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California moves to upgrade aging grid system to meet voracious demand for the juice

An unusual experiment began a few years ago on four blocks of stuccoed ubiquity in suburban Irvine. The rows of nondescript subdivision homes, inhabited by UC Irvine faculty and staff, afforded a high-tech peephole from which to observe how humans interact with electricity.

The houses were outfitted with tools for use with the advanced electricity system glowing on California’s horizon, prepping residents for a near future when things worth having will carry the prefix “smart”—as in smart appliances installed in smart homes attached to the smart power grid.

The complex system that powers the world’s fifth-largest economy is at a turning point. Utility executives, policymakers and regulators are peering into a future where California has shed fossil fuels and is fully buzzing with electricity. Before the state completes its shift to a modern, safe, sustainable energy grid, it has to decide precisely how that should be accomplished.

Among the key issues:

• The grid is aging, large pieces of it having been installed to serve a state with a few million people, not today’s 40 million. Some of the system’s vulnerabilities—even its lethality—have been laid bare by wildfires, when power was interrupted by flying tree limbs and communities were devastated by blazes sparked by broken equipment.

• The 100-year-old system in which power flows one way, from mega-utilities to their millions of customers, is coming apart. Power now runs into and out of the grid from multiple sources, all the time. Many homeowners already run their lives with power generated on their own roofs. Scores of small towns and counties have cut the cord and now operate their own microgrids, buying power directly from wholesalers.

• Storage is the Holy Grail. By law, the state must obtain all of its power by 2045 from clean sources, including sun and wind, which are cheaper than ever but unpredictable and difficult to fully harness. For example, more solar power may be generated in the middle of the day than the grid demands. That abundance presents a technology problem: how to store excess energy until needed.

• The grid could become Big Brother. The “internet of things”—devices large and small that connect us to each other and the grid—offers convenience and ease of control over our lives but also requires users to relinquish some degree of privacy.

Such modernization requires a better understanding of what we need from the grid, and what the grid requires from us. Enter demonstration projects like the five-year experiment at UC Irvine—sponsored by the university, the Southern California Edison power company and the federal Department of Energy—sort of a real-time Truman Show in which homeowners were the subjects. Their households received smart appliances, LED lighting, water heaters, insulation, air conditioning, solar panels and batteries, even electric cars and charging stations. The trade-off for residents was that their every decision was remotely monitored: which lights were flicked on and when; which families used air conditioning or hot water more than others; which wall sockets residents used.

Gene Tsudik, a UC Irvine professor and one of the participants, is a computer scientist specializing in privacy and security. His professional antennae were fired up when teams of installers left behind clicking, ticking, blinking monitors that provided his family’s interface with the grid. “I was very well aware that even simple devices that transmit wirelessly can triangulate the movement of people in the house,” says Tsudik.

Ultimately the experiment did nothing to change his family’s energy consumption. But it left Tsudik with the certainty that when his home is connected to the grid, the smart devices had better be secure from hackers as well as eavesdroppers. “It’s a question of when, rather than if, they can be hacked,” he says.

One takeaway for Scott Samuelsen, director of UCI’s Advanced Power and Energy Program, which ran the project, is that while the adoption of smart-home devices is growing fast, regulations and consumer protections that should accompany them are not keeping pace. “The market is out of control with respect to regulation [of devices],” Samuelsen says. “We are in a free-for-all.”

Some aspects of grid modernization are indeed under way. Regulators have ordered power companies to make their equipment safer, particularly to withstand—and not cause—wildfires. Much of the equipment we can now see will either be buried safely underground or armored heavily to protect it from the elements.

But other aspects—policies, regulations, new business models—could require another decade to resolve. Some policymakers envision a centrally managed Western grid serving everyone from the Rocky Mountains to the Pacific, not ruled over by California alone. Others see more and more micro-grids forming, ranging from a family with solar panels to hospitals, malls and small counties taking care of their own electricity needs.

Indeed, the state has been encouraging this. A new law begins the process of setting rates and rules, and the California Energy Commission awarded more than $50 million in grants to accelerate the creation of smaller, more resilient power grids.

The rise of smaller, local alternatives to the big utilities such as Marin Clean Energy and Sonoma Clean Power is a trend known as community choice aggregation (CCA). The framework for these groups was established in 2002, motivated partly by locals’ wish to decide for themselves where they would purchase power and what they were willing to pay for it, as well as a desire for more clean energy.

The community choice movement was sparked in the Bay Area and has spread across the state. Small aggregators now have 2.5 million customer accounts. Marin Clean Energy (MCE) and Sonoma Clean Power (SCP) have both brought new customers to their utilities, and amassed significant reserves in recent years in order to offset any potential rate hikes—and to enhance these new nonprofits’ credit ratings. The PG&E bankruptcy has led to some uncertainty but won’t impact the rates of local CCA participants, say officials at the local utilities.

In a recent interview, as PG&E was about to file for bankruptcy protection, MCE chairman and chief executive Dawn Weisz told the Pacific Sun that “we partner with PG&E and are certainly monitoring the situation, and beyond that we don’t anticipate there being any impacts to our customers,” as she noted that the utility was sitting on about $50 million in reserves intended to absorb any rate fluctuations—while also serving to bolster the utilities’ credit rating. Sonoma Clean Power is carrying about $40 million in reserves, says SCP spokesperson Kate Kelly.

These local power hubs must report their activities to the state Energy Commission and the Public Utilities Commission, in much the way legacy utilities do. The companies are not currently subject to all of the same rules that govern the big utilities across a web of complex issues, including compliance with California’s clean-energy goals, but the state is in the process of formalizing additional regulations.

“Part of the regulators’ role is to be cautious and thoughtful,” says Barbara Hale, assistant general manager at San Francisco’s municipal power utility and member on the board of directors of the California Community Choice Aggregation Association. “It’s difficult to be in that role and manage change, particularly technological change.”

California’s grid operator and its cadre of electrical engineers share the concern that runaway innovation could outstrip oversight and create precisely what the grid, even the modern grid, can’t abide: imbalance.

“Changes are happening rapidly and we’re trying to keep up with that,” says Mark Rothleder, a vice president at the California Independent System Operator, which manages the state’s grid.

“There will be new players, new resources, new opportunities,” he says. “We have to be open to innovation and we have to ensure our technology that manages the grid can enable those resources. We have to pay attention.”

Source: CalMatters. CalMatters is a nonprofit, nonpartisan media venture explaining California policies and politics. This article was prepared in partnership with the ‘Sacramento Bee.’ Tom Gogola contributed reporting.

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