Recent developments in Resource Adequacy in California Karl - - PowerPoint PPT Presentation

Recent developments in Resource Adequacy in California

Karl Meeusen, PhD Senior Advisor – Infrastructure and Regulatory Policy WECC Market Interface Committee June 27, 2019

Overview

• Overview
• Recent developments at the CPUC
• Centralized procurement and decentralized load service
• Analyzing the RA fleet

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What is resource adequacy in California

• Multiple jurisdictional entities (currently over 30 different

Local Regulatory Authorities) – Each LRA can establish its own RA rules

• Multiple capacity products procured

– System – Local – Flexible

• RA resources must be made available to CAISO markets

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California’s aggressive pursuit of a low carbon future must consider the future procurement landscape

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• Aggressive renewable energy goals

33% by 2020 60% by 2030

• Deep greenhouse gas (GHG) reduction goals

2020 Target Reduce GHG emissions to 1990 levels 2030 Target 40% below 1990 levels 2050 Target 80% below 1990 levels

• Robust electric vehicles goal: 1.5 million by 2025

100% 0-carbon by 2045

• 12,000 MW of distributed generation by 2020;
• 1.3 GW of battery storage by 2024

California procurement landscape is changing rapidly

• Significant changes to local RA procurement (D.19-02-

022)

– Three years forward requirements (100%, 100%, 50%) – PG&E Other” local area requirements now disaggregated

• Proposal in Assigned Commissioner and ALJ ruling in

IRP on 6/20/19 (R.16-02-007)

– RFO for each LSE to procure share of 2,000 MW new peak capacity online by 8/1/21 – Potentially extend of one or more OTC units – Require SCE to solicit 500 MW of capacity from existing resources without a contract past 2021

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California’s transition to a central buyer

• Community Choice Aggregation

– Government entity formed by cities and counties that assumes the load-serving responsibilities for its constituents – Chooses the electricity generation mix on behalf of its consumers without having to own the wires/infrastructure to move electricity

• Challenges of the “load migration” to CCAs

– IOUs don’t want to buy capacity for load they will not serve – No longer large LSE capable of buying grid-scale renewable resources needed for state to achieve its energy policy goals – CCAs may have distinct preferences about how best to serve load

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Roles and obligations of a central buyer

• Ensures state has an entity to procure resources given

transition to many small LSEs

• Could be an IOU, state-run or state-overseen entity
• A central buyer can have various roles and obligations,

depending on policy objectives:

– Full vs. residual procurement – Procurement of different capacity types (system, local, and flexible) – Procurement only or also act as a market participant – Procurement duration (one year or up to 10)

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CAISO is proposing to assess only RA portfolio to test adequacy under various load and net load conditions

• Provides greater certainty that a broad mix of resources

can meet CAISO operational needs

– Including thermal, hydro, wind, solar, energy and availability limited resources, distributed energy resources

• CAISO must assess how the shown RA fleet works

collectively to meet system needs

– Similar in concept to the collective deficiency test the CAISO conducts for local RA – Some resources may be more “effective” in ensuring reliable

• perations under different scenarios
• Must balance modelling complexity with CAISO
• perational needs

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