Grid integration study

Exponentially falling costs of residential photovoltaic (PV) equipment in California has led to high market PV adoption. The high cost-effectiveness of these systems could soon justify residential building standards requiring PV installation in new buildings. However, CEC’s cost-effectiveness analysis is limited to the home and does not account for the utility-scale costs of PV grid integration. Utilities are struggling to integrate renewable energy from all the PV on the grid today, and at certain times already are curtailing PV production to ensure safe, affordable, and reliable grid conditions. That is, at certain times PVs are turned off to reduce the amount of energy flowing onto the grid. As both market and policy drivers act to encourage more residential PV installations, these challenges will loom larger for the utility companies.

To further understand these issues, CPUC engaged DNV-GL to analyze the utility cost of residential PV systems on grid integration over the next 10 years. The Customer Distributed Energy Resources Grid Integration Study: Residential Zero Net Energy Building Integration Cost Analysis compared current PV growth against a ZNE policy scenario that requires 100% ZNE on new homes by 2020.

CPUC staff identified two potential measures to reduce the utility cost of PV integration that could impact homeowners: smart inverters and identification of optimal locations for ZNE buildings.

  1. Updating smart inverter settings to mitigate high PV integration costs requires a policy change to provide support for voltage regulation equipment, which CPUC is evaluating. The smart inverters results are only valid if the rules are changed to ‘reactive power priority’ where this type of mitigation is necessary and more cost-effective than other methods.
  2. To identify the best location for ZNE buildings, the IOUs’ Integration Capacity Analysis (ICA) tool, already under development in the Distribution Resource Plans proceeding, will help indicate optimal sites for ZNE buildings and high concentrations of PV all to minimize the utility costs of grid integration.

CPUC staff will continue to evaluate the measures in the report to make decisions that could impact future residential PV systems. This detailed research of efficient power production and distribution is essential for California to meet carbon reduction goals.

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