Community Microgrid alternatives to gas peaker plants

Image of microgrid courtesy of UC San Diego

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Can Community Microgrids powered by solar+storage replace gas peaker plants? Recent analyses show that the answer is yes. What’s more, solar+storage facilities can be deployed more quickly than gas plants, at a significantly lower price.

Community Microgrids are technically and economically superior to new gas plants. Community Microgrids also provide other advantages, delivering an unparalleled trifecta of economic, environmental, and resilience benefits.

Case study: Puente and Ellwood

In 2017, the Clean Coalition released a study showing that installing solar+storage would be cheaper than undertaking two gas plant projects in California: building the new Puente Power Project and the refurbishing the existing Ellwood Peaker Plant.

The projects are both part of the Moorpark Subarea, which includes the cities of Oxnard, Santa Barbara, and Goleta. They were designed to meet 2,000 megawatts (MW) of local electricity capacity requirements that are currently served by power plants slated to be retired at the end of 2020.

The Clean Coalition leveraged its unique policy, technical, and economic expertise to model realistic alternatives to the Puente and Ellwood plants. The models show that a Community Microgrid powered by solar+storage could be installed for $267 million, compared to $299 million for the Puente proposal. A Community Microgrid powered by solar+storage could replace both Puente and Ellwood for approximately $406 million.

These costs are far lower than those estimated by the California Independent System Operator (CAISO), which used 2014 prices for energy storage, modeled a storage-only solution, not including solar, and overestimated costs for demand response.

Operations, maintenance, and fuel are expected to run about $19 million per year for Puente based on current costs, making it about twice as expensive as a solar+storage design. Accounting for these costs would raise the total cost of Puente to over $870 million over thirty years. A comparable calculation for a solar+storage facility would run about $462 million — and the only “fuel” costs associated with storage are round-trip inefficiencies, which are minor compared to a peaker plant burning natural gas. Including the health, mortality, and social costs of carbon from the natural gas plant would increase the cost of Puente and Ellwood dramatically.

More information on Puente and Ellwood, including regulatory filings, media coverage, and solar+storage models.

Bringing solar+storage Community Microgrids online quickly

Solar+storage solutions can be deployed more quickly than gas peaker plants. The most effective way to hasten solar+storage deployment is by means of a CLEAN Program with a feed-in tariff (FIT).

The Clean Coalition has designed a game-changing feed-in tariff (FIT) that includes a Market Responsive Pricing mechanism to ensure the best value for ratepayers, along with a Dispatchability Adder to incentivize energy storage. This innovative FIT is designed to procure and deploy cost-effective renewables and energy storage much more quickly than auction processes, which are burdened by excessive preparation requirements, transaction costs, and failure rates. And a FIT approach is far faster than building a gas plant.

Image source: Sacramento Municipal Utility District

Sacramento Municipal Utility District (SMUD) has already shown this can be done. SMUD launched a FIT in 2010 to develop 100 MW of distributed solar. Within two years, over 98% of the 100 MW of FIT program capacity was successfully constructed and online.

Examples of solar+storage solutions

Solar+storage solutions are already in place and proving to be cost-effective.

Tesla’s 17 MW solar + 52 MWh storage facility on Kauai stores solar energy during the day to use at night, making solar dispatchable when it is needed rather than only when the sun is shining. AES’ 28-MW solar + 100 MWh storage facility, also on Kauai, will provide 11% of the island’s electricity needs, at a game-changing 11 cents per kWh for dispatchable solar.

Projects like these show that solar+storage is not a dream for the future. It’s viable now, and it’s being deployed now.

Clean Coalition Community Microgrid projects

The Clean Coalition is working on a number of Community Microgrid projects powered by solar+storage, including a project to help rebuild an area of Sonoma County, California that was devastated by recent wildfires.

Our Community Microgrid projects include:

Long Island Community Microgrid configuration for backup power mode