CPUC Seeks Another 3,000 MW by Next Summer

By Published On: November 2, 2021

The California Public Utilities Commission proposes to further bolster the grid the next two summers by adding between 2,000 and 3,000 megawatts, including by expanding commercial and residential demand response and home energy efficiency programs, as well as increasing payments for the resources. The mix of supply and demand products is to alleviate stress on the grid during excessive heat and soaring demand between 4 PM and 9 PM from June through October 2022 and 2023.

The CPUC already ordered an additional 14.8 GW by 2026 to shore up the grid in response to more extreme weather and nuclear and gas plant retirements, as well as to balance out the ebb and flow of solar and wind resources.

Under the CPUC’s latest proposal, Pacific Gas & Electric and Southern California Edison are ordered to each buy between 900 and 1,350 MW and negawatts, and San Diego Gas & Electric between 200-300 MW/NW by next summer.  The planning reserve margin would rise up to 22.5% during peak times and 17.5% in the evenings, according to the CPUC. Earlier, it was recently raised from 15% to 17.5%.

Aggregated demand response from large business and residential energy reductions are expected to increase with the upping of payments to $2,000 megawatt/hour or $2 per kilowatt-hour. During the mid-August 2020 rolling blackouts, demand response providers complained loudly that their offers of considerable supply reductions were ignored. They said the state continued to undermine the resource, causing a huge drop since the 2001 energy crisis.

The CPUC plan would include for the first time supplies from electric vehicles that can feed energy back to the grid from their batteries. Vehicle-to-grid owners that help support the grid during emergencies would be paid between $60 to $120 per kW a year.

Energy efficiency, which is often treated as the stepchild of clean energy alternatives, also is incorporated in the new proposal. Ratepayers would be paid to lower their energy use during times of peak demand, including as the sun sets and solar power diminishes. The load reduction would be measured at the meter.

The proposal, which comes up for a Commission vote on Dec. 2, also would adopt a new smart thermostat program providing $22.5 million in incentives to install connected thermostats that can lower air conditioning use at times of peak demand.

The plan also would put to the test the effectiveness of using fluctuating rates to motivate customers to alter their power use in two new pilots. One would shift agricultural water pumping to off-peak times and the other to get customers to charge their EVs when power prices are low, and the grid is flush with solar energy.

In addition, the proposal makes way for 160 MWh from four San Diego Gas & Electric energy storage microgrids.

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