But now, the state and its grid operator are grappling with a strange reality: There is so much solar on the grid that, on sunny spring days when there’s not as much demand, electricity prices go negative. Gigawatts of solar are “curtailed” — essentially, thrown away.
In response, California has cut back incentives for rooftop solar and slowed the pace of installing panels. But the diminishing economic returns may slow the development of solar in a state that has tried to move to renewable energy. And as other states build more and more solar plants of their own, they may soon face the same problems.
“These are not insurmountable challenges,” said Michelle Davis, head of global solar at the energy research and consulting firm Wood Mackenzie Power and Renewables. “But they are challenges that a lot of grid operators have never had to deal with.”
Solar power has many wonderful properties — once built, it costs almost nothing to run; it produces no air pollution and generates energy without burning fossil fuels. But it also has one major, obvious drawback: The sun doesn’t shine all the time.
Over 15 years ago, researchers at the National Renewable Energy Laboratory were in the midst of modeling a future with widespread solar power when they noticed something strange. With lots of solar power on a given electricity grid, the net load — or the demand for electricity minus the renewable energy — would take on a “U” shape. Sky-high demand in the morning would be replaced by almost zero demand in the middle of the day, when solar power could generate virtually all electricity people needed. Then as the sun set, demand surged up again.
California’s grid operator, known as CAISO, later dubbed this effect the “duck curve.” (If you squint, you can imagine the curve as the belly of a duck.) It’s most prominent in the spring months, when solar panels get plenty of sunshine but there is less demand for heating and cooling.
In recent years in California, the duck curve has become a massive, deep canyon — and solar power is going unused. In 2022, the state wasted 2.4 million megawatt-hours of electricity, 95 percent of which was solar. (That’s roughly 1 percent of the state’s overall power generation in a year, or 5 percent of its solar generation.) Last year, the state did that in just the first eight months.
Clyde Loutan, principal for renewable energy integration at CAISO, says that the state has long been prepared for more solar on the grid. But, he added, “We drastically underestimated the speed at which residential solar was going to come in.”
Curtailing solar isn’t technically difficult — according to Paul Denholm, senior research fellow at the National Renewable Energy Laboratory, it’s equivalent to flipping a switch for grid operators. But throwing away free power raises electricity prices.
It has also undercut the benefits of installing rooftop solar. Since the 1990s, California has been paying owners of rooftop solar panels when they export their energy to the grid. That meant that rooftop solar owners got $0.20 to $0.30 for each kilowatt-hour of electricity that they dispatched.
But a year ago, the state changed this system, known as “net-metering,” and now only compensates solar panel owners for how much their power is worth to the grid. In the spring, when the duck curve is deepest, that number can dip close to zero. Customers can get more money back if they install batteries and provide power to the grid in the early evening or morning.
The change has sparked a huge backlash from Californians and rooftop solar companies, which say that their businesses are flagging. Indeed, Wood Mackenzie predicts that California residential solar installations in 2024 will fall by around 40 percent. Some state politicians are now trying to reverse the rule.
“Under the CPUC’s leadership California is responsible for the largest loss of solar jobs in our nation’s history,” Bernadette del Chiaro, the executive director of the California Solar and Storage Association, said in a statement referring to California’s public utility commission.
But experts say that it reflects how the economics of solar are changing in a state that has gone all-in on the technology.
“You don’t want the utility or the grid operator to be overpaying for power when they don’t have to,” Davis said.
Other states, which have been slower to adopt solar, are…
Read More: California is grappling with a growing problem: Too much solar