On page 4 of an Edison Electric Institute (EEI) booklet called Disruptive Challenges: Financial Implications and Strategic Responses to a Changing Retail, “Distributed Energy Resources” (the best known source of which is Rooftop solar) is identified as “the largest near-term threat to the utility model.” Though the impact of this “disruptive technology” is still small, (p 13) “… the potential impact, based upon DER trends, is considerable (as stated earlier, industry projections propose that 33 percent of the market will be in the money for DER by 2017, assuming current tax and regulatory policies).”
This is a National issue. The recent negotiations in California – in which San Diego Gas and Electric, other California utilities, legislators, the Governor’s office, the solar industry and consumer groups worked towards the forging of legislation that all parties could live with (AB 327) – appears to be an exception. Arizona’s most prominent utilities company and the EEI are now accused of funding false information campaigns in an attempt to squash the rooftop solar threat in Arizona. There have been clashes between utilities companies in Louisiana, Idaho and Colorado. Now Georgia’s utility company is attempting to impose an estimated $22 a month tariff on rooftop solar owners. The real question is what place do utilities companies have in America’s future.
There appears to be two issues. Firstly, these investor owned utilities companies are perceived as being top heavy and, as a result of the near monopoly conditions they enjoy, are believed to charge too much. Secondly, putting industrial scale renewable energy projects in the desert, and building hundreds of miles of utility lines to connect them to urban centers, seems both inefficient and environmentally destructive when compared to rooftop solar.
Regardless of the answers, neither of these questions needs to threaten the existence of investor owned utilities companies. They do involve a shift in perception and a potential loss of profits. The real threat to utilities companies may be a failure to adapt to changing realities.
There are serious doubts as to whether industrial scale renewable projects in the desert actually help address Climate Change. As was admitted in the recent environmental statement for the Palen solar project, “In order to build the facility, the plants, animals and soil of the native desert acreage are damaged and destroyed, which releases CO2. Presently, there is still dispute among scientists as to how to accurately measure the benefits and the loss …”
One of the problems with these desert installations is that power is lost traveling through those long lies to the urban centers where it is needed. According to San Diego utilities engineer Bill Powers, around 7-8% of the power that passes through systems like the Sunrise Powerlink is lost in transmission and this number can rise to as much as 14% on a hot day. These figures are probably conservative, because a study in favor of this system admits that there are sometimes transmission leakages of as much as 33%.
Powers points out that there would not be any leakage if you put solar panels on rooftops, parking lots and brown field areas in urban areas where the power is needed. He said you can use the same panels that you would have put in the desert.
This would eliminate the need to erect hundreds of miles of new transmission lines, which means a loss of income to the companies that build and maintain these lines, yet does not necessarily mean that existing systems need to be taken down. These would have to be evaluated individually, to determine if the environmental damage is already done or there is an ongoing detrimental effect.
According to County Supervisor Dianne Jacob, “There’s no question that Sunrise Powerlink, with its miles of tall towers and electrical equipment, compromises aerial firefighting. According to Cal Fire, retardant drops are essential to putting out a fire while it’s small and most effective when performed less than 300 feet above the ground. Anything higher than that, the wind affects the trajectory of the drop, making it useless. Giant wind turbines poses the same danger. When it comes to ground support, our backcountry fire agencies are not equipped to handle an electrical fire on a turbine that tall. You need a specialized, highly trained and highly equipped fire crew to address a fire of this kind. The environmental impact report for Sunrise Powerlink concluded that not one piece of mitigation can reverse the significant and unavoidable impacts to fire. This remains very concerning.”
The most recent negative incident occurred on Oct 24, when no bidders turned up at the Bureau of Land Management’s auction for solar rights in Colorado. One industry spokesman mentioned financing issues. Others mentioned uncertainties about the solar energy market and federal regulations.
Is the era of large scale solar projects coming to an end?
That does not mean that investor owned utilities companies need also end. Some need to focus their energies on facilitating rooftop solar installations and take their place at the forefront of a new energy frontier.
The large scale desert projects, that some advocate, appear to be in a position similar to that confronted computer companies two decades ago. Mainframes, that cost millions of dollars, have largely been replaced by inexpensive personal computers. IBM was able to make the transition to and is still a multi-billion dollar company. Its one time challenger, Amdahl Corporation, has largely become a historical footnote of the mainframe era.
(Illustration at top of page: Supervisor Dianne Jacob speaking during the Aug 29 demonstration in front of Sempra Energies)