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John Farrell

The content that follows was originally published on the Institute for Local Self-Reliance website at http://ilsr.org/about-the-institute-for-local-self-reliance/staff-and-board/john-farrell/
John Farrell

John Farrell is the Director of Democratic Energy at the Institute for Local Self-Reliance and widely known as the guru of distributed energy.

John is best known for his vivid illustrations of the economic and environmental benefits of local ownership of decentralized renewable energy.

He’s the author of Energy Self-Reliant States, a state-by-state atlas of renewable energy potential highlighted in the New York Times,  showing that most states don’t need to look outside their borders to meet their electricity needs.  He’s also written extensively on the economic advantages of Democratizing the Electricity System, published a rich interactive map on solar grid parity, and polished the policies (like Minnesota’s solar energy standard) necessary to support locally owned renewable energy development.

John provides data-rich presentations on local renewable energy for the common citizen, and has wowed crowds from Presque Isle, Maine to San Francisco to Berlin.  He’s been the keynote at conferences like Solar Energy Focus in Washington, DC, and also inspired citizens in Boulder, CO, prior to their successful effort to seize more control over their energy future.

John’s work appears most regularly on Energy Self-Reliant States, a blog with timely and compelling analysis of current energy discussions and policy.  The posts are frequently enriched by charts, translating the complex economics of energy into tools for advancing local energy ownership and they are regularly syndicated at Grist, CleanTechnica, and Renewable Energy World.

Reach John on Twitter @johnffarrell or by email at jfarrell@ilsr.org

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  • http://www.businessmodern.com Therese Tetzel

    Hi John, I just found your website and was amazed to read your purpose. I have been a part of the power industry since 1997 and have a good understanding of it. I love it and I am thrilled at the level of change within it. However, since the advent of renewable energy and the internet 2.0 I too have been saying “democratize” and thought I was the lone voice in the wilderness. Lucky for me I found your organization. Do you have followers in the Dallas area? I would love to have a chat with you about projects I am working on and get your opinion.

    Democratize, decentralize and distribute is the basis for a business model I am working on and I believe this concept is a match for the mindset and social structure going forward especially in the newest generation in the US.

    Therese
    469-323-1874

  • Peter Walker

    I enjoyed your article, “A $48 billion opportunity for US electric customers.” My biggest complaint about the Report might be the size of the economic effects. I think $48 billion is much too small. Between jobs created, the advantages of distributed energy, the savings for consumers which can be spent elsewhere, long-term lower energy costs to the overall economy, and the environmental benefits, you vastly underestimate the economic benefits.

    Solar and wind energy are now at the point where they compete directly with fossil fuel alternatives. Efforts need to be made to bring these sustainable energy technologies forward as quickly as possible.

    Which brings me to the reason why I and writing you. Do you know of any public service organizations, similar to yours, whose primary purpose is to combat utilities that discourage sustainable energy by restricting electrical transmission over their power lines? Would this be considered a restraint of free trade issue? If so, maybe it’s time these monopolies be challenged in the courts. I am looking for others that have similar interests in changing the current status quo.

    • John

      Peter, an electric utility is regulated by the state government. There are technical reasons why the utility are combating policies like net metering as well as financial. Managing a transmission and distribution system is not a simple as you may think. Adding customer owned generation is a good idea, however, it will only make managing an electrical grid more complicated. That means more staff, smarter computers and in some cases better electrical infrastructure. Who is suppose to pay? Is the utility suppose to absorb those costs? That’s why they want solar to pay a bit more because they end making the process of managing the grid more difficult.

      • houper

        Yes, the utility should absorb the costs. Profits are not guaranteed.

        • John

          In a regulated world, profits are guaranteed; utilities don’t operate under pure market driven
          principles. If that were the case then the utility should have the right to disconnect a customer if they choose too for any reason but they can’t because they operate in a regulated environment. The utility is legally held accountable for delivering electricity and they must earn profit if they are to attract capital (money) to maintain distribution and transmission systems that service all customers. Without that capital, utilities would not be able to build new or maintain their infrastructure. It would put the public at too much risk and therefore, utility profits must be fixed…They shouldn’t be under or over.

          Even people like Elon Musk have admitted that the grid will always be needed in some
          respect no matter how much storage is available. Therefore, shouldn’t we
          try and upkeep it to ensure the future of renewable power is feasible?

          • Ray Pokorny

            John,
            Recently I have begun to explain solar incentives and their role in getting more distributed power installed with the following.

            With Oregon as my place of residence and where I have my solar company, the discussions I get into have local incentives as a base. Utilities in Oregon have voiced concern over the costs they have to incur due to increased power supplied by renewables. My customers and prospective customers have asked me about the nature of those utility concerns so they may be better informed. I suggest they continue to read and research on their own well beyond my comments.

            I hear utilities voice these concerns and all that is in most articles and stories is the complexity of managing the dynamic supply of renewables. Very seldom if ever do I see or hear how this dynamic supply resource is acquired.

            In Oregon, there are usually three incentive sources. The Energy Trust of Oregon(ETO), Renewable Energy Tax Credit(RETC) and Federal Income Tax(FIT)

            The ETO incentive is a direct cost reduction paid to the contractor. They money comes from the customer base. No cost to utility.

            RETC is from the State of Oregon tax payer, also in the customer base. No cost to the utility.

            FTC is from Federal Taxpayers, also in the local customer base of the utility. No cost to the utility.

            Now incentives are not designed to cover all costs of the of a renewable project. That leaves the renewable customer/utility customer to make up the difference out of pocket. No cost to the utility.
            I think I have described a new supply of power for electric utilities that has not cost for them. They should be paid for distributing power as they are currently paid. The whole customer base will benefit from cleaner air, water and not paying for higher rates of a new coal or nuclear plant. All the above mentioned tax bases are also included in the benefit package.
            Smarter grid management systems and coupled with advance storage systems will cost more to distribute power, but smarter management means less waste.

            Renewables don’t appear to me to be such a downer as they may suggest.

            I’m sure I have left out some details, but the general concept should hold water.

            Thanks for the opportunity to say my piece.
            Ray Pokorny, Madras, Oregon
            Solar Contractor since 1979

          • John

            Ray, Thanks for the detailed post. I don’t
            believe renewables are a downer, I am simply trying to convey that there is an
            added complexity that distributed resources like solar or wind add to the grid
            and that the grid will always be necessary in some fashion. Therefore it is in
            our (society, ratepayer whatever) best interest to make sure electric utilities
            are financially viable. Financially viable is a compromise between allowing
            profits for shareholders and investing in infrastructure that supports electric
            delivery of power. To comment on what you said:

            “Now incentives are not designed to
            cover all costs of the of a renewable project. That leaves the renewable
            customer/utility customer to make up the difference out of pocket. No cost to
            the utility.”

            The cost to actually build the new supply
            (renewable energy project) is paid for by the customer, however, there are
            costs and benefits associated with injecting (NEM) power into an electrical
            network. Sometimes the costs outweigh the benefits or visa versa, this is
            usually the analysis an engineer will perform to determine if an injection or
            generation of power is worth it. Unfortunately, sometimes engineers are forced
            to accommodate it when it doesn’t make sense…but that is another discussion. You
            also say:

            “think I have described a new supply
            of power for electric utilities that has no cost for them. They should be paid
            for distributing power as they are currently paid.”

            I get what you’re saying, “The utility
            should do what they have always been paid to do.” Here is the problem with
            that thinking, utilities have operated distribution circuits over the last 100
            years without or with little generation. And when there is a large generator,
            it is almost always synchrous but more importantly it is dispatchable
            generation. That means you can control the MW output 24/7 with very high
            certainty or probability of it being available. Solar, wind and everyday folks
            who are just trying to live don’t fit that criteria. So in reality, you’re not
            asking the utility, “to do what they always do”, you’re asking them to go the
            extra mile just so “the generation (NEM) customer” can make money off them. If
            the utility has to go the extra mile to accommodate an NEM generator shouldn’t
            the customer pay if necessary? So what are the additional things the utility
            might have to pay for, besides the supply side (owned by the customer)
            infrastructure like the inverters, panels, utility telemetry etc?

            “Utilities in Oregon have voiced
            concern over the costs they have to incur due to increased power supplied by
            renewables…My customers and prospective customers have asked me about the
            nature of those utility concerns so they may be better informed”

            They are probably referring to possible
            multiple costs:

            1. Overvoltage – Since the circuit the
            customer is injecting power was never designed by the utility to handle
            generation, the injection (if collectively large enough) could cause a high
            voltage on the distribution circuit and damage other customer equipment…which
            the utility would be financially responsible. The customer (with the damaged
            equipment) would sue the utility not customer injecting power. The utility must
            now maintain the voltage supply with the added expense accommodating the new
            NEM power injection.

            Possible ways to mitigate this:

            Supply side inverter which can absorb the
            VARS of the system. Customer Pays

            Reinforce Network (Heavy-up, replace XFMR,
            install a regulator to create voltage zone and regulate voltage so no customer
            is in violation) Very expensive cost to Utility.

            Storage solution either on the system or at
            the customer point of interconnection to absorb power flows and regulate
            voltage locally. Customer or Utility pays.

            2. Protection – Since the circuit the
            customer is injecting power was never designed by the utility to handle
            generation, the injection (if collectively large enough) could cause a reverse
            flow anywhere upstream from the customers. This can trip out devices that
            support the distribution system and cause a power outage.

            Possible ways to mitigate this:

            Must coordinate your protection schemes
            with the generator and program devices with settings to allow for reverse power
            flow. Utility Pays for capital and labor costs.

            3. “Smart Grid” Infrastructure or Utility
            2.0 – Demand side management and
            distributed generation will all inherently require the electric utility to make
            large investments in new meter infrastructure, complex software applications
            and a more skilled engineering work force because of the need to manage
            variable loads (demand side management), distributed generation and other devices
            on the system remotely. In my opinion, this will be the largest cost if we are
            to shift from a centralized to a distributed grid because very little
            investment has been made close to the end use customers…in fact most of it has
            been made at the generator and transmission system, the points furthest away
            from the end use customer.

            Possible ways to mitigate this:

            Everyone moves towards operating
            independently by using localized storage and/or micro grids. I don’t see this
            as a viable option unless incremental costs of battery storage come down.
            Microgrids will be tremendously labor intensively expensive…Just think thousands,
            possible hundreds of thousands of micro utilities that need electricians, power
            engineers etc. Cost to Customer.

            Start investing in AMI meters and software
            applications that optimize grid electrical power usage. Develop a talented work
            force in the electric utility industry that innovates to reduce net energy
            usage and demand. Allow utilities for a reasonable rate of return on investing
            in these infrastructures. This is a tough pill to shallow for most advocates of
            energy independence. Cost to Utility.

            4. Increased Labor O&M Costs – This is
            the big one. See point 3 and factor the cost of a larger work force to handle
            ageing infrastructure and smarter power system. Cost to Utility.

            5. Grid Transient and Dynamic Stability – This
            is a very complex subject and I don’t have time to elaborate on it. Solar and
            wind are not dispatchable and therefore, if the sun went away (Cloud etc) for a
            moment over a large geographic area, the load would spike very quickly and if
            generation is not very quickly turned on to compensate for the loss of solar
            power, the system will become unstable (very bad).

            Possible ways to mitigate this:

            Very good weather and load forecasting
            techniques so Utilities can predict when these sudden generation shortages will
            occur and procure the necessary “grid generation” to backup. Cost to Utility.

            Storage! Storage!…Cost to Utility or
            Customer

            6. Loss of Load Diversity – This is
            actually a system cost and is not really a cost the utility…but it can be
            viewed as an overall loss to society in efficiency to deliver electrical power.
            I’ll refer you to: https://en.wikipedia.org/wiki/Diversity_factor.
            Basically, the lower diversity you have, the harder it is for generation to
            meet demand. Distributed Resources = Low Diversity. Centralized Resource = High
            Diversity. Low Diversity implies a lower cost efficiency because the collective
            capacity (MW) of your generators will be higher than if you had higher
            diversity. Cost to the system.

            However, utilities usually leave out that there
            are also benefits to having distributed resources (the customers own generation,
            I’ll go into more detail in later post, it’s late and I’m tried)

            Peak Reduction (Capital Expense Deferment)

            Optimize Energy Purchasing (Net Meter 1.0, Net
            Meter 2.0, and beyond)

            Voltage Support or a VAR market ??

            Volt-Var (System Loss Reduction) – Loss reduction
            in distribution lines

            The point I’m trying to make here is that
            the costs and benefits (I have listed) have to be accounted for on a case by
            case basis…No overarching statement can be made by someone saying that the
            costs will always be greater than the benefits or visa versa in determining if “It
            makes sense to use distributed resources”. This analysis is part of the added
            complexity that increases the technical and consequently financial burden on
            electric utilities. Therefore, if we want to achieve a future of low cost
            distributed resources in a manner that does compromise the current level of
            safety, reliability, and integrity of the electrical system then we need to
            make sure we invest in that system. The alternative is to trash the grid and
            move in a new direction of complete independence. I personally think this is
            dangerous and the wrong direction for most societies. It might make sense for
            extremely isolated groups of people but those cases are few a far between.

            Thanks. What did you mean by this statement:

            “Very seldom if ever do I see or hear how this dynamic supply resource is acquired.”