California is generating enough solar power to lower electricity bills
California, a US state that generates over a quarter of its electricity from solar power, is now experiencing an energy surplus. The Washington Post reports that the state's abundant solar energy production on sunny days, has occasionally caused electricity prices to fall into the negative. Michelle Davis from Wood Mackenzie Power and Renewables acknowledges these as unique challenges for grid operators, but asserts they are "not insurmountable challenges."
Solar power is not 'dispatchable'
Solar power, unlike fossil fuel energy, is not "dispatchable," meaning it cannot be controlled by electricity grid operators. This unpredictability affects the "net load," which is the total electricity demand minus the energy provided by solar and other renewable sources. CAISO, California's grid operator, must balance this equation by supplying power from traditional sources when necessary.
Solar power can meet nearly all of California's energy needs
During peak morning hours, conventional energy sources are heavily relied upon. However, when the sun is at its zenith, solar power can meet nearly all of California's energy needs, leading to a significant drop in prices. This fluctuation pattern, known as a "duck curve," is most pronounced in spring when sunny weather coincides with moderate temperatures, reducing the need for heating and cooling.
California's surplus of renewable energy mostly goes unused
Clyde Loutan, Principal for renewable energy integration at CAISO, admitted that "we drastically underestimated the speed at which residential solar was going to come in." This surplus of renewable energy means much of it goes unused. The Washington Post notes that 95% of California's 2.4 million mWh of wasted electricity in 2022 was solar, an inefficiency that could potentially lead to higher electricity prices over time.
California is reducing payments to solar owners
In response to the energy surplus issue, in 2023, the state government began reducing payments to solar owners for their contributions to the grid, a practice called "net-metering." This move has sparked debate among renewable energy advocates, as it could make solar energy less affordable and slow its adoption. However, CAISO is actively seeking alternative solutions, including selling the surplus power to neighboring states.
