California Electricity Rates - Residential - Not That High

Subtitle: Annual Average Price Keeps Pace With Inflation

This post is likely to create a bit of controversy, as the chart Figure 1 shows that annual average residential electricity rates (cents/kWh) have kept up with inflation but not increased in real terms since 1996.  That is in stark contrast to the popular wisdom that electricity rates in California are out of control and skyrocketing due to shutting down nuclear plants (two of them in 2012) plus building expensive solar power and wind power.   What is actually going on is more complex. 

Figure 1.  Nominal prices adjusted for Consumer Price Index (CPI)

The data in Figure 1 for state-wide annual average residential electricity prices are from US Energy Information Agency (EIA) data; while the inflation adjustment is from the US Consumer Price Index.   The overall trend from 1990 at 10 cents to 2016 at 16 cents is a mere 2.5 percent compound annual growth rate. 

The argument that solar power and wind power have increased electricity rates is simply not credible, especially so when the very minor contribution of each is considered.  Solar contributed only 6 percent of the entire grid load, and wind only 5 percent in 2015 per the California Independent System Operator, CAISO.   Only five years earlier, the contribution of each was almost zero.  

Instead, the flat trend since 1996 is due to the steadily decreasing cost of natural gas, and the steadily increasing percentage of natural gas in the generation mix.  Also, California has almost constantly replaced old, inefficient gas-fired plants with new, state-of-the-art Combined Cycle Gas Turbine plants with much greater efficiencies.   A new CCGT plant uses approximately one-half the natural gas as an older steam plant, for the same power output.   Therefore, the state is using much less gas per kWh generated, and the price of natural gas is much lower than in earlier years.   (As an aside, we all have the oil and gas companies to thank, with their expert use of precision directional drilling (PDD) and hydraulic fracturing, for bringing great quantities of natural gas to market and depressing the gas prices). 

It is also a fact, however, that electricity rates are quite complicated in California.   The state has a multiple tier system for power pricing based on the kWh used each month.  The rate structures have changed over the years.   The complex, and a bit un-fair system has caused a new and improved system to be developed by the California Public Utility Commission.  The CPUC website for the improved system, and the process to develop that system, is at "California Residential Electric Rate Redesign"  see link. 

Below is a portion of the Rate Redesign website statements:

"In 2001 during the energy crisis, California passed legislation that froze volumetric electricity rates for a large portion of residential electricity usage (i.e., usage less than 130% of the baseline energy allowance or customer tiers 1 and 2). As utilities' costs increased over the years, because tiers 1 and 2 were frozen by law, increases could only be borne by those customers consuming above 130% of baseline levels (or customers in tiers 3 and 4). As a result, the difference between the lowest and highest tiers has become very large, and rates for tiers 3 and 4 to more than double those for tiers 1 and 2.

In June 2012, the CPUC opened a Rulemaking to examine existing residential electric rate design, with the intention of ensuring that rates are both equitable and affordable for the foreseeable future, including for low-income customers.

On October 7, 2013, Governor Brown signed into law AB 327 (Perea), which allows the CPUC greater flexibility in setting residential rates, as well as:

o  Repeals rate increase limitations on energy usage tiers 1 and 2 (up to 130% of baseline) to allow rate reduction in tiers 3 and above.

o Revises rates for low-income ratepayers, pursuant to the CARE program such that the aggregate discount is between 30% and 35% the bill.

o Limits fixed charges to $10/month for non-CARE customers and $5/month for non-CARE customers.  (Should read $5/month for CARE customers -  Roger)

o Fixed charges may not increase by more than the consumer price index each year, starting on January 1, 2016.

o Allows for a reduction in the number of energy usage tiers in residential rates, but requires rates to have at least two tiers.

o Prohibits mandatory or default time-of-use pricing before January 1, 2018.


o Requires the CPUC to develop a new net metering rate, which would become available on January 1, 2017."

Conclusion

The state's average prices are keeping up with inflation, and no more.  However, the disparity between low users (less than 130 percent of the baseline kWh per month) and those with greater consumption (more than 130 percent of baseline) led to rate reform.  It is entirely possible for a low-use customer to be paying approximately 15 cents per kWh, while a residence with triple the baseline use would be paying 30 cents per kWh, or more.  

It is also clear from the chart in Figure 1, with the annual statewide average at 16 cents, solar power and wind power have purchase power agreements that are more than attractive to new investors.  It is unfortunate that wind power in California has already been essentially built-out, as there are few remaining locations with advantageous wind.  However, solar power is an entirely different story. 

The state has almost limitless square miles of otherwise un-used land with the famous California sun beating down daily.  Recent installed costs for grid-scale solar power plants indicate approximately $2,000 per kW installed, and with the California sun bringing 26 percent annual output, a plant can be built and operated at a 10 percent return on investment with power purchase agreement of 10 to 11 cents per kWh.    That is far, far less than what the utilities must pay for daytime power in the summer.    That is a bit more than what the utilities pay for incremental power in the winter daytime, however the amount of power the solar plants produce in winter is also much smaller.  On balance, the solar power plants are quite attractive at $2000 per kW.   More reductions in installed costs are imminent, so that $1800 and even $1500 per kW are only about 4 to 5 years in the future. 

There are some grid operating implications, but those will be explored in future articles. 

Roger E. Sowell, Esq.
Marina del Rey, California

copyright (c) 2016 by Roger Sowell - all rights reserved

High Speed Rail in California Stuck At The Station

Subtitle: Lack of Funds Makes HSR Fizzle

High speed rail in California has hit yet another snag, this one likely to be fatal.  The almost-$100 billion project to connect San Diego with both Sacramento and a branch to San Francisco is too short of funding and is likely to die, as it should.   The article by Bloomberg (see link) "California Hits The Brakes on High Speed Rail Fiasco" has the realistic portrayal of the proposed project: too expensive, too slow to attract customers, and too few customers likely to ride, resulting in perpetual subsidies to cover the losses.  

Artist rendition of California HSR.  

The fatal snag is the almost zero funding resulting from a recent auction of climate-change securities, proceeds from which the rail would be built.  

As with UK's nuclear plant proposed for Hinkley Point C, with funding woes of its own, the California HSR has "no investors . . . lining up to fill the $43 billion construction-budget gap," per the Bloomberg article. 

The article goes on to list four of the reasons the HSR project is doomed to failure: "the rail project wouldn’t keep its promises. To do so, it would have to be the fastest, most popular bullet train in the world, with many more riders per mile and a much greater percentage of seats occupied than the French and Japanese systems -- a highly unlikely prospect."

The problems are legion with the California HSR proposal.   First, it is more of a milk-run rail than a high-speed rail.  As I wrote several years ago for a very-highly placed client, actually a member at that time of the HSR board, having a HSR route stop multiple times between terminus stations (San Diego and Sacramento) defeats the entire purpose.  The rail is trying to compete with the time required, cost, and inconvenience of air travel.   

For the typical businessman, it is quite easy to board a plane in San Diego and be in Sacramento approximately 90 minutes later.  With arrival at the San Diego airport for security check-in requiring a half hour to one hour, the entire trip is two to two-and-one-half hours.   Starting the trip in Los Angeles instead of San Diego cuts only 15 minutes off of the trip.   

Also, an air trip from Los Angeles to San Francisco requires 75 minutes in the air, and with check-in approximately two hours and 15 minutes.   The HSR is to run from Los Angeles to San Francisco in two hours 45 minutes.  With time for boarding, that is easily three hours or a bit more.   That is the promise.  What is the likely reality?   Rail boarding will become just as time-consuming as today at airports, once the inevitable terror attacks occur at a few train stations in the US.   The travel time will then be extended by at least an hour. 

The train would start at Union Station in Los Angeles, then make several stops on the way to the high desert where the speed finally picks up.  There are then more stops in the Central Valley, and slower speed as the train reaches the Bay Area and makes yet more stops.   

The practical route is also the least popular, politically.  A bit of history with rail systems shows that a city with a train passing through it has economic success.   Cities off the rail line wither.   For that reason, the current routing for HSR has multiple stops in the Los Angeles basin, and multiple more stops in the Bay Area.    The smart thing to do (but politically disastrous) would be to route the train from San Diego to Palmdale, with Los Angeles Area travelers taking a shuttle train (or cars) to Palmdale to board the HSR.  Bypassing Los Angeles entirely was simply not an option, according to my source on the Board.   However, it is equally certain that Los Angeles' future is not dependent on anything as trivial as a HSR stop, not at this point in history.  

Roger E. Sowell, Esq.
Marina del Rey, California

copyright (c) 2016 by Roger Sowell - all rights reserved

Designing an Electrical Grid From Scratch

Subtitle: Ranting and Raving Does Not Produce A Useful Result

Sometimes one just has to laugh at the things others complain about, and even rant and rave about.  A blog article I wrote recently produced a rant (on WUWT), about how the California electrical grid and its operation are grossly unfair and should never have been allowed to reach the condition that it is in today.   The chief complaint, it appears, is the price paid by residential customers, what is known as the rate structure.   California does have some high rates, it is true, by law there are a few tiers or levels of price depending on the season and how much power one uses.   The more use in the summer during peak

California Energy Commission - major electric transmission lines 

demand, the higher the price.   Conversely, low use in Spring during offpeak hours has a low price. 

Another loud complaint is the use of renewable generating resources on the California grid. Most of the howls of indignation appear to be directed at solar power and wind power systems.   It seems that geothermal is not on the list that causes anger.    The utter confusion, indeed ignorance, of how hydroelectric power is treated as a renewable source or not is perhaps understandable.  Basically, most systems of 30 or smaller MW count as a renewable, while most larger systems do not.  

I requested the unhappy commenters to provide their solutions to how California should proceed, what would and would not be included in their ideal grid.   Their goal, of course, is to have cheaper power.    No response as of this date, however.   It seems it is much easier to complain than it is to offer workable, sound solutions.    I should point out that I have never seen a utility reduce their rates when adding new generation assets, or for transmission or distribution assets.   In fact, where nuclear power plants are being built, the utility (in Georgia, USA) obtained a special law from the state legislature to increase customers' power bills for the several years of the nuclear plant's construction. 

Therefore, I put together a few items that one should, and in some cases must consider (laws of many types play into the electricity issue).  

California already has quite a mix of generating types, including nuclear, gas-fired, petroleum coke-fired, oil-fired, diesel engines with generators, geothermal, hydroelectric, wind, solar PV, solar thermal, biogas, and biomass.   Some storage is already provided by batteries, pumped storage hydroelectric, and a gravity rail system is under construction.  There are mandated combined heat-and-power (CHP) systems that replaced standard boilers.   In the gas-fired category, there are at least three types: steam, combined cycle gas turbine (CCGT), and peaker plants or simple cycle gas turbines.   However, at least a few peaker plants are also CCGT.  

Below is a list of generating technologies, with perhaps others existing that do not readily come to mind after a bit of research.    In no particular order, then, here is a list of 46 generating and 7 storage possibilities.   Note:  BL denotes Base Load design, LF denotes Load Following.   There are substantial initial cost and operating cost implications for Load Following vs Base Load designs.   Acronyms may be familiar to readers, if not I can provide a link to a resource. 

1 Nuclear BL PWR - AP-1000
2 Nuclear BL PWR - EPR
3 Nuclear BL BWR - ABWR
4 Nuclear BL SMR
5 Nuclear BL LFTR  - MSR Thorium
6 Nuclear BL HTGR
7 Nuclear BL Fusion - Tokamak
8 Nuclear BL Fusion - LIFE
9 Nuclear - LF PWR - AP-1000
10 Nuclear - LF PWR - EPR
11 Nuclear - LF BWR - ABWR
12 Nuclear - LF SMR
13 Nuclear - LF LFTR  - MSR Thorium
14 Nuclear - LF HTGR
15 Nuclear - LF Fusion - Tokamak
16 Nuclear - LF Fusion - LIFE
17 Coal Rankine - Med Pres
18 Coal Rankine - USC
19 Coal Gasified - IGCC
20 Hydroelectric Large
21 Hydroelectric Small
22 Natural Gas Rankine
23 Natural Gas CCGT
24 Natural Gas SCGT
25 Natural Gas Methane SMR - Fuel Cell
26 Geothermal Rankine
27 Wind Onshore HAWT
28 Wind Onshore VAWT
29 Wind Offshore HAWT
30 Wind Offshore VAWT
31 Solar PV - utility scale
32 Solar PV - residential demand reduction
33 Solar Thermal w/o storage
34 Solar Thermal w/storage
35 Solar Pond - Rankine
36 Biomass Burn - Rankine
37 Biomass Synthetic Methane (Park process)
38 Biogas Methane collection
39 Wave Various
40 Tide         Turbine
41 Ocean Current Turbine
42 OTEC Thermal - Rankine
43 River Current - turbine
44 Oil         Rankine
45 Diesel Engine
46 Natural Gas ICE engine - cogen and tri-gen
47 Storage Pumped Hydroelectric - onshore
48 Storage Pumped Hydroelectric - offshore - MIT spheres
49 Storage Pumped Hydroelectric - combined onshore and offshore
50 Storage Battery
51 Storage Capacitor
52 Storage Gravity - rail

53 Storage Compressed air

With those as the available cards in the proverbial deck, one must then have solid answers to a few dozen questions (or issues) about electrical grid design and operation.   Below are listed just a few of the hundreds of issues that must be resolved in an electrical grid.   I pose these to the ranters and ravers, with the full expectation that they will not ever provide any answers.   Perhaps merely reading the questions will give them pause, and a bit of respect for a grid as large and complex as the California grid.   

1. Power grid first of all must be safe
2. Power grid second, must be reliable
3. Power grid third, must sell affordable power
4. Utilities must obtain a reasonable return on investment
5. Power grid must meet all load conditions, all the time 
6. Account for variations in demand daily, weekends, seasonal
7. Account for planned and unplanned asset outages
8. Account for adverse weather, earthquakes, fire, flood, wind, tsunami
9. Account for blackouts and brownouts
10. Account for fuel supply issues including disruptions (coal, natural gas, etc)
11. Account for available space (if any) on railroads for coal imports from other states
12. Account for growth in demand, if any
13. Account for environmental impacts - wildlife, air, water, soil, radiation, noise, explosion, etc
14. Account for transmission and distribution systems
15. Account for customers' ability to pay - poor, elderly, etc
16. Account for power attributes as attracting or deterring commerce and industry
17. Pricing must also pay utilities for fuel and other operating costs
18. Account for critical services - hospitals, life-support systems at residences, etc
19. Account for cooling water, river, lake, ocean, or air-cooling, mixed-cooling
20. Account for customers' installation of solar on property, and wind; will you buy power from individuals?
21. Account for other states with offers to sell power to California, yes, no, what conditions
22. Account for large industry or commercial sites that self-generate, will you be their backup?
23. Account for large industry or commercial sites that produce excess - will you buy?
24. Account for location, siting, of generating assets, and environmental justice issues
25. Account for location and siting of transmission assets, distribution assets
26. Will you cooperate in a regional grid, or a very large regional grid?
27. For experimental technologies that need research and development - will you fund this?  How?
28. How will you determine acceptable pollution emissions to air, water, soil, and via radiation?
29. What levels of animal, bird, and fish deaths will you accept and how to justify these?
30. What level of grid reliability will you deem acceptable, and how to justify this? 99% or higher?
31. How will you ensure that grid reliability is uniform across all areas, so no group is discriminated against?
32. How will you price the power sales, by residential, commercial, industrial, transportation, or other method?
33. Will you have a flat rate, or a tiered pricing system, and why?
34. Will you encourage efficiency in use, or profligacy, or be neutral, and why?
35. How will you address energy profligacy by a rich few, and the increased generation assets that requires?
36. If nuclear is part of your assets, who pays for a nuclear disaster and related deaths? Property damage?
37. How will you bring electricity to a very small user in remote areas?  Not at all?  
38. Will you have above-ground or in-ground distribution, where and why?
39. Will you allow distributed generation, if so, at what size and where? 
40. How will you address the disparity in use vs location in California, with coastal areas
having mild summers and winters thus low usage, but inland areas
. having hot summers and cold winters thus much higher usage? 
41. For gas-fired peaker plants, if you have those, how will you regulate their use?
42. For large hydroelectric plants, if you have those, how will you decide where to put them?
43. How will you decide when to retire an asset, either generation, transmission, or distribution systems? 
44. On a daily and hourly basis, how will you choose which generating assets to run, which to order to stand by, and which to hold in reserve? 

45. How will you ensure complete compliance with all Federal Laws and regulatory agencies, including but not limited to FERC, Nuclear Regulatory Agency, PURPA, Clean Air Act, Clean Water Act, various national energy policy acts, and state agency regulations such as California Energy Commission, California Coastal Commission, California Public Utility Commission, California Independent System Operator, California State Water Resources Control Board, and California Air Resources Board? 

Have I any experience in any of these issues?  Absolutely, but just a bit.  My engineering experience includes economic justification and preliminary design of a CCGT plant that was installed and is still running near Houston, Texas at a large chemical plant.   I also performed a make-or-buy analysis many times, one notable example was for nuclear power to a large refinery using a small reactor.  Also, I did an economic justification with technology selection, and sizing for a large hydroelectric project overseas.  I had the nuclear power course in undergraduate school for nuclear chemistry, physics, reactor design, and remainder-of-plant design for multiple types of reactors.   I had a full guided tour of a large nuclear reactor in Perry, Ohio with a group of fellow engineers.  I was assigned to analyze completely the fiasco of the South Texas Nuclear Plant design and construction process, then report on the entire matter to my employer.  I have evaluated and made recommendations to several clients on their make-or-buy decisions for both electricity and steam in their large refineries and process plants.   As an attorney, I don't discuss my clients or my cases.  It is sufficient to say that I am quite familiar with many of the legal requirements for grid-scale electrical systems.  

With California presently in a crisis summer, with high loads on the grid and inadequate natural gas supplies due to the Aliso Canyon storage facility problems, it is not surprising that the grid is a popular subject.   Everyone seems to know what California should do.  It is easy to rant.   I wonder how many, if any, could provide answers to any of the issues above.  

Roger E. Sowell, Esq.
Marina del Rey, California

copyright (c) 2016 by Roger Sowell - all rights reserved

California Renewables Averting Blackouts - Every Ten Days

Subtitle: Renewables Add 13,000 MW to the Grid - How Many Deaths Averted?

How much good are renewable sources of electricity doing in California?  This summer, they are doing a tremendous job in preventing a crisis on the electrical grid, even averting blackouts.   A recent article from the San Diego Union-Tribune, see link and excerpts below, shows the Aliso Canyon gas storage facility has approximately 15 billion cubic feet (bcf) of natural gas in storage.   An earlier post on SLB, see link copied and cross-posted at WUWT, shows the combined output of California renewable energy sources are avoiding

Figure 1
Temperatures for Los Angeles, California for 2015 measured at USC Campus near downtown
Heavy black line indicates 95 degrees F
Red oval indicates heat wave events of 95 degrees or greater

approximately 1.3 bcf natural gas burned in the state's power plants.  Given the uncertainties in the data ("some 15 billion..gas in the ground," renewable output varies from 150,000 to 210,000 MWh daily, and the heat rate of the gas-fired power plants), one can say that the renewables are keeping Aliso Canyon from depletion after 10 days of production.  

From the SDUT article:

"As Southern California's energy network braces to keep from buckling during what is expected to be a hotter than normal summer, grid operators may turn to back-up natural gas supplies from an unexpected place: Aliso Canyon.

"The storage facility, site of a massive leak that forced thousands to evacuate their homes in the Porter Ranch neighborhood of Los Angeles, may be restricted from injecting gas until all of its 114 wells have been pronounced safe, but Aliso Canyon still has some 15 billion cubic feet of natural gas left in the ground.

"And Bret Lane, the chief operating officer at Southern California Gas, the utility responsible for Aliso Canyon, told the Union-Tribune Friday that if a sweltering summer leads to a dire situation in which natural gas suppliers run short, the storage facility can be tapped.

"If the conditions are met, it's available and would be used," Lane said.

"Lane emphasized that natural gas would only be withdrawn from Aliso Canyon — not injected — under a protocol that has already been established in conjunction with entities such as the California Independent System Operator (CAISO), the California Public Utilities Commission, the California Energy Commission and the Los Angeles Department of Water and Power."  -- end quote 

A substantial benefit from the renewable energy providers in California is averting blackouts.  The state regulatory agencies are keenly aware of the need to prevent blackouts and go to great lengths to decrease demand, and increase generation capability.   The most effective demand decrease strategy appears to be requesting cooperation from consumers to postpone their electricity use during periods of peak use.   That is relatively easy to do, something as simple as not running major appliances until after 9 p.m.  

Increasing generation capability includes ordering generating plant operators to not perform non-critical maintenance. 

The un-controllable events are a concern, things like wildfire that impacts critical transmission lines, or blazes through a wind power farm.   The huge wildfire near Tehachapi, California that is burning at this time (June 26, 2016) could conceivable extend into the wind farm just a few miles south of the blaze.   The impact of fire on electricity transmission assets is not hypothetical, as the exact thing happened recently near San Diego. 

The impact of a blackout during a heat-wave can be serious, indeed deadly for people.   Living in a house in hot areas, without electricity for air-conditioning or even a fan to circulate air, can be deadly.   Some people, are so anti-renewable energy that they would rather shut down the renewable energy plants.   This is inconceivable to me, but perhaps the health, comfort, and even the lives of millions of people are not so important to the anti-renewables crowd.  

One of the realities of life is coping with the circumstances of that day, and that moment.  The reality in Southern California today, this week and this summer, is that heat waves are likely. (see Fig. 1 above) The electrical grid is powered for the most part by natural gas-fired power plants.  One of the nuclear power plants, SONGS, was shut down permanently more than 4 years ago (January, 2012) see link due to horrible mis-management.  Hydroelectric power is also limited. There is limited capacity to import power from neighboring states.  Finally, the Aliso Canyon natural gas storage system on which the entire system relies is not up to its usual capabilities due to a major leak and ongoing efforts to ensure safe operation in the future. 

Heat waves, as temperatures reach or exceed 90-95 degrees F, are fairly common in Southern California.  One example is shown in Figure 1 above, for calendar year 2015.  Similar charts are available for several years see link.   In 2015, there were 5 events that exceeded 95 degrees, and 8 events that exceeded 90 degrees.   Perhaps 2015 was impacted by the heat from an El Niño year, however the year 2012 had 12 events totalling 30 days that exceeded 90 degrees F.  

The bad news is that there is not enough natural gas available for several heat waves.  The good news is that renewable power plants are already installed and sending electricity into the grid at the rate of approximately 180,000-200,000 MWh each day, and 13,000 MW at peak output.  Even at 6 pm when load tends to peak, and sunshine is waning, the renewables combine to produce approximately 10,000 MW (as reported by CAISO in the past week).  Without the renewable power plants, the reserves in Aliso Canyon would be depleted in approximately 10 days.    The number of human health effects, even deaths, avoided by not having blackouts is unknown, but saving even one life is certainly worth doing. 



Roger E. Sowell, Esq.
Marina del Rey, California

copyright (c) 2016 by Roger Sowell - all rights reserved

California Setting Records with Renewables - 2016

Subtitle:  Renewables Saving The Grid by Reducing Natural Gas Demand

From CAISO, record-setting renewable production

A lot of good is being done by renewable energy power plants in California, especially with the Aliso Canyon gas storage facility at very limited capacity due to an earlier leak.  Renewable power plants are preventing the grid from experiencing blackouts. 

 The graphic at right, from California Independent System Operator, CAISO, shows renewable power production for what appears to be the record-setting date thus far, June 14, 2016.   Total renewable energy was 211,546 MWh.  Yesterday, June 22 was not far behind with 208,949 MWh.   Today, June 23's results are shown below, not quite a record but still a bit more than 200,000 MWh from renewables.  see link to CAISO archives on renewable output. 

Renewables on June 14 provided an average of 33 percent of the 24-hour total system demand.  On an hourly basis, renewables provided 46 percent of the load at 3 p.m. that day.   The load on the grid peaked at approximately 39,500 MW just before 6 p.m.   Solar production peaked at approximately 7,400 MW.  

These results are higher than the peak production in 2015, which was 189,000 MWh in a 24 hour period.   As could be expected, peak production occurs when solar power is at or near the Summer Solstice, June 20th typically, but also when wind production is greatest.   Wind production was at a maximum thus far at 92,000 to 93,000 MWh in the first half of 2016.  On June 14th wind provided 92,250 MWh.  Typically in California, wind production peaks in June or July then decreases for the remaining months (source, EIA). 

Renewables for June 23, 2016
showing Solar PV exceeds 7,000 MW
and total Renewables exceeds 200,000 MWh

The renewable energy produced saves the state from burning natural gas in the gas-fired power plants, which is a very good thing as this summer's loads must be met without the full production of stored gas from Aliso Canyon.   How much gas is not  burned is somewhat difficult to estimate because one must know which gas-fired power plants are not being run and their respective heat rates.  Also, as some gas-fired plants are no doubt operated at a slightly reduced rate, one must know the heat rate for each power plant at the reduced output.   Reduced output from selected plants is advisable to allow rapid power increase to compensate for variations in the renewable production due to clouds, and changes in wind speed. 

However, an estimate of the natural gas not burned can be made by taking the total renewable output from wind and solar, 167,950 MWh on June 14 (per the table at the top of the article), and using an average of 45 percent thermal efficiency for the power plants not being run.  On that basis, approximately 1.3 billion cubic feet of natural gas was not burned on that day.   Per California Energy Commission documents, that is nearly the same gas withdrawal rate at Aliso Canyon when it is at full operation (1.9 billion cubic feet maximum withdrawal).  See Table 1 in "Aliso Canyon Action Plan to Preserve Gas and Electric Reliability for the Los Angeles Basin,"  see link

The state's ability to produce renewable power has changed dramatically since the San Onofre Nuclear Generating Station (SONGS) was taken off-line suddenly in 2012.  As

shown in the figure and California Energy Commission's page (see link), solar PV capacity grew from 214 MW at the end of 2011 to 5,498 MW at the end of 2015.  More capacity has been added so that, as above, solar PV now can produce approximately 7,000 MW.   Solar thermal recently has exceeded 700 MW peak.   

It is especially ironic that renewables, once derided as destabilizing a grid, are now riding to the rescue and helping to prevent blackouts on the California electric grid during summer heat waves.   One can only imagine the rolling blackouts and uproar with Aliso Canyon gas storage effectively out of commission, SONGS nuclear generating shut down, and if no renewable power plants had been installed over the past 5 years. 

Roger E. Sowell, Esq.
Marina del Rey, California
copyright (c) 2016 by Roger Sowell - all rights reserved

California to Close Diablo Canyon Nuclear Plant

Subtitle: Solar Power to Replace Nuclear

It won't be right away, instead the closures of the two remaining reactors in California will be in 8 and 9 years from now, respectively, in 2024 and 2025.   That news rang across the nuclear camp yesterday, as PG&E, the plant's owner and operator agreed to shut the plant down at those dates and not seek a 20 year extension for the operating license.  Many articles on this are available, one from the Wall Street Journal (see link) does a credible job.   Title: "PG&E to Close California’s Last Nuclear Plant by 2025 - It will be cheaper to shut down Diablo Canyon facility and find replacement power, utility says."

Diablo Canyon Nuclear Plant, image from Google Maps 2016
Arrow indicates twin reactors.   Pacific Ocean to the bottom right.

There are some interesting, biased, pro-nuclear articles too, mostly from those who seemingly cannot believe their beloved nuclear plants are being shut down, instead of being built in greater numbers.   Those articles grind on and on with their favorite themes: jobs lost if nuclear plants close, grid instabilities if nuclear plants are not there to anchor the fragile grid, save-the-planet with carbon dioxide-free power from nuclear plants, and of course the old stand-by, coal and natural gas prices might increase again someday.   What many of the pro-nuclear articles omit is the great capital cost that PG&E would incur to keep the plant running past 2025, and how much money the plant is losing by operating in the present economic conditions. 

Much of the hoopla and angst stems from the pledge by PG&E, one of California's largest utilities, to replace the 2,200 MW of electricity presently provided by Diablo Canyon with a mix of wind, solar, storage, and efficiency improvements - all at no additional cost to the consumers electricity bills.  

Taking the above list of four tentative reasons to keep the nuclear plant online, in order, with jobs first.   The plant employs approximately 1500 people, per PG&E.   Jobs and their loss are also trotted out by other nuclear plant owners across the nation, as those plants are shut down.  The company is to work with various unions to keep some employed to perform the decommissioning (more on that expensive fiasco later), transfer some to other jobs within the company, and perhaps provide severance packages to others. 

Second, the California grid is not at all fragile.  The simple fact is that Diablo Canyon is a drop in the bucket in the California electricity market; only 2,200 MW out of approximately 35,000 MW average production, or approximately 8 percent.   On a high-demand day, when demand reaches 45,000 MW (as it did yesterday), the nuclear contribution is a much smaller portion at only 5 percent approximately.  It is also a fact that another, equal-sized nuclear power plant dropped offline forever in 2012 when the SONGS (San Onofre Nuclear Generating Station) had multiple tube ruptures and spewed radioactive steam into the sunny skies of Southern California.   SONGS' 2,200 MW removal from the grid did not create any blackouts, rolling or otherwise.   The ISO, California's Independent System Operator, simply called for more production from the gas-fired power plants.    Also, in the four years since that time, California has installed at least 7,000 MW of solar power plants.   The grid's frequency stability is assured by the gas-fired power plants, and large hydroelectric plants.  

Third, saving the planet by producing power that is free of carbon dioxide emissions is required only by the false-alarmists who believe that CO2 will overheat the Earth's atmosphere.   CO2 in the atmosphere certainly has not produced any appreciable, nor alarming warming thus far.  

Fourth, the tired ploy of gas shortages that nuclear advocates used in the 60s, 70s, and 80s no longer works.  Natural gas is no longer in short supply with a high price, nor is it likely to ever be in that situation again.  The simple fact is that gas exploration companies know now how to use precision directional drilling (PDD) and hydraulic fracturing to good advantage, producing natural gas in surplus amounts.  The wholesale price is now under $2 per million Btu, due to PDD and hydraulic fracturing.   This is a world-wide practice, not limited to the US.   

So, then, what of the naysayers' claims that substituting wind, solar, and increased efficiency will replace the 2200 MW from Diablo Canyon?    Again, as above, the fact is that California added more than triple in solar MW compared to what was shut down at SONGS.  (7000 vs 2200 at SONGS).   The grid remains stable, blackouts did not occur.    

The wind resources in California are nearly fully exploited, as the state has only three economic locations for wind turbines at Altamont Pass, Tehachapi Pass, and Banning Pass near Palm Springs.   Any future capacity growth would be from retired wind turbine replacements with modern, more efficient turbines.   In addition, state-wide data shows that California's wind power plants have a lower-than-average utilization rate, or annual capacity factor compared to the states in the Great Plains region.  In good years, the wind provides approximately 26 percent capacity factor, and in poor years about 22 percent.   In contrast, the Great Plains states have capacity factors of 35 to 42 percent on an annual basis.  Using rough numbers, 40 for the Great Plains and 25 for California, a wind turbine would produce 60 percent more power in the Great Plains (40/25 = 1.6).   However, the costs to install and operate would be effectively the same.  It makes great sense to build wind turbines in the Great Plains but not in California.  

Increased solar power has some intriguing aspects that will be discussed next.   One major point (allegedly) in the Diablo Canyon shutdown agreement is that PG&E will procure 55 percent of its electricity from renewable sources.   This is 5 percent more than the 50 percent that state law mandates by the year 2030.    As wind power is not likely to increase much, the logical candidate is solar power.  The state has ample sunshine that presently produces approximately 8000 MW at noon (recent data from CAISO).   With a total annual power demand of 300,000 GWh, half by renewables then is 150,000 GWh.  Wind and other non-solar renewables in 2014 produced 34,000 GWh, leaving 116,000 GWh for solar to produce.   With the annual average capacity factor for California utility-scale solar of 26 percent (per EIA and California Energy Commission), the state would then require 51,000 MW of solar installed. 

And there lies the problem.  The solar arrays produce too much power for the grid to absorb on any given sunny day.  51,000 MW of solar output greatly exceeds the typical summer day's peak demand of 35,000 MW.   What, then, to do with all that mandated solar power?    One solution, already proposed and under consideration, is to store at least a portion of the solar energy output as hot oil, or molten salt, to be re-produced as electricity later at night.   Yet another is to increase the pumped storage hydroelectric capacity in the state, and store the energy by pumping water into elevated lakes.   A third solution is to store some of the excess solar energy in grid-scale batteries.   A fourth solution is to store some of the excess solar energy in gravity-based heavy rail storage systems, as the ARES system in Nevada will do when construction is complete.  

Update 1: 6/23/2016 -  More uses for excess electricity include a fifth solution - split water via electrolysis, store the hydrogen for later and produce electricity when needed via fuel cells; and sixth, have a multitude of electric vehicles on smart chargers to charge the batteries with excess power.   --- end update 1

It is an interesting time to live in California.  The last nuclear plant will close in less than a decade.  Solar power plants will be built in great numbers.  The electrical grid will not only survive, it will thrive.   Innovations and economics will, as always, combine to sort out the favored solutions to the various challenges that arise.   

Another article will discuss the expenses of keeping Diablo Canyon online, and why it makes economic sense to shut it down. 

Roger E. Sowell, Esq.
Marina del Rey, California
copyright (c) 2016 by Roger Sowell - all rights reserved