While Southern California utilities seek balance in their approaches to renewables and natural gas-fired electric generation, a group of German solar companies touted the prospects for increased growth in solar photovoltaic (PV) technology on a global basis, regardless of another revolution taking place in the North American shale gas patch.
This was the essence of discussions at a “Germany California Solar Day” Tuesday sponsored by German and Los Angeles business development groups to showcase growing renewable energy technology among German-based firms, many of which already have operations in the United States.
While representatives from the Los Angeles Department of Water and Power (LADWP) and Southern California Edison Co. (SCE) painted pictures of aggressive use of solar, they also recognized that natural gas in a state like California will continue to play a pivotal role in balancing power loads. In contrast, German speakers talked about a future where 100% of the electricity comes from nonfossil fuel sources, and they said Europe generally is resisting new technology (hydraulic fracturing) in the oil/gas industry that is being embraced so totally in North America.
When asked about the role of natural gas pricing in Europe’s energy mix, Ruggero Schleicher-Tappeser, a Berlin-based sustainable energy consultant, said gas prices on a worldwide scale have been driven down by the new technology (fracking), but it is not clear how long this situation will last from his perspective. “In the long run, I think prices will rise and this will help renewable technologies,” Schleicher-Tappeser said.
He said that in Europe the use of new gas production technologies has been heavily debated and generally there has been a resistance to use them. “If you look at the forecasts in probable reserves coming down and the enormous increases in the demand for gas in the developing nations in Asia, along with the international hedge prices, it is clear gas prices will rise over time.”
SCE’s Dan Walker, a contract originator, said his utility, which characterizes itself as producing more renewable energy than all but two states (Texas and California), predicted that solar will “dominate” the renewable sector longer term even though it accounts for only 6% of SCE’s renewables currently. He said despite the stigma of recent failed major large-scale solar efforts, the Edison International utility had its largest renewable request for proposals (RFP) ever this year, drawing 1,500 separate proposals for more than 500 projects, or three times larger than any past RFPs.
Wolfgang Drautz, Germany’s consul general in Los Angeles, said cities in the United States are becoming the leaders in finding energy solutions. There is no need to look to Washington, DC, anymore, Drautz said in some opening remarks that placed California, and particularly the southern half of the state, as a potential Mecca for solar energy development.
One of the five-member LADWP oversight board members, Jonathan Parfrey, outlined some financial challenges facing the nation’s largest municipal utility. The city-run utility will be able to meet some multi-billion-dollar repowering efforts of its natural gas-fired plants along Southern California coast as they have received an extended 20-year time frame from state water quality regulators to complete all of the work, but meeting the state’s 33% renewable standard by 2020 requires some rate increases averaging about 5% during the next few years, and elected city officials are balking at raising retail charges for power at the same time some hefty water increases are also coming.
After his remarks, Parfrey told NGI the utility will have to buy extra renewable-based power supplies at higher costs until a rate increase is most likely approved in the mid-part of next year. In the meantime, the $4 billion city utility is looking at other possible revenue sources from its extensive holdings, such as wheeling transmission to other utilities. It also may re-examine the possibility of selling some of its other assets, such as its large holdings in natural gas reserves.
“We own our own transmission; we are a vertically integrated utility, so the grid we are a part of has a very favorable cost,” Parfrey said. “So there is always the possibility of providing wheeling to other public power entities. This is something we are seriously looking at.”
Â©Copyright 2011Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.
© 2020 Natural Gas Intelligence. All rights reserved.
ISSN © 1532-1231 | ISSN © 2577-9877 |