Technically, We Could Green The Grid and Keep The Lights On; Do We Have The Policies to Get Us There?

One concern with adding large amounts of renewable generation to the electric grid is that the variability of renewable resources such as solar and wind might render the electric grid unreliable.  According to a recent report from Synapse Energy Economics, that concern is misplaced and we already have the technological capacity to replace 100% of U.S. coal generation and 25% of U.S. nuclear generation with renewables by 2050 while maintaining grid reliability.

On the technical side, this report is not the first to make similar claims, will not be the final word, and does not address all of the technical issues associated with putting more renewable generation on the grid.  But behind the headline findings, the subtext of the report provides insight into the challenges that policy makers will face if they want to achieve a future where we rely heavily on renewable generation.

For instance the regional analyses in the report vividly show the variation in available renewable resources, current generation fleets, and demand distribution between regions – something that policy makers at all levels should be sensitive to.  The report also highlights the importance of interregional transmission to a grid that incorporates more variable generation.  But making the case-by-case investment decisions that must balance the costs and benefits of transmission (both inter- and intraregional) relative to renewable and traditional generation is not easy when the current policy context often divides responsibility for making such decisions across different levels of government while allocating the costs for such investments differently depending on resource type.

The report also shows the extent to which the future of renewable generation is linked to the future of two other resources: natural gas and storage.  Absent technological breakthroughs, natural gas generation will be relied on to backstop variable generation.  Policy makers (as well as renewable advocates) should consider that flexible gas-generation may need to be developed along with renewables and that the reliability benefits of flexible gas generation may need to be recognized in new ways.  Storage will also be important to a future grid that incorporates more variable resources –electrical vehicles may play a big role here.  Research and innovation is hot in this area, but it is less clear that policies are in place to support the integration of new storage technologies as they emerge.

As technical barriers to greater development of renewable resources fall, it is appropriate to ask whether the complex and often fractured policies we have developed to regulate the electrical grid are ready to keep pace.

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