Whose Fault?
August 14, 2020 was a very hot day in California. Temperatures were 10-20 degrees higher than normal, and demand for electricity soared as people sought relief from the heat by cranking up their air conditioners. The high temperatures also affected the operating capabilities of conventional fossil-fired generation units, which cannot operate as efficiently in hot weather. And, although California has the most solar generation capacity in the country, high clouds reduced the amount of electricity its solar generators could produce.
For much of the day, CAISO, California’s system operator, was able to supply the electricity needed to meet all demands. But its ability to do so became more difficult around 3 pm when a large natural gas-fired generator suffered a forced outage and had to shut down. CAISO nevertheless was able meet all demands at that time. But it was not easy. And it only got harder as the afternoon progressed.
As everyone knows, you need the sun in order to generate electricity from a solar panel. And it is an immutable fact that a solar panel’s output declines throughout the afternoon as the sun moves down to the horizon and the strength of its rays weaken. This afternoon was no different from any other in that respect, and electricity production from solar generation followed its usual course, declining sharply.
But electricity consumption did not follow suit. By 6:30 pm, CAISO had no more spare generation capacity to turn to even as the amount of electricity produced by solar generators continued to drop. At 6:38 pm, CAISO initiated rolling blackouts, which remained in effect for just under two hours, until 8:30 pm.
The hot weather continued the following day. This time, CAISO faced a different set of problems in meeting the demand for electricity. First, storm clouds caused a sharp decline in solar output between 2 pm and 3 pm, but not in the demand for electricity, which was still rising. Next, the wind died down for an hour at 5:12 pm, significantly reducing the amount of wind-powered electricity being generated. Finally, just as the wind began to pick up again, CAISO accidently sent an erroneous instruction to a natural gas-fired generator to reduce its output. This was the last straw. The unexpected loss of electricity from the natural gas unit, combined with the expected decline in electricity produced by solar generators, caused CAISO to again initiate rolling blackouts. This time, however, the blackouts lasted only 20 minutes, ending at 6:48 pm.
Fingers started pointing almost immediately after these blackouts. Some people claimed that the blackouts revealed that solar and wind generation facilities are unreliable. They pointed to the rapid decline in solar generation on both days and the unexpected calm that reduced wind generation the next day. These arguments were made in support of the thesis that it is a mistake to put so much reliance on solar and wind facilities.
Adherents of solar and wind generation pointed the finger in the exact opposite direction. The noted that fossil-fired generation in general was low and that the blackout on the first day would not have occurred had the large natural gas-fired generator not shut down unexpectedly. These arguments were made to support the proposition that solar and wind generation is perfectly reliable.
In my view, neither side was correct in its attempt to assign blame for the blackouts. The dependence of solar and wind generation on the availability of sunshine and wind is well known and well understood. The solar generation facilities worked exactly as intended, and the potential that wind energy will be sharply reduced when the wind dies down is well understood.
Similarly, it is incorrect to assign blame for the blackouts on the reduced capability of California’s fossil units and the forced outage of the natural gas facility on August 14. Again, it is well understood that fossil units do not operate as efficiently in extreme heat. It also is well understood that fossil units are not indestructible and that they can break down, especially when operated in stressed conditions.
In my view, the fault lies in the failure of California to properly integrate its wind and solar facilities into CAISO’s system. An electric system should be assembled so that it fully accounts for the operating characteristics of the different types of generation that it employs. The amount of solar and wind facilities deployed, and even additional amounts of those types of generation, could have supported a completely reliable system if there had been sufficient backup capacity to bring online as the amount of solar generation declined when the sun went down, and to back up California’s wind generation. The fact that there was a problem when the natural gas facility went down on August 14 and an incorrect operating instruction was issued on August 15 confirms that California failed to provide the necessary amount of backup capacity. These events are foreseeable and a properly constructed system could have dealt with them.
Even though CAISO operates the California energy grid, it cannot be blamed for this failure to have properly integrated the solar and wind facilities into the grid. Rather, it is the California PUC that makes the decisions regarding capacity procurement. Unlike many other RTOs, CAISO does not operate a capacity auction and has no say in what types of generation operate in California. This means that it is the California PUC, and not CAISO, that was responsible for the capacity mix in California that led to the 2020 blackouts.
The California PUC implicitly acknowledged its responsibility when it subsequently approved the acquisition of additional generation resources that would be available to serve loads during the summer peak. Further, the California legislature also took some responsibility when it passed a bill that allowed PG&E to extend the operations of its Diablo Canyon nuclear power plant past the then announced retirement date in 2025. That retirement likely would have triggered a capacity shortage that would have led to future blackouts. Hopefully, blackouts will not become a usual feature of summers in California if California acts responsibly to ensure an adequate resource mix in combination with its desire to increase electric production by solar and wind facilities.