New Report: Carbon-Tuning New York's Electricity System

December, 01, 2015
Nick Martin
Energy Policy Associate
ClimateEnergy EfficiencyRenewable Energy

When solar PV panels generate electricity, what are the actual environmental benefits produced? A key component to answering this question is understanding the impact the solar panel has on the rest of the electric system. Since the panels are supplying electricity, a power plant somewhere else no longer needs to generate as much electricity to fulfill demand. If this power plant uses coal—which generally has a higher carbon content than other fuels—to generate electricity, then the solar panels are reducing relatively dirty electric generation. However, if the power plant uses less carbon intensive natural gas, for example, the air pollution reductions will be much smaller compared to displacing coal generation.

With the New York State Public Service Commission’s (PSC) groundbreaking Reforming the Energy Vision (REV) proceeding aiming to unleash market forces to stimulate the deployment of distributed energy resources (DER) like solar PV across the state, understanding the emission characteristics of the generation displaced by DER is more important now than ever. With support from the Heising-Simons Foundation, we have just released our new report—Carbon-Tuning New York’s Electricity System—that analyzes the generation likely to be affected by DER operation by estimating marginal emission rates for CO2 and other pollutants for New York’s electric system.

Not only does this information help us better understand the emission benefits of DER in New York, it also can help direct DER deployment to maximize emission reductions. Marginal emission rates can tell us when and where DER operation will displace the dirtiest centralized generation.

Our analysis finds that carbon-dioxide (CO2) marginal emission rates tend to be highest when demand on the electric system is at its highest as well.

This bodes well for REV’s peak reduction strategy. By reducing energy demand during the hours of the year it is currently the highest, energy generation from power plants with some of the highest CO2 emission rates will be reduced.

We also found evidence of additional opportunities for gaining larger emission reductions during times that are not necessarily aligned with hours of peak demand. Further, we found large locational differences in marginal emission rates, which can be significant when transmission constraints influence the generators that are likely to respond to DER operation.

The report provides greater detail on marginal emission rates for CO2 and other pollutants in New York and what they mean in the context of REV. Explicitly incorporating the value of emission reductions based on marginal emission rates into DER valuation should be a priority for the PSC. There are times and locations where greater emission reductions can be attained through DER deployment. By incorporating marginal emission rates into DER valuation, the PSC can increase the economic efficiency of DER deployment and operation as it strives to move New York toward its ambitious goal of reducing greenhouse gas emissions 40 percent by 2030.