Richard Perez (UAlbany): “Solar will ensure the energy transition”

As we all know, the energy transition is taking place through an increase in production from renewable sources. We also know that these sources are intermittent, that they cannot be scheduled according to demand, and the topic of storage is more pressing than ever. For example, a country like China, the world’s top investor in renewables and biggest manufacturer of wind turbines and photovoltaic panels, wastes high percentages of its green production. In 2018, in Xinjiang, nearly one quarter of all the energy generated by wind was wasted and in 2017, in Gansu, one third of all renewable production went unused. However, very few people know terms like implicit storage or curtailment: the latter, highly known to experts, indicates the non-use of renewable capacity for reasons not deriving from the absence of wind or sun, but those which are technical or regulatory in nature. These are topics addressed by the New York State University of Albany professor, Richard Perez, one of the top international experts in the sector of solar energy, who recently attended the Terna Tech Talks, a digital internal communication event where the operator of the Italian national transmission grid hosts various high-profile scientific and institutional panellists in relation to topics of great interest to the company.

Welcomed by Antonio Geracitano, the Terna Manager for Stakeholder and Academic Relations, Perez presented two case studies conducted on TSOs in the United States and Switzerland, demonstrating that it is worth focusing on photovoltaic more and more as «it is rapidly becoming one of the least expensive technologies to generate electricity», transforming it from intermittent energy to low-cost on-demand electricity. How? Through something called "implicit storage", namely a mix of «overbuilding and curtailment, of optimisation of production as well as reduction, if necessary and appropriate, of that same production». According to the professor, this supply modelling, obtained through a proactive reduction associated with the excess supply of photovoltaic energy, is essential for mitigating intermittence and providing a constant production of solar energy at the lowest cost.

In practice, it involves increasing production capacity to meet demand when demand is high, and reducing capacity when energy would have gone to waste or been stored at higher costs. The challenge is therefore to make renewable energy, specifically photovoltaic but also wind to a lesser extent, an energy that is available 24 hours a day, 365 days a year, as is the case for traditional sources (which are polluting and/or climate-altering). Through his studies and analyses, Perez also seeks to understand how to combine solar and wind generation in an optimal manner.

In a study conducted by the US Department for Energy with the MISO (Midcontinent Independent System Operator) involving 3 macro regions in the midwest and 10 production centres, «the right balance would be 80% photovoltaic and 20% wind, whereas from an economic perspective using 95% renewables would allow for a 17% saving in costs compared to 100%, while flexibly covering the remaining 5% with natural gas». The study shows that between now and 2050 (the deadline set by the European Union for decarbonisation), the levelised cost of electricity (LCOE), i.e. the average revenue per unit of electricity generated required to recover the costs of construction and management of a generation plant during an assumed financial and operational life cycle, would decrease by 70%.

The method is also valid for the Swiss operator: here the winning "cocktail" would be given by a mix of solar and hydroelectric, and between now and 2050, by optimising the photovoltaic sector, Switzerland intends to offset the full decommissioning of its nuclear generation while at the same time increasing electrical demand by 30%. In neither of the two examples mentioned does the topic of mitigating the intermittence of renewable resources seem to require a transmission grid on a large scale: «Switzerland can achieve its stand-alone objective», added Perez during his speech. «Small interconnections are preferable because, although they cost more, it is also true that the higher costs are offset by benefits in terms of grid resilience and simplicity of execution».

The approach suggested by professor Perez can be summarised as "top down", with the underlying assumption that, once consolidated, the supply side of photovoltaic production can be integrated without a continuity solution into the existing electrical grids because, at operating level, it becomes equivalent to the production of traditional energy, so to speak. On the other hand, a "bottom-up" approach would address the matter from a perspective of dispersed resources, focusing on strategies to promote the intermittent flows of renewable energy on the distribution grids and based especially on localised storage and management of demand.

In brief, Perez proposes a change in perspective. If, on the one hand, storage remains an extremely central topic in the strategies of various energy transmission operators (including Terna, on the front line of the digitalisation and resilience of the Italian grid), supply modelling, through a smart reduction in production, is also key and being considered more and more often by sector experts.