California Energy Agencies’ Next Electricity Demand Forecast Will Account for Onsite Energy Resources

For the first time ever, California energy agencies’ forecast projecting electricity demand over the next decade will factor the hourly availability of “distributed energy resources” (DERs)—onsite energy resources such as electric vehicles, rooftop solar, and “smart” appliances that can reduce energy use when the grid is stressed. This is a major step forward that will allow resource planners to better integrate clean energy into the state’s electricity mix.

DERs will play a large role in California’s clean energy economy

The three agencies overseeing the electricity serving California homes and businesses—the California Energy Commission, California Public Utilities Commission, and California Independent System Operator (CAISO)—­­are adapting to the rapidly changing energy landscape and accounting for a proliferation of DERs. This new world of DERs is described in the diagram and includes:

• Energy efficiency (energy savings from smarter appliances and homes);
• Demand response (customers or automated buildings that reduce energy use in exchange for compensation);
• Distributed renewable energy (small-scale solar and wind);
• Electric vehicles, and other modes of energy storage (technology that stores and dispatches electric energy).

The change to an hourly DER forecast will not happen overnight. As previous electricity demand forecasts only predicted annual loads of a few DER resources, it will take the California energy agencies until 2017 to release this new hourly version. By including granular loads of DERs, California will be at the forefront of energy planning and will help build a more resilient electric grid.

The hourly DER forecast will help grid operators plan better

Forecasters must make sure there are enough energy resources to serve all of California’s electricity needs even when the grid is most stressed. This includes managing supply-side resources, such as power plants, that generate electricity and demand-side resources, such as energy efficiency and demand response programs, that optimize consumers’ electricity use.

As a result:

1. Forecasters can plan for times when the grid is most stressed.

The California agencies’ electricity forecast will allow resource planners to account for the hourly generation of renewable energy. CAISO’s “Duck Curve” shows the state’s “net load”—the total electricity load after renewable resources serve some of this load. The “belly” of the Duck Curve is from 8 a.m. to 4 p.m. (depending on the season), as solar energy is generated when the sun is shining. The “neck” of the Duck Curve shows the grid is most stressed and needs to quickly ramp up between 4 p.m. to 8 p.m. when the sun goes down and people use energy after returning home from work.

2. Forecasters also can plan for the best times to save energy.

The hourly forecast will allow resource planners to decide which periods of time are the most important times for customers to reduce electricity demand and save energy. For example, the forecast can be used to determine the best times to charge electric vehicles, and create policy levers such as time-of-use rate structures that incentive charging vehicles during hours when the grid is less stressed.

California’s next electricity forecast is a significant step forward that will allow resource planners to account for DERs’ hourly impacts on the grid, making sure that the state is able to reliably meet people’s energy needs and leading the way towards a clean energy future.