Tuesday, September 17, 2019
Monday, September 16, 2019
Texas has the most wind capacity of any state, generating about 16 percent of its electricity from wind. In August, as temperatures rose to over 100 degrees and consumers increased their use of air conditioning, Texas’s grid operators struggled to meet the record demand for electricity. Many of the wind turbines could not operate because the wind was stagnant, a common occurrence on very hot days. As a result, energy costs skyrocketed. In Houston, wholesale power prices spiked 49,000 percent (to $9,000 per megawatt-hour). The Electric Reliability Council of Texas (ERCOT) warned that reserve margins were so low that it might have to institute rolling blackouts. The independent system operator called for the construction of more gas-fired generating plants.
Facing its second consecutive year of strain on its grid, ERCOT mandated all available power plants to run flat-out, called on factories to cut power consumption, and imported electricity from Mexico.
Power reserve margins were so thin that increments of just tens of megawatts were available to meet demand. The state called the first of its three levels of emergency and hit its market price cap of $9,000 per megawatt hour to avoid rolling brown-outs. According to ERCOT, if one of the state’s large natural gas plants had gone offline when reserve margins were thin, rolling blackouts might have been unavoidable.
Texas has a deregulated power market in which competition holds down power costs unless demand is high and then spot prices skyrocket. Texas prepared for the hot weather this summer, allowing generators to request permission to disregard air regulations, ordering all generation assets to be available and importing power from the neighboring Southwest Power Pool market.
August 13 and 15 were the toughest days because most of the state’s 26 gigawatts of wind capacity were becalmed in the mid-afternoon, and a few power plants, that had been running flat-out for days began to fail from the high temperatures that increased demand across the state. As wind power slowed, ERCOT instituted its first level of emergency alerts, calling on small industrial and commercial generators to pour power onto the grid, and requesting power from Mexico from which an additional 60 megawatts were imported on August 15. Installed capacity numbers for electricity from intermittent sources such as wind and solar mean very little when they fail to produce as wind did in the middle of the hot Texas summer.
ERCOT did not need to institute rolling brownouts since the situation did not escalate beyond the second level of emergency alert in which it would call on about 1,100 megawatts of load to drop off the system.
The Texas power market does not include a capacity market that pays generators to keep power plants available. As inexpensive natural gas and subsidized renewable power pushed down power prices, coal’s market share dipped below that of natural gas and wind. Last year alone, the state retired more than 4 gigawatts of coal-fired capacity, or almost 70 times as much power as was purchased from Mexico on August 15.
The situation may get more dire as additional wind farms are being built. Facebook recently announced a deal in Texas to buy power from the largest single-site wind farm in the country. The power purchase agreement will obtain power from the 200-megawatt Aviator Wind East project, which is scheduled to come online in 2020 in Coke County, Texas. The Aviator East initiative is part of a larger 525-megawatt project. While there are larger U.S. wind farms, those have typically been built in phases, not in the single-phase construction planned for Aviator Wind East.
Texas’s 100-Percent Renewable Experiment
Last October, Georgetown, Texas obtained a $1 million grant from former New York City Mayor Michael Bloomberg’s nonprofit, Bloomberg Philanthropies, in which the city planned to obtain 100 percent of its electricity from wind and solar power. The grant’s only real requirement, however, was that the city serve as a public relations platform to convince Americans to abandon fossil fuels and switch to renewable energy. The town’s politicians promised that the renewable energy would be cheaper. But, as more wind and solar power displaced natural gas, electricity bills went up.
The city’s municipal utility now has a $7 million shortfall that has to be made up by the city’s consumers through higher electricity bills. Embarrassed, the City Council voted 5-0 to kill the Bloomberg PR deal. It also raised property taxes.
As part of the Bloomberg agreement, Georgetown was planning to install solar panels on homes and obtain a battery storage farm to store electricity when wind and solar power were not available. For Georgetown to be 100-percent renewable using today’s state-of-the-art batteries from Tesla’s Gigafactory, the city would need a $400 million battery farm weighing some 20,000 tons to avoid a blackout. And, after spending $15,600 for each household for such a battery farm, its backup power would be drained in 12 hours with a single windless night.
The close call in Texas in mid-August should be a lesson for ERCOT to rethink how it is valuing dispatchable, baseload power. The addition of more intermittent capacity to the market will likely make the reliability challenges Texas is facing only more difficult to manage. Further, the 100-percent renewable goal that several states have instituted should be viewed as a farce as the City of Georgetown recently discovered.
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Solar Energy International (SEI) awarded grant from the Western Colorado Community Foundation for sustainability upgrades on campus
The $5k prize will go toward a greener educational experience at SEI’s Paonia headquarters
Paonia, CO– Solar Energy International (SEI) was chosen as a recipient of Western Colorado Community Foundation (WCCF)’s 2019 Environment grant, and the $5,000 will be put toward “reduce, reuse and recycle” efforts in their Paonia-based industry-leading lab yard.
SEI is one of the longest running and most widely recognized technical solar training organizations in the industry. Over 70,000 alumni worldwide have been through SEI trainings, and SEI’s alumni network has been involved in approximately 10 percent of global solar systems. New sustainability upgrades on campus will further support SEI’s core mission of sustainability and “a world powered by renewable energy.”
Some of the upgrades students can expect to see are iPads in lieu of paper-bound notebooks, hand dryers in the student lounge and commercial composting systems.
“We’re so grateful for the generous award from the Western Colorado Community Foundation,” Kathy Swartz, SEI Executive Director said. “As a global leader in renewable energy training SEI strives to practice sustainable practices in every aspect of our organization. These upgrades will be a wonderful improvement to the lab training experience.”
SEI is one of the greenest campuses in the world. With around 28 kW of operational PV on campus (with the latest addition of a 10 kW carport not included) SEI generates 125% of their annual consumption, in addition to multiple free electric vehicle chargers on campus. The WCCF grant will help SEI continue to lead the way as an exemplary educational institution in solar energy and sustainability.
About Solar Energy International (SEI)– SEI was founded in 1991 as a nonprofit educational organization with the mission to provide industry-leading technical training and expertise in renewable energy to empower people, communities and businesses worldwide. SEI envisions a world powered by renewable energy.
About Western Colorado Community Foundation – The Western Colorado Community Foundation (WCCF) works with community-minded donors who share a connection with western Colorado, the place where they call home. WCCF is a collection of many different charitable funds – over 250 – each separately accounted for and with its own purpose as described by the donors who establish the funds. Through these funds, WCCF annually awards over $3 million in grants and scholarships throughout the seven counties.
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Friday, September 13, 2019
Walmart is suing Tesla alleging that some of the company’s solar panels sparked roof fires at several of its locations. According to Walmart, Tesla’s solar panels were responsible for at least seven fires that destroyed significant amounts of store merchandise and necessitated substantial repairs to buildings, costing hundreds of thousands of dollars. Walmart wants Tesla to remove the panels from over 240 Walmart store roofs and cover the costs. Walmart’s push for solar power generation on its store roofs dates back more than a decade, and was announced with much fanfare. Similarly, Amazon alleges a June 2018 blaze on one of its warehouse roofs involved a solar panel that Tesla had installed. Unlike Walmart, Amazon only has a very small number of solar systems installed by Tesla. Both companies want their solar systems to operate reliably, efficiently, and safely.
The Walmart Filing
According to Walmart’s filing, some of the problems with the panels stemmed from a rushed approach to the system’s installation and inspection of panels by Tesla personnel, who lacked basic solar training and knowledge. According to Walmart, its own inspectors observed negligent and dangerous wire connection practices that were readily apparent at many of the sites inspected and are a risk factor in contributing to fires. Walmart indicated it began using solar panels made by Solar City in 2010, before Tesla acquired it in 2016.
Tesla and Solar City
Tesla bought the Buffalo factory’s main tenant, SolarCity, for almost $5 billion in 2016, accepting $750 million from New York as part of its Buffalo Billion program to revitalize upstate New York—$350 million to build a factory and another $400 million on equipment specified by SolarCity. SolarCity would get a 10-year lease on the facility for $1 a year. Tesla promised to employ at least 1,460 people in “high-tech” jobs at the factory, hire another 2,000 to support the sale and installation of solar panels in New York, and help attract an additional 1,440 “support jobs” in the state. Once it achieved full production, the company pledged, it would spend around $5 billion in New York over the following decade. Tesla’s plan was to turn the plant in Buffalo into “the largest manufacturing facility of its kind in the Western Hemisphere.” Tesla’s SolarCity would build 10,000 solar panels per day and install them on homes and businesses across the country, creating 5,000 jobs in a depressed area.
The initial idea for SolarCity was not to be a manufacturer but rather to control the entire consumer experience, from sale to installation, thereby driving down costs. For a time, SolarCity was a hot stock, growing almost tenfold from its public offering in 2012 to its peak in early 2014. SolarCity’s business model was to front the costs of installing solar panels and allow homeowners to pay over time, which required raising money from outside investors, often big banks, who were then entitled to the first portion of the payments homeowners made. As SolarCity struggled to raise money from institutional investors, it began offering individuals a chance to buy Solar Bonds.
The company initially imported most of its solar panels from China. But, by 2014, it looked like demand would soon outpace supply. As a result, the board decided that SolarCity needed to make its own panels, which was a major shift in its business model because installing and selling solar has little to do with manufacturing it.
In June 2014, SolarCity bought Silevo, a solar-panel manufacturer that had struck a deal with New York to build a factory in Buffalo. The deal was expected to enable SolarCity to install tens of gigawatts of panels every year—far beyond the company’s peak annual rate of about one gigawatt. On its website, SolarCity predicted it would “achieve a breakthrough” in solar-power pricing thanks to “massive economies of scale.”
In May 2016, the Tesla board agreed to acquire the company for almost $5 billion, including the assumption of nearly $3 billion in SolarCity debt. At that time, the cost per watt of solar modules being produced in the Buffalo plant was projected to be 20 cents above the cost of the rest of the industry.
On October 28, 2016, just before shareholders were set to vote on the acquisition of SolarCity, Elon Musk introduced a new product called the Solar Roof—shingles he claimed would last longer and cost less than a regular roof, even before factoring in electricity. In early 2018, the company announced that production of the Solar Roof had begun in Buffalo. Last May, an investigation by Reuters, however, found that most of the solar cells produced in Buffalo were sold overseas, and not used in the Solar Roof, because demand was low.
In the meantime, N.Y. state officials had issued a series of 10 amendments that watered down the requirements SolarCity must meet in exchange for the $1 lease on the Buffalo factory. The 1,460 “high-tech” jobs at the factory and the 2,000 jobs to support solar sales and installation in New York were defined simply as jobs. The agreement to employ 900 people at the factory within two years was reduced to 500. And the timing for the additional jobs was extended to 10 years after the factory was completed—at which point the lease would also expire.
More trouble is brewing for Tesla, however, than just the filings for the fires. By next April, Tesla is required to start paying an annual fine of $41.2 million if it does not employ 1,460 people in Buffalo. Tesla says it currently has 636 employees statewide in New York, including 329 at the plant, and that it has invested almost $400 million in New York.
After acquiring SolarCity, Tesla sold and leased solar panels in Tesla showrooms, with the leases extending 10 to 20 years. Afterward, Tesla promoted sales as opposed to leases. Tesla recently announced that it would rent solar panels to homeowners in Arizona, California, Connecticut, Massachusetts, New Jersey, and New Mexico.
SolarCity was the top U.S. residential solar installer at one time, but, in the first quarter of 2019, Tesla ranked number 3 with a 6.3 percent share.
The SolarCity gamble may not pan out for Tesla, as the filings by Walmart and Amazon can attest to, and may not meet the demands of New York regarding jobs. How that will affect the company overall is yet to be seen.
The post Walmart and Amazon Sue Tesla, Solar Panels Blamed for Fires appeared first on IER.