9. ELECTRICITY
Extreme weather
Extreme weather can often damage power systems and warrant emergency response procedures to restore services, minimise risks and ensure preparedness. Moreover, climate change is increasing the frequency and severity of extreme weather events, which will make further emergency response efforts more important in the coming years. In particular, as identified by the Fourth National Climate Assessment, climate change is expected to result in rising sea levels and flooding along the US coastline, more wildfires in the Southwest, increased risk of more intense hurricanes around the Gulf Coast and eastern United States, and more intense precipitation and extreme temperature events (both heat and cold) across the United States (USGCRP, 2018).
In recent years, several extreme winter weather events have tested the reliability and resilience of the power grid. Cold temperatures can impact the power system in various ways, including by freezing pipelines, downing power lines, halting operations at thermal or nuclear power plants, and causing ice accumulation that shuts down operations of wind turbines. Cold weather can also result in disruptions to natural gas supplies for home heating, prompting a switch to space heaters that increase demand for electricity (Litterman, 2019).
The most significant event in recent years was the January 2014 polar vortex that brought extreme cold through a broad area of the middle and eastern parts of the United States. The incident broke peak winter demand records across several regional grids, including MISO, PJM, SPP, ERCOT and NYISO, as well as several utilities in the Southeast. Utilities were the first and primary line of defence, calling upon DR and conservation measures from its customer base, reducing voltage, and increasing power trade across regions. The freezing temperatures led several power plants to go offline, requiring some utilities to institute rotating outages to shed load (at very minor levels). An estimated 50 000 MW of generation capacity was taken offline, compared with average wintertime outages of 33 000 MW (NERC, 2014). A number of coal piles also froze, which limited supplies to coal-fired generators. More significantly, natural gas pipeline constraints led to prioritisation of supplies to home heating rather than for power generation, slashing fuel supply to gas-fired generators, particularly in the Northeast (which is highly dependent on both gas generation and natural gas for heating). Though power systems overall held up relatively well in the face of extreme winter weather, the incident led grid operators to develop new winter performance standards (building upon improvements made after a 2011 cold snap) to better ensure power adequacy in similar future situations (Washington Post, 2019). Such measures include winter preparation site reviews, securing on-site fuel supply, applying for exemptions from emissions limits and updating weatherisation programmes for generators. Since then, grid operators have boosted capacity payments to generation resources for winter preparedness and imposed hefty penalties on plants that cannot deliver on supplies cleared during auctions. Disruption to natural gas supplies during the 2014 polar vortex was a significant justification for the DOE’s NOPR to FERC on compensating generators such as coal and nuclear plants that can store 90 days of on-site fuel.
The upgraded defences put in place after the 2014 polar vortex were put to the test in the Northeast during the 2018 Bomb Cyclone. During that event, extreme frigid temperatures combined with an outage at the Pilgrim nuclear plant in Massachusetts meant that the ISO-NE region was forced to rely heavily on dual-fuel generators that could switch to fuel oil as well as to import more electricity from neighbouring New York (Utilitiy Dive, 2018b).
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9. ELECTRICITY
As the Northeast region sees more nuclear retirements and already has limited coal-fired units, dependency on fuel oil for reliability will grow stronger there.
Most recently, a polar vortex front that descended upon the Midwest of the United States in January 2019 prompted extreme freezing temperatures across the region. In anticipation of the event, grid operators PJM and MISO put in place emergency procedures ahead of the event that included directing utilities to insulate pipes and top up backup fuel tanks (Utility Dive, 2019f). Utilities in Minnesota and Michigan issued notices to their customers to turn down thermostats in order to minimise the system load. The DOE’s Office of Cybersecurity, Energy Security, and Emergency Response (CESER) as well as NERC also monitored the situation on an ongoing basis in the event it warranted a more extraordinary or national response. Overall, the bulk power system withstood the impacts of the January polar vortex well, with minimal disruptions to supply.
To assist in preparation for extreme weather, NERC publishes reliability guidelines for the bulk power system in anticipation of unusually cold weather. The guidelines outline several focus areas to ensure winter readiness, including safety, management roles and expectations, processes and procedures, evaluation of potential problem areas, testing, training, and communications (NERC, 2017b). In addition, NERC publishes review reports and analysis from major weather events, along with a vast library of reference materials on its website, including training materials and lessons learned (NERC, 2012). Moreover, RSOs and ITOs also publish preparedness guidance and hold workshops for operators in their coverage regions.
Beyond extreme cold, Puerto Rico experienced the longest blackout in US history as a result of Hurricane Maria, a Category 4 hurricane, which made landfall in September 2017. All of the Puerto Rico Electric Power Authority (PREPA) utility’s 1 570 000 electricity customers were without power immediately after Hurricane Maria. Most of Puerto Rico’s electricity infrastructure was damaged, causing total electricity sales to drop below 0.3 million MWh in October 2017 (compared with 17.3 million MWh in 2016) (EIA, 2018c).
An uptick in the incidence of wildfires is also having lasting impacts on the electricity sector, particularly in the state of California. Given a greater number of wildfires in recent years, California’s utilities have put in place response procedures that include activating emergency operations centres and notifying customers in the impacted area of a risk to power supplies. Utilities can also enact a “public safety power shutoff”, triggered by highrisk circumstances such as high winds and dry conditions.
California’s investor-owned utility Pacific Gas & Electric (PG&E) filed for bankruptcy in January 2019, largely stemming from liabilities incurred due to wildfires in California that were attributed to its equipment. State investigations through 2018 revealed that the utility’s electrical equipment triggered several wildfires in California in 2017, prompting PG&E to report an estimated USD 2.5 billion in charges related to the wildfires to federal regulators in June 2018 (Utility Dive, 2019e). California legislators, backed by its governor, passed legislation in July 2018 that limited some wildfire liabilities for utilities in an effort to stem financial losses and help ensure solvency of major utilities. Subsequently, however, the state’s deadliest wildfire – Camp Fire in Paradise, California
– in November 2018 prompted PG&E to file for Chapter 11 bankruptcy protection to mitigate up to USD 30 billion in liabilities associated with the 2017 and 2018 wildfires (Axios, 2019).
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