Following PG&E Power Shutoffs, Could Microgrids Provide Stability?

Submitted on Friday, October 11, 2019 - 14:55

PG&E’s unprecedented power shutoff on October 9 affecting nearly 740,000 customer accounts – approximately 2.25 million people – sent Northern California into chaos.

Without electricity, operations in the city slowed: schools were forced to close, families lost perishable food, and businesses lost tens of thousands of dollars in revenue and inventory. Public safety issues arose as traffic signals and streetlights went out and residents lost the ability to power medical devices, home alarm systems, and air conditioning. In San José, 20,000 customer accounts went dark for about 20 hours.

This follows PG&E power shutoffs in 2017 and 2018, including in Calistoga. Calistoga’s experience led them to begin building a microgrid to establish energy independence—an option communities in Northern California may consider as the threat of power outages increases.

Unintended Public Safety Consequences

In an effort to mitigate the risk of their transmission and distribution lines sparking wildfires, as they did in last November’s Camp Fire, the California Public Utilities Commission (CPUC) has granted PG&E the authority to shut off its power lines in fire-risk areas—leaving the rural and urban communities who depend on those lines without power for up to a week.

Previously, PG&E could shut off only distribution lines, which transport lower voltage power over shorter distances directly to customers. This year, following the Camp Fire, PG&E was granted the ability to shut off transmission lines, which transport power over long distances, increasing the area at-risk of a blackout. Although the importance of preventing wildfires is undeniable, the wide-ranging public safety impacts a PG&E power shutoff can bring are troubling, to say the least.

For example, officials worry that impact of a power outage could spread far beyond the targeted community. “Turning off power to one specific area puts the rest of the grid under more stress. So we worry about a cascading effect, where a PG&E PSPS in one city causes unintended power outages across the Bay Area,” Lori Mitchell, director of San José Clean Energy says. “That could have life-threatening consequences.” Additionally, the transmission lines that cities rely on travel through fire-risk areas. So even if a city is not threatened by a fire, its transmission line could still be turned off due to fire-risk, resulting in a blackout.

While PG&E is incentivized to proactively shut off the power to prevent its equipment from sparking wildfires, cities and counties must bear the burden and allocate their resources to deal with impacts to affected residents and businesses. An initial estimate of costs to the City of San Jose for responding to impacts from PG&E’s October 9-10 power shutoff was over half a million dollars for labor costs alone.

Losses borne by residents and businesses could be immense. “If Silicon Valley lost power for two or four or seven days, the consequences could be felt around the globe,” adds Zach Struyk, deputy director of San José Clean Energy. “We need to start to make plans to build more resiliency.”

What Are Microgrids?

As the name suggests, microgrids are scaled-down versions of the typical electrical grid. Rather than transmitting power over long distances to thousands of homes and buildings, microgrids serve a smaller and more localized user base. They can be scaled to serve a university campus, a small community, or even an entire city.

Most of the time, they remain connected to the larger grid and function as a standard piece of grid infrastructure. However, in the event that the grid loses power, microgrids can disconnect and operate independently—this is known as “islanding.” Because of this flexibility, buildings connected to microgrids can keep their lights on even if the main grid lacks power. With added local generation and storage, a microgrid can extend the amount of time that an islanded area has reliable power. For hospitals and emergency shelters, the extended time can save lives; for businesses and households, they mitigate the effects of a blackout. As transmission-level PG&E PSPS events pose a threat to most of Northern California, microgrids are an important resiliency tool to consider.

Case Study: RCEA x Airport

Redwood Coast Energy Authority (RCEA), a community choice energy provider (known as a CCA) serving Humboldt County, recently began working on a microgrid in partnership with the county airport. “Since roads into Humboldt County are frequently closed by fires and slides, energy security at the regional airport is crucial,” the lead contractor of the project explains on their website. “In the event of a grid outage, the airport microgrid will allow flight service and rescue operations to continue without interruption.”

Much like RCEA’s current partnership with PG&E – where RCEA procures energy that is delivered to customers through PG&E lines – RCEA will own the electricity generation, while PG&E will build and maintain the microgrid’s distribution lines. Electricity generation will occur on two large photovoltaic arrays located on the airport’s land: one array will generate electricity for the airport, and the other will provide Humboldt County with renewable energy. Because the arrays are connected to a battery system, solar energy can be stored and distributed at all hours. Additionally, excess energy will be sold to California’s wholesale power market — resulting in revenue for RCEA.

The microgrid, financed by a $5 million grant from the California Energy Commission and $6 million from RCEA, will be the first of its kind owned by a CCA. This makes it an important test case in determining the feasibility and replicability of a microgrid—and one that SJCE will be following closely. Full operation of the system is scheduled for December 2020.

Going Forward

Despite their promise, microgrids remain relatively niche, and policies that will heavily influence their future are still being deliberated. SB 1339, which became California law in 2018, created standards around microgrid tariffs and rates. California Senate Bill 774, which is currently being discussed in the state legislature, would require Investor Owned Utilities, like PG&E, to collaborate with “local governments and other interested territories” to identify areas where microgrids may be needed. While both these bills illustrate a growing conversation around microgrids, they are only a start. The direction of future policies could impact everything from ease-of-adoption and financing to who chooses to build them.

In August, San José Clean Energy briefed the City Council on energy resilience, including considerations for microgrids. Staff demonstrated the possibility of microgrids to increase resilience, as well as the need to further analyze the challenges that implementing a microgrid would present.

As climate change poses new risks to our existing power infrastructure, microgrids will continue to be an important point of discussion in the energy sector. SJCE will continue to monitor microgrids and other emerging technologies to identify opportunities that advance our commitment to providing sustainable, affordable and reliable electricity to all of our customers.

Due to the possibility of PG&E PSPS events, all San José residents and businesses should prepare for a multi-day power outage. Learn how you can prepare.

Photo credit: San José Police Department