Renewables Curtailment: What We Can Learn From Grid Operations in California and the Midwest

SmartGridAmerica’s electric grid is undergoing rapid metamorphosis as wind and solar become a significant part of the system: Half of all new generation capacity added in 2014 was from renewables. Nearly 7 gigawatts of solar were installedin 2014 to reach just under 20 gigawatts of cumulative capacity, and 4.7 gigawatts of wind were installed in 2014, pushing total onshore capacity over 64 gigawatts.

But this renewables influx is entering a system designed for very different resources. As low-cost wind and solar evolve to provide more and more electricity, grid operations, power markets and financial structures must evolve along with them.

Some organized markets already have begun transitioning, and while these varied changes reflect different market conditions, the results are similar: increases revenue stability and lower risk for developers. Comparing how contracts and markets are evolving in two parts of the country, California and the Midwest, sheds light on changes that will be necessary as renewables begin to form the core of our electricity mix.

 




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