FOR IMMEDIATE RELEASE: 9.9.2020
Contact: Leora Broydo Vestel
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CalCCA Proposes Policy Changes to Improve Reliability of California’s Electric System
CCA Association Calls for Immediate Action in Regulatory, Legislative, and Federal Arenas
Concord, Calif. – With record-breaking heat and rampant wildfires threatening the stability of California’s power grid, the California Community Choice Association (CalCCA) is calling for immediate policy action to improve the reliability of the state’s electric system. In a letter sent today to Governor Gavin Newsom, CalCCA provides a series of recommendations that, if implemented, would help to avert future grid emergencies.
California power supplies were exceptionally tight during extreme heat storms that engulfed the state over the Labor Day weekend and in mid-August, and out-of-control wildfires have knocked out critical generation and transmission facilities. The emergency conditions, fueled by climate change, reveal an urgent need to reform the existing resource adequacy rules administered by the California Public Utilities Commission (CPUC) and California Independent System Operator (CAISO), and focus the state’s integrated resource planning (IRP) process more rigorously on supply reliability.
“As the root causes of the extreme emergency events are revealed, they may point directly to solutions necessary to mitigate the risk of repeating similar events in the future,” CalCCA Executive Director Beth Vaughan noted in the letter to the Governor. “Even without certainty regarding those causes, however, California can begin now to take steps to increase reliability through action in the regulatory, legislative, and federal arenas.”
CalCCA recommends the following near-term actions to improve the reliability of California’s electric system:
1. The CPUC should continue to ensure adequate supplies will be in place for summer 2021 requirements and beyond through the procurement track of the IRP process, and review its import restrictions in the context of the lessons learned during the extreme emergency events.
2. The Legislature should enact AB 3014 (Muratsuchi) to establish a Central Reliability Authority (CRA) responsible for planning and coordinating the state’s resource adequacy with the CAISO and, where necessary, procuring backstop supply.
3. California should support the expansion of the federal Investment Tax Credit (ITC) to standalone energy storage resources and the removal of charging restrictions currently limiting the flexibility of battery energy storage to support the state’s ramping and peak needs.
CalCCA also recommends the Governor appoint an Independent Review Panel to consider the results of a root-cause investigation of the strained grid conditions that led the CAISO to initiate rotating outages on August 14 and 15, leaving thousands of Californians without power. CAISO, the CPUC, and California Energy Commission (the Joint Agencies) are investigating the August events and will issue a report with their findings. A review panel, CalCCA asserts, should consist of former agency experts, non-market participants representing each of the three categories of load serving entities (IOUs, CCAs, and ESPs), and other key stakeholders.
“While the Joint Agencies are no doubt motivated to prevent future shortages, an objective eye will ensure that natural biases do not affect the characterization of the root cause or proposed mitigation measures,” CalCCA notes.
CCAs share the state’s strong interest in ensuring reliable energy supply and grid operations and have actively engaged in regulatory efforts to boost reliability. Collectively, CCAs have executed almost 5,000 MW (5GW) of long-term power purchase agreements for new-build solar, wind, geothermal, and energy storage projects. Additionally, CalCCA members have taken the following actions to bolster reliability and prepare for future grid emergencies:
- Expanding the use of critical peak pricing and TOU pricing that maximizes incentives for shifting demand away from periods of high stress on the grid.
- Exceeding their share of the three-year 3,300 MW resource adequacy procurement ordered in October 2019 (to be installed between 2021 and 2023).
- Taking steps to form a Joint Powers Authority to enable cooperative procurement of large-scale resources (e.g., long duration storage projects).
- Installing hybrid generation and storage solutions to enhance the reliability of new solar resources and to reduce emissions from existing resources.
- Facilitating the installation of clean energy backup power systems at local critical facilities used by the community for disaster preparedness.
CCAs are prepared to do more and are committed to working with the Joint Agencies and the investor-owned utilities (IOUs) to support reliable energy service and ensure sufficient in-state renewable integration supply.
About CalCCA: Launched in 2016, the California Community Choice Association (CalCCA) represents California’s community choice electricity providers before the state Legislature and at regulatory agencies, advocating for a level playing field and opposing policies that unfairly discriminate against CCAs and their customers. There are currently 21 operational CCA programs in California serving approximately 10 million customers.