Analysis: Curtailments rising with renewables increasing on the Cal-ISO grid

With renewable generation growing rapidly across the California Independent System Operator, the need to balance the supply and demand of the grid has led to increased management of the oversupply of the ever-growing renewables fleet.

California's target of 100% carbon-free generation by 2045 provides challenges and opportunities as the state incorporates increasing amounts of renewable energy on to the electric system, according to ISO.

ISO renewable output has risen from an average of about 22% in 2010 to more than 40% in 2019, according to ISO data. And, there is more to come with the renewable portfolio standard target of 60% by 2030 and 100% carbon free by 2045.

LARGE SOLAR ADDITIONS PLANNED

Sometimes, California's renewable resources can generate more electricity than is needed during the middle of the day, so the ISO automatically will reduce the production of energy from renewable resources, or "curtail" generation, in order to balance the grid. In rare instances, when economic bids from generators are insufficient, ISO operators manually curtail production to maintain the balance between supply and demand.

With increasing amounts of renewable resources, oversupply conditions are expected to occur more often.

The ISO interconnection queue includes active requests for 14.5 GW of solar PV, 10.5 GW of solar PV with storage as a secondary generation source, 14.9 GW of storage with solar PV as a secondary source and 16 GW of storage with no secondary source, said Morris Greenberg with S&P Global Platts Analytics.

CURTAILMENTS PEAKED SUNDAY

To provide market transparency on renewable curtailments in California, S&P Global Platts launched the California ISO Systemwide Renewable Generation Curtailment Index in December 2019 to provide additional market insight around wind and solar curtailments in the ISO. The indices show the daily wind and solar curtailments reported by the ISO.

The vast majority of ISO curtailments come from solar, which has an installed capacity of 12.7 GW, compared to 6.9 GW of installed wind capacity, according ISO data. On a typical, ISO curtailments slowly begin during hour ending 7am PDT as solar starts to enter the grid and ramp down by hour ending 5pm as the sun sets and solar generation falls off.

Since Platts started publishing the assessment, curtailments for a single hour reached as high as 1,464 MW for hour ending 14 on Sunday, February 23 when the highest 24-hour total of 6,290.5 MWh was also reached, according to Platts data.

Curtailments tend to be higher on Sundays due to generally lower loads on the weekends. When combined with good wind and solar conditions and low demand, curtailments were boosted.

"Curtailments were up year over year in November-January. This is occurring against a long-term trend toward increased curtailments as solar capacity continues to grow," Greenberg said. "So all else equal, we would expect an earlier start to the curtailment 'season'."

SPRING SURGE

"Curtailments are significant at certain times of the year, such as spring," Greenberg said about increased solar during that time, but decreased loads due to milder weather. That means there is not a large market to absorb the increased renewables generation, he added.

ISO curtailments reached a record level in May 2019 as the ISO slashed a total of 223,195 MWh of wind and solar geneation to balance supply and demand, a more than 17% month on month increase, according to ISO data. Curtailments in 2019 more than doubled year on year and have averaged a nearly 97% increase annually over the last five years, according to ISO data.

"One factor that may limit system curtailments this spring is lower California hydro supply," Greenberg said. "However, we may still see modest increases in curtailments from the prior year related to congestion, depending on wind and solar conditions."

Hydro generation has average 7.4% of the fuel mix so far this year, well below the average of 13.2% for Q1 2019, according to ISO data. The water supply forecast for Shasta Dam, the barometer for hydro conditions in the state, is currently at 59% of normal, which is the trend across California reservoirs, according to California Nevada Rive Forecast Center data.