Old Power Gear Is Slowing Use of Clean Energy and Electric Cars

Seven months after workers finished installing solar panels atop the Garcia family home near Stanford University, the system is little more than a roof ornament. The problem: The local utility’s equipment is so overloaded that there is no place for the electricity produced by the panels to go.

“We wasted 30,000-something dollars on a system we can’t use,” Theresa Garcia said. “It’s just been really frustrating.”

President Biden is pushing lawmakers and regulators to wean the United States from fossil fuels and counter the effects of climate change. But his ambitious goals could be upended by aging transformers and dated electrical lines that have made it hard for homeowners, local governments and businesses to use solar panels, batteries, electric cars, heat pumps and other devices that can help reduce greenhouse gas emissions.

Much of the equipment on the electric grid was built decades ago and needs to be upgraded. It was designed for a world in which electricity flowed in one direction — from the grid to people. Now, homes and businesses are increasingly supplying energy to the grid from their rooftop solar panels.

These problems have become more urgent because the fastest way to cut greenhouse gas emissions is to move machinery, cars and heating equipment that currently run on oil and natural gas to electricity generated by solar, wind, nuclear and other zero-emission energy sources. Yet the grid is far from having enough capacity to power all the things that can help address the effects of climate change, energy experts said.

“It’s a perfect violent storm as far as meeting the demand that we’re going to have,” said Michael Johnston, executive director of codes and standards for the National Electrical Contractors Association. “It’s no small problem.”

Ms. Garcia and her husband, Quin, bought their home in Portola Valley a little more than a year ago. They invested in solar because Ms. Garcia, a 37-year-old biotech lawyer, and her husband, a venture capitalist, wanted to do their part to fight climate change.

The Garcias are not pioneers. About one out of 10 utility customers in the state have solar power, according to the California Solar and Storage Association.

So, the Garcias were surprised when their utility, Pacific Gas & Electric, would not allow them to fully use the panels.

The problem is that on sunny days, rooftop solar panels can produce a lot more electricity than is being used in the neighborhoods where they are installed. That can overload electrical transformers, which help regulate and direct the flow of electricity within a neighborhood, forcing them to shut off or blow up. Such problems can be avoided by installing newer transformers that have greater capacity.

Barry Cinnamon, the chief executive of Cinnamon Energy Systems, the company that installed the panels on the Garcia home, said such problems were far too common. “My experience and understanding of the way utilities do things is they just wait until the neighborhood is overloaded and then the transformer blows up,” Mr. Cinnamon said.

PG&E apologized for the delay in upgrading the transformer outside the Garcia home, noting that it can take workers up to six months to do so if they are swamped with projects.

During a heat wave in August 2020, an aging transformer at an electrical substation in downtown San Jose, which is about 25 miles from where the Garcias live, blew up. That blacked out the homes of tens of thousands of people, some for days.

The city’s mayor, Sam Liccardo, expressed frustration with PG&E, saying the company’s dated equipment was hampering San Jose’s plan to increase the use of solar panels, electric cars and other new devices. To achieve its climate goals, the city has already banned the use of natural gas in new buildings, the largest local government in the country to do so.

“It’s an infrastructure that’s failing,” Mr. Liccardo, a Democrat, said. “We’re very ambitious. The question is whether there will be a grid ready when we get there.”

Mark Esguerra, senior director of electric asset strategy at PG&E, said the company planned to upgrade a lot more of its equipment. Since the failure in San Jose last year, the company has replaced 400 transformers in and around that city, of a total of 62,000 in Santa Clara County. The company added that it supports the use of solar panels by nearly 600,000 of its residential customers and electric cars owned by 360,000 customers.

“We know that our grid is going to look different in a few years,” Mr. Esguerra said.

How Much and How Fast?

The big challenge for policymakers and the utility industry is figuring out how quickly to invest in the grid while keeping the energy affordable.

It would cost hundreds of billions of dollars to upgrade the distribution networks across the country to meet the country’s clean energy goals, said Ben Hertz-Shargel, global head of Grid Edge, a division of Wood Mackenzie, a research and consulting firm. That does not include spending on long-distance transmission lines and power generating equipment like solar and wind farms.

Mr. Hertz-Shargel has personal experience with the shortcomings of the electric grid. When he was recently charging his Tesla at his home on Long Island, the electrical equipment that connected the utility’s power line to his home became so hot that it melted.

“I’m the only E.V. on my block and even that modest use was enough to overwhelm the secondary side of the grid on my house,” he said. “It just shows how many weak links there are in the utility distribution system.”

How much money utilities spend on their equipment is determined in a complicated process that involves state regulators who have to approve increases in electricity rates that pay for upgrades.

State officials don’t want to raise rates too much because it hurts consumers and could undermine public support for clean energy, said Abigail Anthony, a utility regulator in Rhode Island who also chairs a committee that studies these issues at the National Association of Regulatory Utility Commissioners.

“Not only do the cars and the heating systems need to be affordable,” Ms. Anthony said, “but also the fuel, the electricity, needs to be cheap especially compared to oil, gasoline and natural gas.”

People who are pushing for greater investment say the spending will pay off by saving people money on monthly bills and preventing the worst effects of climate change.

Consider the following example: If all 330,000 households in San Jose gave up using gasoline and natural gas and switched to electric cars, heat pumps and electric water heaters and stoves, the city would use three times as much electricity as it does now, according to Rewiring America, a nonprofit group that advocates grid upgrades and policies to fight climate change.

But the money San Jose residents and businesses spend on electricity would not necessarily triple or even double, the group contends. That’s because people could generate some electricity through rooftop solar panels and store that energy in home batteries. They could install smart thermostats and appliances to use electricity when it costs less, like at night, said Sam Calisch, head of research at Rewiring America.

Emily Fisher, a senior vice president for clean energy at the Edison Electric Institute, a utility industry trade group, gave another example. Mr. Biden wants electric cars to make up half of new cars sold in the country by 2030. If all of those cars were plugged in during the day when energy use is high, utilities would have to spend a lot on upgrades. But if regulators allowed more utilities to offer lower electricity rates at night, people would charge cars when there is plenty of spare capacity.

Some businesses are already finding ways to rely less on the grid when demand is high. Electrify America, a subsidiary of Volkswagen that operates an electric vehicle charging network, has installed large batteries at some charging stations to avoid paying fees that utilities impose on businesses that draw too much power.

Robert Barrosa, senior director of sales and marketing at Electrify America, said that eventually the company could help utilities by taking power when there was too much of it and supplying it when there was not enough of it.

Ultimately, electrifying cars, heaters, stoves and other equipment currently running on fossil fuels could save an average family $1,050 to $2,585 a year, according to Rewiring America. Those products are more energy efficient and electricity tends to cost less than comparable amounts of gasoline, heating oil and natural gas. Electric cars and appliances are also cheaper to maintain.

“Done right, money can go further toward a more reliable network,” Mr. Calisch said, “especially in the face of increased stress from climate change.”