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Transmission, Renewables: Arranged Marriage, But at What Cost?

Dec 4, 2007 - NGI's Power Market Today

While technically and administratively California's grid can absorb renewable generation sources at the 20% level by 2010, according to a recently completed report by the California Independent System Operator (CAISO), how much the transformation will cost and who pays for it are still unknown, CAISO CEO Yakout Mansour said Monday during a news media briefing on the grid operator's new demand response lab

While the boost in renewables means a new paradigm for the grid, the CAISO report only assessed the practicality of absorbing the added renewable power and maintaining grid reliability; it specifically did not attempt to assess the economic feasibility or the projected added costs, Mansour said. That is left for subsequent studies, he said.

"The next stage is to figure out all of the exact costs of implementation [for transmission, demand response, etc.]," Mansour said. "What we can say quantitatively is that compared to the costs of the development the resources themselves [wind, solar, etc.], the cost of interconnection is a small fraction of that."

The latest report outlines the areas in which these added costs will be accumulated, focusing on five major areas:

Timely upgrades of transmission lines and interconnections as new renewable load is developed; Keeping the existing fleet of aging fossil fuel generation plants on-line and operable; Creating and marketing transmission products at fair prices to CAISO stakeholders; Development of more highly accurate wind forecasting; and Adjusting customer use patterns through demand response and other tools.

With its new testing lab, CAISO hopes to inspire more new technology and applications for demand response in both the commercial and residential sectors -- and do it all year long, not just in the midst of peak demand. The lab contains working systems for commercial demand response, a home network for Internet-based ways to turn off appliances, programmable heating/air conditioning thermostats, and utility products, such as a Pacific Gas and Electric Co. air conditioning recycling system.

"We also have technologies that can tell the individual customer how much power is available to be turned off at any given time and where it can be turned off," said Steve Berberich, CAISO's chief technology officer. "Specifically, we also want to demonstrate how these demand response measures work in the market in terms of the overall curbing of demand and payment to the customers in the voluntary programs."

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