Power generation and grid reliability
Tom Rehm, October 5, 2021
Biases: Carbon fee and dividend policy (H.R. 2307), regenerative agriculture, nuclear energy
In 2020 I read a book by Meredith Angwin, “Shorting the Grid: The Hidden Fragility of Our Electric Grid.” Meredith uncovers several root causes of electric grid reliability problems in the U.S.
But you rightfully ask, “What reliability problems? What are you talking about?”
I live in Texas. In February 2021, the Arctic circle descended upon us. You know the cause and effect – destabilization of the jet stream due to the excessive warming of far northern latitudes. If you read the tea leaves, you know that February 2021 was a shot over the bow, a warning.
In February 2021, our rolling blackouts didn’t work as well as the “manageable” 1-2 hour California rolling blackouts. At my house the first rolling blackout lasted 32 hours. The second lasted 8 hours. We didn’t know it at the time but we were only four minutes and thirty-seven seconds from a complete ERCOT grid collapse. And we didn’t know at the time that ERCOT’s black start capabilities are so poor that a 32 hour loss of power would have seemed a blessing compared with most likely a few weeks without power returning, if ERCOT had collapsed.
I can hear my renewables friends moaning, “Here we go again. Blame wind turbines for icing up!” Nope, that wasn’t it. It was definitely some frozen piles of coal plus some gas flowlines clogged with methane hydrates in west Texas that shutdown some fossil power plants; one nuclear plant down due to a feedwater pump’s frozen pressure instrument sensing line; and gas compressor stations inoperable due to loss of electrical power.
So what caused it? Let’s first look back about twenty five years.
In the U.S., we can demarcate grid reliability between the good old before-times and the troublesome after-times. The demarcation occurred in conjunction with three FERC Orders – two in 1997, the third in 1999. Meredith describes these in her book. These three Federal Energy Regulatory Commission Orders focused on busting up monopolies.
Prior to 1999, one company could own the plants that generated electricity, and own the high voltage transmission lines that conveyed that power to substations, and own the substations that transformed it to voltage levels that you and I require in homes and businesses, and own the distribution to those homes and businesses. A monopoly! We hate monopolies. So FERC busted them up.
I really don’t know the difference between grid reliability in the before-times compared to the after-times, but as Bill Maher might say in one of his bits, “It’s worse now. I can’t tell you why, but I just know it’s true.” I know, that’s lousy rationale, but do continue to read my rant as I get into this a bit.
In the aftermath of Storm Uri in February 2021, most people blamed the gas sector. The greatest loss of power generation from the gas sector was 15 GW (Figure C-1 of a July 21, 2021 report by the University of Texas at Austin Energy Institute, “The Timeline and Events of the February 2021 Texas Electric Grid Blackouts”). However, that is less than the greatest overall shortfall of power (demand minus generation) during Storm Uri of 28.3 GW (Figure 2.c) so the gas sector wasn’t completely to blame.
So who should we blame?
With the breakup of evil electric power monopolies, who had historically owned everything and were responsible for everything, we now have companies who only generate electricity, other companies who only own high voltage transmission lines, and still other companies who only own distribution equipment (substations and distribution to end users). Who is to blame for ERCOT failures from Storm Uri? And who should take corrective actions to prevent recurrence of those failures?
Let’s look at a root cause.
In the electricity generation business, there are variable generators and firm generators. We all know the variable generators: solar and wind. Firm generators are gas-fired plants, coal-fired plants and nuclear plants. Some generators can also be considered load followers if they are able to rapidly change their power output to follow rapidly changing load demand. The load followers are gas-fired plants and coal-fired plants. Nuclear plants are not nearly as good at load following as gas- and coal-fired plants, although advanced reactor designs are improving that capability.
In investigating the causality of the ERCOT failure in Feb 2021, let’s return to our questions: Who is to blame for the ERCOT failures during Storm Uri? And who should take corrective actions to prevent recurrence of those failures?
Root cause: Since the evil monopolies were busted up, we now have auctions between generators, the most common auction being conducted every five minutes! Of course live breathing humans can’t possibly participate in auctions every five minutes with hundreds of generators “bidding,” so algorithms take over. Ah, how comforting. Why is that a root cause? Please continue to read my rant.
These five minute auctions explain the $9,000 per MWhr (legislated cap) in the face of generation shortfall, but it doesn’t explain poor grid reliability. What explains that? Well, as noted there are those algorithm-controlled five minute auctions, and some others at greater intervals – each auction between hundreds of generator bidders. When the sun is expected to be shining and the wind is expected to be blowing, those algorithm auctions are quite amazing! If you are a solar or wind generator and therefore are lucky enough to receive subsidies and tax credits, and the weather forecast is sunny and breezy, your algorithm can bid a negative price. You can actually pay someone to take your power and still turn a profit!
Meredith discusses this abomination in her book. And here’s a 2018 paper that discusses the same abomination in Germany. Power plants who receive no subsidies or tax credits must bid against those that do. So, once again catch this vision in your mind’s eye … when it’s sufficiently sunny and windy, solar and wind algorithms bid negative. Hey, I’ll pay you to take my electricity! Understandably, firm generator algorithms decline to bid.
Firm generators are gradually being driven out of the electricity business. Yes, sometimes they do reap those $9,000 per MWhr bonanzas, i.e., the gas-fired and coal-fired plants that can load follow. But that doesn’t happen very often. And sometimes while a firm generator plant is sitting in idle-mode waiting in-the-wings to put their shoulders to the wheel if the load requirements creep up on hot summer days, they may briefly make a few hundred USD per MWhr. Those revenue generating days perhaps help to keep the doors open, but far too much of the time the firm generators are running their plants with operating costs exceeding revenue. The ERCOT electricity market only pays for delivered electricity. They don’t enter into contracts for guaranteed electricity. That type of market is called a capacity market. Oh no, we don’t do that in ERCOT! So our firm generators are gradually shutting down. Who wants to build new ones? I don’t know. Not me. As the firm generators leave, who will remain? We will have solar. We will have wind. We may have some biomass. With all fingers and toes crossed, we may have a little bit of battery storage for electric grids but not much. My last bit of rant goes into that kerfuffle.
So what are our prospects for successfully achieving 100% renewable power?
In December 2019, Professor Simon Michaux produced a detailed report in which he discusses our planetary reserves of Critical Raw Materials. Upon opening that report, my renewables friends will say, “Aha, it’s all about oil. Don’t pay any attention to the report or that video Tom’s going to point to next!” Yes, in everyone’s interest of avoiding catastrophic collapses of national economies around the world, oil and gas are Critical Raw Materials during our transition to carbon-neutral energy, even though they are threatening our planet. Michaux’s report goes into other Critical Raw Materials that are not oil and gas, so please do not despair. With regards to oil and gas and their importance in the transition, we cannot throw the baby out with the bath water. We are facing a Gordian knot of immense complexity that must be solved, in the most responsible manner possible, even if we want to wish upon a star and keep all oil and gas in the ground starting tomorrow morning.
Back to challenges associated with non-fossil electrification: There may not be enough mineral resources to do even one life cycle of electric vehicles (EVs), much less the needed vast quantities of minerals for electric grid storage to provide power during periods of cloudy/rainy/calm days. And dreamers, consider this: Even if we replaced all ICE (internal combustion engine) vehicles with EVs, we won’t have the needed electricity generation to recharge them.
This last hyperlink is a YouTube video in which Michaux spends some time near the end focusing on the minerals needed for EV batteries; see screenshots below to direct you to the timestamps.
The dream of 100% renewables will cost us dearly if we go down that rabbit hole. We must have firm generators in the electricity mix. We must also remove coal- and gas-fired plants from the mix if we expect to solve our planetary global warming problem. Yes, this is a plug for nuclear. Without a significant increase in nuclear energy in the electricity generation mix, we cannot solve our planetary problem. Must this be done everywhere, worldwide? YES
I have been told by my renewables friends, “Tom, we cannot possibly build enough nuclear plants fast enough to provide all electricity from nuclear!” Did I ever propose that? At the end of our clean energy transition rainbow, we need all forms of clean electricity generation, even those despicable renewables ;-)
How do we figure out the best combinations, the best mixes of electricity generation in each nation and in each region? Is that something that should be calmly figured out, or should we just roll the dice and hope that “planning” between vested interests, the passionate public and politicians is the way to go? I don’t think so. Those biases must be mitigated by using the Wicked Problem Approach. Join us if you agree.
Appendix: Two screenshots from the Michaux video hyperlink
Global resource mineral reserves for one life cycle of batteries for electric vehicles
350 gigafactories projected to make EV batteries for Europe alone
~49:00-50:00 time stamp