The CPUC’s Staff Proposal on Track 2 of the microgrid proceeding was very disappointing. The Commission failed to propose requirements for microgrids to include a diverse portfolio of energy and storage sources, to transition to renewable fuels and cleaner technologies, to require long-duration energy storage, or to move beyond pilot scale programs. BAC’s comments on the Staff Proposal urge the Commission to include bioenergy and other forms of baseload and flexible generation power and to add requirements for long-duration storage (which biogas and biomethane can provide), to move away from fossil fuels, and to expand the program beyond pilot projects.
The CPUC is required by state law to adopt a microgrid tariff and other policies to support microgrid development. The CPUC recently adopted a decision implementing several short-term actions that are intended to expand the use of microgrids during the 2020 wildfire season. The Commission also just issued a Staff Proposal on Track 2 of the proceeding, which addresses the need for a statewide microgrid tariff, expanded use of micrgrids to maintain power for essential services and other issues.
BAC submitted comments in support of the Proposed Decision on BioMAT, which is a 250 megawatt program required by state law (SB 1122, Rubio, 2012). Most importantly, the Proposed Decision will extend the program end date to the end of 2025. BAC also supports the Proposed Decision to increase flexibility for developers, set deadlines for utility’s, and to convert to a statewide program in recognition of the statewide benefits that BioMAT projects provide.
The CPUC voted 5-0 to extend the BioMAT program and make several critical changes to the program. The CPUC’s Decision extends the program end date to the end of 2025. This is critical since the utilities have only procured about 20 percent of the 250 megawatts required by the program. The CPUC Decision also increases delivery flexibility for project developers, establishes deadlines for utilities to review project eligibility and approve contracts, and establishes a non-bypassable charge so that all rate-payers will share the costs of the program. The CPUC proposed the non-bypassable charge in recognition of the fact that BioMAT projects provide important statewide benefits that all ratepayers should help to pay for, not just the purchasing utility’s customers.
See CPUC’s Proposed Decision on BioMAT (July 24, 2020), which was adopted by the Commission on August 28.
BAC filed comments on the CPUC’s BioMAT Staff Proposal to support the proposal and request clarification of several items. The most important changes recommended in the Staff Proposal would:
- Extend the end date to the end of 2025
- Increase operational flexibility and revise burdensome penalty provisions
- Make the program a statewide program
BAC supported these changes and requested that they apply to existing BioMAT contracts. BAC also asked for clarification on the proposed greenhouse gas modeling. And BAC has asked the CPUC to remove the utility service territory restriction as part of the move to make the BioMAT a statewide program.
In early March, the CPUC released a revised Staff Proposal on the BioMAT program. The Staff Proposal contains 15 separate and significant proposals to revise the BioMAT program. Generally, the proposals are quite helpful and some – extending the program end date – are absolutely critical. The most significant recommendations in the Staff Proposal would:
- Extend the BioMAT program end date from December 31, 2020 to December 31, 2025;
- Make the program statewide, allowing other purchasers of BioMAT power, instead of limiting it to the three investor-owned utilities;
- Provide greater operational flexibility and reduce some of the excessive penalty provisions;
- Extend the time allowed for projects to begin commercial operation;
- Set deadlines for utilities to execute contracts; and
- Require projects to provide lifecycle greenhouse gas emissions analyses
BAC’s comments on the CPUC Staff Proposal on Microgrids focus on the need to include bioenergy and biogas in microgrids. Relying on solar and batteries alone limits the duration that microgrids can operate. Bioenergy can extend the duration of microgrids and make them much more reliable by providing a fuel source for backup generators, flexible generation that can fill in around solar and batteries, energy storage, and other grid services.
SB 1339 (Stern 2018) requires the California Public Utilities Commission to adopt a measures to accelerate the development of microgrids to ensure reliable electricity supplies during Public Safety Power Shutoffs and other grid disturbances. Microgrids are especially important to keep the power on for emergency and essential services. The CPUC Staff Proposal for short-term actions that can help microgrids before the 2020 fire season focuses very narrowly on microgrids powered by solar and batteries, which are not sufficient for long-duration outages and will not be effective under all circumstances.
BAC submitted comments in late October on the CPUC’s Order Instituting Rulemaking. BAC urged the Commission to address the need for baseload and flexible generation, to consider opportunities to convert local organic waste to local energy supplies, to include renewable gas for microgrid reliability, to consider the importance of Short-Lived Climate Pollutant reductions, and to consider other upstream benefits like wildfire mitigation and landfill reduction. BAC’s comments are on BAC’s website.
The CPUC is expected to issue the Scoping Ruling in early 2020 and to complete the development of the microgrid framework by the end of 2020.
In September, the CPUC launched a new proceeding to develop a policy framework for microgrids. Microgrids are defined areas of the grid that can operate as part of the larger grid and can also be completely disconnected from (operate independently from) the larger electricity grid. Microgrids include the energy producers, transmission and distribution lines, and energy end users that are within a defined electricity boundary. The goal of establishing microgrids is to enable communities to have a fully independent grid that can operate even when there are disturbances to the regional grid. The recent Public Safety Power Shutoffs have underscored the urgency of developing microgrids, especially for essential services like firefighters and police, hospitals, wastewater treatment, communications, and more.
The CPUC launched the new proceeding to develop the framework for commercializing microgrids. It will consider the appropriate standards, eligible technologies, rates, tariffs and other issues for microgrid development in California.
See the CPUC’s Order Instituting this new Rulemaking: OIR on Microgrids Rulemaking (R.19-09-009)