthewinners

• Tripleelectricsales,cuttingpriceswithquantity• Lowerenergycosts,fixedindefinitely• LocalGreenNewDeal:Muni’s(smallorlarge)canleadandshowhowitcanbedone• Itcanbedonebecauseithasbeendone;atleastinpart!• Takebestpartsfrommany– putthemtogetherinonegoodprogram• StudyExperienceofLeadingMuni’s

• AustinEnergy,Texas• GreenMountainPower• Burlington(VT)ElectricDepartment• SacramentoMunicipalUtilityDistrict

Thankyouforlistening!

• StevenB.Smiley

• Email:[email protected]

• Ph:(231)883-4850