Since the turn of the millennium, it is hard to imagine a New Year’s Eve that was as fraught with uncertainty and unease as this one has been. The past year was supposed to bring us out of a pandemic. Instead, we plod ahead realizing that viruses do not follow rules, and as COVID adapts and changes, so must we… but we don’t yet know how. We do not have a clear picture of how to move forward.
Fortunately, this is not the case within the clean energy space. This past year left us with many encouraging signposts and indicators of better days to come. Clean Energy Group’s mission is to accelerate an equitable and inclusive transition to a resilient, sustainable, clean energy future, and solar energy generation and battery storage (solar+storage) are particularly suited for this purpose. Notable events of the past year are providing robust clues about the future of equitable deployment of these technologies.
Looking back at the major stories of 2021 that have the biggest implications for solar+storage, a clear theme emerged: big, centralized, dirty power failed, and smaller, cleaner, more nimble and resilient power gained traction.
Six stories caught my eye, and individually, they each tell us something about the near future. Together, they show us so much more.
Story 1: Climate change cripples fossil-fuel power. Massive, centralized fossil fuel-based infrastructure failed spectacularly when confronted by weather events exacerbated by damage to the climate caused by fossil fuels. In February, more than 4.5 million homes and businesses were left without power, and as many as 702 vulnerable residents of Texas died when an unusual winter storm completely disabled the ERCOT grid, cutting off heat and power needed for medical devices. Then in late August, Hurricane Ida caused more than 888,000 power outages in New Orleans, resulting in loss of life and livelihood as Louisiana residents sweltered. Not to be outdone by the Texas storm, Ida took out all eight of the New Orleans area’s transmission lines, 216 substations, and thousands of miles of distribution lines. The situation even rendered a brand-new gas-fired power plant, touted for its black start and emergency capabilities, useless for 48 hours.
What this means for solar+storage: These events, along with the ever-increasing wildfire risk in western states, are demonstrating that complete reliance on centralized infrastructure leaves us vulnerable. But it also provides data that can inform the real value of resilient power. Homes, community centers, neighborhoods and towns with solar+storage are up and running much more quickly after a catastrophic event. Two barriers to adoption of solar+storage at the community level historically have been our blind trust in large-scale infrastructure and our inability to properly value the resilience inherent in distributed renewables and battery storage (lives not lost, businesses preserved, structural damage avoided). This is changing, and the events of 2021 are placing a laser focus on the issues at long last (as evidenced by this new Stanford study on grid reliability and renewables).
Story 2: New York peaker plants will be replaced with renewables and storage. The owners of three dirty fossil-fuel peaker power plants in New York City were either denied new permits or, wisely, withdrew repowering permit applications when faced with the data demonstrating that the plants could be replaced by transmission infrastructure upgrades and battery storage. In late October, the New York Department of Environmental Conservation (NY DEC) denied the air permit for NRG’s Astoria Replacement Project, a proposal to replace an older, dirtier fossil fuel peaker with a new fracked gas plant. NY DEC cited New York’s 2019 Climate Leadership and Community Protection Act (CLCPA), which mandates zero emissions in the electricity sector by 2040, in its decision. Then right before Christmas, Eastern Generation announced it would voluntarily scrap plans to replace two of their New York City peaker plants (Gowanus and Narrows) with a new gas peaker, opting instead to replace them with battery storage.
What this means for solar+storage: These three plants represent more than 1.5 gigawatts of fossil fuel generation. They are peakers that only run for a few hours at a time. Industry rhetoric has insisted for years that this kind of power could not be replaced by batteries, and that fracked gas would continue to be needed as a bridge fuel. These three plant decisions – announced within two months of each other and in one of the densest and most transmission-constrained regions in the country – slams the door shut on that argument. These 1.5 gigawatts will be replaced by renewable energy generated both inside and outside of New York City as well as by battery storage. This was made possible by the CLCPA, New York’s zero emissions by 2040 mandate. Policy matters.
In March, prior to these announcements, New York’s PEAK Coalition outlined a path to retire all New York City peakers by 2030 in the report Fossil Fuel Endgame (CEG is a member of the PEAK Coalition). Advocates note that distributed solar+storage, offshore wind, and demand response can further mitigate the need for peaking power (and increase community resilience) above and beyond the announced utility-scale measures. As icing on the cake, in December the Governor of New York announced a strategy to achieve 10 gigawatts of distributed solar by 2030 (an increase of four gigawatts over previous targets), focusing significant resources on disadvantaged communities, and the U.S. House Oversight Committee requested that the U.S. Government Accountability Office investigate the negative impacts and high costs of fossil fuel peakers nationwide. Solar+storage are proving themselves as replacements for fossil fuels, and we expect to see many more fossil peaker replacement announcements in all parts of the country in the coming year. To paraphrase the famous song about New York: if you can make it (clean resilient energy) there, you can make it anywhere.
Story 3: Ford F-150 Lightning changes the game. In May, Ford Motor Company announced the all-electric Ford F-150 Lightning pickup truck, followed by news that Sunrun will be the preferred installer of the optional 80-amp Ford Charge Station Pro and bi-directional home integration system. This allows the electricity stored in the truck’s battery to flow back into the home to provide full backup power for up to three days in the event of an outage. For homes and businesses with solar, the resilience benefits are even bigger: solar+storage+hauling capacity.
What this means for solar+storage: The Ford F-150 Lightning is a clear game-changer for two reasons. First, it reaches a market segment that may otherwise have resisted electric vehicles (and battery storage) by producing a vehicle that is irresistibly useful. It has a range of up to 300 miles, and it functions as an on-site generator, offering 9.6 kW of power through 11 outlets, including one 240-volt outlet. It eliminates the need to haul fossil fuel generators to construction sites, for example. It will be an ideal fleet vehicle, and employees who drive it will quickly see its benefits as a personal vehicle that can also provide backup power for the home. In this market segment, it could even spur the adoption of solar panels.
Second, the F-150 Lightning does not exist in a vacuum. The Nissan Leaf supports bi-directional charging, and this year Volkswagen announced that all 2022 EV models will support bi-directional charging for vehicle-to-grid (V2G) capability. This will soon be ubiquitous, and it will become increasingly tempting to add solar to charge these vehicles to save money and to maximize their resilience functionality. This is also good news for the grid itself. BloombergNEF found that if half of all of the cars in Germany were EVs that charged during periods of the day when renewables on the grid are high and discharged 10 kilowatt-hours (about 37 miles worth of power) to the grid during periods when fossil fuel peaker plant generation is high, it could reduce the amount of fossil fuel generation needed by 76 percent by 2040. (This is a good time to mentally circle back to the New York peaker replacement story.) Once technology and policy align, V2G-enabled EV’s will become the cheapest and most versatile home battery storage devices available to be paired with rooftop solar.
Story 4: Utilities begin to recognize the value of distributed batteries. In December, Sunverge (a distributed energy services provider) and Delmarva Power (an Exelon company) announced they have entered an agreement with regional transmission organization PJM to provide the services of a virtual power plant (VPP) in Maryland as a pilot project. A VPP is an aggregation of home batteries that are controlled by a service provider to feed into the grid during peak demand. This will be the first VPP in PJM, but the most noteworthy aspect is that Delmarva Power will provide up to 110 battery systems to residents at no cost.
What this means for solar+storage: A fully bi-directional grid incorporating residential and commercial rooftop solar and distributed battery storage is on the way, and it will deliver resilience as an added benefit. But historically, the cost of the battery has been a barrier for most customers. Green Mountain Power (GMP) in Vermont pioneered the use of customer-sited batteries as a grid asset back in 2017 (customers leased a Tesla Powerwall from GMP). Delmarva Power is the latest in a handful of utilities that are providing the battery at no cost as part of a pilot.
Distributed batteries can provide multiple benefits to the grid, including demand response, peak power, voltage regulation, and easing capacity constraints. That Delmarva is willing to provide the battery at no cost for this pilot signals that electric utilities 1) are beginning to recognize the true value of behind-the-meter (BTM) storage to the larger transmission and distribution system and 2) should start compensating customers accordingly. As utilities and regulators begin to properly value and incentivize BTM battery storage, a tremendous financial barrier to resilience for low- and moderate-income customers will be significantly reduced, especially if incentive levels are higher for low-income customers to ensure more equitable distribution of resources. Pay-for-performance programs (such as ConnectedSolutions in Massachusetts and Rhode Island) currently exist, but better incentives for the batteries themselves and accessible financing tools such as tariffed on bill financing and green banks are needed.
Story 5: Technical assistance funding helps close equity gaps. Clean Energy Group (CEG), the national nonprofit that I work for, announced in September that it has awarded $1 million in technical assistance funding to community-serving organizations to advance the installation of solar+storage for resilience projects benefitting frontline communities. The grants fill a capacity gap for community-based non-profits and affordable housing providers that do not have the in-house expertise or resources to assess the technical details, costs, and benefits of installing solar+storage on community-serving facilities. CEG will continue to grow this program as funding allows.
What this means for solar+storage: A solution to one of the most fundamental barriers to equitable deployment of solar+storage – the initial technical capacity gap – has been identified. Projects supported through Clean Energy Group’s Technical Assistance Fund have a jump-start on the fundraising process, and the focus is on helping the communities that need it the most. These communities have often been the most burdened by fossil fuels in multiple ways: energy burden (cost), pollution adjacency (air emissions, water pollution from disposal of toxic residuals), and lack of programs to support the provision of clean energy to these communities. The Technical Assistance Fund is unique, and if it is able to grow, it will bridge the gap and increase deployment of solar+storage for resilience in communities that need it most.
Story 6: Australia proves that grid-scale fossil-free power is possible. In November, it was reported that the grid in South Australia operated with almost no fossil fuel generation and that the region is close to being able to run its grid entirely with solar, wind, and battery storage. Hydrothermal and geothermal energy are common in other parts of the world that achieve this, but relying exclusively on variable wind and solar makes South Australia unique for the time being.
What this means for solar+storage: Operating a grid at gigawatt-scale entirely on renewables and battery storage is definitely possible, even without “baseload-type” hydro and geothermal in the mix. It will require re-thinking how the grid operates and developing finely tuned technologies and policies (a common theme here), but we know now that it is technically possible. A grid of this type will be comprised of both utility-scale renewables and storage as well as distributed solar+storage, all working together bi-directionally. The bi-directionality and the storage options for energy that is freely provided by the sun and the wind (no wells and no pipelines) will increase reliability and resilience at all levels, from the grid to the individual. The end of fossil fuel power generation is finally in sight as we enter 2022.
Late breaking news further confirms this. The Energy Information Agency’s latest forecast shows solar and storage comprising 62 percent of U.S. capacity additions in the next two years. And on January 5 in New York, Governor Kathy Hochul announced a doubling of the state’s energy storage target to 6 gigawatts, making it the largest state energy storage procurement target in the nation. In combination with offshore wind, energy storage will work to speed up retirement of fossil fuel plants in New York City and across the state.
In sum, 2021 made it abundantly clear that reliance exclusively on large fossil fuel-based infrastructure is increasingly risky. Our grids desperately need to incorporate large amounts of flexible, clean technologies that include wind and solar, storage (EVs and traditional batteries), and bi-directionality. The technologies themselves are advancing rapidly but maximizing the benefits of solar+storage requires a complete overhaul of regulatory policy.
This past year may have done more to clarify the goals and capabilities of distributed renewable energy, energy storage, and the hardware and software that connects them to the grid (and to our lives) than any other year thus far. The clean energy picture is becoming clear. Now we need supportive policies to help us finish the journey.