By Dennis Wamstead
Forward-looking template is one that lagging utilities like Duke Energy and Southern Company can follow
PacifiCorp’s announcement last week that it will build thousands of megawatts of new wind, solar and battery storage capacity in its transition away from coal will reshape electricity markets across the West over the next 10 years.
Its impact will be felt nationally, too, perhaps nowhere as much as in the Southeast.
The reason behind this is PacifiCorp’s approach to battery storage, which it embraced as part of its preferred least-cost choice for meeting customer needs through 2035 or so. All told, the utility, which serves 1.9 million customers in six states (California, Idaho, Oregon, Utah, Washington and Wyoming) plans to add 595MW of battery storage to its system by 2025, all of which will be paired with new solar—nearly 3,000MW in total.
These newly paired resources—solar and battery storage—will be distributed across the utility’s service territory (as the graphic below illustrates) to help maintain system reliability as the company moves forward with a series of coal plant retirements. For example, PacifiCorp will build 354MW of new solar and an 89MW battery storage unit in Bridger, Wyo., by 2024; it also now plans to retire Unit 1 at the coal-fired Jim Bridger power plant in 2023 instead of 2037 as was scheduled previously. The 531MW coal unit came online in 1974.
Similarly, the utility plans to pair 900MW of solar and 225MW of battery storage in northern Utah to enable it to close Units 1 and 2 at the Naughton coal-fired plant in neighboring Wyoming. The solar and storage capacity will come online in stages from 2021-2024. Naughton 1 and 2, which came online in the 1960s and have a combined capacity of 357MW, will be retired in 2025, four years earlier than previously planned.
This is only the beginning of PacifiCorp’s transition. The company also intends to added 1,400MW of standalone battery storage to its system by 2028, and to have a total of more than 2,800MW of battery storage in operation by 2038, the end of the forecast period for its current integrated resource plan—all of which will enable the utility to soak up electricity from the 6,300MW of new solar and 4,600MW of new wind generation that it plans to add during this period.
It will be hard for utilities and regulators in the rest of the country to ignore these plans.
As noted in an IEEFA report published last month, COAL-FIRED POWER GENERATION IN FREEFALL ACROSS SOUTHEAST U.S., 45 coal-fired units across that nine-state region posted annual capacity factors of less than 25% in 2018, meaning they were not—and are not—needed for consistent power generation. Instead, these plants are being ramped up and down, either daily, seasonally, or both, to meet variable needs. Because this is not what the plants were designed to do, it puts more stress on the equipment and leads generally to higher operating costs.
Broad underperformance of Southeast coal plants presents a clear opening for solar-plus-storage plants, using solar during the day to charge storage units that can then be tapped during peak periods in the evening rather than using fossil generation, whether coal- or gas-fired. Examples exist already of this type of usage, even regionally, as IEEFA detailed in a June report, Advances in Electricity Storage Suggest Rapid Disruption of U.S. Electricity Sector. Players include utility companies from Florida to Massachusetts and Arizona.
