Dive Temporary:
- The California Public Utilities Fee on Thursday accredited three energy project contracts proposed by San Diego Gasoline & Electrical, in addition to four contracts proposed by Southern California Edison, that may collectively present greater than 800 MW of latest photo voltaic and storage capability to assist make sure the reliability of the state’s electrical grid this decade.
- SDG&E’s proposal included one hybrid photo voltaic and storage mission, anticipated to come back on-line in June, in addition to two battery storage tasks scheduled to come back on-line in mid-2024. SCE’s proposal, in the meantime, comprised 4 front-of-the-meter vitality storage tasks.
- The tasks are the results of solicitations carried out after the CPUC accredited an 11.5-GW procurement package in 2021. The order goals at making certain the reliability of California’s grid towards the center of the last decade, and marked the company’s largest-ever capability procurement in a single shot.
Dive Perception:
The CPUC’s 11.5-GW mid-term reliability procurement order sought to satisfy the state’s grid wants between 2023 and 2026, given the then-planned retirement of the two.2-GW Diablo Canyon nuclear energy plant by 2025, in addition to the closure of a number of pure gasoline crops. The state is now contemplating extending the lifetime of the Diablo Canyon plant via the top of the last decade. Nonetheless, it continues to deal with procuring new clear vitality assets to satisfy grid wants, with the 2021 choice requiring 2 GW to come back on-line by August, one other 6 GW by mid-2024, adopted by installments of 1.5 GW and a couple of GW in 2025 and 2026, respectively.
In September 2021, SDG&E issued a request for presents to satisfy its share of those procurement wants, after which reopened the solicitation final April for brand new bids in addition to updates to earlier ones. It filed a proposal with the fee in October, looking for approval of two lithium-ion battery storage tasks – the 80-MW Bottleneck mission and 100-MW Cald mission – in addition to a 20-MW hybrid photo voltaic and storage facility. SCE, in the meantime, additionally launched an RFO in 2021, and filed its newest proposal with the fee in October, proposing 4 storage tasks, starting from 69 MW to 230 MW, for a mixed capability of 619 MW.
The expedited approval of the 4 vitality storage contracts from the fee will assist present certainty to maximise the probability of bringing the tasks on-line on time, in response to SCE spokesperson David Music.
“[T]his vitality storage will present further reliability to the grid, particularly through the essential hours of 4 p.m. to 9 p.m,” Music mentioned, including that “they may also be used to answer the CAISO’s indicators, high-demand occasions, warmth waves, or when the vitality grid is strained, as we noticed final September.”
Each utilities’ proposals acquired pushback from the CPUC’s Public Advocates Workplace, which filed protests with the fee in November. Within the case of SDG&E’s request, the workplace notes that the Inflation Discount Act, signed into regulation in August, created an funding tax credit score for standalone vitality storage assets, and that SDG&E didn’t attempt laborious sufficient to barter down the worth of two of its tasks to account for that.
SDG&E has pushed again on these arguments, noting in a submitting with the fee that making an attempt to restart negotiations for the contracts would decelerate the approval course of and jeopardize the tasks.
The Public Advocates Workplace additionally raised considerations with SCE’s proposal, saying that the utility may be overpaying for considered one of its contracts. In response, the utility reiterated that its proposed contracts are “the least price, best-fit assets” to satisfy its procurement targets.
The fee concluded in its choice that SDG&E’s solicitation was managed fairly and that re-negotiating contracts at this stage would threaten its capacity to satisfy procurement necessities. And whereas the company voiced considerations that utilities not overpay for procurement, it concluded that SCE has opted for “least price, best-fit” assets.
