Distributed Generation Integration Cost Study Analytical Framework California Energy Commission Table of Contents

In his Clean Energy Jobs Plan, Governor Brown established a 2020 goal of 12,000 megawatts of localized renewable energy development, or distributed generation, in California. In May 2012, Southern California Edison published a study that estimated the electricity infrastructure cost to accommodate its fair share of localized renewable energy could be more than $4 billion. However, the Southern California Edison study suggested those costs can be reduced by guiding projects to areas of the system better equipped to accommodate these resources. The California Energy Commission engaged Navigant Consulting to validate Southern California Edison’s approach to evaluating distributed generation impacts, and to conduct an independent cost analysis to interconnect and integrate increased penetration levels of renewable distributed generation on its system. This Energy Commission/Navigant Consulting study developed and used an analytical framework to predict potential impacts, least‐cost solutions, and how integration costs vary as a function of location. This study validated Southern California Edison’s approach and concluded that the cost to integrate localized renewable energy resources depends highly upon locational factors for both the distribution and transmission systems. Additionally, it concludes that policies to guide projects to areas better equipped to accommodate renewable distributed generation can significantly reduce integration costs. The Energy Commission considers this study a first step toward the 2012 Integrated Energy Policy Report Update goals of identifying preferred areas for renewable distributed generation and minimizing interconnection and integration costs and requirements.