SCE study highlights locational value of clean local energy
The study makes the importance of locational planning abundantly clear in implementing Governor Brown’s goal of 12,000 MW of DG.
As one of the largest utilities in the state, Southern California Edison (SCE) must incorporate significant penetrations of DG into the grid to meet Governor Brown’s goal of deploying 12,000 MW of DG in California. According to a recent report by SCE, directing these DG projects to key areas on SCE’s grid could save consumers up to $2.4 billion, largely by avoiding expensive transmission upgrades.
This study by SCE found that a project’s location affects grid upgrade costs dramatically and that well-planned placement of new DG facilities would avoid billions of dollars in system upgrades, when compared to the historic approach in which the vast majority of energy is generated far from where it is consumed.
This study makes the importance of locational planning abundantly clear in implementing Governor Brown’s goal of 12,000 MW of DG. It is critical for any DG procurement process to account for the significant benefits of well-sited projects and ensure that ratepayers gain from cost-effective projects, which eliminate the exorbitant costs associated with transmission. These findings align with long-held Clean Coalition recommendations, including that well-placed projects should be incentivized through compensation for locational value, and that state regulators implement thoughtful and efficient distribution system planning processes.