Picking up, as we're talking, wind and solar PV are moving to dominate new renewables construction and they impose a new challenge. Their variability or non-dispatch ability. You just can't turn them up and down the same way you can, for example, a natural gas power plant. Now, why are they moving to dominate so quickly? It's largely about cost and not entirely. Policies relevant, markets relevant, public preference that all matters. But what we've seen this is US data, but it's also consistent with global data, is that wind and solar PV are increasingly the least-cost option for new electricity production. Shown here in the thick black line are natural gas prices, that essentially is the marginal cost per kilowatt-hour of generating electricity from natural gas. That black lines are only for the fuel, and of course, natural gas prices change, and recently natural gas has gotten cheaper. Those thick black dash lines are moving down. But notice for most contracts, these are actual signed contracts. For wind and solar PV, the contracts are lower. In other words, buying wind and solar PV is less expensive per kilowatt-hour than generating that electricity from natural gas. That is the major reason why wind and solar PV are moving to dominate global markets because they are just cost-effective. Now it doesn't mean they're always cost-effective. They're not always the cheapest option. Depends on natural gas prices and local conditions. As we've talked about, maybe looking at cost per kilowatt-hour is not the only [inaudible] to consider. We need to consider, for example, the dispatchability. When wind and solar PV aren't really dispatchable, they're variable. That needs to effect decisions about technology adoption as well. Now, we've talked about the fundamental challenge, which is electricity produced must exactly equal electricity consumed with an asterisk which is for storage. If you store electricity, then this complicates this whole analysis. But in general, you need to produce exactly as much as you consume. How was that done historically? It was pretty straightforward for the 20th century, you had baseload plants that just run coal and nuclear. You had intermediate plants such as natural gas and hydro, and you meet peak demands with a natural gas peaking turbine. That worked fine until it didn't. The problem was wind and solar PV are being put in the mix, are entering at very rapid growth rates electricity systems. Why is that a problem? Because the output of these wind and solar PV varies with the wind and the sun. One characteristic or representative example here is, power output in percent for a wind turbine in China for two different days, and notice how different it looks. That makes integrating wind and solar PV into electricity systems a challenge. It's manageable, as we've talked about, it's doable, but it's a challenge that needs to be understood and considered. We talked about the duck curve, which is the well-known graphic that shows an example of US State of California some of the challenges that, in this case, solar PV impose on electricity system. For example, California has a lot of solar PV and it generates a lot of electricity during the day. The net demand curve, what's leftover that needs to be met with all other power plants shows this shape where it comes down very much during the day when the solar PV output is the highest and then goes up quickly. This what's called the rapid ramp. The California electricity system was not originally designed for that rapid ramp, so changes are being made. Again, it's a manageable challenge. California lights are not going out. We are making this work day by day. To summarize the Grid Integration Challenge. Demand has always been variable, that's not new, but now some supply can be thought of in the same way as a variable. How do we keep the system reliable? How do we keep the power quality high? How do we keep the cost low as we put more and more wind and solar PV in the system? The basic, the one of the words, the concepts behind how we do that is flexibility. We have components of the electricity system which can be on the demand side and supply side can be storage, that are flexible. They can accommodate changes in wind and solar PV. There are many such options we've talked about in the course. Coming back to the US State of California, which is a useful case study because California is at roughly 20 percent solar PV. Much of the rest of the world will be there and we can learn from what California is doing. What are they doing? Variety of things, as I mentioned. They are integrating their electricity system, including or improving connections with neighboring states. California has too much, they can sell it into Nevada, the neighboring state to the east. If California doesn't have enough electricity at some point, they can import it from the neighboring state, Oregon, to the north which is hydro it's an example of a strategy. Similarly, as shown here, California is putting in storage in the system which can essentially act to time-shift electricity. If it's too much electricity, too much meaning a lot of solar PV in the middle of the day, you can use it to charge batteries, and those batteries, in turn, can help meet that steep late afternoon, early evening ramp. These are examples of what California is doing. Another example would be Republic of Ireland and Northern Ireland, which they have very limited connections outside the Island, obviously because they're a physical Island. What are they doing about that considering their high penetration of wind, roughly 30 percent, and that instantaneous as I said five years ago was up to almost two-thirds? They are looking at, for example, demand-side management to change demand. They're looking at battery storage projects. They're looking at changing the ancillary service market, improving physical connections to the mainland of the UK. There are a variety of approaches. Again, the point being, the Grid Integration Challenge is a significant one, there's not one magic solution. There are a lot of ways that different countries and regions are making this work. We'll take a short break here and come back and talk about energy storage.