IEEE Power & Energy Magazine - March/April 2022 - 26

The utility will document the set of DER services necessary
to defer investment and produce a price sheet indicating
the utility's willingness to pay for DER products.
improve electric resiliency in the face of California's changing
climate landscape.
In January 2021, the CPUC initiated the Microgrid Incentive
Program as part of Track 2, which authorizes a US$200
million budget to fund the construction of microgrids supplied
by clean energy resources and deployed in vulnerable
communities. The budget set aside for the Microgrid Incentive
Program is expected to fund 15 projects across the three
IOU service territories. Although the incentive program
represents a small piece of what will be necessary to build
and operate a resilient and carbon-neutral electricity system,
it will facilitate demonstration projects to help address the
many challenges presented by multiproperty microgrids
(i.e., microgrids, which include multiple independently
owned assets).
The need for DER-based NWAs to augment electricity
resilience in California is clear. The rising risk of wildfires
has frequently limited the use of crucial T&D lines. This
is exemplified by the Public Safety Power Shutoff (PSPS)
program, which impacted millions of customers by initiating
power outage events in many communities over the last few
years. This repeated lack of access to electricity for many in
California, often within the same geographic areas, has led
to considerable private and public investment in backup diesel
generation to support critical loads during PSPS events.
In 2019, the CPUC authorized PG&E to procure 450 MW
of backup diesel generation for the 2020 wildfire season.
To balance the need for both clean energy and resilience
requirements in California, utilities and ratepayers will have
to dedicate thought and resources to developing and implementing
clean energy microgrids.
Climate Change Impacts on System
Requirements and Planning
Climate change impacts on California's electrical system
are systemic, including reduced resiliency and reliability
due to overstretched generation resources, insufficient levels
of resource adequacy (RA), drought-induced reductions
in hydroelectric generation capacity, transmission lines shut
down due to wildfires, and PSPS events to prevent wildfires
during extreme weather events. The consequences of
reduced reliability and resiliency directly impact public
health and safety and disrupt people's lives and normal business
operations.
In August 2020, the California Independent System
Operator (CAISO) was forced to institute a two-day rolling
electricity outage in response to emergency conditions from
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a prolonged heat storm. These were the first rolling outages,
and the first time there was more than one emergency declaration
since the RA implementation in 2006. There were
many questions about what went wrong.
The CAISO, CPUC, and California Energy Commission
(CEC) jointly prepared a root cause analysis to
determine contributing factors that triggered the rolling
outages. Increased air conditioning usage, lower efficiency
of conventional generation, and lower hydroelectric
output due to drought conditions all played a part,
but the ultimate question is, " Why was there not adequate
resource capacity? " The analysis identified several challenges
that contributed to the emergency, the most relevant
being that the unexpected increase in system demand
exceeded RA and planning targets, and that while transitioning
to a clean energy portfolio, planning for ramping
energy needs in the early evening hours has not kept pace
with grid needs.
The generation shortfalls in August 2020 had many
potential main causes, including inaccurate load-serving
entity demand schedules in the day-ahead market and the
unexpected loss of a generator delivering 475 MW. Many
actions were taken by the CAISO to mitigate the loss of
operating reserves, but ultimately the CAISO initiated
forced outages of 932 MW and 466 MW across two days to
stay within acceptable reserves to maintain overall system
reliability. Subsequent days of the heat storm required no
outages due to a combination of operator actions, regional
coordination, demand response (DR) programs, and successful
public campaigns for consumers to reduce their
energy usage.
This emergency spawned a new CPUC emergency reliability
rule (R.20-11-003) ordering a new DR program, the
Emergency Load Reduction Program (ELRP), followed by
an executive order creating another new DR program, the
California State Emergency Program. Each program has a
fixed payment of US$1/kWh and US$2/kWh, respectively,
to customers reducing their loads after emergency notifications.
However, emergency programs do little to influence
the development of DERs generally or NWAs specifically.
While incentives for load reduction are high, there is no certainty
in emergency programs since the number or duration
of events in a year is unpredictable. Yet, in Phase 2 of the
emergency reliability rulemaking, the CPUC has identified
a shortfall of as much as 5,000 MW for 2022, indicating
there will likely be a need for continued load reduction from
emergency programs in the coming years.
march/april 2022
IEEE Power & Energy Magazine - March/April 2022

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