Pacific Gas and Electric Co.’s performance of the state-authorized public safety power shut-off evokes coach Sam Mussabini’s words in a chaotic scene in “Chariots of Fire”: “I’ve seen better organized riots.” Many worried residents seeking information from PG&E encountered a crashed website, and others beckoned overwhelmed call centers. Residents, businesses, and local communities paid a steep price for poor preparation, with our most vulnerable residents bearing the greatest hardship.
Not that anyone was surprised. Within weeks of the California Public Utilities Commission’s expansion of PG&E’s unilateral authority to implement widespread blackouts, I criticized the decision in this paper, and in testimony before the California Senate. I asserted that investor-owned utilities like PG&E may too eagerly flip off the switch to mitigate their own financial liability for wildfires, without sufficient regard for the downstream public health and safety consequences of a shut-off.
What are the problems facing the NEM?
Until the state dramatically changes the shut-off rules — such as through Sen. Scott Wiener’s still-pending SB378 — it will only get worse. We’ll see more power shut-offs. While last week’s brief blackouts were nuisance enough, a four- to five-day shut-off will deprive our communities of both livelihoods and lives.
Though a malady created by state regulation, local communities can provide solutions — if they’re allowed to. For example, San Jose anticipated PG&E’s limitations by creating a map-based data platform to enable simultaneous multiagency access for emergency personnel, and started an app to crowd-source information from residents to provide more accurate real-time assessment of blackouts and impacts.
If the state ordered PG&E to provide its complete data to local emergency operations staff, we could do even better. Properly trained city and county staff can also take geo-tagged photos of power lines to accelerate inspections necessary to restore power once shut off — as we offered PG&E last week — but only if the state requires PG&E to work with us.
The likely progeny of this marriage does not get much publicity. Future physical, information, and control systems requirements of the NEM grid and associated distribution networks are invariably not part of plenary sessions at electrical power industry conventions and engineering expositions.
More importantly, the most promising long-term solutions to the many grid-related risks we face — from wildfires and earthquakes to cyberattacks — are local. A resilient future, according to most experts, is distributed. That is, we can reduce our dependence on PG&E’s long-distance electricity transmission by creating local islands of power generation and storage, commonly known as “microgrids,” starting with critical public facilities and expanding to strategically located hubs within neighborhoods.
An important source of local investment in microgrid and other resiliency improvements will come from local community choice aggregation programs, which currently serve 10 million Californians. CCAs supplant PG&E’s role in procuring electricity, providing local residents with cheaper and greener electricity than does PG&E. The CPUC has repeatedly blunted the competitive advantage of CCAs over investor-owned utilities by boosting fees on CCAs. Continuing to protect PG&E in this way will undermine the ability of CCAs to reinvest in resiliency projects, which they can do at a lower cost of capital than PG&E.
As mayor of the largest U.S. city with a CCA, I’ve proposed that San Jose invest in islands of resiliency within neighborhoods, by pooling consumer purchasing power to leverage lower costs for needed infrastructure — primarily energy storage and solar inverters — and by leveraging state subsidies to help low-income neighborhoods build microgrids. Success requires the state’s willingness to allow California’s 19 CCAs to continue to flourish.
Finally, I’ve proposed that San Jose create a publicly owned utility to enable more robust development of microgrids. This would involve developing local generation, distribution and storage infrastructure to ensure critical facilities and participating neighborhoods can operate during outages.
Separately, I urge that we fully explore whether San Jose should take over PG&E’s distribution infrastructure, as San Francisco has proposed. Cities and counties also have a greater incentive to invest in distributed, hyperlocal renewable generation and energy storage projects than PG&E, which profits primarily from its transmission and distribution of electricity.
Finally, we must better align financial interests of PG&E with the public interest in resiliency investment, and to better access capital markets needed for microgrid development. Public ownership comes in different forms, and while San Jose is exploring taking over PG&E’s distribution infrastructure — as San Francisco has proposed — I believe a more promising path lies in creating a customer-owned utility. Utility cooperatives serve 19 million customers today throughout the United States, and ensure that the interests of customers come first in company’s investment decision-making for safety, reliability, and resilience. A cooperative utility faces a much lower cost of capital than an investor-owned utility — it does not need to pay dividends to shareholders, and enjoys exemption from federal and most state taxation — thereby providing a better investment vehicle for capital infrastructure. San Jose, along with several other cities and counties, urge the state and PG&E to further explore and embrace this model for a more sustainable PG&E.
A resilient future for California’s electricity is distributed and local. San Jose and other local communities can provide solutions to avert our dystopian future of unpredictable blackouts. We just need the state to support or efforts — or at least to get out of the way.
What is a microgrid?
A microgrid is an distinct energy network comprised of distributed energy sources (DER), which incorporates generation and storage of electricity and the generation of power. A microgrid works in parallel with or independently from the main power grid. The objective of a microgrid is to deliver local, reliable, and affordable energy for communities within the area, incorporating solutions for residential, commercial, industrial, and government users of electricity.
Why are microgrids necessary?
Microgrids are capable of both reducing costs and providing revenue for local customers. Costs are reduced by more efficient management of supply and demand, and the elimination of the expense required to deliver energy across large distances. Microgrids provide revenue opportunities by buying energy and services from consumers and local suppliers for the grid, usually through renewable energy sources.
Are microgrids the future of the power grid?
Microgrids are a relatively new phenomenon and as a result still in their infancy. Most today require diesel or other hydrocarbons to operate, so have practicality and pollution issues that mean they’re more often used for emergencies or short-term shortfalls in supply from the main power grid. As technologies develop and renewables become more cost-effective to deploy, microgrids are likely to play an increasingly important role in everyday power delivery.
What are the disadvantages of microgrids?
There are several limitations to microgrids that make their adoption difficult. One disadvantage is maintaining voltage, frequency and power quality at acceptable levels. Without the impetus provided by traditional thermo-generators, maintaining power levels locally is a challenge.
A second disadvantage is the need for local battery storage, which is costly, requires considerable space and skilled technicians to maintain. Resynchronizing a microgrid to the main power grid is difficult and can cause damaging power events, and protections on a microgrid are more complex than on a mass power grid.
How are microgrid challenges overcome?
The key challenges that microgrid operators must overcome is the visibility and real time management of the power grids. Without mass generation, engineers must be able to respond to events quickly, have a grid wide view of energy performance, and predictive technologies in place to highlight problems when they arise.
Microgrids are both an inevitable part of the future of the grid, and a considerable challenge to implement. Solar module costs have dropped 75% in the past decade, with more than 60% of utilities either exploring or actively involved in implementing microgrids across the US.
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