Utility Southern California Edison has been asking for batteries, demand response and other distributed energy resources to solve a host of its grid needs, from long-term capacity needs caused by the San Onofre nuclear power plant shutdown, to the immediate shortfalls caused by the Aliso Canyon closure.
Now it’s asking for distributed energy resources (DERs) that can help it help prevent outages in the Santa Barbara region, no matter how unlikely.
That’s the goal of SCE’s request for offers released Monday, which calls for between 15 and 55 megawatts of storage, demand response, load shifting, solar and fuel cells to help mitigate a “transmission-related contingency” -- a rare, but possible, set of combined emergencies that could lead to blackouts for thousands of customers served by its Goleta substation.
That's a different goal than most of SCE’s previous DER solicitations, which have sought to increase the capacity of the overall electric system, said Colin Cushnie, the utility’s vice president of energy procurement and management. It does share some similarities with SCE’s Preferred Resources Pilot (PRP), which is seeking DERs to shore up two specific substations in the Orange County region.
But unlike the PRP, the Santa Barbara procurement has emerged not as a regulator-mandated pilot, but as part of a “unique and localized transmission grid issue” that first reared its head during SCE’s winter preparedness work in 2015. As part of that analysis, SCE found that "transmission towers serving the Goleta region could be impacted by heavy rainfall or other natural events,” forcing it to set up several backup generators just in case that happened.
The generators were never fired up. Nonetheless, SCE decided that distributed resources that could add generation or reduce power consumption in the event of an emergency would be a better fit than relying on megawatts of generators.
Resiliency comes with its own unique set of needs that differ significantly from those served by SCE’s other DER procurements. It’s a long-duration need, because it’s there to cover for an emergency that could last much longer than the few hours typical of energy or capacity-related resources. Specifically, SCE is seeking DERs that can be available during a 14-hour window, between 7 a.m. and 9 p.m., during any day of the week.
Such a large span of time is unlikely to be covered by any one distributed resource in its entirety, outside of combined heat and power or fuel cell installations designed to run all the time. At the same time, solar PV, behind-the-meter batteries, demand response and other shorter-duration resources could be aggregated by third-party providers to spread their value across that window, or be fit into blocks of time being organized by SCE. (This is likely the reason why Monday’s procurement has such a wide range of needs -- it could include as little as 15 megawatts of longer-duration DERs, to as much as to 55 megawatts of shorter-duration resources.)
As with most of its requests, SCE isn’t disclosing the values of the contracts it is seeking to sign in terms of dollars-per-megawatt. It’s unclear whether resiliency carries a higher value than filling in for long-term capacity needs or bidding into day-ahead energy markets, as DERs are doing under the state’s Demand Response Auction Mechanism (DRAM) program.
Resources that win contracts for resiliency may be used to achieve various targets, depending on SCE's resource adequacy needs. The details on this are complex. The chart below from SCE’s RFO instructions lays out a high-level list of benefits and costs for each type of technology.
SCE needs these Santa Barbara resources to come on-line between 2018 and 2020. The timeline is not as fast as the nine-month turnaround for its Aliso Canyon procurements. But it's in line with the schedules for its local resource adequacy and capacity DER contracts to date.
SCE has really broken new ground among U.S. utilities DER procurement, starting with its 2014 local capacity requirement that contracted for hundreds of megawatts of distributed solar, behind-the-meter batteries, automated demand response, and targeted energy efficiency. Companies that have profited from SCE’s groundbreaking work include Advanced Microgrid Solutions, Stem, AES Energy Storage, Ice Energy, NRG Energy, Swell and Tesla.
Greentech Media is holding its California’s Distributed Energy Future conference this week in San Francisco, where we'll delve into the details of DER integration in one of the country's bellwether states. Join us via live stream and stay tuned for more developments this week.