California businesses should get paid for ‘negawatts’ to solve energy crunch

With fires burning across the state, and public safety power shutoffs back on the table, Californians are still wondering what led to rolling blackouts in August. Due to record-breaking heat and high demand, utilities shut power off for up to two million people, not as a way to prevent fires, but as a response to high electricity demand.

Some people have pointed the finger at the increased reliance on wind and solar for California’s inability to meet its peak energy demands.

But this is simply not the case. The state’s grid managers are aware, for example, that the sun sets every evening and that phenomenon is factored into the planning. There are technical solutions to this problem that need to be implemented, such as vastly expanding our energy storage capacity. These have been discussed previously in this column.

But there is something much simpler and less expensive that we can do now. We need to supplement our megawatts with “negawatts.”

California has sufficient energy to meet peak demand, and as the current explosion of fires around the West reminds us, the last thing we should be doing is reverting to old polluting technologies that exacerbate the problem. We must continue to build out our clean energy infrastructure, but we must also get smarter about how we use our power.

The three main California energy agencies said it loud and clear in a letter to the governor and the legislature dated Aug. 19: “Renewable energy did not cause the rotating outages.” It is clear that California’s climate policies and clean energy goals did not cause the outages. So let’s try and understand what did.

At the core of our problem is the 20th century mentality that the main mission of energy system planners is to constantly increase supply to meet demand.

Fortunately, there is another path.

A reliable 21st-century energy system must include attention on the demand side.

In other words, the old adage “a penny saved is a penny earned” turns out to apply equally to kilowatts as pennies. We can do much better than simply sending out alerts begging residents and businesses to ramp down their use!

We have the technology to automate such throttling. What we need is aggregated and automated demand response. We have the technology to automate reductions in electricity use at critical times in ways that don’t interfere with customer comfort. All that is needed are pre-agreements with customers, particularly heavy-load commercial and industrial customers, so that power can be made available when needed.

In Sonoma County, we are already doing this with residential electrical loads through Sonoma Clean Power’s GridSavvy program. It allows our power provider to dial back the amount of electricity going into electric car charging and other domestic electrical applications when demand is high.

The customers that participate in the Gridsavvy program play a key role in helping manage the electrical load in ways that help avoid the need for rolling blackouts during heatwaves and other periods of high electricity demand.

As outlined in this Inside Climate News article, we can “unobtrusively reduce customers’ electricity use during times of crisis so that the system remains stable, and maybe even get paid to allow it.” That is exactly what the GridSavvy program is starting to do.

Local businesses can also play a critical role.

Mark Soiland, owner of Stony Point Rock Quarry and Grab n Grow soil products, says: “As a business owner, I have participated in demand response in the past, and I can tell you that we are always glad to do our part to reduce our operations in times of high demand. If we can be fairly compensated for allowing that reduction in our demand, that makes it even better.”

Instead of just building more megawatts of supply, we should be equally focused on creating negawatts, which is power demand that has been negated or deferred. Estimates of what demand response could supply in the form of negawatts far exceed the shortfall that we just experienced.

In 2009 the Federal Energy Regulatory Commission produced a national assessment and found California had a potential for over 4 gigawatts of demand response, which is four times greater than the anticipated shortfall that led to the rotating outages in August. And that is not taking into account the prospect of compensating customers for their participation.

It is high time that we get on with the business of tapping these highly effective strategies.

“At the end of the day,” says Soiland, “If we create incentives for people and businesses to do what’s right, then we can come together and solve our problems”

The dramatic climate impacts we are seeing right now here in California are further evidence of the urgency to act on the climate crisis. The Climate Center is working with multiple partners to implement these and other policies needed to secure an equitable, healthy, and climate-safe future for all.