Update: Midwest Utility Says Goodbye to Coal, No more Gas, We’re Going Solar

July 7, 2018

I posted a video interview last week with a Resource Planner for Michigan’s largest electric utility – Consumers Energy – in which she described the decision to forego new gas turbines, in favor of solar, some wind, and efficiency.

Above, a recent local television spot describes further the steps to shut down coal plants.  The goal is 80 percent carbon reduction by mid-century – which is not enough, to be sure – but it’s hard to overestimate the significance of this change, which has really happened at light speed (in utility terms) over the last several years.

Here’s the Resource Planner, Jessica Woycehoski.

It’s part of a larger, international trend.

Utility Dive:

Despite pronouncements from the White House, that preferred mix is no longer a portfolio based largely on coal and nuclear energy. Both those resources have seen their market share undercut by cheaper natural gas in recent years, pushing many of the oldest and least efficient plants offline.

Natural gas may fall victim to a similar situation within the typical two-decade utility planning horizon, according to new research.

To quantify this, RMI compared the costs of four currently proposed natural gas plants with “optimized, region-specific clean energy portfolios.” Two of the plants were CCGTs, “planned for high capacity-factor operation,” and two were combustion turbine (CT) power plants, “planned for peak-hour operation.”

Actual projects, though unidentified, were used to make the modeling credible, Dyson said. The two “peakers” were in Texas and the Mid-Atlantic region, and the two CCGTs were in Florida and on the West Coast.

The technology choices and geographic distribution of the plants were intentional, as were specific operational challenges modeled, RMI Electricity Practice Associate and paper co-author Alex Engel told Utility Dive. Florida’s poor wind resource, for instance, made optimizing a portfolio there more challenging, and the Mid-Atlantic portfolio required meeting a winter peak.

In each case, RMI assessed regional resources and used an optimization tool to determine a cost effective clean energy portfolio, Dyson said.

RMI’s cost modeling compared the plants with replacement portfolios that would provide the same services at the time of the plants’ early 2020s in-service dates.

The net cost of the clean energy portfolio was 6% less than the proposed California CCGT, 47% less than the proposed Texas CT, and 60% less than the proposed Mid-Atlantic CT, RMI found. It was 6% more expensive than the proposed Florida CCGT until projected “cost reductions in distributed solar and/or a $7.50/ton price on CO2 emissions” were factored in.

“All four cases show that an optimized clean energy portfolio is more cost-effective and lower in risk than the proposed gas plant,” RMI reported.

One Response to “Update: Midwest Utility Says Goodbye to Coal, No more Gas, We’re Going Solar”

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