Solar PV Curtailment in Changing Grid and Technological Contexts: Preprint

Solar photovoltaic (PV) systems generate electricity with no marginal costs or emissions. As a result, PV output is almost always prioritized over other fuel sources and delivered to the electric grid. At increasing levels of PV penetration situations arise where PV is curtailed, either because of local supply/demand imbalances or to maintain system flexibility. In 2018, we estimate that about 6.5 million MWh of PV output was curtailed in four key countries: Chile, China, Germany, and the United States. We find that PV curtailment peaks in the spring and fall, when PV output is relatively high but electricity demand is relatively low. Similar to the case of wind, some PV curtailment is attributable to limited transmission capacity connecting sparsely populated solar-heavy regions to load centers.Grid policies generally seek to minimize curtailment because it is viewed as an economic and environmental loss. However, we argue that changing grid and technological contexts warrant new thinking on PV curtailment. In the grid context, as grids integrate more PV and other renewable energy generation, seeking an optimal level of accepted curtailment becomes more efficient than preventing it. In the technological context, emerging technologies such as advanced inverters and low-cost battery storage are making PV systems more flexible. With flexible PV, grid operators can use withheld PV output to provide various non-generation grid services. This withheld PV output is a form of curtailment under prevailing definitions of the term. Hence, policies that aim to minimize curtailment may undercut the ability of grid operators to fully use the emerging capabilities of flexible PV systems. We argue that the changing grid and technological contexts require a re-examination of the curtailment paradigm. We argue that PV output that is withheld to provide grid services is fundamentally different from output that goes unused in response to system constraints. As a result, we propose a more exclusive definition of curtailment as unused PV output rather than the more expansive conventional definition as any reduction in system output from its technical potential. The terminological distinction is more than a question of semantics. Facilitating grid services by withholding PV output may increase the potential value of flexible PV systems to the grid. This shift in thinking may allow grid operators and policymakers to think in terms of PV curtailment management rather than minimization. Effective curtailment management may include policies that increase PV system dispatchability, alternative PV compensation schemes that decouple generator revenue from system output, and policies to increase grid flexibility.