On November 13, 2014, the American Council on Renewable Energy (ACORE), held the panel event “Renewable Energy at Scale in the U.S. and Europe: Lessons Learned and Best Practices,” in collaboration with the Transatlantic Climate Bridge and hosted by the German Embassy in Washington, D.C. The discussion continued the dialogue from an earlier event, “Energy Transitions in Germany and the United States.” In addition to discussing market aspects of renewables (see related blog), participants highlighted another key to clean growth: the broad dispersal of renewables. Surprisingly simple, it is a key step to make renewables the power sources of choice, especially if done along several dimensions.
Distributing renewable power generation geographically helps to average out local fluctuations in wind and sunlight. In the U.S. state of Iowa, a nationwide leader in renewables, wind energy has reached 27.4 percent of statewide electricity generation. Key to this is the distribution of wind farms across most of the state’s more than 56,000 square miles (145,000 square kilometers). This enables high wind speeds in some counties to compensate for lower wind speeds in others, yielding steadier total electricity production than would be possible if all turbines were placed in a single location. Furthermore, the wind industry´s production and manufacturing businesses, located near several population centers, are helping to broadly distribute the benefits of a clean economy to Iowa’s populace.
Iowa’s Wind Farms and Wind-Related Businesses
Credit: American Wind Energy Association
In addition, using a diversity of technologies helps different renewable energy sources complement one another, such as wind power compensating for the lack of solar energy at night or reduced output on cloudy days. Biomass deserves particular attention in this regard. In 2013, in addition to its use in heat generation, biomass provided 31.4 percent of renewable electricity in Germany, and 24.7 percent in the United States—less than wind energy, but more than solar.
Biomass can be stored, and biomass plants can be ramped up and down. As a consequence, these plants can be used for distributed generation as well as to back up other renewables when needed, making them suited for providing base load power. The result: Clean energy does not need dirty fossil fuels or dangerous nuclear plants to supply 100% power reliably.
Spreading generation out across large numbers of distributed generators helps to further stabilize production. The German startup Next Kraftwerke aggregates and sells 1 gigawatt of renewable capacity from some 2,500 different generators into a “virtual power plant” (VPP). Using advanced and standardized control electronics, and without owning any of the generation itself, the company operates this swarm of generators like a school of fish: if one “fish” malfunctions, the others cover for it. Curtailment or adjustment of production—for example, using biomass units—is needed only when short-term trading is insufficient to match demand and supply on the market.
Dispersion across a large and well-connected network is instrumental for integrating high shares of renewables into the grid. Because storage technology is progressing, but still not fully sufficient, grid operators with the ability to dispatch power automatically and on short notice are critical to help balance demand and supply. Iowa, for example, is administered by the Midcontinent Independent System Operator (MISO), whose footprint also covers many neighboring states. Collaboration between MISO and California’s large and advanced operator, CISO, expands the network, easing the distribution of clean power.
In Europe, grid upgrades and interconnections are helping countries dispatch and use clean power, such as wind power in Germany and Poland. To streamline this activity, participants at the panel event suggested creating a future central transaction platform for power markets. In Italy, grid upgrades have reportedly reduced curtailments of renewable generation, which previously were necessary because of the lack of dispatching options for local clean energy surpluses. Curtailments are down from 10 percent of renewable generation in 2009 to only 1.8 percent today, contributing to Italy’s success in achieving a more than 30% renewable share in total electricity production.
As distributed generation grows, flowing through smarter grids and across borders, it is sweeping away the business model of legacy utilities. Feeding power to consumers and exchanging information via monthly bills is being replaced with a continuous, bidirectional flow of power and data between professional service providers and self-producing consumers (“prosumers”). The future role of utilities is as energy integrators, tasked with providing ancillary services such as automated voltage and frequency control, forecasting and analytics, and rapid dispatching.
In November 2014, one of Germany’s big four energy giants, E.on, announced plans to abandon its fossil fuel and nuclear business and focus on renewables and services. The company says it has been priced out of the market by clean energy and lower energy prices on the stock market, resulting in lost profitability for conventional power suppliers.
Business models for services, as well as for grid maintenance and backup capacity, are in their infancy. Although abundant ideas exist, new models still need to be tested in reality. Still, the many success stories clearly demonstrate the feasibility of distributing clean energy benefits.