Brownouts, soaring rates and climate emissions are pushing food processing companies to get creative in adopting new technologies. The state is now offering incentives to help those facilities decarbonize while freeing up more electricity for the grid during times of peak demand.
The food sector is a major contributor to greenhouse gas emissions (GHGs), emitting about 3.2 million metric tons of carbon dioxide-equivalent emissions per year, according to the California Energy Commission. To change that dynamic, the California Energy Commission (CEC) launched the Food Production Investment Program (FPIP) in 2018 and awarded $118 million to 56 projects, reducing emissions more than 161,000 metric tons annually.
The companies spanned several industries—animal feed, ethanol, beverages, breweries, wineries, dairy processing, prepared foods, meat, rendering, fruits, vegetables and nuts. About 85% of the sites benefited disadvantaged or low-income communities.
The Legislature built on that success last year with Assembly Bill 209, reviving the program with new funding and an additional focus on providing benefits to the electrical grid. CEC is beginning to implement the initial $25 million allocated for the current fiscal year, while Gov. Gavin Newsom has maintained $40 million for next year, after trimming it 13% in his budget proposal.
Jingjing Liu, LBNLPacific Coast Producers (PCP), with plants in Lodi, Oroville and Woodland, invested dollars from the initial round of FPIP in new evaporators, a boiler, a refrigeration upgrade, vertical hot breaks and an air compressor. According to Erick Watkins, director of engineering, the farmer cooperative has had to tackle several hurdles along the way.
During a recent CEC workshop on FPIP, Watkins said one of the biggest issues is finding viable alternatives for natural gas boilers.
“We do make food that people eat and consume, and that has to be safe,” he said. The cooperative is owned by over 150 family-farms located in Central and Northern California and specializes in canning fruits and tomatoes for private brands across the globe.
Electrification technologies, for one, are in the “early days.” Also, the state lacks the infrastructure to distribute the needed power on a large scale, and PG&E would not support the boiler installation because the energy was not available. Electrical interruptions are a major concern for Watkins as well. Aseptic products treated for food safety must be thrown away if a facility suffers a significant power loss.
John Ahrens agreed that the loss of utility “is certainly a challenge.” As director of the microgrid program at Schneider Electric, Ahrens estimated that at least 95% of his projects are “islandable,” meaning the microgrid can sustain power during an interruption without issues. But that would require a processing facility to invest in costly power sources that are essentially stranded assets.
Yet the greatest impediment for processors hoping to transition to cleaner and more flexible energy solutions is the state’s electric rates, according to Watkins. PCP was facing a utility increase “like a thousand percent higher than natural gas.” He worried that the structure for purchasing, billing, sourcing and markets in California is “not going to get us where we want to go in the big picture.”
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Jingjing Liu, a program manager and researcher at Lawrence Berkeley National Laboratory, explained that the rates need major reforms to support electrification. Utilities must develop new capital to pay for upgrades while making rates more affordable on an ongoing basis. She noted that the California Public Utilities Commission has initiated a proceeding on dynamic pricing, which would allow processors and manufacturers to schedule higher energy use when overall demand is low to take advantage of more affordable pricing. The time-of-use rates in practice today do not allow such flexibility. According to Liu, states like Georgia and Oklahoma are using dynamic rates to recruit industries from other regions of the country.
Ahmad Ganji, who directs the Industrial Assessment Center at San Francisco State University, noted that refrigeration systems have significant opportunities for such demand management approaches. But cutting a processing plant’s energy consumption at times when the grid hits peak load capacity—such as during a record heat wave last September—would require a portfolio of options. Watkins envisioned a microgrid powered by solar and with battery storage to discharge the energy as needed.
And it would need a lot of power, with bigger batteries and better discharge times than currently available. In the last 10 years, PCP has added about 4.5 megawatts of steam turbine capacity at its Woodland facility, reducing their overall electric demand by 40%.
“For many years, we never were concerned about power outages or voltage dips or brownouts,” said Watkins. “Now it's part of our risk management plan.”
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