Energy Storage Would Be Needed

A new study from the National Renewable Energy Laboratory attempts to quantify the answer. The authors model several scenarios in which the California grid generates 50 percent of its power from solar by 2030. To do so will require some pretty major changes, including more flexible baseload generation, as well as more deployment of electric vehicles, exports to other states and demand response.

Those can only go so far, though. To meet the 50 percent photovoltaic threshold economically will require energy storage. The state already has 3,100 megawatts of pumped storage, with 1,325 megawatts of additional storage set to be deployed by 2020, per the state mandate. Under the most optimistic flexible grid scenario and with PV prices falling rapidly to 3 cents per kilowatt-hour, California will need another 15 gigawatts of storage by 2030.

That’s more than 11 times the amount mandated currently in California, and 66 times the total megawatts deployed in the U.S. last year. And any delays in the price declines of solar, or the rollout of EVs, or the flexibility of conventional power plants, will raise the bar on the amount of storage required.

That sounds daunting, admitted NREL Principal Energy Analyst Paul Denholm, who co-authored the research with Robert Margolis.

But the challenge becomes more attainable if you frame it as getting storage to a price point where it can take the place of peaker plants, the most expensive form of thermal generation. California had 22 gigawatts of fossil-fueled peakers as of 2014, including 14 gigawatts that were older than 25 years and will eventually need to retire.

“The way to think about it is not necessarily to compare it to existing storage, but compare it to existing peaking capacity, because ultimately that’s what storage is going to have to be replacing,” Denholm said.

Whereas peakers only operate for the tiny fraction of the year when demand surges, longer-duration energy storage can fulfill that role and perform other services the rest of the year. Top candidates for those other services are avoiding new distribution and transmission costs and reducing costs from thermal plant starts and stops, by charging from those plants when low demand would otherwise require them to turn off, Denholm said.

Why this target?

The study’s benchmark of 50 percent PV by 2030 doesn’t come from California’s existing policy, which calls for all types of renewables to add up to 50 percent of generation by that year.

The choice of target for this study came out of the unexpected success of solar manufacturers relative to the Department of Energy’s SunShot goal, which called for reducing solar prices to 6 cents per kilowatt-hour by 2020. That goal now seems readily attainable, Denholm said, which led him to wonder what further price reductions could mean for PV penetration into the grid. Five cents per kilowatt-hour is “totally doable” for California by 2030, he added.

It’s worth noting, then, that this study isn’t optimizing all possible low-carbon grid options and concluding that 50 percent solar is the best way to go; it’s just saying that if California wants really high PV penetration, here’s how much storage it will need to achieve that.