Specialist
Former director at California Public Utilities Commission (CPUC)
Agenda
- California energy market dynamics, focusing on CAISO’s (California Independent System Operator) battery storage regulation, price pressures and approach towards September 2022 heatwave
- California utilities’ collaboration with PUC (Public Utilities Commission) and CAISO on storage projects, discussing potential process changes
- Resource reliability with uncertainty revolving around Diablo Canyon nuclear power plant’s operation
- Inflation Reduction Act and solar buildout, highlighting net metering and battery storage
- Transmission requirements, interstate connection and incentives, discussing PPA (power purchase agreement) pipelines
Questions
1.
In early September 2022, California hit a new 52GW demand record as a result of the heatwave. We saw that CAISO [California Independent System Operator] issued warnings of potential rolling blackouts, but from what I saw, there were no major load shedding or blackouts. What are some takeaways from this recent heatwave? Have there been any surprises?
2.
You mentioned CAISO and the regulatory agencies’ proactive approach to tackling the heatwave. Could you elaborate on what kind of a change in mentality you saw with them? How did their approach really change?
3.
You mentioned that CAISO has a learning curve on market incentives for battery storage. Obviously, people know about the duck curve or the demand curve in California with the solar build. How difficult has it been for CAISO to adapt to that? How quickly is that still changing? Are you seeing YoY or MoM changes, given these curves are slightly different and you have to adapt to them?
4.
ISOs [independent system operators] are reportedly targeting market changes for battery storage, possibly introducing new products. Do you know where the discussions are heading in California? What are the possible outcomes in terms of capacity market changes and creating entirely new products?
5.
Has the market functioned efficiently amid the price and grid operating pressures? Have you seen things work at high energy prices?
6.
You mentioned CAISO’s Department of Market Monitoring releases quarterly data in response to events such as the heatwave. Is that quarterly, or directly in response to these events? Does it have a date or is it spontaneous?
7.
You mentioned transmission congestion. Is this relevant to the way battery storage has been deployed in California at all, or less relevant than in other places? Congestion has been a part of storage deployments in ERCOT [Electric Reliability Council of Texas], from what I understand. Are you seeing that in California too?
8.
Do you think that sufficient improvements could be made to CAISO’s interconnection queue process by streamlining the priorities, or does it have to hire a lot more people to deal with the workload? Are you optimistic that the operator might be able to sort this out? Is one avenue efficient or do you have to both streamline the process and invest in capacity?
9.
Have you seen enough cooperation or collaboration with the utilities in California on storage projects? Is there some question about potentially changing the process to some extent and introducing a more competitive process? What are some ideas for ensuring that these projects are built efficiently and within budget?
10.
How much visibility does the PUC [Public Utilities Commission] or CAISO have into the renewables queue? You mentioned issues with land use permission. Is that a problem when planning 5-10 years out in advance, where you don’t really know what’s going to be built? How are CAISO and the PUC thinking about this?
11.
Lawmakers in California reportedly approved the extension of Diablo Canyon Power Plant’s operation from 2025 to 2030 amid energy shortages. How does that affect the planning process if the plant were to come offline? Would CAISO need to come up with other incentives, or would the renewables queue take care of resource adequacy in the state?
12.
You mentioned ratepayers’ average electricity cost per kilowatt in California is USD 0.18 vs USD 0.10 for the rest of the US. Is there room to raise rates? There are clearly all these spending priorities we’ve been talking about, be it urgent, less urgent, interconnection, resource buildout and regional transmission under-grounding. How much room is there for this spending?
13.
You mentioned the under-grounding, which is a big lift for PG&E. Are you optimistic that the company will be able to hit the USD 2m per mile budget target? I think that’s sitting at around USD 3.5m per mile. It’s a big push. What are some of the things that are being discussed as to watching that pan out?
14.
How is rooftop solar factoring into the planning stage, especially given the 2022 Inflation Reduction Act and what we’re hearing about technical challenges with grid balancing on the distribution grid? What should the state of California do, and what are its priorities?
15.
PG&E and SoCal Edison filed incident reports on 12 September 2022 for California wildfires. Are we well prepared as we’re heading into fire season? Have the investments in wildfire reduction panned out?
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