Innovation Ecosystem

Here comes the sun

For the first time, a system of distributed solar power has been awarded a bid in the forward capacity market auction by ISO New England

Image courtesy of Sunrun Facebook page

Solar panels being installed.

By Richard Asinof
Posted 2/18/19
In a sea change, ISO New England, the electricity grid operator for the region, accepted a bid from Sunrun, a national solar aggregator, to provide power from its fleet of solar and battery powered distributed generation from roughly 5,000 homes.
How will the success of Sunrun change the equation in regard to the proposed Invenergy gas-fired plant in Burriville? Has Gov. Gina Raimondo and her team been in direct communications with Sunrun? Does there need to be better education around the difference between behind-the-meter solar installations and large utility-scale solar farms?
It has been more than two decades since the wave of deregulation swept through the American utility system, mostly as a way to relieve the burden of stranded costs from nuclear power plants. Now, with the rapid growth of solar and wind industry in the market, both as an economic driver of new job creation accompanied by a rapid decrease in the cost of electricity being produced, is it time to think about a re-regulation of the electric utility industry as an important component of efforts to lower carbon emissions?

PROVIDENCE – On Feb. 6, ISO New England, the region’s electricity grid operator, as part of its forward capacity market auction, awarded a bid to Sunrun to deliver 20 megawatts of energy capacity beginning in 2022 by aggregating its home solar and battery systems.

“This is a first for home solar and battery systems,” said Anne Hoskins, chief policy officer at Sunrun, a national solar aggregator, in a post announcing the successful bid. “[We] are now competing head-to-head against more polluting, centralized power plants in one of the largest electricity markets in the United States.”

While the 20 megawatts is but a small portion of the promised power procured by ISO New England, which totaled 43, 641 megawatts, it marked the first time that a distributed source of electricity generated with solar panels and battery backups had been awarded such a bid at an auction.

“We are transitioning toward a new electricity system with locally generated clean energy,” Hoskins said. “It’s a new day for energy. We are only just beginning to tap the potential for a cleaner, more efficient decentralized electricity system. Rather than banking solely on last century’s poles, wires, and generation plants, let’s work towards a future where people are at the center of the solution, providing reliable energy for themselves and their communities.”

As Mary Serreze described it in a story published by MassLive, “A network of around 5,000 solar- and battery-equipped homes in Massachusetts, Rhode Island, New Hampshire, and Vermont could soon be funneling power back into the grid at times when it’s needed most.”

Serreze’s story continued: “The national solar installer Sunrun made history this month when it bid into the region’s forward capacity auction for wholesale power and won the right to contribute 20 megawatts to the New England grid during periods of high demand.”

Behind-the-meter success
This past summer, in New England, distributed solar from behind-the-meter systems on rooftops and businesses was credited with reducing wholesale power costs by nearly $20 million by lowering the energy load during peak demand times during the heat wave from July 1 to July 7, 2018, according to Hoskins, citing a report by Synapse Energy Economics. [See link below to ConvergenceRI story, “Behind the meter solar is transforming the market.”]

According to Serreze’s story, “The full swarm of home solar-storage system has yet to be installed,” but Sunrun said it was confident that the company would be able to lease its systems to enough homeowners lured by the promise of cheaper electricity and backup power during outages.

The electricity must be made available to ISO New England during the 2022-23 season. “If Sunrun delivers, Serreze wrote, “it gains tariff payments. If it fails to deliver, it faces penalties.”

The tipping point
In contrast to Sunrun’s successful bid, the proposed $1 billion, 900 megawatt, gas-fired Invenergy power facility in Burrillville still awaits approval from state regulatory authorities about whether it can be built or not.

In September of 2018, ISO New England cancelled what is known as its capacity supply obligation contract with the facility, because the commercial operation date for the first unit was more than two years beyond June 1, 2019, the start of the capacity commitment period.

At a time when the dire threat from climate change and global warming connected to carbon emissions keeps growing, the question remains: Would Rhode Island be better off by in quadrupling its investments in behind-the-meter, distributed solar power with battery backups?

For Sunrun’s Hoskins, the answer is straightforward: “Home solar and batteries deliver clean and reliable electricity to households at a lower price than traditional, centralized generation,” she said. “Since they do not require fuel inputs, they can provide cost-effective resources to the wholesale capacity market, and lower the price of power for all customers. At the same time, this clean energy network stands ready to deliver backup power when the centralized grid fails.”

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