2021 and 2022 were difficult years for new solar farm developments due to the uncertainty of a ITC extension, supply chain issues, and inflation in general.

As we start 2023 these items are becoming more understood and stable. However at the end of 2022 the costs have risen for utility scale projects from the prior year.

As can be seen in the recent SEIA report the Utility scale total prices have increased to over $1/Wdc for a tracking system.

We would believe that we are going to enter into a more stable pricing period starting in 2023 so that developers can better predict their costs and financial models for 20 year returns.

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Recent PPA Prices accepted have been in the $30/Mwh range or lower

Now it seems that to get any approved PPA the solar project must also have associated battery storage. This makes the financial model for acceptability even more challenging

It now takes careful and difficult scheduling of the storage and discharge of the BESS (battery energy storage system) to maximize the late in the day potential revenue. Most programs are moving to paying only on the 15 minute spot market at a pricing node.

This effort to make sure that the project is profitable will be a continuing challenge in the coming years.

PG&E has meet their 33% renewables goal of 2020 almost 3 years early they announced.

Closing the Diablo Canyon nuclear plant by 2025, which produces 27.4% of their energy, will cause more renewables to be acquired later to allow them to meet the next mandate of 50% by 2030.

Last Friday on June 2nd, SDG&E opened their RAM VII RFO solicitation with the hope that their earlier filings on cancelling this requirement would be granted by the CPUC.  They state that they reluctantly are opening this RFO for up to 107.3 MW, but will terminate those on the shortlist as winners, if their Application for Modification and Petition for Modification are granted by the CPUC to remove their requirement for this RFO.

This and other proceedings by SDG&E, PG&E, and SCE to terminate any requirement for further solar PPA agreements in RAM etc. show their determination to stop further solar power acquisitions for several years into the future.

Only with constant lobbying pressure with the legislature to force a higher RPS standard and keep alive PPA opportunities will solar continue to make significant progress for all of us in CA.

Some are hoping that the retirement of the Diablo Canyon nuclear plant will spur the need for more solar and wind in the coming years in PG&E territory.  This has produced an increase in the start of new CAISO interconnection studies for several new projects this past March.

My checking today (8-11-2016) of the present status of the CAISO Cluster 9 interconnection queue from the application last April showed some totally unexpected results.  I expected a large increase from Cluster 8 with the ITC extension, but this was way out of my expectations.

Counting only solar, or solar/storage, there are currently 94 projects moving toward the phase 1 study.  The majority of them are projecting operation in the late 2019 into 2020 time period.

The total amount applied for is 21.06 GW!

This is a mindboggling amount of speculation that that much capacity would find a PPA in CA in that time frame with the attitude of the utilities and no new RPS legislation that would force them to purchase such capacity.

We are finding that too many new groups seem to be confused about the Community Renewable Project portion of the GTSR program that is now being implemented.  This is off course the part of the program that allows subscription to a community solar facility set up by a developer/ownership group, and bill credit from this facility to subscribing customers being administered by the Utility.

First of all getting your project qualified and advertising to the community under pretty stiff rules to be eligible is tedious, but that is not the discussion for today.

What we are finding disturbing is that some new groups do not understand that their payment for this huge effort has these facts:

• The queue offerings tag along with the separate but very related ever other month ReMAT program.
• The offering is like ReMAT at only 5MW max for each period.
• Most importantly, what the developer gets is the ReMAT PPA price for that period.  This of course will drop like a rock from the present around $0.065/Kwh as groups agree to the ReMAT pricing with the AWFUL TOD payment schedules now in force for SCE and PG&E.

Then they must understand that this price is the amount credited against the subscribing customers’ bill.  I suspect their bill for the corresponding time is higher than the rate they are compensated for their subscription.

I personally think that the GTSR program and this version of community solar is the worst example I have seen in the US.  Too bad the solar community did not lobby better to prevent this program from ruining what the people once again thought they were being given by their legislature.

 

Yesterday on February 2nd SCE submitted their Advice Letter 3357-E to the CPUC with the winning bids from the 2015 RAM 6 solicitation.  It should be noted that this is the last  RAM program RFO that is required of SCE by the CPUC and legislature.  Additionally in the PG&E Advice Letter described earlier, PG&E has petitioned to discontinue further RAM program RFOs that were earlier ordered by the CPUC.  So in summary, the RAM RFO program as we have known it is most probably over.  Also remember that the utilities have been allowed to use the RAM program “mechanism” for future RFOs that they may choose to hold in the future.  Of course none are scheduled.

The winning bids for this RAM 6 auction were:

There was a 5MW Land Fill Gas project that made up the final winning bid.

Some notable items found in the Advice Letter were that there were only 18 passing RAM bids from 12 developers this round.  As you can note from prior year offerings, the number of developers that have kept these 20MW projects active for several years with all of the huge utility interconnection process deposits and long and complicated permitting processes is dwindling.

In a further advice letter 3358-E for the GTSR (Name for SB 43 enacted program) component that award was only one 20MW project owned by Recurrent Energy.  They had earlier effectively petitioned the CPUC to reduce their REQUIRED initial offering from 50MW and put the rest into the upcoming annual RPS RFO.  Amazing how the Utilities change the intent of legislative laws with the help of the CPUC!!!  So you can see once again that the expectation of developing new  smaller projects in that program are not happening.

More effective lobbying by the smaller developer community is surely needed once again to FORCE the utilities to procure solar from smaller than 20MW projects in the next few years.

On Friday 1/22 PG&E published the results of their RAM 6 RFO in advice letter 4780-E. This was the first RFO that also included the required 50MW RFO for the GTSR (Green Tariff Shared Renewables) program.  So these two sets of programs were treated differently in this process.

For the designated RAM and old PV program portion there were 5 winning bids.  This table shows the winning and losing companies behind the winning bidding project company names for both the RAM, PV, and GTSR programs.  Those project company names are sometimes simple and sometimes strange, but they usually disguise the company behind them:

In the bidding chart above note the preponderance of offers from Recurrent Energy and Mirasol Development.  Mirasol had three little 1MW wins in the GTSR category.  However note the high winning percentage by the competent sPower team with 5 bids and 3 wins in the RAM portion of the offering. sPower won 60MW with these three 20MW projects in the LA county area.

There was comment in the evaluator’s section that the winning bids for the normal RAM portion were close to last year’s winning bids; while those for the GTSR program were slightly higher as expected due to the generally small sizes.  However as noted the two 20MW winners in the GTSR program consumed most of that capacity allocation.  One was from Recurrent and one from 8 minute Energy.

Also note that in a simultaneous filing PG&E is petitioning to stop all further RAM RFOs, in spite of remaining capacity.

Now that the final CPUC required RAM RFOs have been completed, it is time to consider the future status of RAM like RFOs in California that have significant capacity allocations to allow further development of projects going forward.

From my reading of the present status of CPUC rulings, the IOUs can rather arbitrarily use the RAM “process” to have offerings when they want for whatever capacity they may want.

In the SCE comments on the ongoing GTSR program Phase IV they state that they will not have another RAM RFO by itself. They will only have the annual RPS RFO solicitation, but might incorporate multiple programs in that one offering somehow!

This is not a tolerable situation for the development of significant solar going forward because of such uncertainty it presents.

It is time once again for developers to lobby with the legislature and the CPUC to produce a new series of Mandated RFO offerings by the three IOUs.  This was how we got CREST modified to be a viable program, significant allocations for the SCE SPVP and PG&E IPP programs established, and the RAM program continued up to now as some successes.  On the other hand, when the developer community did not stand together we got the Re-MAT program.

It is now the end of the bidding submission period for the SCE SPVP 5 program RFO on Sept 21st.  The stated goals of that offering are:

As has been the standard for this program from the beginning this was to be for rooftop projects mostly, and the 25 MWdc allocation for ground mount systems was allocated long ago.  There was great effort in finding roof tops of large warehouses in the LA basin that would handle >1MW ac systems for some time, so the amount of previously scouted sites is large for this believed to be final offering.  Remember that SCE submitted CPUC documents to cancel this program and only have the RAM program; however, amazingly they were not allowed to do this.

This offering shows the start of selecting projects based on a Preferred Resources Area criterion.  This is stated to be a Pilot of that upcoming new restricted bid winning criteria for future RFO bids I suspect.  You can see in the plot below their first preferred regions for this offering.

Going forward there would seem to be no size restrictive RFO programs for SCE, or PG&E/SDG&E for that matter, that do not allow bidding of projects up to the size of 20MW in the same RFO.  It was far better when some programs were kept for the <10MW size projects, so that they could bid in concert with the economics and advantages of these more distributed generation projects.  The extremely small allocation every other month of the ReMAT program that was totally ruined by the final proceedings, has become a token small system RFO program with winning pricing so low as to be unviable.