Rhode Island Works On Creating Right Mix of Renewable Energy
December 7, 2020
Rhode Island’s path to 100 percent renewable energy by 2030 is being cleared, but it’s not a simple, straight route, as numerous options need to be considered.
There will likely be plenty of wind and solar power coming online during the 2020s to meet the benchmark. But the renewable energy directive from Gov. Gina Raimondo requires an analysis of jobs, costs to ratepayers, and economic benefits of lower climate emissions.
A study underway by the Rhode Island Office of Energy Resources (OER) and The Brattle Group, a Boston-based energy consultant, has a simple goal but lots of moving parts, including myriad sources of renewable energy.
The state must choose from renewable energy certificates (RECs), direct purchases of power from large wind and solar projects, and retail power generated by thousands of smaller installations.
The latest update by The Brattle Group looked at using these options independently and combining them in energy portfolios.
To look at these options, the report noted that Rhode Island has to meet a gap of 4,600 gigawatt-hours of renewable energy on top of what it already expects to be procuring by 2030 through mandates, such as the Renewable Energy Standard (RES).
If a single source of renewable energy is relied on, such as offshore wind, the state could meet the 2030 target with just two or three additional contracts from projects like the 400-megawatt Revolution Wind facility. The goal could also be met with about 10,000 more small solar arrays.
Land-based wind power and wholesale electricity purchased from large solar arrays presents limitations, such as land scarcity and limits imposed by moving the electrify through the power grid.
The cost to ratepayers in the recent report is determined by the acquisition costs of the energy, minus the market revenue. The economic benefit is defined by gross domestic product (GDP), jobs, and construction. GDP is determined by in-state construction expenditures, operation and maintenance expenses after projects go online, and the cost to ratepayers for the project. It doesn’t include the overall economic impacts of a new industry expanding in the state, like what offshore wind is doing in the Ocean State.
Filling the state’s renewable-energy gap with RECs, pegged at $30 per megawatt-hour, is the least-expensive method for buying power. But it has the lowest economic benefit in terms of GDP and fostering development of in-state renewable projects. Land-based wind, offshore wind, and large solar arrays require similar costs to acquire the energy.
If each source of renewable power is used to fulfill the entire gap of 4,600 gigawatt-hours, the typical retail customer would pay about $11 more a month for a portfolio of RECs. Offshore wind also adds $11 a month. Land-based wind adds $13 a month and small-scale solar adds $31 a month, according to The Brattle Group.
Land-based wind power is relatively inexpensive, but economic benefits are low because the energy will likely be imported from other states and it offers few local jobs. Electricity from net metering is expensive because it shifts costs to non-net-metering customers. But it has a strong local economic benefit due to the construction work it creates.
Without getting into specifics, OER commissioner Nicholas Ucci said he supported using a blended energy portfolio. Those offered by The Brattle Group had similar costs.
Ucci advocated for expanding the state’s RES to 100 percent by 2030, which would require approval by National Grid and the General Assembly. Energy consumption can be decreased through renewing energy-efficiency programs, he said, and by shifting electricity usage during peak periods of demand, a process known as demand response.
Steps will be taken to improve siting, energy storage incentives, and distribution systems, according to state officials. The state Renewable Energy Fund, which offers grants to developers, will likely be extended before the program ends in 2022. Incentives will be expanded for building energy projects on brownfields and building newer technologies such as microgrid systems.
The cost assumptions don’t include new incentives, such as tax credits, that may be offered by President-elect Biden, so without specifics they can’t be calculated. But permitting for offshore wind is expected to happen more quickly, along with improvements to the electric distribution system.
Ucci emphasized that offshore wind is “here to stay” and said the state remains committed to building a hub for the industry. Offshore wind will likely be a major source of energy in the future, as evidenced by the governor’s executive order for 600 megawatts of offshore wind, because it can be built at scale and can be easily connected to the power grid.
Policy and planning changes to prepare the grid for the increased workload through 2050 will be launched in 2021, according to Ucci. He said this effort will include planning with municipalities, National Grid, state agencies, and neighboring states and seeking ways to reduce interconnection costs.
Environmental equity for frontline communities, land use, and the growing demand for electricity, as the heating and transportation sectors decarbonize, are expected to be addressed in the upcoming report.
Yasmin Yacoby, OER’s energy justice program manager, spoke of the mistrust marginalized communities have in authority figures and by extension large initiatives. She said OER will host meetings with established community organizations to address systemic racism and legacy inequities. She also noted that OER and National Grid will create an energy equity group in 2021. She said traditionally overlooked people will be included in this effort and in future projects by making sure assumptions aren’t being made about their needs. There will also be localized job training and education programs, according to Yacoby.
“This is going to be a long process and a difficult one,” she said. “There is a lot of mistrust and there is a lot of work to be done to build that trust back up. But that is a priority we are working on.”
Based on an OER study, the agency is hoping to ensure equitable benefits and equitable costs.
”It’s not just focusing on bill savings,” Yacoby said. “It’s really focusing also on pollution reduction, increase to in-home comfort and health and climate change.”
Ucci described Rhode Island’s energy goal as bold, but he noted that the process he will be proposing soon has been written with input from the Rhode Island Division of Public Utilities and Carriers, the Public Utilities Commission, and the Department of Environmental Management.
“We know how to do it, and we have a suite of policies and programs that can already help foster that success,” he said.
Ucci added that a blended portfolio offers the greatest cost, job, and reliability benefits to meet the goal of reducing climate emissions, but it won’t be cheap.
“Achievement of our clean energy future requires ratepayers to support those investments in order to drive the energy, economic, and environmental outcomes we seek,” he said.
The public will have an opportunity to comment during online listening sessions scheduled for Dec. 10 and Dec. 14. The public comment period ends Dec. 15. A final analysis with recommendations is expected to be released by Dec. 31. Comments can be emailed to [email protected].