It's wild to imagine that after the ITC expires in about 7 years, we could transition to the least subsidized grid the United States has ever had in its history. Imagine how that could impact state and federal budgets? Tax code loop holes? The improvement of our economy as a whole? International relations? This is tectonic stuff were talking about with the advent of a distributed grid in my opinion.
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I think your right. But note it is watt, not watt hour. Conventional generation is expressed in watts, which is where the $10KW/Month comes from. Batteries should be worth less than conventional, as the reserve runs out depending on watt hours in the battery.
Looking at the Green Mountain Power offer of $36/month, maybe solarcity could make $20-$30/month per battery subscribed to their system. That is a nice annuity with little cost after the initial software development work.
Competitors can't touch solarcity's PPA customers, but their will definitely be competition to aggregate other battery owners. This could drive down revenue from the PPA customers too, as solarcity would not like to look like jerks by under compensating their customers with PPAs and purchased batteries.
I just watched the Nevada legislature meeting on net metering where they questioned the PUC chair thomsen about his net metering decision. My goodness, what a mess thomsen. He was asked about legislative intent was to promote private investment in solar and thomsen listed off investments made before the bill. Senator ford reiterated the bill was concerned about investment going forward not in the past. Thomsen then said utility level investment has gone up. But the bill was rooftop solar investment. Also, rooftop applications dropped by 93% and private investors fled. Ford said this created the opposite of legislative intent and thomsen then replied he was tasked to eliminate unreasonable subsidy from non solar customers and he did just that. Ford as what is an unreasonable subsidy, by which thomsen replied "any subsidy is unreasonable." Ford replied that that wasn't the intent of he legislation. He was then asked that about casino paying way more then residential customers, subsidizing all residential rate payers by which thomsen replied thst it was different.
I can't make this stuff up folks.
There were so many things wrong about just to say he said there are 31k net metering customers causing $3 subsidy per month(which had increased from what was just a few weeks ago apparently) on non solar ratepayer bills. He was later called out because 11k of those were not interconnected and or been approved for interconnection so he lied about how many are actually net metering customers. But yet, in all the confusion of his long winded, angry testimony against rooftop solar, none of the legistors could really figure out what the hell he was saying. At one point one of the legistors asked him to stop and slow down sontheyncould understand the numbers he was throwing out.
i can't see how this can move forward in any kind or resolute way... Is so backward that the only way I can see real change in Nevada is through a referendum directly voted on by the people.
By the way Thomsen worked for a nv energy contracted geothermal company(which makes equipment for oil and gas industry). He is on record and I posted his statements earlier in this thread, that solar is overcompensated and will have its day of recognizing that fact. I guess he just had to get on the commission to make that statement true. Totally, totally corrupt and backward over there.
I can't make this stuff up folks.
There were so many things wrong about just to say he said there are 31k net metering customers causing $3 subsidy per month(which had increased from what was just a few weeks ago apparently) on non solar ratepayer bills. He was later called out because 11k of those were not interconnected and or been approved for interconnection so he lied about how many are actually net metering customers. But yet, in all the confusion of his long winded, angry testimony against rooftop solar, none of the legistors could really figure out what the hell he was saying. At one point one of the legistors asked him to stop and slow down sontheyncould understand the numbers he was throwing out.
i can't see how this can move forward in any kind or resolute way... Is so backward that the only way I can see real change in Nevada is through a referendum directly voted on by the people.
By the way Thomsen worked for a nv energy contracted geothermal company(which makes equipment for oil and gas industry). He is on record and I posted his statements earlier in this thread, that solar is overcompensated and will have its day of recognizing that fact. I guess he just had to get on the commission to make that statement true. Totally, totally corrupt and backward over there.
Aggregation is not tied to a battery. It's tied to the capability of a solar home to aggregate. Solarcity can offer anyone that has the capability to aggregate a contract. A sunrun customer that has a capable solaredge inverter and a capable sonnen battery can be under contract with Solarcity for aggregation services with the utility. Thst is clearly possible when taking about Solarcity aggregation network. It might get interesting if any those companies has a stipulation in their contracts that they can only aggregate through one of them... Then could put them all at a disadvantage on selling any systems if Solarcity turns out to have the best aggregation service terms. At 1/3 the current marketplace, they already have a step ahead in that direction.
also of special note, thomsen was put on the commission by Sandavol about three months ago... Months after the sb374 was signed into action. It is odd how Sandavol put this guy on the commission to interpret unreasonable subsidy as nothing other than complete elimination. It is funny how that happened after the bill was signed. It's very curious that he be named chairman of the PUC as well... Being be just got there and all... Very interesting to say the g'damn least.
jhm
Well-Known Member
Well, currently 13% of SolarCity use MyPower loans and 3% pay cash. So that's 16% off the top who can harvest ITC for themself. It think they can boost that to 20% to 40% with a basic loan. Even if it's only 20%, they still need to replace MyPower loans with something or risk losing market share.
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What do you know about HLBV and tax equity structures? My wife who is an auditor will help me wade through these specialize accounting treatments, but right now we drink margaritas.
jhm
Well-Known Member
Referendum, yes, but it sound like there could be legislative action as well. It seems obvious that Thompson. Either had no sense of legislative intent or was himself intent upon evading it. Seems quite contemptuous. I wonder if the legislature has any power to remove such a commisioner, or even to eliminate the PUC altogether and replace it with a more responsive regulatory structure.
Additionally, the PUC has failed to demonstrate that there is any subsidy going on at all because they have not taken the time to quantify all 11 potential benefits of solar to ratepays. If you have not added up all the benefits, it is intellectually dishonest to claim that a subsidy, i.e., a net cost to ratepayers has occured. A net benefit to all ratepayers would imply that solar owners are entitled to greater compensation and that no subsidy from nonsolar to solar has occured. Indeed, there may be a subsidy of solar to nonsolar occurring under NEM and the PUC has made it even greater. I'd like to see Thompsen try to defend his claim of subsidization in court when he has failed to do a complete analysis of benefits.
jhm
Well-Known Member
So what would it take for SolarCity aggregation to be recognized as a QF? To hit the 20 MW make they need only about 6000 Powerwalls in aggregation. Are there other qualifications?
I wonder specifically if in Nevada, SolarCity can claim both that they are a QF within the state and that the utilities in the state have block their participation in the wholesale market. Adding to this that the PUC asserts that solar owners must pay for access to the transmission and distribution grid, does this access not entitle them so use the grid to deliver power to the wholesale market. It is odd that NV Energy wants to argue that solar owners are only entitled to wholesale compensation for solar exports, and yet they probably do not want to recognize them as a QF or grant them real access to the wholesale market. This seems patently inconsistent and may actually be in violation of FERC regulations.
I'd like to see Obama charge FERC to look carefully into the case for recognizing distributed solar, battery and other energy resources in aggregation as QFs. It would be good for FERC to put some clarity on this and draw lines that utilities and PUCs should be careful about crossing. Again my view is that opponents of NEM have crossed the line using rhetoric that solar owners should be compared to wholesale power producers without granting them any meaningful access to wholesale markets. They really should not get to have it both ways.
jhm
Well-Known Member
This is good stuff. You can really see how the utility world wants to compensate these peakers for MW capacity rather than MWh production as they are an economic abomination on a MWh basis.
So 300 Powerwalls should provide 1 MW capacity and 2.1 MWh max per event. (I'm actually not too impressed by arguments that batteries sustain fewer hours per peak event given that peaker plants are only utilize about 4 to 5 % or maybe 60 minutes per day. Their ability to sustain way underutilized and can easily complement batteries in a sustained event.) 300 Powerwalls would cost about $1.2 M to install. Note this is $1.2/W which is competitive to new gas peakers which are in range of $1/W.
So let's suppose 1% utilitization. That is 87.6 hours per year, roughly 1 to 2 hours per week. Over 10 years time the at 1% utilitization the cost would be $1.2M/MW ÷ 876h = $1370 MWh, excluding the cost to charge. So by PJM standards, this is super cheap. But I think the utilization can be pushed out to 5%. At this levels the cost reaches $274/MWh. 5% utilitization is stI'll just 437.5 hours per year, 1.2 hours per day. Under day cycling, there are 2.1 hours available each day. So 5% utilitization consumes about 57% cycle depth. Max ulilization would be 2.1 hours per day or 8.75%, which would imply $157/MWh, excluding the cost of charging. This should be seen a theoretical lower bound. 5% utilitization is probably a more robust assumption and gets us to $274/MWh.
Fuel cost, the cost of charging the battery, is even more interesting. Firstly, since we are talking about grid services and costs to the grid, we should consider power at wholesale prices. So the most economical wholesale price is the daily min, which can sometimes even be negative. But even when positive, the daily min can be so low that generators are operating at a loss. Thus, providing load at these prices to secure more profitable price support is an economic benefit to the grid. Suppose coal is at $3/MMBtu and a plant must burn 10.33 Btu/Wh. That's a fuel cost of $31/MWh. But because coal plants cannot ramp down and up quickly, they are willing to operate at below the cost of fuel for many hours a day. They may even need to pay the grid to take load, which is how the spot price can go negative. So batteries can soak up surplus baseload for prices below the cost of fossil fuels, below say $30/MWh. Moreover, if there is surplus wind or solar, this can push wholesale prices down to $0/MWh in absence of baseload plants (coal,.gas, nuclear) pushing the price negative. Indeed, the presence of nuclear power seems to guarantee that when demand is fully satified by wind and solar, spot prices will be negative. So longer-term as renewable penetration increases to a certain level, the reliable cost of fueling batteries may be under $1/MWh.
But what about those transmission and distribution costs? The energy losses in transmission are proprtional to the square of load. Thus, if you can avoid transmission during times of congestion, peak demand, this has a big impact on energy losses. About 10% of generated power is lost in transmission, but most of this is at times of peak demand. So here is where out 300 aggregated Powerwalls really shine. They are distributed. When discharges the power is consumed onsite or distributed within the substation. Thus, they avoid congestion when discharging. Charging happens local or at times of very low load. Not only do they reduce congestion, but they reduce the capacity needed to handle congestion. Thus, distributed batteries can reduce both the capex and opex costs of transmission for the grid. This implies negative marginal cost of transmission and distribution for distributed batteries. Note that centralized batteries used as a grid scale peaking facility do not generally offer this advantage. They have to push power through transmission at times of greatest congestion. The placement of the batteries has a big impact on the transmission losses. T&D costs for residential ratepayers is about $70/MWh. Let's say $50 is avoided on discharge at peak times and $25 is avoided when charging at times of minimal load. So altogether about $70/MWh is avoided in T&D.
Let's put this together. The cost of 1 MW is $1.2M. At 5% utilization, opex cost is $274/MWh, fuel cost $1 to $26 per MWh, and T&D an avoided cost of about $75. Thus, the net cost to the grid paying $1.2 M for this is $200 to $225 per MWh. Coincidentally, $1200/kW divided by 120 months is $10/kW/month. This is really not a bad price for standby power and substantially less than the $190/kW/year that California paid for standby power. If gas peakers really do need $190/kW/year to be profitable, they are going to have a tough time competing with aggregated home batteries at $120/kW/year.
can this be relied upon to support the grid at its limit state, the once a year co-incident peak? or once a decade? etc
a UPS might be great for 1 hour backup 12 times a year, but if it can't support the 12 hour blackout once per year, then its not a replacement for a generator (or larger batteries) that does.
Fukushima disaster happened because the backup battery had a finite charge holding capacity, and the diesel generator shutdown due to tsunami. Its parallel to the grid is that the capital cost of having a dispatchable permanently continuous power supply (ie fossl fuel plant) is NOT materially diminished by the existence of a backup battery, even if the fuel supply costs are massively diminished.
Fukushima disaster also suggests that earthquake/tsunami zones are not suitable for nuclear power.
Japan has 10% of grid power (26 GW) supplied by pumped hydro. thats larger than its hydro power supply (8% - GW)
Yes, the most likely highest economic use of batteries in solarcity homes is simply peak shaving by demand response. People who own batteries will likely make the peak shaving deal directly with the utility, cutting out middlemen like solarcity. This is how Green Mountain Power is able to offer $35/month incentive to use the homeowners battery maybe 20 times a year.
Solarcity is an intermediary that will probably be disintermediated by the utilities on systems they do not own. Quite the opposite of having some sort of aggregation advantage on non-solarcity PPA systems. Solarcity is probably an unnecessary middleman.
TheTalkingMule
Distributed Energy Enthusiast
Discover magazine did an interesting article on blackouts this month. Apparently the forest fire metaphor has been proven true and current blackout prevention methods help build up the size of the next blackout. I know this is a vague question, but how does distributed/aggregated solar/battery usage help or hinder the effort to reduce the probability of decade-scale blackouts? I would think the sponginess of a distributed battery bank would be beneficial, but I don't know the grid.
jhm
Well-Known Member
Certainly one can come up with scenarios where no configuration of generation capacity is sufficient to support the grid. In particular this grid itself is vulnerable. Centralized peak capacity are impetent with the transmission lines that connect them to communities is lost. And this happens in virtually every severe storm somewhere. This is why millions of families have generators.
So a much more robust architecture is to have microgrids everywhere that can function in island mode. Batteries form the natural backbone for microgrids, and local solar and backup generators can be integrated for sustained island mode support. So aggregated batteries are an important step forward. If every home had a home battery. That would be incredibly roboust, but add to the the ability to recharge batteries with solar and generators and share that with neighbors, and the sum of the parts is greater than the whole.
Suppose you have a few neighbors who are offgrid capable. What would it be worth to you to be connected with them to share power when your grid connection fails? When the zombie apocalypse comes you'll be glad you didn't kick your crazy neighbors off the microgrid.
jhm
Well-Known Member
I have not read that particular article but I think AI know the principle that it is based on. Small failures in a system serve to make the system more robust. Efforts to prevent small failures can lead a system to be much more fragile in the face of less frequent events, and so the damage to the rare failure events is more widespread and extreme for lack of robustness.
A common example of this is a developing immune system. It is beneficial for children's immune systems to gain experience to a wide range of pathogens. This helps their immune system develop. Without developed immune systems, a population can become vulnerable devastating epidemics.
So distributed batteries are very helpful for robustness, but local communities need to have experience drawing upon those resources and integrating them with other local resources to really gain the full robustness that is possible.Learning goes way up responding to real crises. But also local disaster planning and testing can help. For example, can your neighborhood function in island mode. Simple planning would reveal many issue. Most neighborhoods have no way to function in island mode. If the transmission resources are down, it's every home for itself. So with a little planning, a microgrid could be initiated. But once installed, it would also be good to test it. Like a fire drill, the microgrid could be forced into island mode as a test. Ongoing island tests at different time and different durations would help the neighborhood maintain and improve its robustness. Or communities could just wait until the next natural disaster and see what happens. But personally, I would prefer to live in a community that does random island testing.
TheTalkingMule
Distributed Energy Enthusiast
I believe I mentioned this a while back, but all this reversal of the grid to a more distributed model will clearly necessitate a more federal feel to regulation simply from a national security standpoint. That is not a great considering the govt's track record, but wonderful for solar owners who are currently dodging easily corrupted state "regulators".
Kind of ironic when you think about how some folks are howling to eliminate the DoE just before it becomes 100x more vital.
The Blue Owl
Endangerous Herbivore
I preached this angle in my first comment on this board years ago. National security. National security. National security. I can't understand, for the life of me, why this argument isn't front and centre every time distributed generation is discussed. This is the one argument that will have guaranteed traction with people of all political persuasions. The resilience in the face of both directed attacks and natural disasters enabled by distributed power generation is a strategic advantage of mind-boggling proportions. It is orders of magnitude more consequential than cheap and reusable access to space, and that argument carried the day in the SpaceX vs. ULA boxing match.
SolarCity should rename themselves to SolarSecurity. Candidates pushing policies against distributed energy generation should be called out as Weak on National Security. Heck, call them low-energy, too.
The key to this is not just batteries but the entire home system(panels, inverter,battery, software)which includes controlling the AC(through nest). The battery is one piece of the aggregation puzzle. Then the central piece is the software platform to enable that network to be controlled/managed.
demand response is a part of battery utiltization. Another part is for the consumer themselves to utiltize in management of the home. Refer to the gridx white paper for the full stack of services to get the complete picture.
Solarcity's system and software platform unlocks all 13 values that are not just battery related, they are whole system related. The same complete system provides services to iso, utiltiy, and customer.
As solarcity's system and software platform may be worth in network $10/kW-month to a utiltiy, the same system also has a price point for the customer services. It is clear the current Solarcity system hasn't even come close to achieve full value yet.
This also applies to all other distributed solar companies as well, it just a matter of how effectively they get there. Solarcity has a step ahead right now in my opinion.
demand response is a part of battery utiltization. Another part is for the consumer themselves to utiltize in management of the home. Refer to the gridx white paper for the full stack of services to get the complete picture.
Solarcity's system and software platform unlocks all 13 values that are not just battery related, they are whole system related. The same complete system provides services to iso, utiltiy, and customer.
As solarcity's system and software platform may be worth in network $10/kW-month to a utiltiy, the same system also has a price point for the customer services. It is clear the current Solarcity system hasn't even come close to achieve full value yet.
This also applies to all other distributed solar companies as well, it just a matter of how effectively they get there. Solarcity has a step ahead right now in my opinion.
I think smart occupancy sensor thermostats like Nest and Ecobee is probably as good as it gets for HVAC energy management. Ecobee more than Nest, because of the multiple sensor option.
Extensive use of demand response on residential HVAC is probably never going to happen. The time the utility wants to cycle AC is on the hottest days of the year in the evening. No one wants to come home from work on a hot day and have the utility cycling the AC. Household members now fight over a 1 degree change on the thermostat. Will these household allow the utility to change temp for $10/month? I don't think so. Especially because the people who have things like Nest thermostats and backup batteries have disposable income. They pay for luxury, not discomfort.
Demand response will probably work for heat pump water heaters and EV charging. Beyond those two items it is added inconvenience.
Extensive use of demand response on residential HVAC is probably never going to happen. The time the utility wants to cycle AC is on the hottest days of the year in the evening. No one wants to come home from work on a hot day and have the utility cycling the AC. Household members now fight over a 1 degree change on the thermostat. Will these household allow the utility to change temp for $10/month? I don't think so. Especially because the people who have things like Nest thermostats and backup batteries have disposable income. They pay for luxury, not discomfort.
Demand response will probably work for heat pump water heaters and EV charging. Beyond those two items it is added inconvenience.
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