California duck curve “alive and well” as renewable, minimum net load records set

At-a-Glance:

High wind and solar production combined with low demand led the California Independent System Operator (CAISO) to reach a new record of 92.5% of load served by renewables and 98.1% of load served by carbon-free resources,CAISO reported. To learn more, read “California duck curve ‘alive and well’ as renewable, minimum net load records set.”

Key Takeaways:

  • The records were set on March 13. That same day,  CAISO established a new minimum net load, which is load minus wind and solar generation, 3.614 GW.
  • Wind generation averaged 22% of the total fuel mix on March 13, the highest daily average on record, according to CAISO data. That jump in wind generation drove wind and solar generation to a combined daily average of 39.2% of the mix, more than double the three-year average.
  • CAISO has made significant progress in working with the battery storage community to support system reliability during stressed operating conditions by establishing a minimum state of charge requirement that will be applied when day-ahead markets indicate the potential for insufficiency.
  • CAISO is also initiating longer-term market design work with storage providers to develop enhancements that will support system reliability while more effectively addressing the commercial and asset optimization needs of a diverse fleet of storage resources.

Path to 100% Perspective:

California has made impressive gains in its integration of renewables into the power supply mix. While these numbers are worth celebrating, there is much more work to do if the state is going to meet its 100% clean energy target by 2045. It is possible, and the Optimal Plan provides the

lowest transition costs by including flexible thermal generation. The flexible thermal generation assets can be converted as needed to use carbon-neutral fuels produced with excess solar and wind energy through Power-to-X, forming a large, distributed, long-term energy storage system.

 

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The 10 most innovative corporate social responsibility companies of 2021

At-a-Glance:

From sustainably manufactured shoes to offsetting 75 years of carbon waste, these ten initiatives set the bar for this year’s most innovative companies in the category of corporate social responsibility. To learn more and view the full list read The 10 most innovative corporate social responsibility companies of 2021.” 

Key Takeaways:

  • Microsoft promised to become carbon neutral by 2030 and, by 2050, to remove all the carbon the company has ever emitted since its founding in 1975.
  • Natural products retailer Grove Collaborative has committed to removing all plastics from its product lines by 2025.
  • Consumer electronics design company Logitech has committed to label its products with a carbon footprint number by 2025 to help consumers make more informed decisions and hold itself accountable for “total carbon transparency”.
  • Twisted X is driving down waste in the fashion industry by using sustainable raw materials in its production and is aiming for its shoes to contain 80% “eco elements”, such as rice husks and algae, by the end of 2021.

Path to 100% Perspective:

Lower costs and increasing spending on renewables are driving deeper penetration of renewable energy around the globe. While solar energy generates only about 2% of Earth’s electricity today, it is projected to generate 22% by 2050, according to Bloomberg New Energy Finance. And while wind generates 5% of today’s electricity, it is projected to generate 26% by 2050. While two thirds of the world’s electricity is generated from fossil fuels today, by 2050 two-thirds of electricity will be generated from zero-carbon sources, with almost half coming from renewables and the rest from hydroelectric and nuclear power. The writing is on the wall: the global shift to renewable power generation has begun, and there is no going back.

 

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Utilities Are the Focus Of Electrification And Decarbonization, But Can They Deliver?

At-a-Glance:

In the early 2000’s, utilities were unable to grasp the climate change movement. Today, they have been swept up by it – a function of stricter environmental regulations, cheaper natural gas, and affordable renewables. But if electrification and decarbonization are realized, it could pay big dividends for power companies. To learn more, read Utilities Are The Focus Of Electrification And Decarbonization, But Can They Deliver?” Reading this article may require a subscription from the news outlet.

Key Takeaways:

  • About 70% of the largest U.S. electric and gas utilities now have net-zero goals, says S&P Global Market Intelligence.
  • The Boston Consulting Group analyzed a “model utility” with 2-3 million customers. It found that it would need to invest between $1,700 and $5,800 in grid upgrades per electric vehicle (EV) through 2030.
  • Xcel Energy has announced plans to serve 1.5 million EVs by 2030. Xcel Energy Chair Ben Fowke expects 60% of the utility’s electric generation to be fueled by renewables in 2030 – with some natural gas as a backup.

Path to 100% Perspective:

Carbon neutral and carbon free systems must install enough capacity (with the right capabilities) to meet energy needs in worst-case scenarios. At a minimum, to assure reliability and avoid blackouts, utility system planners and policy makers need to account for seasonal trends in availability of renewable resources. Accurate modelling can make a critical difference in renewable integration, resilience and reliability. Finally, energy storage systems designed for daily shifting with less than 12 hour duration are not cost optimal for long-term storage and energy time-shifting in high renewable power systems.

 

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Shell enters supply deal with Amazon to provide renewable energy

At-a-Glance:

Shell Energy Europe BV has agreed to supply Amazon.com Inc. with renewable energy, which will help the U.S. online retailer power its business completely using clean energy by 2025 which is five years ahead of Amazon’s target. To learn more, read “Shell enters supply deal with Amazon to provide renewable energy.”

Key Takeaways:

  • Shell Energy Europe BV said it will provide the renewable energy from a subsidy-free offshore wind farm constructed off the coast of the Netherlands.
  • According to a press release distributed by Shell, the wind farm will be operated by The CrossWind Consortium, a joint venture between Shell and Eneco.
    • Starting in 2024, Amazon will offtake 250 megawatts (MW) from Shell and 130 MW from Eneco, for a total of 380 MW.
    • “Supplying Amazon with electricity from this offshore wind farm contributes to their net-zero pledge while progressing our own ambition to be a net-zero emissions business by 2050 or sooner,” stated Elisabeth Brinton, Executive Vice President of New Energies at Shell.

Path to 100% Perspective:

Achieving a 100% renewable energy future requires collaboration and innovation to serve organizations and utility partners. Mutually beneficial partnerships, such as the newly established agreement between Shell and Amazon, is an impactful strategy with the potential to accelerate decarbonization. Although costs continue to decline for renewables, the need for ongoing solutions to create flexible, reliable and sustainable grids continues to be the overarching challenge in reaching renewable energy goals.

 

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Renewables expected to replace coal by 2033, says Morgan Stanley

At-a-Glance:

The U.S. is on the path to cutting out coal completely as the cost of renewable energy falls and the push for carbon-free power picks up steam. A new report from global wealth management company Morgan Stanley projects coal-fired power generation is likely to disappear from the U.S. power grid by 2033 and will largely be replaced by renewable energy resources. To learn more, read “Renewables expected to replace coal by 2033, says Morgan Stanley.” 

Key Takeaways:

  • The report from Morgan Stanley said renewable energy such as solar and wind power will provide about 39 percent of U.S. electricity by 2030 and as much as 55 percent in 2035.
  • Coal has experienced a steady decline in power generation due to sustained low prices for natural gas.
    • In 2010, coal supplied 46 percent of U.S. electricity, compared with an approximate 20 percent share just a decade later.
    • The share of electricity supplied by natural gas-fired power plants increased from 23 percent in 2010 to an estimated 39 percent last year.
  • The projection from Morgan Stanley comes as the Biden administration is aiming to make the U.S. carbon neutral by 2050, which will require steep reductions in greenhouse emissions and investments in renewables like solar and wind.

Path to 100% Perspective:

Rapidly reducing the use of fossil fuels is a big step on the journey to 100% clean energy. However, as reliance on fossil fuels declines, integration of renewable fuels and renewable generation must increase to ensure reliability and sustainability in power grids. This transition includes efforts to promote policies that enable rapid reductions in fossil fuel use and rapid increases in renewable generation in the electricity sector. These commitments will also steer electricity-sector decisions about investments, infrastructure, and technology toward decisions that quickly reduce greenhouse gas emissions and pave the way for a 100% renewable energy future

 

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Xcel cuts carbon emissions 50% by 2021, eyes Colorado transmission, coal plants to reach 2030 goal

At-a-Glance:

Xcel Energy estimates that it has reduced carbon emissions 50% below 2005 levels in 2020, and is on track to meet its 2030 target of reducing carbon emissions 80% in the next decade, based on its upcoming integrated resource plans (IRPs). To learn more, read “Xcel cuts carbon emissions 50% by 2021, eyes Colorado transmission, coal plants to reach 2030 goal.”

 Key Takeaways:

  • Xcel completed six wind projects in 2020, representing nearly 1,500 MW of capacity. Another 800 MW of wind projects are under construction and expected to become operational in 2021.
  • Xcel plans to file solar plans with Minnesota regulators later this year, which would have the utility develop 460 MW of solar near its Sherco coal plant – retiring in 2030 – to take advantage of existing transmission near the plant.
  • Although specifics are not available regarding Xcel’s upcoming Colorado IRP, the plan will include transmission expansion to bring additional load from remote-located renewables into the Denver area.
  • Xcel will also propose a plan for its remaining Colorado coal plants, as well as adding more renewables, to put the utility on track to reduce its carbon footprint 80% by 2030.
  • Xcel plans to exit coal entirely in Minnesota by 2030.
  • Xcel executives will continue to be bullish on electric vehicle infrastructure build outs, investing $500 million in charging stations and distribution system infrastructure over the next five years, and closer to $1.5 – 2 billion over the next decade.

Path to 100% Perspective:

Xcel is paving the path to 100% for those in the energy sector, setting and meeting ambitious carbon reduction goals and building out its renewable energy capacity. Leveraging existing infrastructure while making key investments in solar and wind will help ease the transition to 100% carbon-free energy and serve as an example to others looking to do the same.

 

 

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McKinsey: Low Cost Renewables Will Outcompete Fossil Assets By 2030

At-a-Glance:

The energy transition is accelerating. In 2020, renewables outpaced fossil fuels in Europe for the first time. According to the latest research from McKinsey, demand for fossil fuels will never return to pre-pandemic levels. To learn more, read McKinsey: Low Cost Renewables Will Outcompete Fossil Assets By 2030.” Reading this article may require a subscription.

 

Key Takeaways:

  • McKinsey’s 2021 Global Energy Perspective Report predicts that fossil fuel demand is set to peak globally by 2029 and that by 2036, half of the global power supply will be generated by intermittent renewable energy sources.
  • While an earlier peak in hydrocarbon demand means a substantial reduction in forecasted carbon emissions, the world remains significantly off the 1.5°C pathway and will run out of its carbon budget for 2100 in the early 2030s.
  • Many pandemic related recovery packages are providing significant support to the hydrocarbon industry. The 2020 Climate Transparency Report said that by mid-October 2020, G20 countries had spent nearly $400 billion on support for the energy sector – with 53.5% going to the fossil fuel sector.
  • McKinsey’s Christer Tryggestad concludes: “According to our estimates, annual emissions would need to be around 50 percent lower in 2030 and about 85 percent lower by 2050 than current trends predict to limit the global temperature increase to 1.5°C.”

 

Path to 100% Perspective:

The shift toward renewable energy sources over fossil fuels appears to be the way forward. Governments around the world will need to use this shift as motivation to put policies in place that encourage greater investment in renewable energy. There is a tremendous opportunity in this moment for G20 countries, which are responsible for around 75% of global emissions, to rethink their energy investments and bank on low-cost renewables to meet net-zero targets and pave the way for a 100% renewable energy future.

 

 

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Mexico’s Path to 100%

At-a-Glance:

Considered a global initiative, the Path to 100% movement seeks to find reliable, quick and cost-effective ways to fully decarbonize electricity. To achieve this, there are a variety of paths available to every country. What would Mexico’s roadmap look like? Wärtsilä’s Business Development Executive for Mexico, Central America and the Caribbean, Raúl Carral, sheds light on where to start. To learn more, read Mexico’s Path to 100%.”

Key Takeaways:

  • A look at SENER’s latest 2019 figures reveal that Mexico had around 80 GW of installed energy capacity. Fossil fuels accounted for 66 percent of that capacity, of which 56 percent came from natural gas.
  • Renewables and hydroelectricity combined made up 17 percent of installed energy, although many MWs of wind and solar were installed in 2020.
  • Carral argues that Mexican utility CFE should consider competitive, future-proof assets like renewable power and flexible power generation and make plans based on a vision that will lead to more profitability, sustainability and reliability for CFE’s power generation and Mexico’s power grid.
  • Carral highlighted that several hydrogen projects are underway, which will help lower costs associated with this fuel. Existing gas-based power plants could be adapted to run on hydrogen and Wartsila announced they will be ready to burn this fuel with their equipment, too.

Path to 100% Perspective:

Mexico’s path to 100% is beginning to unfold. As the country increases its reliance on renewables, investing in infrastructure, like flexible thermal generation, will be critical to make up for times of intermittent wind and solar power. Path to 100% formed  a community of subject matter experts in Mexico to explore the best way to 100% renewable energy penetration.

 

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Cal-ISO renewable capacity climbs, storage resources coming onto system

At-a-Glance

The California Independent System Operator added 2.1 GW of capacity to its grid in 2020 with another 3.3 GW permitted with online dates in 2020 or 2021 as the state works to achieve its ambitious 100% clean energy mandate over the next 25 years. To learn more, read Cal-ISO renewable capacity climbs, storage resources coming onto system.”

Key Takeaways

  • In 2020, Cal-ISO had 2.1 GW of capacity added through September of which 1.3 GW was gas-fired, according to U.S. Energy Information Administration (EIA) data.
  • EIA also shows 3.3 GW permitted with an online date in either 2020 or 2021. About 2,500 MW of this is under construction which includes 1.5 GW solar, 800 MW battery and 200 MW wind.
  • Cal-ISO president and CEO Elliot Mainzer has said the grid operator is working to improve its resource adequacy system following the rotating outages in August.
  • “Longer term, we’re working very closely with the [Public Utilities Commission], the Energy Commission and others in the regulatory space to try to make sure the resource adequacy paradigm in California is modernized sufficiently to recognize the changing resource mix,” Mainzer said. “There’s a lot of additional solar and batteries and wind and other renewables coming onto the system.”
  • Renewable generation curtailments in 2020 were up 220% year on year, according to ISO data.

Path to 100% Perspective

No power system can achieve 100% renewable electricity just by adding more renewable generation. It also needs to slash fossil-fueled generation. That means reducing reliance on traditional gas- and coal-fired plants, whether they’re used for baseload or to back up variable renewable generation. And that can be harder than you might think. The challenge is that traditional fossil-fuel-powered plants are inflexible: they can’t just switch off when the sun is high and switch back on when the sun sets. Because traditional power stations require many hours to shut down and many hours to start back up, they cannot power up and down quickly enough to handle predictable shifts in demand and generation, let alone unexpected changes in the weather. To ensure a steady flow of electricity, California’s traditional gas-fired power stations have to keep running at 40% to 50% capacity, even on a bright, sunny day. Running at low capacity is inefficient and emits large amounts of climate-warming carbon.

 

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California’s pathway to 100% clean electricity begins to take shape, but reliability concerns persist

At-a-Glance

California’s energy agencies are taking a first stab at assessing possible pathways to the state’s ambitious goal of achieving 100% renewable and zero-carbon electricity by 2045, but concerns about system reliability — especially in light of the rolling blackouts — continue to plague regulators. The California Public Utilities Commission (CPUC), California Energy Commission (CEC) and California Air Resources Board (CARB) released a draft report on getting to a 2045 clean electricity portfolio, which indicated the goal is technically achievable. To learn more, read “California’s pathway to 100% clean electricity begins to take shape, but reliability concerns persist.”

Key Takeaways

  • The report presents important initial insights into potential paths for the electric sector, Mary Nichols, CARB chair, said at the workshop, adding that “the initial work highlights the enormous challenge ahead, requiring a complete transformation in the type of electricity that Californians consume.”
  • California’s carbon goals are part of legislation passed by the state in 2018, called Senate Bill 100, which calls for 100% of electric retail sales in the state to come from renewable energy and zero-carbon resources by the end of 2045.
  • The bill also required the three energy agencies to create a report evaluating the policy and follow it up with updates at least every four years. The agencies intend to submit a final version of the initial report early next year.
  • Based on this analysis, the report concludes that achieving the 100% clean electricity goal is technically achievable, and could cost around 6% more than the baseline 60% Renewable Portfolio Standard (RPS) future by 2045, although that could change if renewables continue to decline in cost at a faster rate than anticipated by the models.

Path to 100% Perspective

A place where the transition to renewables has progressed quite far already is California. The lessons learned along the way have been plentiful, but powerful nonetheless. The record-breaking heat wave that swept across the western part of the country and caused a series of blackouts in the Golden State, offered additional modelling opportunities to demonstrate the most effective mix of energy to accommodate any extreme weather situation during the transition, and to meet clean power mandates. The big challenge facing California and the rest of the world is how to integrate renewables into the grid while building security of supply and a sustainable power system with an affordable plan for everyone involved.

 

 

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Leveraging Coronavirus Stimulus to Take a Giant Leap Toward Decarbonization

At-a-Glance

While electricity demand has faltered during the global pandemic, the share of wind and solar generation has continued to increase. Wind and solar produced 10 percent of global electricity between January and June in 2020. In the European Union, renewables accounted for 33 percent of all power generation. According to the International Energy Agency, the EU’s renewable energy production was higher than its fossil fuel generation between February and early July of this year. The increased role of renewables has highlighted the investments necessary to make the transition to a 100 percent renewable power system faster and more economically efficient. To learn more, read “Leveraging Coronavirus Stimulus to Take a Giant Leap Toward Decarbonization.” 

Key Takeaways

  • While there are nuances depending on local circumstances, one significant takeaway is that the power system as a whole can handle a more rapid shift to renewables than grid operators have long assumed. 
    • “What we found was the energy system can cope really well with much more renewable power and that it’s possible to raise the ambitions around adding more clean energy,” said Sushil Purohit, president of Wärtsilä Energy.
  • Charting a more rapid and financially efficient transition to a 100 percent renewables future was a primary objective of Wärtsilä’s recent report, Aligning Stimulus With Energy Transformation, based on its Atlas modeling. 
    • The report demonstrates how using energy-related stimulus investments to support clean energy could speed decarbonization in five key countries: the U.S., the United Kingdom, Brazil, Germany and Australia.
  • According to the report, 54 percent of the $400 billion pledged has been targeted to benefit fossil-fuel-based energy, while 36 percent has been devoted to clean energy. 
    • In the U.S., more than 70 percent of the current $100 billion allocated for energy stimulus was pledged to fossil fuels, compared to less than 30 percent for clean energy.

Path to 100% Perspective

Beyond the issue of decarbonization, this is a missed opportunity to spark near-term job creation. According to a report by McKinsey & Company, every $10 million of government spending on renewables creates 75 jobs, while the same amount invested in fossil fuels creates 27 jobs. For the U.S., reallocating the $72 million of the COVID-19 energy stimulus currently earmarked for fossil fuels to clean energy would result in 544,000 new jobs, 175 percent more than would be produced in the traditional energy sector. In addition, these investments would result in 107 gigawatts of new renewable energy capacity and a 6.5 percent increase in renewable electricity generation, from 17.5 percent to 24 percent.

New Energy Outlook Projects Massive Energy Sector Shift Through 2050

At-a-Glance:

BloombergNEF (BNEF) published its New Energy Outlook 2020 (NEO) in October. The NEO projects the evolution of the global energy system over the next 30 years. This report is widely utilized by planners, strategic thinkers, and investors in developing long-term forecasts and plans. One of the NEO’s most notable projections is that the sharp drop in energy demand from the Covid-19 pandemic will remove about 2.5 years’ worth of energy sector emissions between now and 2050. To learn more, read New Energy Outlook Projects Massive Energy Sector Shift Through 2050.” Reading this article may require a subscription.

Key Takeaways:

Other notables from the report:

  • Electric vehicles (EVs) reach upfront price parity with Internal Combustion Engine (ICE) vehicles before 2025.
  • Gas is the only fossil fuel to grow continuously through the outlook, gaining 0.5% year-on-year to 2050.
  • Coal demand peaked in 2018 and collapses to 18% of primary energy by mid-century, from 26% today.
  • In the NEO Climate Scenario, the clean electricity and hydrogen pathway requires 100,000 terawatt-hours (TWh) of power generation by 2050. This power system is 6-8 times bigger than today’s and generates five times the electricity.
  • Green hydrogen provides just under a quarter of total final energy in 2050 under the Climate Scenario.
  • Reducing emissions well below two degrees under the clean electricity and green hydrogen pathway requires between $78 trillion and $130 trillion of new investment between now and 2050.

Path to 100% Perspective:

The dramatic fall in once-expensive renewable and flexible capacity costs has transformed energy investment over the last decade and the pace of change in accelerating. The cost of offshore wind, for example, has fallen by 63% since 2012. With a renewed focus on future-proofing their business models, utilities have increased renewable energy investments, taking advantage of the certainty that clean energy brings to the balance sheet. In effect, adopting renewable energy, coupled with flexible generation and storage for system balancing, is akin to purchasing unlimited power up-front, as opposed to placing bets on fluctuating oil prices and exposure to narrowing environmental regulation.

 

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