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Power Politics The Smart Energy Plan 2020 increases reliability and security while decreasing costs and environmental impacts. Why isn’t it getting traction with politicians? Follow the money. |
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San Diego Smart Energy 2020: The 21st Century Alternative,” is a comprehensive, peer-reviewed plan to provide clean, reliable, affordable energy for San Diego. Prepared by professional engineer Bill Powers and E-Tech International, this “Smart Energy Plan” (SEP) would not only save consumers money, it reduces San Diego’s greenhouse gas emissions by 4.5 million tons of CO2 compared to San Diego Gas & Electric’s plan. SDG&E and their supporters at the Federal Regulatory Energy Commission (FERC - remember them? The ones who allowed Enron to manipulate our energy markets and led to blackouts?) want us to think there’s only one way to solve our region’s energy equation: more transmission lines across miles of unsecured, wildfire-prone areas. The truth is that there are many sound solutions to meeting our energy needs that are less expensive, more reliable, and friendlier to the environment than the SDG&E mega-project called, in classic green-washing terms, the Sunrise Powerlink. The only drawback with the other solutions: they don’t earn a large profit for SDG&E and its parent corporation, Sempra.
History You can’t separate the proposal from the parent company and all their activities. The Sempra Powerlink proposal has been around for a long time as part of a proposal to connect Imperial County into the Southern Cal Edison power grid. But it has morphed into a proposal to bring it into San Diego. The ultimate destination for the Powerlink is the Los Angeles area but that part of the proposal is not commonly discussed in San Diego since they divided the project into the Sunrise Powerlink as Phase 1. Phase 2 is to get it up into L.A. The biggest obstacle to all these public benefits is the existing profit model for the utilities. Basically, utilities have been cost-plus operations. The higher they drive their costs, the higher they drive their profits. They are more than happy to have high costs that go into their base. In one sense, what the SEP is asking is for them to shoot themselves in the foot by reducing their costs, since they get 10% on top of their costs. That reduces their profits. So from that angle, no matter what the public benefits of another approach are, the financial guy in the back room is saying, forget it. They can’t make as much money doing local solar and efficiency. What’s a greener future? Every proposal in the SEP is cost effective. One of the key premises is to avoid ratepayer increases. Another key premise is that each part must be doable. The SEP stays within the known world. It’s all been done somewhere else already at each proposed level. The SEP in a nutshell finds we can achieve:
The PV part of the plan presumes we get to 20% by 2013 because we already have a legislative mandate for that. From that point forward, the SEP is based on adding primarily commercial large systems in the urban and suburban areas on non-controversial sites – on rooftops and parking lots – so you avoid environmental conflicts. You don’t even need to do Environmental Quality Act review, so you can avoid the biggest show-stopper of any major infrastructure project.
A regional energy strategy The SEP is consistent with both California’s energy and global warming mandates and San Diego’s Regional Energy Strategy. The California Energy Commission (CEC) “Loading Order” ranks new sources of supplies as follows: 1. Energy Efficiency 2. Renewable energy … and only then … 3. Traditional power plants and transmission infrastructure There was a lot of community unrest and interest in forming our own energy plan out of concern for the performance of utilities during the “energy crisis.” Out of that came the SD Regional Energy Strategy (SDRES). It predates the energy plan at the State level, but tracks the loading order. Instead of importing more energy, it proposes that we generate more local energy to maximize reliability of the system, whether it’s fossil-fired or renewable. Business as usual While the Powerlink approach ranks last according to the loading order, and is consistent with many of the goals of the SDRES, somehow now the project is first. The expert Energy Working Group at SANDAG (San Diego Regional Association of Governments) voted 10-5 that the Powerlink proposal was not consistent with the Regional Energy Strategy. But when their recommendation went before a SANDAG Board of elected officials, it was ignored. SANDAG has no conflict-of-interest rules that required those Committee members to recuse themselves if they had already taken a position on the project. Four out of six of the members of that Committee had already supported the Powerlink based on the PR efforts of SDG&E and declined to consider any of the arguments made by the public or supported by the SEP. You pay, they make money A major issue is the cost of the Powerlink: $1.3 to 1.4 billion financed over 40 years, for a total cost in 2010 dollars to ratepayers (that’s you!) of $7 billion. Utility incentives have been oriented toward hardware. The ratepayers pay for it and it’s the highest revenue generator with the highest profit margin. Power plants are also big moneymakers, while conservation and efficiency that reduce demand and save consumer money have a hard time competing. Can we avoid the costs of the proposed Powerlink? The Powerlink is proposed to cost $7 billion over 40 years. Can we put in 2,000 MW peak of PV in this region for less than that? First, we already have the California Solar Initiative that is targeting 3,000 MW by 2017 - and the SEP is a smaller program than that. Germany amazingly put in 1,000MW of PV in 2006. So it can be done, but why does solar power look more expensive? When you consider conventional generation and compare the prices of solar PV ($4/watt) to a combined natural gas plant ($1/watt), at first glance it seems cheaper. But with gas-fired systems all your money later goes into the fuel, while the sun energy is free, and at the same time reduces dependence on foreign imports and volatile fossil fuel prices.
Blackouts and firestorms The PV in the SEP would be equipped with battery support to address a utility complaint that its peak power generation (at the same time as peak demand) is not trapped. So by adding 3 hours of battery storage, you could shift the peak as needed; if you have a fire then you have some capacity in the system. We know firestorms may start somewhere in the County and the winds whip it west. We know it will cut across the transmission lines. During the Witch Fire this year, when both the existing SW Powerlink and the I-5 lines were cut at the same time, and we had no other imports, we got power from Mexico. We were lucky the power was available, due to the time of year. Another benefit of the SEP is that it concentrates power generation locally and reduces blackout possibilities. In 2007 we imported 67% of our power. With the addition of another transmission line, that would go up, increasing our dependence on imports and reducing our local energy reliability and security. Land use issues The SEP is based on the least-conflict ways to create energy. The SEP reduces conflicts through good planning. One of the conflict issues is when you have a platoon of renewable energy promoters scouring the back country looking for sites for wind transmission and scaring people who want to keep their views clear. The SEP idea is to design a system that places renewable sites along existing highways and transmission corridors - already industrialized land. Adding watts of local power is completely complementary to doing large renewable projects remotely. Why is that? The best and quickest way to get more renewable power to urban areas is to free up the existing transmission lines so you can put the remote renewable power on them. Too many are buying into the utility argument that all of that capacity is already allocated. The whole idea of the SEP is to displace the conventional resources with renewable resources. For each MW of local distributed generation we build, either PV or combined heat and power, we free up 1 MW of import capability on existing transmission lines. We should be doing lots of local distributed generation to free up the existing lines to avoid the inevitable controversy that is generated by big power lines in sensitive areas. It cannot be emphasized enough that you cannot accept the utility assumptions that the transmission lines aren’t available. The bottom line is to understand everyone’s motivation, because the utilities make the most money from transmission. It’s that simple. They are trying to do what makes them the most profit, not what provide ratepayers and the region the most security, reliability, renewable energy and savings. What’s next? The SEP is a good way to do it, but it’s not the only way. The challenges are not technical! This is a hearts-and-minds institutional situation. There are certain things that have been in motion for a century. A smart energy future requires changing them. The CPUC has done a very good job in their environmental assessment. The EA concluded the worst option is the Sunrise Powerlink. The #1 most environmentally friendly would be a mix of gas-fired and renewable projects right here – as proposed in the SEP. |
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This article is based on a presentation by Bill Powers to the San Diego Renewable Energy Society. To see the presentation, slides and notes online, visit video.google.com/videoplay?docid=3142342722597645584&h1=01. To read the Smart Energy Plan, see: www.sdsmartenergy.org. |
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