Author: REsurety

Leading Global Organizations Launch New Consortium to Assess Climate Benefits of Energy Storage

Wind power

The Energy Storage Solutions Consortium will develop a first-of-its-kind methodology to quantify the greenhouse gas emissions benefits of stored energy usage.

REsurety logo
Broad Reach

Sept. 14, 2022 (Menlo Park, Calif.) – A group of leading organizations, including Meta, REsurety, Broad Reach Power and others, has announced the formation of the Energy Storage Solutions Consortium, a consortium to assess and maximize the greenhouse gas (GHG) reduction potential of electricity storage technologies. The group’s goal is to create an open-source, third-party-verified methodology to quantify the GHG benefits of certain grid-connected energy storage projects, and to ultimately help add a tool for organizations to create credible progress toward their net zero emissions goals.

Once approved by the third-party Verra through the Verified Carbon Standard Program, the standard would be the first verified methodology to quantify the emissions benefits of large-scale energy storage facilities, and would provide valuable guidance such as when to deploy stored energy to deliver maximum emissions reduction benefits. 

“At Meta, we are committed to accelerating the transition to the carbon-free grid of the future, and large-scale energy storage is a critical part of that transition. Having achieved 100% renewable energy for our global operations, we are now looking to help move the energy storage industry forward by addressing next-level challenges and opening pathways that will help drive high impact emissions reductions on the grid,” said Peter Freed, director of energy strategy at Meta. “We are excited to launch this consortium in partnership with these industry-leading organizations, who will bring diverse perspectives and experience to the development of a robust, transparent methodology.”

“We need to decarbonize the grid as quickly as possible, and to do that we need to maximize the emissions impacts of all grid-connected technologies – whether generation, load, hybrid or standalone storage,” says Adam Reeve, SVP of software solutions at REsurety. “Enabling this sort of decarbonizing activity is the exact reason why we invested in developing high-resolution Locational Marginal Emissions. Energy storage is a technology that has huge potential, and we’re delighted to partner with industry leaders in this forward-thinking and collaborative effort to develop a global standard for energy storage benefits.”

“Battery storage will play an increasingly important role in delivering reliable and affordable power to homes and businesses as we move toward a 100% renewable energy grid. As the leading utility-scale battery storage platform in the U.S., we’re looking forward to working with other industry leaders to be able to quantify the important GHG reduction benefits of large-scale energy storage facilities and help organizations take climate action,” says Paul Choi, EVP of origination at Broad Reach Power.

In order to calculate the GHG benefits of large-scale energy storage facilities, the consortium will leverage locational marginal emissions. This concept measures the tons of GHG emissions displaced through the charging and discharging of energy storage facilities on the grid at a specific location and point in time.

In addition to steering committee members Meta, REsurety and Broad Reach Power, the consortium includes a number of advisory committee members. These advisory members include leading technology companies, emissions data providers, investors, storage developers and service providers, and non-governmental organizations among others.

Members include:
3Degrees Group, Inc., Akamai Technologies, Clearloop, Equilibrium Energy, Fluence, General Motors, GlidePath Power Solutions, Habitat Energy, Hannon Armstrong, Jupiter Power, Longroad Energy, Marathon Capital, Microsoft, Primergy Solar, Quinbrook Infrastructure Partners, RES Group, Rivian, Rowan Digital Infrastructure, Stem, Tabors Caramanis Rudkevich, TimberRock, UBS Asset Management, and WattTime.

The Energy Storage Solutions Consortium is also partnering with Perspectives Climate Group, the German consultancy dedicated to helping its clients achieve net zero GHG emissions and to developing practical solutions for accounting of emission reductions from innovative climate- friendly technologies.

About Meta Platforms, Inc.
Meta builds technologies that help people connect, find communities and grow businesses. When Facebook launched in 2004, it changed the way people connect. Apps like Messenger, Instagram and WhatsApp further empowered billions around the world. Now, Meta is moving beyond 2D screens toward immersive experiences like augmented and virtual reality to help build the next evolution in social technology. about.facebook.com

About REsurety
REsurety is the leading analytics company empowering the clean energy economy. Operating at the intersection of weather, power markets and financial modeling, we enable the industry’s decision-makers to thrive through best-in-class value and risk intelligence, and the tools to act on it. For more information, visit www.resurety.com or follow REsurety on LinkedIn.

About Broad Reach Power
Broad Reach Power is the leading utility-scale battery storage platform in the United States. Based in Houston, Broad Reach is backed by leading energy transition investors, EnCap Investments L.P., Apollo Global Management, Yorktown Partners and Mercuria Energy. The company owns a 21 GW portfolio of utility-scale battery storage and renewable power projects across the U.S., giving utilities, generators, and customers access to technological insight and tools for managing merchant power risk so they can better match supply and demand. For more information about the company, visit www.broadreachpower.com.

Media Contacts

REsurety
Tara Bartley
[email protected]
(774) 232-1220

Broad Reach Power
Morgan Moritz
[email protected]
(512) 745-2575

Meta
Stacey Yip
[email protected]
(650) 407-0610

How Playing Whack-a-Mole With Dirty Power Can Help the World Reach Net Zero, as published by Bloomberg

Understanding the real-time mix of power sources in electricity grids could be a win-win for companies and the planet.

Authored by Eric Roston

Bloomberg reviews the challenges behind corporations meeting net-zero goals and REsurety’s efforts with the new Energy Storage Solutions Consortium is highlighted. Read more below.

Excerpt:

“Until now, power investments have been made largely with a focus on maximizing revenue and reliability. Now they need to help the world reach net zero, too.

Meta Platforms Inc., the power data and analytics company REsurety Inc., and Broad Reach Power, which owns and operates clean energy projects in the US, last week launched an Energy Storage Solutions Consortium. The group wants to set up a freely available and independently approved method to measure the planetary greenhouse gas savings associated with grid-scale energy storage. The goal is to make sure battery-stored renewable power is displacing fossil-generated electricity.”

Read the full article on Bloomberg’s website.

The Importance of Basis in Project Valuations: How Investors are Using REmap to Help

Wind Energy

Authored by Blair Allen, Director, Software Customer Success

In our Q2 2022 REmap report, we focused on node-to-hub basis: how deteriorating node-to-hub basis and the increase in use of basis-sharing clauses in PPAs were forcing companies to direct more attention to it as a risk, and that investors were chief among that group because of its impact on project health and ultimately project returns. This has prompted investors to search for new tools to better understand the basis risk faced by existing assets, and to carry that focus up the decision-making tree when new investment decisions are being made. Simply put, basis exposure not only impacts the valuation for cash and tax equity investors, but increasingly whether to walk away and forgo the time and cost of additional due diligence of a project. To help drive towards more efficient and realistic investment decisions, investors are turning to alternative data sources to supplement their traditional methods.

One way that REmap, REsurety’s SaaS-based market analytics product, supports more efficient and realistic project valuations is by saving investors time when accessing up-to-date historical basis performance for wind and solar projects. REmap shows hourly basis values for all operational wind and solar projects across the country. Investors use this data as a confidence check against forecasted basis values present in sponsor models, and to see how it aligns with historical performance at that proxy node as well as nearby nodes. Investors are turning to REmap for this information not only because it is easy to access and visualize with just a few clicks, but also because REmap’s hourly generation for all projects enables users to see the generation-weighted impact of basis – which is ultimately what matters most for project valuations.

Caddo County and neighboring wind projects

For example, an investor might be evaluating a portfolio of assets with a mix of operating and in-development projects. One project is an in-development wind farm in Caddo County, Oklahoma, and the engineering report included in the sponsor model designated a nearby operating wind project as the representative “proxy” node due to its geographical and electrical proximity to the new location. The sponsor model says the forecasted basis for the project is going to be $3 over the next few years then fall to $1 in the outer years. To confidence check this value, the investor can login to REmap and search for the county to identify the proxy node used in the consulting report, then quickly flip through the time series data for the proxy node to see how it performed recently, how prices have trended, and the project’s generation-weighted value. The same is then done for neighboring nodes/projects to see if the proxy node is an outlier or consistent with trends in the area. If performance at other nearby nodes differs, a note is made to discuss this difference with the sponsor or consultants to understand why any differences may exist. In this example, the investor finds that, historically, generation-weighted basis has ranged anywhere from $2 to -$12 on average for the proxy node and neighboring nodes, and recent data suggests a downward trend at several locations. The decision is made to use several different basis scalar values in the project model, based on historical performance at these different locations, so that the investor can evaluate how these different scenarios may impact expected profits and the likelihood of hitting a return threshold. After discussing with internal stakeholders, a decision will be made on how to price the overall investment given the risks inherent in this project, or to pass on the investment opportunity.

The historical, monthly-level generation-weighted basis for wind projects in, and neighboring, Caddo County. Projects display a range in month-to-month performance, and a mix of trends.

Investors know that markets are changing and history isn’t necessarily an indication of future performance, and that costly 3rd-party basis forecasts don’t get it right either. The utility of historical data is that it represents real-world performance and builds a foundation for evaluating the uncertainty in the future. Investors starting with a simple question – “how different is the forecast in the sponsor model from what’s happened in the past” – can use the answer to determine how much time to put into due diligence, or how much risk to price into the investment. REmap is helping investors make these decisions more efficiently with centralized, easy access to the historical and forecasted data they need.

For more information on REmap, or REview, which is helping investors evaluate the basis risk of their current portfolio, contact [email protected].

Learn more about REmap:
See what’s coming from REmap on the forecasting front
Learn how investment firm Hannon Armstrong is using REmap

Improving the Electrical Grid with Innovation and Partnerships, as published by Tech at Meta

Wind power

The electrical grid is transforming as older, less efficient fossil fuel generation plants are closing and more wind and solar farms are added to the system.

Authored by John DeAngelis, Energy Manager, Meta

AN EXCERPT: The electrical grid is transforming as older, less efficient fossil fuel generation plants are closing and more wind and solar farms are added to the system. These changes, however, can introduce additional complexity to the system that requires new tools to help the grid transition reliably. Additionally, companies are attempting to reach net-zero emissions by reducing carbon emissions from their operations, removing greenhouse gases from the air, and partnering with others on specific projects to directly reduce air emissions. Increasingly, energy storage is being deployed to help address these challenges and improve grid reliability.

The global energy storage market could hit one terawatt-hour by 2030, according to the latest forecast from research company BloombergNEF. Energy storage has been deployed in the United States mostly to help balance the electricity system when there are short-term fluctuations in supply and demand. However, these energy storage projects are currently incentivized to maximize revenue, which at times can inadvertently increase system emissions.

In 2022, Meta along with our partner Broad Reach Power, launched a pilot to test how energy storage could reduce carbon emissions while continuing to help preserve a reliable electrical grid. Meta is working with industry leaders to study how emerging technologies like energy storage can support grid reliability and reduce emissions as we continue to build some of the most efficient and innovative data center facilities in the world.

Read the full article on Tech at Meta.

Q2 2022 REmap Report

REsurety creates the REmap-powered State of the Renewables Market report every quarter to provide readers with data-driven insight into the emerging trends and value of renewables in U.S. power markets. We combine our domain expertise in power markets, atmospheric science, and renewable offtake to analyze thousands of projects and locations and summarize key findings here. All of the data behind this analysis is available via our interactive software tool, REmap. Please fill out the form at the bottom of the page to access the full report, the Editor’s Note is below.

Blair Allen, director, software customer success, REsurety

Blair Allen
Director, Software Customer Success, REsurety

Editor’s Note:

Node to hub basis* is rapidly becoming one of the most prominent financial risks for renewable developers and clean energy buyers alike. Although not a new issue, it has recently become more visible for two reasons: first, it is getting much worse in many areas with a lot of renewables, and second, clean energy buyers are increasingly taking on basis-risk exposure through contractual terms in PPA agreements. While basis used to be a risk only borne by project developers and investors, now corporates are sensitive to it as well.

In Q2, a handful of renewable-rich regions saw generation-weighted (AsGen) basis worsen by double digit values relative to the 4 year Q2 average. In many cases this was most prominent in areas that were already no stranger to negative basis. In ERCOT South Hub, for example, the average AsGen basis for operating wind projects in Q2 over the last 4 years was -$11 – in 2022 it declined to -$34. In the NP15 region of CAISO, the average AsGen basis for operating solar projects dropped from -$9 over the last 4 years to -$27 in 2022. And in SPP South Hub, operating wind projects saw their 4 year average decline from -$9 to -$31 in 2022.

But hub-level average values only tell part of the story, since basis is inherently a project-specific concern and can vary considerably not only within hub boundaries but across projects only miles apart from each other. For instance, when considering the projects within SPP South Hub last quarter, REmap shows project-by-project AsGen basis values that varied from as low as -$48 to as high as $26. The same extreme divergence played out across different ISOs and hubs, driven by subregional constraints driving a wedge in value between locations on either side of congested areas.

Basis warrants so much attention because it is extremely volatile and has a large impact on investment returns. In addition, it is hard to solve: investment into transmission infrastructure takes years and is extremely expensive. Developers screen for viable greenfield locations to avoid it, investors pore over model results to price it, and now energy buyers are turning to their advisors or tools to understand it better as well. The basis risk sharing clauses increasingly present in PPAs link the developer and clean energy buyer to the project’s basis performance in ways the two groups weren’t before, and the mechanics of that linkage aren’t always well understood. Although its impact ultimately depends
on the counterparty and the project-specific contract details that can either worsen or improve exposure, one thing is clear: basis should be on everyone’s radar.

In this Q2 REmap report, we analyze a number of metrics including: shape, capacity factor, and AsGen value of power for renewables domestically. REmap users have real-time access to these metrics and more, including basis analysis, through the map-based SaaS offering.

*AsGen basis is defined in this report as the difference between a project’s AsGen nodal price ($/MWh) and its hub price ($/MWh), where the hub is assumed to encompass the area where the node is located.

Q2 2022 REmap Report Download

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Options for EIA to Publish CO2 Emissions Rates for Electricity, as published by Resources for the Future

The path toward decarbonization in the United States entails not only a mix of federal, state, and local government policies promoting clean energy, but also voluntary efforts by the private actors to reduce their CO2 emissions.

Authored by Karen Palmer, Brian Prest, Stuart Iler, and Seth Villanueva

Resources for the Future reviews use cases for emissions rate data and different options available to the Energy Information Agency for publishing data on both average and marginal emissions rates. Existing methods and data sources, such as REsurety’s Locational Marginal Emissions data, are discussed and evaluated. Read the executive summary excerpt below.

Excerpt:

Decarbonization efforts in the US consist of a mix of government policies to promote clean sources of energy and improve energy efficiency and voluntary actions by private actors to reduce their CO2 emissions. Understanding both the likely and actual benefits of both policies and private actions requires information about the carbon intensity of different sources of energy including electricity. Demand for data on the CO2 intensity of US electricity production and consumption is growing as governments and private companies seek to understand the emissions effects of both their electricity consumption and their clean energy investment choices. Emissions rate information is also important for Scope 2 emissions accounting under the GHG Protocol Corporate Standard1 that provides a way of tracking progress toward clean energy targets that many companies have declared.

The desire for transparent and consistent data on electricity emissions rates led the US Congress, in the Infrastructure Investment and Jobs Act (IIJA), to call for the US Energy Information Administration (EIA) to publish spatially and temporally granular electricity emissions rate data, beginning in late 2022. Specifically, the IIJA calls on EIA to report on hourly operating data, including “where available, the estimated marginal greenhouse gas emissions per megawatt hour of electricity generated” within each balancing authority and by pricing node. The law also calls on EIA to harmonize its electric system operating data with GHG and other relevant data collected by EPA or other federal agencies, as well as data collected by state or renewable energy credit registries. The resulting integrated data set should include net generation data and “where available, the average and marginal greenhouse gas emissions by megawatt hour of electricity generated within the boundaries of each balancing authority,” to be offered on a real-time basis through a publicly accessible application programming interface (API).

Read the full report on Resources for the Future’s website.

REsurety unveils renewable energy toolkit for portfolio management

Solar Wind Energy

Clean energy buyers and investors utilize the best-in-class SaaS to forecast, audit and explain the financial and environmental outcomes of clean energy projects and contracts

BOSTON, June 28, 2022 – REsurety, Inc., the leading analytics company empowering the clean energy economy, today announced a new SaaS analytics toolkit, REview. It’s the latest addition to the company’s software suite, which harnesses massive project performance and high resolution weather datasets to give clean energy buyers and investors a unique view into the financial and carbon emissions impact of the projects in their clean energy portfolios. 

The new toolkit extends REsurety’s existing market intelligence SaaS product capabilities by providing insight into customer-specific projects and specific contracts. REview customers can use the tool to analyze how their contracts are performing, what risks they hold, and how settlement is expected to occur over the coming months and years. The tool provides a breakdown of drivers of financial, operational, and carbon emissions performance, both at the hourly and aggregate level. 

Rich Santoroski, Chief Risk Officer and Co-head of Portfolio Management for Hannon Armstrong
Rich Santoroski

“We are pleased to incorporate REsurety’s dynamic new tool in service of our commitment to innovative client solutions,” said Rich Santoroski, Chief Risk Officer and Co-Head of Portfolio Management for Hannon Armstrong, and a Board member of REsurety. “Like their entire set of software applications, REview offers superior data with actionable insights to evaluate new renewable energy investments and monitor asset performance.”

REview delivers several unique benefits to customers: data speed and transparency, locational marginal emissions (LME) integration, and fundamentals-driven, scenario-based forecasting. REview provides high accuracy estimates of project and contract performance long before project data is typically provided; an independent and granular view of settlement and operational performance; and it’s the only tool on the market that measures both project-specific carbon emissions performance alongside project-specific financial performance. 

Lee Taylor, CEO of REsurety
Lee Taylor

“REsurety is excited to empower sustainability leaders with the insight and confidence they need to continue accelerating their investments in the clean energy-fueled future,” said REsurety CEO Lee Taylor. “Full visibility into project performance – both financial and environmental – and high confidence in the value and risk of future results is key for the long term success of this industry.”

For years, REsurety has used its proprietary data and analytics to accurately model the project output, carbon emissions impact, and financial value of clean energy generation. The new subscription service leverages these models and makes the insights they enable accessible to corporate buyers or investors through just a few clicks.

Screenshot of REsurety's new analytic tool, REview
REview helps customers understand settlement impacts potentially caused by a project’s operations by comparing modeled settlement to actual settlement.

Information about REview and its applications can be found here.

REview is currently in private launch with leaders in clean energy procurement, investment, and trading. General availability beyond the private launch is expected later this fall.

Companies may request an online demo of REview from an expert on the REsurety team by contacting [email protected]. Members of the news media may arrange for a demo by contacting Tara Bartley, [email protected]

About REsurety

REsurety is the leading analytics company empowering the clean energy economy. Operating at the intersection of weather, power markets, and financial modeling, we enable the industry’s decision-makers to thrive through best-in-class value and risk intelligence, and the tools to act on it. For more information, visit www.resurety.com or follow REsurety on LinkedIn


Disclaimer.

Decarbonizing the Datacenter, as published in the Wall Street Journal

Solar Energy

EXCERPT:

Solar Energy

Microsoft, which operates a global network of datacenters for its cloud services, has a long-term vision that by 2030, 100% of its electricity consumption, 100% of the time, will be generated from zero-carbon sources. This “100/100/0” commitment recognizes not only the critical obligations Microsoft has as a major consumer of electricity, but also the opportunities that come with it, says Brian Janous, general manager of energy and renewables at Microsoft.

Microsoft, which operates a global network of datacenters for its cloud services, has a long-term vision that by 2030, 100% of its electricity consumption, 100% of the time, will be generated from zero-carbon sources. This “100/100/0” commitment recognizes not only the critical obligations Microsoft has as a major consumer of electricity, but also the opportunities that come with it, says Brian Janous, general manager of energy and renewables at Microsoft.

In the U.S., Microsoft has partnered with clean energy analytics company REsurety to help develop tools capable of calculating emissions at each node along an electric grid. First piloted in Texas, these measurements of Locational Marginal Emissions (LMEs) help companies trying to decarbonize better understand the sources of the power they use on a granular level, then measure the impact of clean energy use and adjust power practices accordingly.

Read the full article in the Wall Street Journal.

Employee Spotlight on Sarah Sofia, Software Engineer and Solar Energy Expert

“I remember in high school, people were often surprised that I was interested in STEM and art, but I think they’re super connected and that a lot of engineering is creative.”

Software Engineer Sarah Sofia talks about her career

“I liked math and science but I also danced very seriously growing up, doing ballet, tap, and jazz. I remember in high school, people were often surprised that I was interested in STEM and art, but I think they’re super connected and that a lot of engineering is creative. Whether literally you’re building something or building a structure in your head for how to visualize a model, it’s all very connected to how you think about art and drawing or sculpting. 

“Increasingly it was very clear that physics and engineering was really what I loved to do. And my dad is very into science so he instilled an early interest in that for me. He has a small business that’s at our house and his team makes tools to test reliability, thermal conductivity, and thermal management of electrical components. As I get older, I have realized that being around a lot of circuit boards, working with my dad to build different things, and doing science experiments in the basement, made a lot of science and engineering feel more tractable as an adult. Like when I was little, I would go into the shop and make jewelry out of solder and ribbon cable and then as I got older I wanted to understand what they are and what they do. Participating in that and having someone lead me to see all of the possibilities from a young age was really valuable. I feel like that’s a big barrier for some because you can have so much separation from how things are made or work. So getting that growing up and being like ‘oh I know how to make something’ was special.

“I was very into physics and astronomy in undergrad, then my trajectory sort of slowly changed. After graduating, I wanted something with an impact on the world I was living in, in a more direct way. It felt like a pretty natural transition to engineering from physics and I found solar as a really cool application of physics. I liked being able to go all the way from the fundamental physics of what is happening on a micro level, all the way up to energy going into people’s houses. I was fortunate to work with industry in grad school. I wanted to maintain that and continue working in industry, where it really felt like I was directly connected with renewables getting installed now and less hyper focused on a very small portion of something that’s important in a solar cell. 

“As I have been in this world, I increasingly just think energy is super cool. I’m really interested to see, particularly as new technologies come more online, how they will change and shape the way our grid is evolving. I think getting to a higher and higher percentage of renewables and carbon free energy poses a lot of challenges, but they’re really exciting and interesting challenges. 

“My big hobbies at the moment are baking and quilting. I’ve always loved the transformative process of baking. As I’ve gotten into baking more complicated things and figured out how to optimize recipes and why certain things make certain things happen, I think it is really interesting. And then you get a treat at the end! Then during Covid, I took a remote quilting class through a fabric store in Cambridge. They did Zoom classes and sent materials. It’s slow, but very fun. Whenever there’s some progress that you see day to day it’s very satisfying.”

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Currents Podcast: Recent Evolution of the Hedge Market

Currents podcast features discussions on project finance and recently interviewed REsurety's CEO Lee Taylor.

Listen in as Todd Alexander and Lee Taylor discuss the recent evolution of the hedge market due to the impacts of winter storm Uri. They get into the spectrum of hedging options before the storm, how each of those structures fared, how the hedging landscape has changed and more.

The Currents Podcast features in-depth discussions on the latest developments in project finance. The podcast is hosted by partner Norton Rose Fulbright’s Todd Alexander, who interviews key business leaders and policy makers to investigate important trends affecting the energy and infrastructure space.

Employee Spotlight on Jennifer Newman, VP of Atmospheric Science Research

Jennifer Newman

“I found anecdotally that a lot of meteorologists also play instruments.”

Jennifer Newman, Vice President, Atmospheric Science, REsurety, standing in front of a wind turbine.

“I grew up in the Boston area, and my dad was a sportswriter and my mom works in medical book publishing. So not really all that science-related. But I’ve always loved blizzards and snowstorms and thunderstorms. I still absolutely love snow. Growing up in New England, we definitely got a wide variety of weather. I was always fascinated by all of it and loved being out in it. 

“I have a younger brother who’s a software developer out in L.A. Sometimes we chat about agile development and things like that. We have this common vernacular now.

“Back then I took dance classes, I was in chorus, I played clarinet in the band, I acted. I was into the humanities, but I had this inclination for science and math. Everything appealed to me, so I went in as an undeclared major at Cornell University

“One draw for Cornell was its marching band. I did marching band throughout high school and all four years in college. I played the clarinet. We did every home and away game, and we also did a couple NFL games, and a Canadian Football League game. Rehearsals were three times a week. One of them was Tuesdays until 11 pm, which now I can’t imagine!

“Someone in the band was in the Meteorology Department, and he became known as the band meteorologist. I had never really found an outlet for all the math and physics, but once I saw, you can apply it to something that I really loved – the weather – that’s when things started to click. I found anecdotally that a lot of meteorologists also play instruments. 

Jennifer Newman, Vice President, Atmospheric Science, REsurety, with a weather balloon.

“I did an internship with the University of Rhode Island, sending up weather balloons with instruments to measure ozone. Then the summer after my junior year, I went to the University of Oklahoma and got into more severe weather research, and ended up going there for grad school too. 

“My thesis was on how to better detect tornadoes with current weather radar systems. I did a lot of storm-chasing down there. It took me a couple of years of going out driving around dirt roads in Kansas, but I did eventually get to bag a couple of tornadoes. You end up running into all kinds of people, like a crowd of people on a dirt road in Kansas or Oklahoma. Now that I own a house, I have to say I don’t think I’d be thrilled if there was a tornado coming through or hail, knowing I would have to pay to replace my roof. I think I’m good with an occasional minor thunderstorm.

“While taking a renewable energy class during the last semester of my Master’s program, I realized I really loved learning about wind energy and the meteorology applications. That’s when I decided to stay for a PhD so that I could learn more. During my PhD, I got to set up meteorological instruments at some operational wind farms and analyze the data, which gave me a great understanding of how important accurate measurements are for wind energy. After finishing my PhD, I did a postdoc with the National Renewable Energy Laboratory in Boulder, Colorado.

“I’ve always thought I liked working in industry more than academia, and I wanted to move back to the Boston area, because my family is still here. I started reaching out to my network, and was connected with REsurety. It was a smaller company then, about 10 or 11 employees, and they were looking to hire some kind of research scientist, so my skill set matched really nicely. 

“I was able to look in-depth into the challenges we were facing and improvements we wanted to make with our generation modeling. What I bring is figuring out what we’re doing well, where we can improve, and working with the engineering team to make those changes to our wind and solar models.

“Math and physics tend to be male-dominated fields. Having two female co-advisors in graduate school was very impactful in my life. Seeing that they had to work hard to be heard always inspired me to speak up and be confident. There was only one other female when I got here, and so I started Women of REsurety. I want the females here to have a connection to other women working at the company.

“I had a daughter five months ago, so my hobby right now is child rearing!”

Jen’s full bio.

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Carbon Accounting with the Greenhouse Gas Protocols: Successes and Emerging Challenges

David Luke Oates
David Luke Oates is a carbon accounting subject matter expert.
David Luke Oates

By David Luke Oates, SVP of Power Markets Research, REsurety

The Greenhouse Gas Protocol is a foundational component of modern climate standards. It is incorporated into the Task Force on Climate-Related Financial Disclosures’ (TCFD) guidelines for voluntary climate disclosures1, as well as the Science-Based Targets Initiative’s (SBTi’s) recommendations for aligning corporate targets with climate goals.2 It has also largely been paralleled in the U.S. Security and Exchange Commission’s recent proposed rule on climate disclosures.3

The GHG Protocol has achieved considerable success in providing a common framework for voluntary disclosures. But it is now a fairly outdated standard, and its flaws are becoming more impactful and problematic. The GHG Protocol Corporate Standard was originally released in the early 2000s, with updated Scope 2 guidance released in 2015. The nearly seven years since that release have featured dramatic increases in corporate clean energy purchases and interest in accurate corporate climate disclosures.4 There is now growing interest in updating the GHG Protocol and addressing some of its shortcomings.

At REsurety, we spend much of our time helping buyers and sellers of clean electricity to manage their financial risks and achieve their decarbonization goals. We are particularly interested in ensuring that Scope 2 accounting is as effective as possible. Today, the GHG Protocol Scope 2 Guidance has two major flaws: 1) it does not ensure that all actual carbon emissions are accounted for across entities and 2) it often doesn’t create the right incentives for entities interested in decarbonization. 

On the first item, the GHG Protocol’s Market-Based method for Scope 2 accounting allows reporting entities to apply REC purchases to cover their consumption at an emissions rate of 0 tons/MWh. It also allows entities to account for their grid consumption by applying a simple-average emissions rate. This average emissions rate reflects the same clean energy claimed through REC retirements, effectively double-counting the impact of clean energy and contributing to under-reporting of emissions.5 While this double-counting may have been of little concern a decade ago, the volume of today’s clean energy purchases make it a more serious problem.

On the second item, by relying on average emissions rates with low temporal and spatial granularity, current Scope 2 guidance risks send the wrong signals to entities interested in decarbonization. Consider an entity purchasing solar energy that mostly displaces coal generation, in a grid that also includes considerable baseload nuclear. Since the average emissions rate of this grid is much lower than the emissions rate of the displaced coal, the reduction in the entity’s carbon footprint would not reflect the solar energy’s full carbon impact. In general, the activities achieving the greatest amount of decarbonization are not fully rewarded under the current GHG Protocol, creating a misalignment of incentives. We think there is an opportunity to fix both of these problems.

Governments and corporate entities have recently made ambitious climate mitigation commitments. Truly delivering on these commitments will require a modernized set of carbon accounting rules to align incentives and avoid double-counting. We believe that a revised Scope 2 carbon accounting framework based on granular marginal emissions data can help address some of the shortcomings we mentioned above. We look forward to sharing more details on potential solutions to these challenges in the months to come.

In the interim, we love talking with anyone who shares our goals of more accurate carbon impact measurement and the tools to maximize that impact – so please contact us at [email protected] if you have any questions or want to connect and discuss.

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Footnotes:

[1] See p. 21, Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures, October 2021

[2] See p.3, SBTi Criteria and Recommendations, Version 5.0, October 2021

[3] See §I.D.2. (p. 40), The Enhancement and Standardization of Climate-Related Disclosures for Investors, SEC Proposed Rule, File No. S7-10-22

[4] U.S. corporate clean energy purchases grew from 1.2 GW/year in 2014 to over 11 GW/year in 2021. See Clean Energy Buyers Association Deal Tracker

[5] While this double-counting could theoretically be corrected by applying the residual mix emissions rate to all parties’ grid consumption, this approach is not feasible in many jurisdictions. Calculating the residual mix emissions rate depends on visibility into all private contracts for RECs between counterparties, something that individual reporting entities aren’t able to provide. In jurisdictions (such as the U.S.) where residual mix emissions rates are not available, current GHG Protocol guidance is to apply the average emissions rate to grid purchases. See GHG Protocol Scope 2 Guidance §6.11.4


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Media Advisory: Prolonged periods of negative pricing in Q1 set new record

Blair Allen

REsurety’s REmap Q1 State of the Renewables Market report presents generation-weighted value, shape value, and capacity factor for major U.S. hubs

BOSTON, MAY 10, 2022 – The U.S. power grid saw record lows in the first quarter of 2022, REsurety’s REmap Q1 2022 State of the Renewables Market Report finds, with prolonged negative pricing in Texas expected to ease this summer.

Unlike the soaring prices of last year during the Texas energy crisis of February 2021, this year the ERCOT power grid saw record lows in Q1. It was another turn in a developing plotline REsurety commented on last quarter. 

One example: In February 2021, ERCOT West Hub (among others) settled at the market price cap of $9,000/MWh for three days; in February 2022 ERCOT West Hub saw a two day period where prices never rose above $0/MWh. Mild demand coupled with sustained periods of high wind and solar generation created the conditions for this negative pricing event, though these conditions weren’t isolated to only those few days. In fact, by the end of the quarter, West Hub more than doubled the number of negative-priced hours than were seen in Q1 the year prior.

REsurety creates the REmap-powered State of the Renewables Market report every quarter to provide readers with data-driven insight into the value and latest emerging trends of renewables in U.S. markets. The team uses its knowledge in power markets, atmospheric science, and renewable offtake to analyze thousands of locations, and summarize a few key findings, using the data that is available via its interactive software tool, REmap.

Key components in the report to be used to analyze trends in a given ISO, sub-regions of an ISO, or hub, are:

  • The generation weighted value, or the realized value of the wind and solar projects 
  • The shape value, or the relationship between the generation value and the simple-average market price
  • The net capacity factor for operating wind and solar projects 
Blair Allen, Director, Software Customer Success, REsurety
Blair Allen

“Using the modeled energy in REmap, which tells us how projects could have performed based on underlying wind/solar resource availability, last quarter West Texas solar projects saw anywhere from 20 to 30% of their potential hourly production for a given month happen in negatively priced hours. However, in reality, these projects weren’t operating at their potential capacity in these intervals, and either shut down or significantly ramped down production,” reports Blair Allen, Director, Software Customer Success, REsurety. 

Over the next quarter as the weather starts to transition to summer conditions negative pricing is expected to decline. With an increase and shift in demand, Q2 will likely be a transitional period, with the frequency of negative pricing hours remaining high to start before subsiding more materially by the end of the summer in mid Q3. 

The power of REmap lies in the historical and predictive modeling for renewable energy projects across the United States, as well as the ability to analyze hypothetical installations. Learn more by reading the Q1 report

About REsurety

REsurety is the leading analytics company empowering the clean energy economy. Operating at the intersection of weather, power markets, and financial modeling, we enable the industry’s decision-makers to thrive through best-in-class value and risk intelligence, and the tools to act on it. For more information, visit www.resurety.com or follow REsurety on LinkedIn

Contact:  Allison Lenthall, [email protected], +1-202-322-8285


Disclaimer.

Q1 2022 REmap Report

REsurety creates the REmap-powered State of the Renewables Market report every quarter to provide readers with data-driven insight into the emerging trends and value of renewables in U.S. power markets. We combine our domain expertise in power markets, atmospheric science, and renewable offtake to analyze thousands of projects and locations and summarize key findings here. All of the data behind this analysis is available via our interactive software tool, REmap. Please fill out the form to access the full report, the Editor’s Note is below.

Q1 2022 State of the Renewables Market Report

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Blair Allen, director, software customer success, REsurety

Blair Allen
Director, Software Customer Success, REsurety

Editor’s Note: As the first quarter of 2022 concludes, we reflect on historic highs and historic lows. Another record in ERCOT marks the quarter’s passing, just as one did a year ago following the market events of February 2021. However, unlike the soaring prices of last year, this record involves a prolonged period of negative pricing, and another turn in a developing plotline we commented on last quarter. Please fill out the form below to access the report.

Consider this comparison: in February 2021 ERCOT West Hub (along with others) settled at the market price cap of $9,000/MWh for three days; in February 2022 ERCOT West Hub saw a two day period where prices never rose above $0/MWh. Mild demand coupled with sustained periods of high wind and solar generation created the conditions for this negative pricing event, though these conditions weren’t isolated to only those few days. In fact, by the end of the quarter, West Hub would more than double the number of negative-priced hours than were seen in Q1 the year prior.

One impact of this increasing frequency in negative pricing is rising levels of curtailment, particularly among solar projects which, unlike wind, don’t benefit from the production tax credit and are less likely to operate below $0/MWh. For example, using the modeled energy in REmap, which tells us how projects could have performed based on underlying wind/solar resource availability, last quarter West Texas solar projects saw anywhere from 20 to 30% of their potential hourly production for a given month fall in negatively priced hours. However, in reality these projects weren’t operating at their potential capacity in these intervals, and either shut down or significantly ramped down production.

Another important angle to consider: whereas for the last few years hourly negative prices at West Hub were evenly split between on-peak and off-peak hours during this time of year, this year saw that balance shift to 60/40 in favor of on-peak hours. The cause for this shift is clear: increasing amounts of solar capacity means that low pricing is no longer just following the production profiles for wind, and is coinciding more regularly with the rise and fall of solar energy.

Looking ahead, as seasons change into summer conditions so too do we expect a change in the volume of negative pricing. An increase and shift in demand– which will steadily move more towards the mid afternoon as air conditioning ramps–and a decline in wind production at the same time should converge to steadily mitigate on-peak negative price frequency. Q2 will likely be a transitional period, with frequency of negative pricing hours remaining high to start before subsiding more materially by the end of the quarter.

Friends don’t let friends use 8760s

says Jennifer Newman, VP of Atmospheric Science Research, REsurety

As featured in POWER Magazine

Any company embarking on a new project must do its research to ensure that it calculates the proceeds based on the right financial information. With so much data now readily available, it’s more important than ever to use the right data, and make accurate calculations. 

REsurety's Jennifer Newman, VP of atmospheric science research, talks about 8760s.

Amid the boom in demand for renewable power plants, that is not always happening when backers go to measure the value of the energy they will generate. Here’s why, according to Jennifer Newman, Vice President of Atmospheric Science Research at REsurety, the Boston-based renewable industry data and analytics company. 

Q: What is an 8760 and how is it used in the renewable energy industry?

A:  An 8760 (sometimes referred to as a typical meteorological year or TMY) consists of hourly generation values for a wind or solar project for all 8,760 hours of a typical year. Importantly, 8760s are almost always used to represent average generation for a renewable energy project in a given hour. 

Q:  And what’s the problem? Why shouldn’t 8760s be used to estimate the value of power generation being produced by renewable energy projects? 

A:  An 8760 isn’t bad on its own – it’s a perfectly acceptable way of representing average generation. The issue is when a generation 8760 is paired with hourly power prices to produce either a revenue backcast (an estimate of the revenue a project would have made given historical prices) or a revenue forecast (an estimate of how much revenue a project could earn in the future). 

The problem with a backcast is that hourly renewable generation influences power prices during each hour. And that’s because wind and solar tend to be very inexpensive sources of electricity. So an hour where there’s a lot of wind or solar on the grid will tend to be associated with lower power prices, particularly in markets with high renewable penetration. When you use an 8760 instead of actual generation values during each timestamp, you aren’t able to capture that impact of hourly generation on hourly power prices.

And when analysts are using a model to predict future power prices, it’s a mistake to assume that conditions in the future will be similar to  an “average weather year”. Abnormal weather conditions can cause drastic price changes, as we all saw in Texas during February 2021.

Q: So what should be used to accurately calculate the value of renewable power generation?

A: There’s an abundance of rich datasets we can use to inform our decisions on whole new levels. For a backcast analysis, we should be using concurrent generation and price time series data to make these calculations and avoid errors (i.e. the generation volume that is used for 7:00 am on January 13th, 2019 should reflect the same weather conditions that generated the price that was observed in that same hour). In a forward-looking scenario, you should use a variety of different potential weather conditions beyond just an average year. Would you want to use a typical Texas February to project possible gains and losses, now that you know that Texas in February of 2021 is possible?  

Q: Where does a company turn then, to ensure it’s using the right information?

A:  At REsurety we offer the REmap tool, which models hourly generation for every wind and solar project in the United States, and will soon look forward at hypothetical situations to allow for future planning. REmap also offers data for synthetic situations – what-if planning for potential future sites – including historical modeled generation, observed power prices, and the combination of generation and power prices to estimate revenue. 

Getting beyond 8760s can not only steer a company to site a new renewable project in one location versus another, it can also provide guidance on the financial risk associated with a range of potential weather conditions.

Learn more, download the white paper.

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