In 2013, the California Independent System Operator (CAISO) introduced the iconic “duck curve” chart depicting the expected effects of variable renewable resources – primarily utility-scale solar – on grid conditions. Since then, the conditions predicted have come to pass: meaningful midday overproduction and late-day ramps. Yet, when measured as a percentage of net generation or total installed capacity, the penetration of solar in the U.S. remains very small, even in California.
The question, then, is how can such a small set of resources have such a large operational impact? Answering this question requires a clear understanding of the dynamic relationships between three operating variables in an electric system: annual minimum midday load, peak solar production, and baseload or must-run generation. When taken together, these variables can be used to characterize a stress-case operating scenario and assess the oversupply risks an electric system faces when solar net load (i.e., system load minus solar generation) drops below must-run baseload generation.
This article, featured by Solar Industry Magazine, builds from these dynamic relationships to derive new metrics that estimate the impacts and risks of solar in major U.S. electricity markets as of the end of 2015, the most recent year of data available. More specifically, the analysis examines select North American Electric Reliability Corp. (NERC) regions, as well as regional transmission operators (RTOs) and independent system operators (ISOs). The findings reveal the potential for the electric system to accommodate additional solar, though it is important to note that all results are contingent upon simplifying assumptions made involving an electric system’s operating variables. Changing these assumptions, leveraging advanced capabilities of utility-scale solar, or integrating storage with solar could yield different results.
Overall, the new metrics are valuable because they account for baseload generation considerations while signaling how close a region may be to experiencing oversupply risks from solar generation. Further, the new metrics provide solar stakeholders with a simple heuristic to assess oversupply risks across multiple markets.
Sussex Economic Advisors is now part of ScottMadden. We invite you to learn more about our expanded firm. Please use the Contact Us form to request additional information.