Analysis: Solar boom replaces California hydro

OREANDA-NEWS. California's booming solar and wind generation will help the state meet summer 2015 power demand as drought and low snowpack erode reliance on hydropower.

The California Independent System Operator (ISO) projects summer demand will reach 47,188MW, 2pc above the weather-normalized 2014 summer peak, but slightly below the actual peak of 47,351MW, according to a preliminary forecast.

The ISO expects to have resources of 58,754MW, giving the state a 24.5pc operating reserve margin this summer, the highest since 2009, ISO officials told the board yesterday. Last summer's margin was 23.8pc.

The grid operator has reported a healthy reserve margin above 20pc since 2009 as resources come on line to meet the state's 33pc renewables goal at the same time the financial crisis blunted economic growth.

Rising solar output has reduced the need for conventional resources on peak days.

"As we transition into a new system, we are less and less concerned about a capacity shortage and more concerned about over-generation and resources needed for ramping," ISO manager of interconnection resources Robert Emmert said.

Electricity load in California peaked at 50,270MW in summer 2006 and has trended lower since.

The drought will pare expected hydro resources by 1,300MW from last summer to 5,905MW. The state's two largest reservoirs are at less than 40pc of capacity and officials do not expect rainfall or snow runoff to improve. "We will not be able to rely on hydro this year," Emmert said.

Even under extreme hot weather, high generation outages and low hydro conditions, California's reserve margin should remain above 10pc, allowing the grid operator to avoid potential rolling outages.

Summer peak assessments are about \\$38/MWh for the NP-15 and SP-15 hubs, a 25pc discount to the year-earlier preschedules.