The California Independent System Operator has had 2.1 GW of capacity added to its grid so far in 2020 with another 3.3 GW permitted with online dates in 2020 or 2021 as the state works to achieve its 100% clean energy mandate over the next 25 years.
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The ISO interconnection queue lists nearly 2.3 GW remaining with 2020 online dates that have executed interconnection agreements and completed studies, according to ISO data. Of that amount, 1 GW is solar, including 462 MW with battery storage attached, 780 MW is wind and 510 is stand-alone battery storage.
"There are a number of projects that are still trying to come online by Dec. 31," Cal-ISO Spokeswoman Vonette Fontaine said Dec. 21.
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In 2020, Cal-ISO had 2.1 GW of capacity added through September of which 1.3 GW was gas-fired, according to US Energy Information Administration data.
EIA also shows 3.3 GW permitted with an online date in either 2020 or 2021. About 2,500 MW of this is under construction via 1.5 GW solar, 800 MW battery and 200 MW wind, said Morris Greenberg, senior manager of North American power analytics at Platts Analytics, adding some of the solar may also include battery capacity.
Any extension of solar investment tax credit included in the COVID stimulus bill should help to sustain capacity additions over the next several years, Greenberg said.
Solar & storage
"The tax credits also apply to co-located storage that charges mainly from the solar capacity," Greenberg said. "We are seeing a rapid increase in storage additions over the next several years as well to meet resource adequacy needs."
Cal-ISO president and CEO Elliot Mainzer has said the grid operator is working to improve its resource adequacy system following the rotating outages in August.
"Longer term, we're working very closely with the [Public Utilities Commission], the Energy Commission and others in the regulatory space to try to make sure the resource adequacy paradigm in California is modernized sufficiently to recognize the changing resource mix," Mainzer told Platts about evolving the market to interface with new resources. "There's a lot of additional solar and batteries and wind and other renewables coming onto the system."
2020 renewable generation
Cal-ISO renewables generation dipped 7 percentage point year on year to average 33.2% of the total fuel mix so far in 2020, while thermal generation increased 5.5 percentage points to 34.5% of the mix and imports rose 1.2 percentage points to 24.6% of market share, according to ISO data. The drop in renewable came as hydro generation slipped 6.4 percentage points year on year to average 7.2% of the fuel mix so far this year due to weather changes.
Precipitation in the October 2019-September 2020 water year in the Sacramento River Basin measured about 60% of normal and precipitation in the San Joaquin Basin measured about 50% of normal, following an above-normal water year the preceding year, which amplified the year-on-year decline, Greenberg said.
La Nina conditions in California have driven by low precipitation at the start of the 2020 Water Year, and higher-than-normal precipitation in the Pacific Northwest, said Kieran Kemmerer, S&P Global Platts' North American power analyst.
"La Nina is expected to persist through the winter with a 50% chance of continuing into the Spring, which would result in continued below-normal precipitation and CA hydro well into 2021," Kemmerer said.
Impact of more renewables
The shift to a low-carbon grid provides challenges and opportunities, as the state incorporates increasing amounts of renewable energy on to the electric system. In 2018, then Gov. Jerry Brown signed Senate Bill 100 into law calling for 100% clean energy by 2045.
"Sometimes, during the middle of the day, California's renewable resources can generate more electricity than is needed," according to Cal-ISO. "During these periods of surplus energy, the ISO's market automatically reduces the production of energy from renewable resources, or 'curtail' generation."
Renewable generation curtailments so far in 2020 are up 220% year on year, according to ISO data.
More renewables tend to suppress wholesale power prices.
SP15 on-peak day-ahead locational marginal prices have averaged 18.5% higher year on year so far in 2020, thanks to record-high prices during an August heatwave, according to ISO data. Outside of July-September, prices averaged 2% lower year on year.
SP15 2021 forward packages are trending nearly the same as 2020 packages last year, according to S&P Global Platts data.