July 1, 2010

Utility Perspectives on Using Renewable Power

By Angela Neville, JD

Selection Criteria for Renewables

In general, utilities use some basic metrics when choosing a renewable energy technology, according to Kurtz:

• Acceptable cost, which depends on local resources.
• Energy payback, which also depends on local resources.
• The match between generation and load profile (peak shaving).
• Demonstration of the product.
• The future potential for the product (PV technology is still maturing).
• Installation details, such as the size of the installation, site preparation, and dual use of land.
• Maintenance requirements (for example, trackers require regular maintenance, but inverters are typically the most problematic).
• Water use.
• Other environmental concerns, such as permitting challenges.

Kapner gave a specific example of the renewable technology selection criteria that Austin Energy uses: “We consider wind, solar, hydro, biomass (landfill methane, anaerobic digestion of organic waste, and combustion of wood and crop residue), and geothermal as qualified renewable energy sources.”

What the Future May Hold for Renewables

Session participants provided valuable insights into the variety of challenges that lie ahead related to adding more renewables to utilities’ generation portfolios.

“Renewable energy is gaining in market share as the prices drop. Within a few years, renewables may be a substantial fraction of new electricity generating capacity,” Kurtz said. “Any utility out there needs to be diversified and able to move quickly in new directions.”

In a different vein, Turner emphasized the impact that utilities’ increased use of renewables will have on their personnel. “There will be a huge transition for the U.S. utility workforce as utilities move from coal-fired power plants to facilities based on renewable energy like wind and solar. The workforce will need to retrain for more maintenance-type jobs,” Turner said.

Kapner chose to focus on plans that Austin Energy has related to using more renewable energy sources such as wind or solar. The utility’s generation expansion plan calls for 1,000 MW of wind, 200 MW of biomass, and 200 MW of solar by 2020.

He also addressed the question of how critical the role of energy storage is for his utility. “Energy storage should not be viewed as a show-stopper for the addition of renewables until Austin Energy runs out of flexible generating capacity,” he said. “In addition, when storage is considered, it should be viewed and analyzed as a system resource, not a cost to be assigned just to the renewable sources.”

Hoffman had a different view of how the U.S. should handle the expected growth in demand from both business and residential consumers. “Going into the future, we’re going to need it all: renewables and traditional energy sources,” he said. “In addition, looking ahead, the electrification of the U.S. transportation fleet is critical.”