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FUEL FROM THE SKY: SOLAR POWER’S POTENTIAL FOR WESTERN ENERGY SUPPLY Ideas for a Future Transmission System An adequate transmission system will be required for both a renewable and a non-renewable energy future. The following considerations about the future of the transmission system should be part of any discussions by the Western governors in shaping their policy recommendations. ● A well-connected and well-designed transmission system will assure a high level of reli- ability and can minimize market power by a few generators in load pockets. ● Modern transmission technologies allow the development of a system with higher per- formance and less impact. High-voltage electric transmission is a very efficient and prac- tical way to move energy. ● Energy resources are not distributed evenly in the West. If fuel diversity is a strategic goal, then its realization will require expansion and improvement of the transmission system. ● Geographic diversity can greatly mitigate the intermittence issue of wind and solar resources through averaging. Therefore, if the West wants to adopt a widespread use of intermittent renewable energy sources, an adequate transmission system is important.6 ● Local opposition to high-voltage transmission lines remains strong, because of alleged health problems, aesthetics, rights-of-way, and property value issues. In summary, a strong transmission system is in the interest of western states and is essential if western states intend to provide a large portion of their energy needs from intermittent renew- able energy sources such as wind and solar. Meeting Future Electricity Demands With population growing in the western states, electricity demand is poised for growth for the remainder of this decade. Both energy demand, that is the number of megawatt-hours con- sumed over the course of the year, as well as peak demand, the highest hourly demand across the hours of the year, will continue to increase. Peak demand in the West is typically 60% to 65% higher than the average annual demand.7 This relationship has not exhibited any particular trend over the course of the last decade and, for our base case demand forecast, we assume that this relationship continues to hold over the next 10 years. Therefore RDI Consulting’s pro- jected demand growth rates are the same for energy and peak demand. For purposes of reliability, peak demand is what matters in most regions.8 If peak demand out- strips supply, blackouts occur or consumers are asked to conserve. However, if consumers are exposed to real-time energy prices, peak demand growth could slow relative to energy. This is because it is expensive to provide large amounts of power for only a few hours of the year, and 10PDF Image | Solar Fuel From The Sky
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