Renewable Energy Challenges and Opportunities: Geospatial and Qualitative Analysis of Southern California Monica Perry, James Pick, and Jessica Rosales School of Business, University of Redlands, 1200 E. Colton Ave . P.O. Box 3080, Redlands, California 92373-0999 USA Contact author: Monica Perry,
[email protected] Abstract. Renewable energy has become an increasingly important and viable approach for mitigating the negative impacts of generating electrical energy with fossil fuels, such as oil and gas. In our study of renewable energy we conducted geospatial analysis of an array of demographic characteristics and renewable energy facilities (manufacturers, installations) for wind and solar energy. The analysis focused on Southern California, but also included two benchmark urban regions in other states, Maryland and Texas with well-developed solar and wind sectors, respectively. Qualitative data on renewable energy was also collected through personal interviews to supplement our geospatial analysis. Implications for sustainability are drawn by identifying key aspects of renewable energy development in Southern California. Keywords: Renewable Energy, Solar Energy, Wind Energy, Ecoinnovation, geospatial analysis
1
Introduction
Global climate change continues to be a fundamental and critical issue for both developing and developed countries. The United Nations’ Convention Framework on Climate Change is a global collaboration which illustrates the significance of climate change, as well as the widespread commitment to reducing and minimizing the negative aspects of climate change [1]. Towards that end, greenhouse gases represent the primary cause of negative climate change, with fossil fuel activities associated with electricity generation being the primary cause of increased greenhouse gases in the United States as well as around the world [2]. A wide array of alternative energy sources exists for fossil and nuclear fuels, the most significant being renewable energy sources. Renewable energy represents an increasingly important and viable approach for reducing the negative environmental impacts of generating electrical energy with fossil fuels, such as oil and gas. The most important renewable energy sources in Southern California are solar, wind and geothermal energy sources. The relative abundance of wind, solar and geothermal energy sources varies across different geographic regions, thus laying the foundation for differential potential for these forms of renewable energy generation. As part of an in-depth research project on renewable energy development and manufacturing potential in Southern California, we conducted a multi-method study utilizing geospatial analysis. The geospatial analysis was supplemented primarily with qualitative analysis through personal interviews.
In the discussion that follows we address how geospatial and qualitative analysis were applied to the renewable energy sector to identify meaningful patterns and draw implications for the renewable energy sector in Southern California. We focused our efforts on geographic analysis of a variety of renewable energy, demographic, and economic characteristics to illustrate the opportunities and challenges for renewable energy development and manufacturing in Southern California. Characteristics included location of key renewable energy facilities and resources, the population and other key complementary attributes such as transportation infrastructure. Renewable energy resources, markets and manufacturing represent important features of the Coachella Valley in Southern California. The Coachella Valley (the Valley) extends southeast approximately 45 miles from the southeastern part of the San Bernardino Mountains to the Salton Sea. The Salton Sea is a water basin filled by rainfall and irrigation runoff that flows northwards from the Imperial Valley draining into the Sea. The sections that follow address three aspects of the research study. In Section 2, we present a detailed discussion of the methodology and data used for both the geospatial and qualitative analysis. The methodology sub-section addresses data sources as well as challenges with data availability. In Section 3 we provide an overview of the primary geographic area of interest in Southern California, the Coachella Valley, by focusing on demographic, economic and natural resource characteristics. In the last section we present preliminary implications and conclusions for renewable energy and sustainability in the Valley. 2 Methodology: Geospatial, Qualitative Data and Analysis 2.1 Geospatial Data and Analysis The renewable energy project was designed with the goals of understanding the challenges and opportunities for renewable energy development in the Valley. The specific renewable energy activities of interest included potential production activities such as manufacturing and assembly, as well as aspects of current and future demand for renewable energy. To achieve those goals the project primarily focused on analysis of key aspects of the renewable energy supply chains for solar, wind and geothermal combined with in-depth analysis of the political, economic, sociodemographic and physical characteristics of the Valley. Effort was spent identifying relevant data sources related to each of the three renewable energy sectors (solar, wind and geothermal) as well as data on the cities and urban area of the Coachella Valley. Extensive searches yielded secondary data sources which provided considerable information and data for analysis. The data sources included: federal, state and local government agencies, trade associations, as well as articles, reports and books authored by experts and participants in renewable energy, and governmental, business, and nonprofit websites. Government resources included census and other data from the federal government, California state agencies and nonprofits concerned with renewable energy. These resources were used to describe and map relevant characteristics of the population and businesses of nine cities and two unincorporated areas or census designated places (CDPs) within Coachella Valley. The nine cities included Cathedral City, Coachella, Desert Hot Springs, Indian Wells, Indio, La Quinta, Palm
Desert, Palm Springs, Rancho Mirage. The two CDPs were Thousand Palms and Mecca. U.S. Census social and economic data include population, educational attainment, income, net worth, occupation, employment, age, home ownership, internet use, and crime. Data on businesses included business types from the North American Industry Classification System (NAICS), size (employment) and location. Given the project focus on the Valley, additional detailed data on manufacturers were identified, mapped and analyzed. Population estimates of the Valley were projections from Southern California Association of Governments (SCAG) and the California Department of Finance were utilized with occasional modified assumptions. We estimated population for 2020 based on continuation of the U.S. Census’ average yearly city and non-city 2008-2013 growth rates. Although our primary focus was on renewable energy in the Valley, some aspects of the renewable energy sector were relatively under-developed. As a result, we sought to identify some well-developed renewable energy sectors outside of the Valley as benchmarks or exemplars. We identified geographic regions in Maryland and Texas for solar and wind energy respectively, as well-developed renewable energy exemplars.. Similar population data for those regions were also collected, mapped and analyzed. Data on renewable energy facilities, policies and initiatives was also gathered from federal agencies, such as the US Department of Energy, U.S. Geological Survey, and U.S. Energy Information Administration, as well as state agencies for California, Maryland, andTexas . These sources were used primarily to collect information and data on renewable energy supply chain participants, policies, incentives, initiatives, and environmental issues. In addition to government resources, trade and non-profit associations provided a wealth of specific data on various aspects of renewable energy in the Valley as well as in the United States. Data on renewable energy supply chain activities in specific geographic areas were collected from renewable energy trade associations. Individuals within select trade associations were contacted to investigate the availability of additional relevant data for the study. Data on manufacturers for major wind, solar and geothermal related products were collected, mapped and analyzed for California, solar for Maryland and wind for Texas. Similarly, data on the locations of major solar, wind and geothermal installations (existing and in development) were collected, mapped and analyzed. Market characteristics included the existing status and forecasts for major installations and jobs in renewable energy came from nonprofits especially the Solar Energy Industries Association (SEIA) and American Wind Energy Association (AWEA). Additional data and information were provided from the following trade associations and non-profit organizations: Alternative Energy Institute, American Council on Energy Efficient Economy, As You Sow, National Renewable Energy Laboratory (NREL), The Solar Foundation, and the Utility Variable-Generation Integration Group.
2.2
Qualitative Data Analysis
Supply chains represent relatively complex ecosystems of interdependent organizations. The interdependent organizations provide various goods, information and services necessary to serve ultimate customers [3]. The process of serving the ultimate renewable energy customer consists of many prior stages where a variety of organizations engage in a wide assortment of activities to transform and distribute raw materials, manufacture, assemble and distribute components, as well as provide financing and information. While broad commonalities exist in the respective supply chains for the three renewable energy industries, the nature of each industry, products, and organizations involved create particularities for each specific renewable industry. For example, significant differences in physical principles and technologies exist in each of the different renewable energy industries [4]. As such, the qualitative approach utilized in-depth personal interviews with open-ended questions to provide sufficient opportunities to identify specific information on supply chain structures, issues, requirements and activities for solar, wind and geothermal industries. A key benefit of personal interviewing with open-ended questions is that they allow the opportunity for interviewers to probe participants for clarification and additional depth. We designed and conducted personal interviews with a total of twelve participants. Participants included renewable energy experts from non-profits, providers of renewable energy products and services, as well as officials and managers from the public sector. The information from the personal interviews with renewable energy experts was useful in providing additional context for the geospatial analysis generated with secondary data. Similarly, the personal interviews with renewable energy executives helped identify organizational, inter-organizational, and strategic factors not easily addressable with geospatial analysis. As a result, the combination of geospatial and qualitative data analysis provided a relatively rich and robust basis for understanding the challenges and opportunities of renewable energy and drawing meaningful conclusions. 3.
Human, Economic and Natural Resources in the Valley
According to the 2010 US Census and Southern California Association of Governments, the Valley has almost half a million residents (490,000) with the overwhelming majority (347,000) residing in its 9 largest cities and Thousand Palms CDP. Approximately 100,000 are seasonal residents, predominantly present in the winter. Figure 1 illustrates the total population by zip code for the Valley, and is indicative of the types of maps used for demographic analysis. Population projections for the Valley indicate more than 550,000 residents by 2020. At two percent annually for 2010 the population growth rate for the Valley is about double the growth rate for both the state of California and the United States as a whole. The economy of the Valley is based on agriculture, tourism, and retirement. Its farming is typified by fruits and vegetables, including national prominence in dates, palm trees, and citrus. As a well-known winter tourist location, winter visitors are attracted by warm temperatures, dryness, and desert landscapes. Retired people
comprise a meaningful portion of the residents. Approximately 20 percent of the population is 65 years of age or older, which compares to California’s 11 percent [5]. There are high-end retirement communities and residential areas, as well as moderate priced retirement developments in the northeastern and southwestern parts of the Valley.
Figure 1.
Population by zip code for Coachella Valley cities (2010 Census)
The Valley is endowed with some of the most plentiful natural resources for renewable energy in the U.S. The western part of the Valley possesses areas with large and exposed areas of high winds. Winds have historically ranged from a high maximum of 59 mph and an average high maximum of 29 mph [6]. The Valley’s desert location is linked to high sunlight intensity which favors solar energy production, both within the Valley and in the unpopulated areas of Riverside County to the West extending parallel to the Interstate 10 all the way to the Arizona border. The Valley had an average of 838 solar watts per square meter (w/m2) and an average yearly total of 3,538 hours of sunshine between 2009 and 2014 [6]. In addition to plentiful sun and wind, the south end of the Valley borders the Salton Sea. The Salton Sea has one of the largest geothermal deposits in the U.S. However extraction of the geothermal deposits has been limited due to high salinity and the varied composition of its brines [7] [8]. The Valley’s resources are presently utilized for renewable energy, with considerable growth potential, subject to natural barriers, community challenges and restrictions especially in the urban areas. In the West, in the area of San Gorgonio Pass and mostly visible from Interstate 10, and along State Highway 62, hundreds of wind turbines output considerable electrical energy that is purchased by utilities for the electrical grid of southern California. For example, in Figure 2 one can see that the Valley has a number of small solar plants. The solar plants currently have a capacity totaling 55 MW [9], which equates to 5.0% of the Valley’s electrical generating capacity. By contrast, along Interstate 10, between the western Coachella Valley and Arizona, a massive series of solar electrical generating plants are in
development or construction with some already in operation. The total capacity in development/construction is 3,077 MW [9], which equates to one and a half nuclear plants.
Figure 2: Solar Installations in Coachella Valley (Adapted from SEIA) In residential solar energy, based on Coachella having 1.5x the California prevalence, we estimate that the Valley had installed residential solar capacity in 2013 of 60.3 MW [1] [9], which constitutes 5.3% of estimated total Valley energy capacity. As a result of rapid growth in residential solar projected for 2014, we estimate the Valley will have 99.1 MW of installed residential solar capacity by the end of 2014. It is clear that the Valley produces a high level of solar energy, about an estimated 10.3%in its energy supply in 2013. Another aspect is the challenge of evenness in solar production, daily and seasonally, coupled with seasonal fluctuations in demand in the Coachella Valley, which is accentuated by the seasonal flows of tourists. Unevenness can be mitigated through use of smart grid and battery storage technologies by utilities, organizations, and communities. These technologies are being actively researched and developed by several small enterprises in the Valley. It might advance to a larger scale if Lithium extraction were to expand as part of geothermal energy growth in the Salton Sea area. Geothermal energy is a renewable form of energy that utilizes the heat flow of the earth to generate very hot steam and hot water (350-480 degrees F). Geothermal deposits in the earth can be drilled into from the ground and used for electrical generation, direct uses of hot water, or extraction of minerals from the hot brines being brought to the surface. Although geothermal sub-surface fields eventually lose their heat and expire, they are regarded as “renewable,” because there is a continual flow and because the water itself is not lost, but is recycled at lower
temperature [7]. In 2014, the U.S. had 5,410 MW of installed geothermal capacity, constituting 29 percent of the world capacity of 55,709 MW of installed geothermal capacity. This represented only 0.43 percent of U.S. electrical demand [7]. Worldwide, nearly all geothermal is concentrated along converging tectonic plate edges. The Salton Sea geothermal capacity is presently 437 MW, or a sixth of the state resource [10]. Since the Coachella Valley is already well endowed nearby with electricity generation from fossil, solar, and wind, geothermal capacity scale-up of electricity generation in the Salton Sea area does not have much economic impact on the Valley related to electricity. The number of new workers needed is limited and would likely be drawn from the experienced pool of geothermal workers located mostly in Imperial County, just to the south of Coachella Valley. However, concomitant direct use of the Salton Sea brines for extraction of lithium and possibly other substances has a chance of providing greater economic stimulus for the Valley. One firm is in the process of completing a successful pilot test plant, receiving brines from the adjacent EnergySource’s Hudson Ranch One Geothermal Plant in Calipatria [11] [12]. The intent is to scale up the pilot extraction plant to a full-size plant producing substantial amounts of lithium, which is a scarce substance that is principally produced in South America. Lithium is essential for lithium batteries, which constitute a primary battery source for modern electronics as well as electric automobiles. There is some opportunity for prospective industrialization in the Valley based on the lithium extraction. The lithium extraction could encourage the location of some battery manufacturers for renewables in the Valley, building on a base of some small start-up firms already present. While the Valley has some advantages to support the renewable energy sector, challenges are also present. The major advantages include proximity to large renewable operating facilities; a fairly attractive, medium-sized urban area; support from nonprofits and somewhat from local governments, vast renewable energy resources in and adjacent to it and the presence of low-level manufacturing.. In spite of these advantages the manufacturing of renewable products and components is just beginning in the Valley with a handful of small, early-stage firms. The Valley faces considerable challenges in scaling up renewables manufacturing, including insufficient workforce size and skill levels, limited R&D environment in the Valley, a lack of renewable energy-related training and education, unfavorable transportation compared to coastal areas in Southern California, the risk of sun-setting of the federal subsidy for renewables, and a limited local financial investment environment. 4.
Implications and Conclusions for Sustainability in the Valley
A multitude of factors have an impact on sustainability with respect to energy generation and use in general, and the Valley in particular. These factors represent the relative complexity of sustainability. Although complex, the factors can be classified in three broad categories, which Camarinha, Afsarmanesh, and Boucher [13] describe as the three pillars of sustainability. The three pillars are environmental, social and economic. What is central to sustainability with these three pillars is the importance of collaboration within and across the pillars to better support sustainability. Coordination and interaction of the various stakeholders
within each pillar as well as across the three pillars is likely to lead to enhanced sustainability in the Valley Some elements of each of the three pillars were present in our study of renewable energy in and around the Valley. The Valley possesses considerable natural resources which are elements of the environmental pillar. The abundance of natural resources that are relatively underutilized support an increased potential for renewable energy, especially with respect to solar, wind and geothermal energy. In conjunction with the abundant natural environment, our study identified several companies in the Valley which were relatively innovative in their development of renewable energy businesses. For example, one innovative company currently has developed a patented process for lithium extraction from Salton Sea brines [12], while another has developed special solar arrays/storage for a variety of applications, including limiteduse vehicles [14]. While most of the renewable companies were relatively small and emerging, they represented a potentially critical component of the economic pillar. If the existing companies are able to expand and attract new companies to the Valley, renewable energy innovation may continue to support the economic pillar of sustainability. Although there were no major solar or wind energy related manufacturers in the Valley, clusters of manufacturers existed near the Valley in other parts of Southern California (See Figure 3). These manufacturers can serve the Valley’s need for solar or wind products.
Figure 3:
Solar and Wind Renewable Energy Manufacturing near the Valley. Data Sources: AWEA 2013 and SEIA 2014
Growth of renewables in the Valley also reflects the social pillar, which can potentially support and interact with either the environmental or economic pillar. In the Valley, the social pillar includes community participation and characteristics that are relatively favorable. The state of California’s Renewable Portfolio Standard (RPS) addresses goals to reach a certain percentage of energy production from renewable sources of energy by a certain future date, and is 33% by 2020 [15]. At the local level, a number of renewable energy initiatives exist that are supported by the cities and constituents. San Bernardino County exhibits relatively positive
support for renewable energy as evidenced by its inclusion in the general county plan, as well as the San Bernardino County Partnership for Renewable Energy and Conservation (SPARC) initiative [16]. Similarly, Riverside County exhibits considerable support for renewable energy though activities and programs. Riverside County is part of the Salton Sea Authority and provides an array of commercial and residential incentives and programs that support renewable energy [15], while cities in western Riverside County actively provide financing through the HERO program [17]. Various cities, such as Palm Springs, have participated actively in The Clean Cities Coachella Valley Region’s Coalition which focuses on alternative-fuel transportation. Overall, cities in Coachella Valley have displayed considerable interest in renewable energy, with some cross-city initiatives as well as particular cities taking the lead in a variety of renewable energy initiatives. The CV Link is a proposed multi-purpose pathway connecting cities in the Coachella Valley which would be accessible to low-speed (neighborhood) electric vehicles [18]. An independent study on electric vehicle readiness for The Coachella Valley Association of Governments sponsored by the California Energy Commission and the Coachella Valley illustrates the commitment of Palm Desert and Palm Springs to renewable energy [18]. Both cities have already invested in and developed public electrical vehicle charging stations to support electric vehicles. Such relatively abundant natural resources create considerable market opportunities for commercial or industrial utilization of renewable energy as well as with consumer utilization of renewable energy for households and personal transportation. As discussed in Section 3, the population of the Valley is expected to grow at a rate greater than that of the state of California and the U.S. As a result, increased demand for energy generation would be expected as the population expands. Such increased demand for energy in the Valley could be addressed with requisite increases in the utilization of renewable energy such as solar, wind and geothermal energy. There is also the potential of increasing the relative proportion of renewable energy to the Valley’s energy supply, beyond what might be required to address increased energy demand. Doing so would also further sustainability efforts in the region. Further geospatial and qualitative analysis is warranted to draw definitive conclusions regarding sustainability related to renewable energy development in the Valley. Addressing some limitations of availability of detailed geographic data on renewable energy participants could improve the geospatial analysis, and provide more robust conclusions. In particular, U.S. Census data with detailed NAICS codes for renewable energy (currently not available but planned for inclusion) could add considerable depth to geospatial analysis. Such geospatial analysis would be useful to better address the current state of renewable energy and potential growth in specific geographic regions. Nevertheless, our study was useful in helping to understand the current state of renewable energy in the Valley. The comparative geospatial analysis of exemplary renewable energy manufacturing sectors in other states illustrated how well developed and highly productive certain urban areas can become and suggested policies for Coachella Valley governments to consider for advancing renewable energy. Lastly, supplementing our geospatial analysis with interview data provided the opportunity to both confirm conclusions drawn from the geospatial analysis as well as develop a
more robust assessment of the challenges and opportunities for renewable energy. Acknowledgement. We acknowledge support of grant 07-69-06995 from U.S. Department of Commerce. References 1. United Nations Framework Convention on Climate Change, http://unfccc.int/2860.php 2. United States Environmental Protection Agency. Sources of Greenhouse Gas Emissions, http://www.epa.gov/climatechange 3. Mentzer, J. T., DeWitt, W., Keebler, J. S., Min, S., Nix, N. W., Smith, C. D., Zacharia, Z.: Defining Supply Chain Management. Journal of Business Logistics, 22, 1–25 (2001) 4. Boyle, G.: Renewable energy: Power for a sustainable future.Oxford University Press in association with the Open University, Oxford (2012) 5. U.S. Bureau of the Census. American FactFinder. Washington, DC,. http://www.census.gov 6. Desert Weather, http://www.desertweather.com 7. Garnish, J., Brown, G.: Geothermal Energy. Chapter 9 In: Boyle, G. (Ed.), Renewable Energy, 409-460, Oxford, Oxford University Press. (2010) 8. Butler, E.W., Pick, J.B.: Geothermal Energy Development. New York: Plenum Publishing Company (1982) 9. Solar Energy Industries Association (SEIA) http://www.seia.org 10. Matek, B. and Gawell, K.: Report on the State of Geothermal Energy in California. February. Washington, DC: Geothermal Energy Association. (2014) 11. The Desert Review. Tesla Motors’ Gigafactory, the 10-million-square-foot facility, May Have the Valley on their Short List of Where to Build, April 14. The Desert Review. Brawley, CA: The Desert Review. (2014) 12. Simbol Inc. Interview with Tracey Sizemore, VP of Simbol Inc., April (2014) 13. Camarinha-Matos, L. M., Afsarmanesh, H., Boucher, X.: The role of collaborative networks in sustainability. 1-16. Springer Berlin Heidelberg. (2010) 14. Solaris Power Cells. Interview with Lenny Caprino, President of Solaris, May (2014) 15. Database for State Incentives and Renewable Efficiency (DSIRE), http://www.dsireusa.org/ 16. Land Use Services Department. Renewable Energy and Conservation Planning Grant Application, http://www.sbcounty.gov/Uploads/lus/SPARC_Initiative_Application.pdf. 17. Western Riverside Council of Governments, HERO Financing Now Available for Energy/Water Conservation Retrofits. http://www.wrcog.cog.ca.us 18. Coachella Valley Association of Governments , CVLink FAQ http://www.cvag.org/library/pdf_files/trans/CM%20RFP/CVLink_FAQ.pdf.
