ELECTRICITY – ON A CLEAN GRID?

In Part I of this three-part series, I discussed that our continued myopic focus on centralized utility-scale deployments is on a collision course with the objectives of dematerialization and decarbonization. The reasoning to deploy ever larger centralized systems simply does not reconcile with reality. How else could one justify bulk solar generation, with greater and greater power ratings and even greater footprints, when a major foundation of the centralized power system – the transmission lines – is more fragile than ever due to global warming? As evidenced in California, climate change has brought to fore a major weak link in our centralized powering platform. We may convince ourselves that these extreme system failures cannot manifest elsewhere. That’s how we reacted when we first encountered SARS. It was a viral outbreak confined to the Far East…until COVID-19. It’s time to reconcile our thinking with a planet clamoring for change.

During 2017 and 2018, a historic drought turned parts of California into a tinderbox. Winds toppled dry trees on to transmission lines and the poles carrying them, knocking them down causing devastating fires. Hundreds of thousands of acres were set ablaze. Thousands of properties were burned to the ground. Over a hundred people died. Inconceivably, Nature dealt a Faustian bargain for the Golden State’s electric grid – the nation’s leader with the most solar deployment. In dry windy conditions, the utility has no choice but to de-energize the transmission lines leaving large swaths of the population hung out to dry without electricity for days. Wildfire victims are treated as second-class claimants over those from the utility investors. Regrettably, the unacceptable situation is now being normalized for the next decade while at least one of the utilities – PG&E – had been driven to bankruptcy. Imagine we were asked to wait ten years for the COVID-19 vaccine developed by financially strapped biotech firms. We, in the power community, seem to think that the utility equipment-related fires are just a set of one-off events and we can all go back to business as usual.

Nature has exposed the fragility of the centralized system in its new environment. Global warming and its extreme weather patterns may very well be a constant threat to our top-down platform. Instead the media seems to blame the utility-instigated wildfires on California’s overemphasis on renewable energy targets. Supposedly, the regulators took their eyes off the ball when mandating safety for the centralized grid platform. The Wall Street Journal explains, “it was tough to get Sacramento lawmakers excited about funding safety” because “‘Safety is not a glamorous thing.’” First, neither safety of power delivery nor striving for renewable energy should be a badge of honor for their proponents; they are both necessities. Second, the media got it both right and wrong. There are real issues with the centralized electric grid especially with its challenges of integrating intermittent generation resources. Nevertheless, they cannot be more wrong in blaming renewable energy as the culprit.

DISTRACTIONS OF SIZE

“Economies of size” is the overarching goal for utility-scale solar PV power plants. Larger capacity (wattage) power plants benefit from lowered fixed costs of plant construction – on a $/W basis. While the models delivered the desired financial outcomes (returns on investments) the spreadsheets did not account for externalities – the unknown unknowns. The incomplete modeling painted a rosier picture for investors. For them and the industry, the utility-scale paradigm remained the same. Instead of fossil fuel power plants they now invest in solar. But we all ignored the caustic combination of high material infrastructure, waste and inefficiency. Delivering electricity from the generation plants to the homes, offices and factories in cities and towns is complex and lossy. Centrally generated clean solar power is also made to hurtle down hundreds and, in most cases, thousands of miles of transmission power lines. Its generation efficiency of low to mid-teens decreases to single digit by the time it reaches us. It’s time we question the efficacy and environmental impact of utility-scale solar PV: This is not the way forward for clean energy.

Nature doesn’t need to review half-baked spreadsheets to correct course. She always exposes the weakest link in the system. The overhead transmission lines are the Achilles Heel of the centralized infrastructure. No amount of band-aids – sensors and/or predictions – can stop dry, arid conditions and winds from wreaking havoc. When utilities turn off the transmission lines, homeowners and businesses are forced to fire up generator sets that run on fossil fuel. Ironically, the tide then turns on the very definition of “stranded assets.”

When the grid lines are shut off, the clean energy assets on the bulk power systems get “stranded” and become the equivalent of the stranded fossil fuel assets. Without the live transmission lines, their contribution to reducing green-house gas (GHG) emissions and electricity generation are dismal. The centralized deployment of renewables and its infrastructure remains problematic in two areas: dematerialization and decarbonization.

The lessons in California offer a valuable opportunity of soul-searching for the entire industry. We should heed Nature’s invitation to confront reality.

Burying the transmission lines underground may be a consideration. However, there’s no denying that this approach would be fraught with unprecedented financial, logistical and maintenance nightmares. The core problem of the centralized system – it’s inherent fragility – would remain. Burying this fragile system underground at considerable costs, further increases its footprint, material content, wastage and overall losses. No matter how these daunting challenges are confronted – with or without governmental subsidies and legislation – these valuable resources will be far better utilized in developing hardened 21^st century distributed powering solutions. A transformed system demands localized power sources for a resilient, sustainable, clean grid. Ignoring the “distributed” aspect of distributed energy is not what Nature is teaching us. Rather, it is a wake-up call for government agencies and regulators to steer the entrenched industry to fundamentally innovate for the electric grid’s necessary transformation.

Energy VC firms, climate activists, impact funds and project financiers may want to reevaluate the impact of their portfolio and embrace the mission to dematerialize. Continuing to apply traditional models and analysis without accounting for the externalities only helps perpetuate our stagnation.

It is an opportunity for us all to question our decisions and their impact on future generations.

THE SOLUTION – STRENGTH IN NUMBERS

Nature always has the final say. Renewables deployed on the bulk power systems fail to dematerialize, effectively decarbonize and reduce costs for the consumer. Ironically, the road to the sustainable clean grid may originate at the grid edges. Advanced behind-the-meter (BTM) systems deliver inherent “distributed-ness” and the added benefits of resiliency and reliability for the electric grid.

In the third and final part, we will uncover the potential for simplicity and elegance of localizing our power sources by enhancing the grid edges with advanced powering technologies. True 21^st century solutions will demand deeply embedded resiliency, unfailing reliability delivered universally – affordably and sustainably. Only an electric grid platform that utilizes the grid edges to localize our power sources can deliver on these mandates.