Author:
Read more here >>> SkySports | News
Tag Archives: grid
Grid operator ERCOT says Texans can return to regular electricity use
(File/Getty)
AUSTIN (Texas Tribune/KXAN) — Texans no longer need to cut back on their electricity use to avoid stressing the electrical grid, according to the current grid conditions on the Electric Reliability Council of Texas website.
Consumers may return to normal usage of electricity after a week that stressed the grid — and Texans’ anxieties. The ERCOT website said: “There is enough power for current demand,” and an ERCOT spokesperson confirmed the power conservation notice expired at 7 p.m. Friday.
On Monday, the state’s grid operator warned that an unusual amount of power generation, primarily from natural gas-fired power plants, had gone offline at the same time as weather patterns produced little wind for turbines. For five days, ERCOT warned that the supply of power was running low as Texans increased their demand for electricity in hotter weather, and asked the public to reduce electricity use.
Approximately 12,000 megawatts of generation were offline Monday, or enough to power 2.4 million homes on a hot summer day. The majority of the offline generation was unexpected, the grid operator said, meaning something at a power plant malfunctioned or broke, and the plant was forced to partially or totally shut down.
The amount of generation that was down earlier in the week was several times what ERCOT typically expects for this time of year; Texas power plants are typically built to perform well during the summer heat. And, wind turbines were not generating as much power as the grid operators anticipated for the summer season. The combination of the two resulted in what ERCOT called “tight” grid conditions.
ERCOT officials could not provide details as to why so much generation was offline. At the same time, Texans used a record amount of electricity for early June. Power grids must keep supply and demand in balance at all times, which is why the grid operator asked consumers to cut back usage — the first of several emergency steps ERCOT takes to prevent customer outages.
In an interview earlier this week, Joshua Rhodes, a research associate with the University of Texas at Austin and Webber Energy Group, shared his reaction to ERCOT’s alert, which issued since February’s deadly winter storms.
“To see it happening while temperatures are a little bit lower than they normally are is a bit concerning, but given how many power plants are offline, it makes sense,” Rhodes said, “but I mean it’s something we’ve got to figure out. If anything we know, the summer’s only going to get hotter.”
Impatience with ERCOT has run high since February’s storm, when mass outages left millions of Texans in the dark and cold for days under single digit temperatures. ERCOT’s handling — or mishandling — of the crisis came to be near-universally acknowledged as a failure. This judgment resulted in resignations from several board members and the termination of President and CEO Bill Magness.
Additionally, both the Texas House and Senate held hearings to determine the extent of the council’s preparation for the storms.
Friday was also the day state regulators said they would begin lifting the utility moratorium, which means utility companies can begin to send customers disconnection notices. Disconnections can resume June 29 at the earliest.
Portions of this article originally appeared in The Texas Tribune at www.texastribune.org. The Texas Tribune is a nonprofit, nonpartisan media organization that informs Texans – and engages with them – about public policy, politics, government and statewide issues.
Author: Russell Falcon
This post originally appeared on KXAN Austin
Gov. Greg Abbott downplays electric grid concerns as Texans are told to conserve
AUSTIN (KXAN) – Gov. Greg Abbott on Wednesday downplayed concerns about the reliability of the Texas electric grid while millions continue to be told to conserve energy because of unexpected outages and demand.
“Everyone who has been trying to make a big deal about the power grid over the past two days, I have found were the same people who called me a neanderthal when I opened Texas 100%,” Abbott said during a press conference on his plan to build a wall along Texas’ southern border with Mexico. “They were hoping that there would be a power failure.”
While the request from ERCOT that Texans reduce their energy consumption during peak times — 3 p.m. to 7 p.m. — through Friday caused many to see flashbacks of February’s extreme winter storm, Abbott said the announcement was the first example that communication has improved since then.
He added that reforms made by the state legislature to the electric grid – like requiring electricity providers to prepare for extreme weather – will take time to implement.
“I can tell you for a fact, as we’re sitting here today, the energy grid in Texas is better today than it’s ever been,” Abbott said.
ERCOT briefed members of the Texas House Wednesday morning about the issues facing the grid this week. The unexpected failure of thermal generation plants, less wind power generation than projected, and higher demand for power led to the call for conservation, according to state Rep. Donna Howard, an Austin Democrat, who was on the call.
Howard said the state legislature took important steps to improving the electric grid in the legislative session that concluded last month but said lawmakers have yet to address fluctuating market prices and the need to weatherize natural gas providers.
Less than a week before ERCOT would issue its conservation warning, Abbott announced that “everything that needed to be done was done to fix the power grid in Texas.”
“We have much more to do and just about anybody else who’s been involved with this will say that,” Howard said.
Terry Hillis, a retired Leander man, typically stays out of politics – he’s locked in on ERCOT developments.
“For anyone to stand up and say, ‘well, we really don’t have a problem,’ it’s crazy! Of course we have a problem,” he said.
Author: John Engel
This post originally appeared on KXAN Austin
Austin Mayor Adler: Gov. Abbott 'doesn't seem to care' about 'unreliable' ERCOT power grid
AUSTIN (KXAN) — Austin Mayor Steve Adler directed a strong message at Texas Gov. Greg Abbott on Tuesday — after ERCOT, the commission that directs 90% of the state’s power, released a conservation alert.
On Monday, ERCOT, or the Electric Reliability Commission of Texas, drew national contempt for urging Texans to conserve energy due to many forced generation outages just months after millions were left without power for days during February’s historic winter storm. The incident is widely acknowledged as a colossal failure on the part of ERCOT. It’s faced ferocious scrutiny since.
Now, Adler is calling on Abbott to do something about it.
“It’s Day Two of conservation warnings from @GregAbbott_TX delicate power infrastructure,” Adler tweeted Tuesday morning. “It’s still technically spring and Texas is experiencing late-summer temperatures, power plants offline, and the governor is tweeting about a border wall that he can’t fund.”
Adler poked at the governor’s Tuesday announcement that he’d solicit individual donations to fund construction on the Texas-Mexico border wall. The mayor called Abbott’s priorities in question, saying the governor would likely care more about keeping the power reliable if it affected Texas business.
“Maybe when a corporation tells the governor that an unreliable power grid is bad for business, he’ll finally listen,” tweeted Adler. “He doesn’t seem to care about whether it’s bad for people.”
Last week, Abbott signed two bills into law that will change the number of ERCOT board members, give state leaders more say in new appointments, and will also require power providers on the ERCOT grid to weatherize equipment and communicate further about outages. Abbott said these changes adequately addressed the grid’s issues, saying: “Bottom line is that everything that needed to be done was done to fix the power grid in Texas.”
As of Tuesday afternoon, Abbott has not addressed the alert via Twitter or through an official statement. Adler’s comments refer to one of Abbott’s tweets about Texas business: “Texas ranked #1 again,” the governor tweeted in response to a state award for attracting development projects. “…Thanks to all the job creators in Texas.”
Author: Russell Falcon
This post originally appeared on KXAN Austin
Analysis-To tackle climate change, China must overhaul its vast power grid
© Reuters. FILE PHOTO: Power lines and wind turbines are pictured at a wind and solar energy storage and transmission power station of State Grid Corporation of China, in Zhangjiakou of Hebei province, China, March 18, 2016. REUTERS/Jason LeeBy Muyu Xu and John Geddie
BEIJING/LONDON (Reuters) – One of the most pressing challenges for China to meet its pledge to cap carbon emissions this decade and pivot toward renewables is overhauling its electricity grid, the world’s largest, officials and analysts say.
Beijing’s surprise announcement last year that it would hit peak emissions by 2030 and become carbon neutral by 2060 could presage the biggest reduction in projected global warming of any climate commitment to date, researchers say.
But building new solar plants and wind farms is the easy part, analysts say. Upgrading the system that transmits that green power to faraway consumers could be five times more costly, and depends on rapid technological progress.
“When we talk about the challenges, most people focus on the (electricity) grid,” said Chunping Xie, an expert on China’s policies on climate change and energy at the London School of Economics and Political Science. “It’s the first step in this long journey.”
Investments in China’s grid and other associated costs are expected to exceed 6 trillion yuan ($ 896 billion) over the next five years, Mao Weiming, former chairman of State Grid, said in a speech in October.
China, the world’s biggest electricity generator, power consumer and carbon emitter, has said it is aiming for renewable power to account for more than 50% of its total electricity generation capacity by 2025, up from 42% now.
This mainly involves pivoting to solar and wind energy and away from coal, of which China is the biggest global consumer. Beijing plans to more than double its solar and wind power capacity to 1,200 gigawatts (GW) by 2030, from 535 GW now.
Such a drastic swing from coal, which generates a stable baseload power supply, to renewables, which can fluctuate with weather conditions, could play havoc with China’s electricity network, officials say.
A senior manager in charge of dispatch at China’s State Grid – the world’s largest utility, which manages 75% of the country’s network – told Reuters the system had already “reached its ceiling” of how many renewable sources it could handle and still maintain stable operations. The official asked to remain anonymous as he is not authorised to talk to the media.
But China, which runs the world’s largest power system, with a total installed capacity of 2,201 GW compared with 1,107 GW in the United States, is pressing on.
By 2030, it has said it will force grid operators to buy at least 40% their of power from non-fossil fuel sources, up from around 28% now.
MAJOR COSTS
Alex Whitworth, a research director at Wood Mackenzie, said that the pace of grid investment would most likely be maintained until the end of the decade, and would be five times higher than the cost of building additional renewable plants in that period.
The major costs involve new power lines, re-tooling hundreds of coal plants as backup generators, and ramping up storage capacity, analysts and officials say.
At least seven new ultra-high voltage power lines would be built over the next five years to better connect the country’s far western regions, where solar, wind and hydropower plants are mainly located, to China’s big cities, the State Grid said. China has 29 such lines already.
That buildout could cost an estimated $ 34 billion.
“We have reached a consensus that China will preserve coal plants, but only for emergency uses,” said Shu Yinbiao, president of Huaneng Group, China’s second-largest power generation firm, and a former State Grid president.
But China is struggling to promote costly modifications to coal plants allowing them to offset gyrations in renewable power. It typically costs 150 million yuan ($ 23.27 million) to upgrade a 300-megawatt coal plant.
Only about 10% of coal-fired power plants in China have been modified, according to data from State Grid and China Electricity Council.
“China will need to establish a mechanism to make coal power unfavourable in the renewables’ booming moment,” said Zhang Shuwei, a director at Draworld Energy Research Centre. “Otherwise China is not able to advance its green agenda.”
TECH PROBLEMS
Power storage is another obstacle.
Bing Han, a senior research analyst at IHS Markit, expects China to need about 120 GW of energy storage to support additional solar and wind power needs by 2030. That is four times more than the 32.3GW capacity in place as of 2019, according to China Energy Storage Alliance.
For battery storage, Wood Mackenzie’s Whitworth said China is expected to install 47 GWh by 2030, more than four times the total global storage capacity today.
But it is not just a question of cost. Chinese officials have said they are worried about slow technological developments.
“Power storage technology has not realized revolutionary progress,” said Li Gao, director of Climate Change Department at the Ministry of Ecology and Environment at a media briefing in April.
Michal Meidan, director of the China Energy Programme at the Oxford Institute for Energy Studies, said “geopolitical tensions” and “technological rivalry” between China and Western countries could also hinder the collaboration needed to improve Beijing’s storage capacity.
“It’s not to say China cannot innovate, but it could take longer until China has its home-grown innovation,” she said.
Other analysts questioned China’s commitment to renewable power plans given its lack of clarity on phasing out coal and continued expansion of new power plants. China put 38.4 GW of new coal-fired power capacity into operation in 2020, more than three times the amount built elsewhere around the world.
But all agreed tackling the power system is an essential first step of a project critical to the future of the planet.
“The world just can’t achieve climate targets without China,” said LSE’s Xie. “China’s role in the world is now of a magnitude that makes its actions in the immediate future critical to how the world goes forward.”
($ 1 = 6.4463 renminbi)
Author: Reuters
This post originally appeared on Stock Market News
Texas House targets power grid flaw that cut electricity to natural gas
The Texas House on Monday gave initial approval to a series of bills aimed at preventing another massive power failure, including one that would require state officials to adopt rules designating certain gas facilities as critical during an energy emergency.
The Electric Reliability Council of Texas, which operates the state’s main power grid, ordered utility companies to cut power during the February winter storm because demand was outpacing supply so much that it threatened the entire grid. But when utility companies complied, they shut off electricity to natural gas facilities, preventing them from delivering fuel to power plants.
That exacerbated ERCOT’s problems during the storm and exposed a major structural flaw in Texas’ electric grid: Utilities didn’t have good lists of what they should consider critical infrastructure, including natural gas facilities — simply because natural gas companies failed to fill out a form or didn’t know the form existed. Currently, there is no requirement for natural gas and other companies that operate crucial parts of the grid to register as “critical.”
House Bill 14 would create the Texas Electricity Supply Chain Security and Mapping Committee to designate priority electricity service needs for extreme weather events.
“This is establishing a committee that will map the critical infrastructure and force them to be identified so that their electricity is not turned off,” state Rep. Craig Goldman, R-Fort Worth, who is carrying the legislation, said during Monday’s debate.
More than 4.8 million customers in Texas were left without power during the winter storm that plunged large parts of the state into single-digit temperatures. At least 111 people died — more than half of them from hypothermia. Texas lawmakers are working on several bills aimed at preventing more power outages in extreme weather. Some proposals have drawn criticism for not going far enough to prepare electricity infrastructure for increased risks posed by climate change.
The measures the House gave initial approval to Monday come days after ERCOT asked Texans to conserve power on what was a relatively mild spring day. And experts and company executives are warning that the power grid is at risk of another crisis this summer, when demand for electricity typically peaks as homes and businesses crank up air conditioning to ride out the Texas heat.
The committee created by HB 14 would be composed of the executive directors of both the Public Utility Commission, which oversees ERCOT, and the Texas Railroad Commission, which regulates the oil and gas industry; the president and the CEO of ERCOT; and the chief of the Texas Division of Emergency Management. Members would have to submit a report to top state officials and the Legislature on their findings by Jan. 1.
State Rep. Jon Rosenthal, D-Houston, raised concerns that HB 14 does not substantively address the state’s infrastructure ahead of future weather emergencies.
“I just feel like this bill does not actually do anything for our infrastructure other than look at it,” Rosenthal said.
The House on Monday also gave initial approval to House Bill 3648, which would require the Railroad Commission to work with the Public Utility Commission and adopt rules to designate certain gas entities and facilities as critical during an energy emergency.
“Had these facilities been designated as critical natural gas facilities, this problem could have been avoided,” said state Rep. Charlie Geren, R-Fort Worth, who authored the bill.
Members also gave preliminary approval to House Bill 1520, which aims to address high gas costs for consumers as a result of the February winter storm. The bill would allow local distribution companies to securitize the cost of gas during the winter storm and spread that cost over several years. Critics of the measure have said it amounts to a bailout for gas companies. But state Rep. Chris Paddie, R-Marshall, who authored the bill, denied that portrayal and called it a “common sense solution” for Texas gas consumers.
“Currently, if we do nothing, numerous consumers will receive gas bills that are many, many multiples of their normal bill, as the cost of natural gas is simply passed through from the local distribution companies and gas costs were greatly elevated during the winter storm,” he said.
Sami Sparber
This article originally appeared on The Texas Tribune: Main Feed
Grid security funding not included in Biden’s infrastructure plan
Experts this week were disappointed that President Biden
Joe BidenJobs report adds to Biden momentum White House says bills are bipartisan even if GOP doesn’t vote for them Trump calls for boycott of MLB for moving All-Star Game MORE[6][7][8][9][10][5]’s $ 2.25 trillion infrastructure package did not include specific funding for securing the electric grid against cyberattacks, although the White House is working on a separate initiative to protect the grid. Meanwhile, a Russian court fined Twitter on Friday for failing to remove certain posts, and two Democratic lawmakers pressed the Education Department to protect K-12 institutions from malicious hackers.
ADVERTISEMENT
GRID INSECURITY: President Biden‘s $ 2.25 trillion infrastructure plan does not include any funds to protect critical infrastructure against cyberattacks, even as the threat grows against targets such as the electric grid.[11]
Experts say it was disappointing to see there were no funds set aside to defend systems critical to everyday life from hackers, particularly as the proposal does including things such as $ 100 billion for improving grid resiliency, the creation of new jobs and developing more clean electricity.
“It is a bit of an eyesore of not seeing a more prominent listing of cybersecurity in this, but I think there will be more to come,” said Tobias Whitney, vice president of energy security solutions at Fortress Information Security, which works with grid operators.
The cybersecurity of the grid has become an area of increasing concern in recent years as hackers have ratcheted up efforts to target critical systems. Those efforts accelerated during the COVID-19 pandemic.
A National Security Council spokesperson told The Hill on Thursday that the administration “is committed to safeguarding the cybersecurity of U.S. critical infrastructure from persistent and sophisticated threats” and has “launched a 100 Day Control Systems cybersecurity initiative, working closely with the private sector that manages much of this critical infrastructure like those for electricity and water, to improve cybersecurity.”
TWITTER FINED: A Russian court fined Twitter Friday for not removing posts that encouraged minors to participate in protests, The Associated Press reported[13].
ADVERTISEMENT
The court’s ruling comes after Russian telecommunications watchdog pressured the platform to remove the content or be blocked. [14]
The court found Twitter guilty on three counts of violating regulations on restricting unlawful content, ordering it to pay three fines adding up to 8.9 million rubles, or about $ 117,000, the AP reported.
SCHOOL INSECURITY: Reps. Doris Matsui
Doris Okada MatsuiHillicon Valley: House approves almost billion in cyber, tech funds as part of relief package | Officials warn of ‘widespread’ exploit of Microsoft vulnerabilities | Facebook files to dismiss antitrust lawsuits New research finds ‘record-breaking’ number of K-12 cyber incidents in 2020 Biden signs supply chain order after ‘positive’ meeting with lawmakers MORE[17][18][19][20][21] (D-Calif.) and Jim Langevin
James (Jim) R. LangevinHillicon Valley: Grid security funding not included in Biden’s infrastructure plan | Russia fines Twitter | Lawmakers call for increased school cybersecurity Lawmakers urge Education Department to take action to defend schools from cyber threats Lawmakers roll out bill to protect critical infrastructure after Florida water hack MORE[23][24][25][26][27] (D-R.I.) on Friday urged the Department of Education to prioritize protecting K-12 institutions from cyberattacks, which have shot up in the past year as classes moved increasingly online during the COVID-19 pandemic.[16][22]
In a letter to Secretary of Education Miguel Cardona
Miguel CardonaHillicon Valley: Grid security funding not included in Biden’s infrastructure plan | Russia fines Twitter | Lawmakers call for increased school cybersecurity Lawmakers urge Education Department to take action to defend schools from cyber threats Biden requesting information on legal authority to cancel student debt MORE[29][30][31][32][33], the two lawmakers highlighted concerns that cybersecurity threats to school have spiked during the pandemic, and urged Cardona to issue guidance to educational institutions to help navigate these threats.[28]
“As the U.S. continues to battle the ongoing pandemic, the Department of Education will play a critical role in supporting American families as they navigate the challenges of distance learning and prepare to reenter the classroom safely,” Matsui and Langevin wrote.
“To help ensure schools are keeping pace with the demands of the modern classroom, we urge you to issue guidance that will allow K-12 schools to make needed investments in increased cybersecurity measures,” they added.
The letter was sent after a year in which school districts were hit with a wave of cyberattacks and other online interruptions as K-12 institutions were forced to hold classes online during the COVID-19 pandemic.
Read more about their concerns here[34].
INTERNET DOWN: Myanmar’s military is shutting down wireless internet access in an attempt to quell protests that have erupted throughout the country since the military takeover on Feb. 1.
The military has been shutting off the internet overnight for weeks, but the Ministry of Transport and Communications told internet providers Thursday that “all wireless broadband data services be temporarily suspended until further notice,” Ooredoo, a local internet provider in the country said, according to the Associated Press.[35]
Companies are also no longer allowed to offer high-speed internet to Myanmar’s citizens as the military is now only offering fiber optic cables that give internet access at slow speeds.
The decision comes after Myanmar’s deadliest week of protest as the Myanmar military has now killed more than 500 pro-democracy protesters.
ADVERTISEMENT
FACEBOOK’S FRAME: Facebook on Thursday launched COVID-19 vaccine-themed frames for profile pictures.
The company said in a statement that it developed the frames in collaboration with the Department of Health and Human Services and the Centers for Disease Control and Prevention (CDC).[37]
It said in the coming weeks users can see a summary in their News Feed of those who they follow who are using the profile frames.
Users have the option of choosing between frames that feature banners that say “I Got My COVID-19 Vaccine” or “Let’s Get Vaccinated.” The frames feature logos that say “We Can Do This” in either magenta or blue.
Lighter click: Just your typical broadcast[39]
ADVERTISEMENT
An op-ed to chew on: Science is rescuing us from COVID — it’s time for the US to return the favor[40]
NOTABLE LINKS FROM AROUND THE WEB:
LexisNexis To Provide Giant Database Of Personal Information To Ice (The Intercept / Sam Biddle)[41]
Advanced hackers used Fortinet flaws in likely attempt to breach government networks, feds warn (CyberScoop / Sean Lyngaas) [42]
Why cable hates Biden’s $ 100B internet plan (Axios / Margaret Harding McGill)[43]
How America’s surveillance networks helped the FBI catch the Capitol mob (Washington Post / Drew Harwell and Craig Timberg)[44]
Same as the old boss: How Amazon honed its anti-union bent at a Seattle call center 20 years ago (GeekWire / Mike Lewis and Todd Bishop)[45]
DOE watchdog detailed its cybersecurity state amid SolarWinds hack (NextGov / Mariam Baksh)[46]
Welcome to Hillicon Valley, The Hill’s newsletter detailing all you need to know about the tech and cyber news from Capitol Hill to Silicon Valley. If you don’t already, be sure to sign up for our newsletter by clicking HERE[1].
Welcome! Follow our cyber reporter, Maggie Miller (@magmill95), and tech team, Chris Mills Rodrigo (@chrisismills) and Rebecca Klar (@rebeccaklar_), for more coverage.[2][3][4]
[email protected] (Chris Mills Rodrigo,Rebecca Klar and Maggie Miller)
Gov. Greg Abbott names former aide to retired House Speaker Dennis Bonnen
/static.texastribune.org/media/files/5eac2ae67fdfd9ee7777b037ec3eb66a/Will%20McAdams%20TT.jpg?w=474&ssl=1)
Gov. Greg Abbott[2] on Thursday named Will McAdams, president of the Associated Builders and Contractors of Texas and a former aide at the Texas Capitol, to the board of the Public Utility Commission.
This is the governor’s first nomination to the board of the agency that oversees the state’s power grid after all three of the previous board members resigned in the aftermath of February’s deadly power outages that left millions without electricity in subfreezing temperatures.
McAdams will need to be confirmed by the state Senate.
“Will McAdams will bring a fresh perspective and outstanding leadership to the Public Utility Commission of Texas,” Abbott said in a statement. “Will’s wealth of experience in public service and state government make him the ideal leader to carry out the PUC’s mission to protect customers, foster competition, and promote high quality infrastructure across Texas. Will is committed to charting a new course for the commission and restoring trust with Texans. I am confident that he will lead the agency with integrity and transparency and I urge the Senate to confirm Will’s appointment.”
McAdams used to work as an aide to former House Speaker Dennis Bonnen and for multiple state senators. Before that, McAdams served as an infantry officer in the Army.
The governor appoints nominees to the three-member Public Utility Commission board. The PUC oversees the Electric Reliability Council of Texas. Abbott has criticized ERCOT for the state’s power grid failure in February. Lt. Gov. Dan Patrick[3], meanwhile, has criticized the PUC and has called on Abbott to shake up the agency[4].
“His experience suggests he understands the electric industry. The question is, will he stand up to the industry and vigorously work to protect consumers and the environment?” said Luke Metzger, executive director of Environment Texas. “The PUC is a shipwreck right now. “
The agency has come under fire after the widespread electricity blackouts left nearly 200 Texans dead, according to the Houston Chronicle[5].
The three previous PUC commissioners resigned after Patrick and lawmakers called for their resignations when the PUC would not retroactively adjust the price of power in the electricity market during the winter storm. Experts said such a move could make things worse[6], and it remains unclear how readjusting the price of power during the winter storm would impact Texas electricity consumers.
An independent market monitor found that ERCOT unnecessarily charged $ 16 billion to power companies and others over a 32-hour period during the freeze when electricity prices were left high. The monitor recommended energy sold during that period be repriced at a lower rate, which would allow ERCOT to claw back about $ 4.2 billion in payments. Outgoing ERCOT CEO Bill Magness insisted the high prices were necessary to incentivize generators to send power to the grid and to keep big customers from turning their power back on and increasing demand.
References
- ^ Sign up for The Brief (www.texastribune.org)
- ^ Greg Abbott (www.texastribune.org)
- ^ Dan Patrick (www.texastribune.org)
- ^ called on Abbott to shake up the agency (www.texastribune.org)
- ^ Houston Chronicle (www.houstonchronicle.com)
- ^ such a move could make things worse (www.texastribune.org)
Mitchell Ferman
The $7 TRILLION cost of upgrading the US power grid
The Texas freeze that led to numerous blackouts has made the state painfully aware of the shortcomings of its power grid, but the real problem is much larger, and goes way beyond Texas.
We have just witnessed the damage caused by poorly designed energy grids—rolling blackouts, skyrocketing electricity prices, people sleeping in their cars and in one insulated room to keep warm. At the same time a weaponized right wing media swings into action blaming wind turbines and the green new deal for Texas’s energy woes. There is a pattern here. These are variants of stories told after California’s forest fires and resulting power outages. But we see no easy end of power outages that have plagued electricity supply in recent years while adverse weather events seem to get more frequent and impactful. (See Figure 1)
But this is the bottom line. In a way an electric system is like maintaining a car. Spend adequately on repairs maintenance etc. and reliable performance is reasonably assured. Or one could skimp repeatedly on maintenance, save a lot of money over the years and take one’s chances on vehicle reliability. The electric system in Texas was built it appears around the latter proposition. Their reserve margins are the lowest in the country (about eight percent). And this is the third time the electric system failed to perform adequately in winter (1989, 2011 and 2021). Our point here is that any system that consistently fails in this manner regardless of the governance regime is designed that way— despite claims and protests to the contrary. This is a big problem for any region because an increasingly digital economy requires highly reliable electricity service. And what is being provided at present in ERCOT is anything but.
Figure 1. Major disturbances and unusual occurrences on USA electric grids
Now let’s add another ingredient to the mix. Automobile makers are in a very clear transition from internal combustion to electric vehicles. A key step we believe to decarbonize the economy. But first as a society we have to decarbonize our electricity supply, and then sell decarbonized electricity to the transportation sector (which plan, if successfully executed could reduce carbon emissions by 40 percent or more).
But how will the electricity grid handle this incremental demand from the transportation sector well as the needs of existing customers under the increasingly stressful conditions imposed by climate change? One obvious answer: upgrade and expand. If the grid does not, outsiders — including industrial consumers acting to protect their individual electric supply — will.
We have previously written that decarbonizing and modernizing the US’s existing electricity plant (whose average age is 35 years) could cost $ 7-8 trillion. Electricity suppliers might need 20 years to complete the job, meaning $ 350-400 billion per year to get into shape. Currently, they spend about $ 150 billion per year which means a lot of catching up to do.
Also on rt.com Natural gas production plunged 45% during the Texas freeze
Those numbers look huge, but the actual payments will stretch out over decades like a mortgage. And financings of this magnitude will make little dent in US capital markets, where the electricity industry accounts for only 3-4 percent of total capital expenditures and financing. In order to pay for new equipment, without government subsidy, we calculate that electricity suppliers would have to raise prices by 3 – 4 percent per year in real terms. (Academic studies optimistically calculate no price increase under the right operating conditions.) The electric bill equals about two percent of the US’s gross domestic product and the household bill about two percent of household income. Paying for modernization and decarbonization together, spread over decades, would add about $ 45 each year to the average household electric bill. Not an enormous burden, and one that could be spread to mitigate financial hardship.
Admittedly, we should view long term projections with caution. Markets, technology, institutions and solutions change over time. What the numbers show, at best, is that the electric industry can finance modernization and decarbonization without placing undue burdens on consumers. That should be enough to encourage faster action.
What will encourage the industry to raise the ante? Legislation in Congress reprises Obama administration policies: a mix of emissions restrictions, generous tax handouts and regulatory incentives. The industry pushed back then and might do so again, considering that the courts have become friendlier to business. Overall, greenhouse gas emissions per kwh generated fell about two percent per year during the Obama presidency and three percent per year during Trump’s term, largely for economic reasons. Generators shifted from burning coal (high carbon content) to natural gas (lower carbon content) because gas was cheaper. In order to approach zero in 20 years, greenhouse gas emissions per kwh must fall more than ten percent a year.
Also on rt.com Four board members of Texas grid operator RESIGN over blackouts during deadly winter storm
We believe that policy makers would accelerate decarbonization and modernization of the electricity sector by making it a business opportunity for electric companies to embrace rather than as an environmental compliance problem, using tried and true components such as securitization to pay for the most polluting regulated power stations if retired promptly, granting higher returns on assets that support decarbonization, and a bonus to electric companies for the fossil-free electricity that they produce or deliver. Add a Federal guarantee for the securitization bonds or any other deferrals designed to smooth the price impact of the capital program, and that will lower costs to consumers at practically no cost to the government.
(For details of proposed policies, see blog page, lenhyman.com.) Businesspeople do not oppose or stall policies that might raise their profits.
We can’t argue that with the notion that recent polar vortex events or summer wildfires reveal serious shortfalls in electricity regulation, governance and market structure. And this includes lack of financial accountability. But from an operating perspective we also see inadequate reserve capacity, plants in the wrong place or unable to stand up to severe weather. Combine those inadequacies with the need to decarbonize, and it all adds up to a lot of capital spending. Even if the energy market decentralizes—we would think the ERCOT disaster drives people away—some public or private corporation has to spend money for a modernized electricity grid. And needless to say energy consumers will eventually pay. However the good news is if we start this massive grid redesign and rebuilding process now at least the cost of money is very low.
By Leonard Hyman and William Tilles for Oilprice.com