Several environmental groups – including the Sierra Club, Public Citizen and Environment Texas – have petitioned the Public Utility Commission of Texas to pass new rules calling for more development of non-wind renewable energy in the state.
The petition, filed with the commission on Sept. 12, asks for amendments to the commission’s existing Goal for Renewable Energy. This regulation, adopted by the commission as required by the Texas Public Utility Regulatory Act (PURA), reflects the Texas Legislature’s command to the commission to promote renewable energy development in Texas as an essential component of long-term energy resource adequacy, reliability, and consumer choice, the petition noted.
The purpose of the amendments proposed by those groups is to further implement the Legislature’s intent to advance non-wind renewable energy technologies in the state by strengthening the renewable portfolio standard (RPS) for non-wind resources such as solar, geothermal, and hydroelectric.
First, these amendments implement the target for non-wind renewable resources to achieve at least 500 MW by 2015, and then expand this target to 3,000 MW by 2025, the groups said. Second, these amendments will ensure that the 3,000 MW target is achieved by allocating responsibility for meeting the 3,000 MW target in the same way that the PUC has effectively done for the higher target for total renewable resources. At the same time, these amendments will establish alternative compliance payments, as authorized in 2007 in HB 1090, to provide program participants with flexibility and to bring these non-wind renewable resources online cost-effectively, the groups wrote.
“The Commission has the authority, and legislative mandate, to take the actions requested in this petition to encourage development of renewable energy resources and should do so as a matter of good policy set forth by the Legislature,” the petition argued. “Encouraging these resources will help alleviate the state’s energy resource adequacy challenges and will comply with the Legislature’s direction to take affirmative steps to encourage the development of cost-effective, reliable energy resources without exacerbating the state’s water crisis. Moreover, thousands of Texas citizens have expressed support for PUC action to increase the amount of non-wind renewable energy resources in the state.”
The commission and the Electric Reliability Council of Texas (ERCOT) have recently expressed serious concerns about the adequacy of energy resources available to meet the state’s growing demand, the petition noted. The commission recently sponsored a study from the Brattle Group of the factors influencing investment in new energy production, and formulating recommendations for policy mechanisms to “enhance favorable investment outcomes for long-term resource adequacy in ERCOT.”
ERCOT President and CEO H.P. “Trip” Doggett recently gave a presentation illustrating how increased solar development could help ERCOT meet its target reserve margin over the next decade, the groups said. “Solar energy, in particular, is well suited to fill the state’s resource adequacy needs,” they added. “Solar output peaks at the same time that electricity demand is highest in Texas – hot, sunny days. This has two key benefits. First, the coincidence of solar generation and consumer demand enhances the reliability of the ERCOT grid and helps to avoid rolling blackouts. In addition, the peaking nature of solar will reduce energy costs for Texas consumers by increasing the available capacity that can come online quickly during the hottest periods.”
The Brattle Group evaluated how adding different quantities of solar resources to the supply mix would affect energy prices during the highest demand season. This study shows that adding 1,000 MW of solar PV could have reduced average wholesale energy prices by about 60 cents per megawatt-hour (MWh), that adding 2,500 MW of solar PV would have reduced prices by $1.50 per MWh; and that 5,000 MW of solar would have nearly doubled those savings to $2.90 per MWh, the groups said.
Petitioners point out that solar is relatively quick to install
Solar can be developed and deployed more quickly and flexibly than many conventional generation technologies, the petition said. “The development timeline for solar (photovoltaic, in particular) is much faster than most other generation sources, some of which can take at least 18 months to construct,” it said. “In fact, at a recent forum in San Antonio sponsored by Solar San Antonio, Cris Eugster, representing CPS Energy, noted that the 45 MWs of utility-scale solar energy the municipal utility added in 2011 and 2012 was installed and came online within six months of when final contracting was signed. In addition, solar is easily scalable and therefore can expand at a particular location as demand increases.”
Texas has already invested significant resources in the transmission infrastructure necessary to develop the state’s Competitive Renewable Energy Zones (CREZ), the petition pointed out. Development of solar will maximize the CREZ investment, since solar generation occurs during the daytime when the wind tends to ebb, the groups argued.
Texas, a very sunny state, has vast potential for solar energy development, the petition said. In a July 2012 report by the National Renewable Energy Laboratories (NREL), Texas was identified as having the highest potential for both urban and rural utility-scale solar photovoltaic development, at an astounding 154 GW and 20,411 GW, respectively, it added. This is consistent with the conclusion of the State Energy Conservation Office in a 2008 study, that the “recoverable energy [from solar] is many times greater than the state’s total energy demand.”
Although the PUC has given effect to the Legislature’s overall renewable energy goal, it has not yet fully implemented the non-wind renewable target also mandated by the Legislature, the petition said. In 1999, the Texas Legislature amended the Public Utilities Regulatory Act to add the Goal for Renewable Energy. That section, as amended in 2005 and 2007, states: “It is the intent of the legislature that by January 1, 2015, an additional 5,000 megawatts of generating capacity from renewable energy technologies will have been installed in this state. The cumulative installed renewable capacity in this state shall total 5,880 megawatts by January 1, 2015, and the commission shall establish a target of 10,000 megawatts of installed renewable capacity by January 1, 2025. … Of the renewable energy technology generating capacity installed to meet the goal of this subsection after September 1, 2005, the commission shall establish a target of having at least 500 megawatts of capacity from a renewable energy technology other than a source using wind energy.”