Since putting itself on the market for renewables with its 33% renewable energy requirement, California has become like a wildly popular debutante, with a superfluity of suitors offering what Energy Prospects is calling a “glut” of renewable projects to meet the need.
Three times more would-be renewable energy projects are queueing to be added to the grid than would be needed, totaling 71 GW. Cal-ISO is having trouble fielding a truly staggering number of applications for renewable energy projects, enough to supply more than 100% of California’s energy needs.
So far, the state has added 7.6 GW of renewable power in recent years, pretty much meeting the original Renewable Energy Standard set in 2006 to get 20% by 2010 (19% is installed, the full 20% is contracted for and will be online by 2013).
To meet the 33% target would take adding about another 20 GW. About 11 GW of wind and 7 GW of PV are almost surely in the pipeline, along with a gigawatt or two of geothermal and solar thermal.
For Cal-ISO, which finds room for all energy projects on the grid, the renewable “glut” is creating a problem: how seriously to take all of these suitors offering to meet California’s clean energy requirement.
If all of the 71 to 73 GW of renewable energy were to make it through all the roadblocks of getting financing, passing environmental reviews and local NIMBY objections, then far more transmission would have to be built than Cal-ISO has estimated.
Modeling need based on all the generation in the queue could lead to an inflated estimate of costs to reinforce the transmission system. Not every project makes it. But if a too low number for their success rate were estimated, then all that potential clean energy would be not utilized.
Only the most serious contenders are counted. As evidence of the seriousness of their intentions, at least half a million dollars must be posted as interconnection financial security for a project, representing not only the renewable project developer’s conviction that their project is going to be able to jump all the hurdles and get built, but also that they are willing to pay 15% of the cost to upgrade the grid to bring their energy to market.
And at $20,000 per megawatt in each project, these contenders are willing to pay over $7 million and much, much more for the privilege of helping add that grid infrastructure. What a problem for California to have, eh?