U.S. grid regulators are warning the power sector to be careful about replacing coal plants and other “always-on” thermal generation plants with variable renewable sources, or else risk the long-term reliability of regional power grids.
The North American Electric Reliability Corporation’s newest warnings go to the heart of the difficulties with the transition toward green energy and away from fossil fuels that President Joe Biden aims to accelerate in order to mitigate climate change.
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Operators and policymakers should focus attention on carefully managing the pace of retirements of coal, natural gas, and nuclear power sources, which have contributed to reliability constraints, NERC said in a new annual long-term grid reliability assessment released Thursday.
“Planning and operating the grid must increasingly account for different characteristics and performance in electricity resources as the energy transition continues,” NERC said, adding that operators must “manage the pace of generator retirements until solutions are in place that can continue to meet energy needs and provide essential reliability service.”
For example, the regulator said, “Generation resources, primarily solar and wind, continue to be added to the grid in Texas in large quantities, increasing on-peak planning reserve margins but also elevating concerns of energy risks that result from the variability of these resources.”
NERC concluded that numerous regions, such as Texas and the Northwest, face an elevated risk of electricity generation capacity shortfalls over the next 10 years in extreme weather conditions.
Other regions, such as California and much of the Midwest, however, lack adequate capacity and reserves even in normal conditions, it found.
“Extreme temperatures and prolonged severe weather conditions are increasingly impacting the [bulk power system],” NERC said, adding that “while a given area may have sufficient capacity to meet resource adequacy requirements, it may not have sufficient availability of resources during extreme and prolonged weather events.”
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NERC has outlined similar shorter-term issues in other recent reports.
Utilities across the country have for years been retiring aging coal-fired generation capacity, which is subject to increasing regulatory pressure and competition from cheaper and cleaner alternatives such as solar and wind and, in many cases, gas.
Biden, in remarks made on the campaign trail in early November, pledged that coal closures would continue.
“We’re going to be shutting these plants down all across America” and having wind and solar instead, he said.
Those utilities covered by the Midcontinent Independent System Operator, which oversees the grid in much of the middle of the country, have been especially aggressive in retiring coal-fired generation.
MISO, which is projected to face a 1,300-megawatt shortfall next summer, has retired 5,900 MW of coal-fired and natural gas generation since 2021, NERC said.
Based on announced retirements, MISO is projected to close nearly 60% of its installed coal capacity by 2030, according to America’s Power, a coal power trade group that’s been calling for utilities and relevant authorities to keep coal capacity online.
Nuclear plants do not produce greenhouse gas emissions like coal and gas and have widespread support in Congress, but in some markets, they have been economically uncompetitive, leading to retirements.
Since 2016, at least seven reactors totaling more than five gigawatts have been retired.
Environmental groups and others advocating renewables to replace traditional sources have argued that utilities need to spend more on energy storage technologies to capture wind and solar generation that is otherwise lost.
They’ve also pointed to outages and generator failures to argue that traditional sources have their own flaws. In February 2021, a freak winter storm struck Texas and led to extended power outages, leaving more than 200 people dead.
Some 27% of outages were wind generators, but more than half were natural-gas-fired units, according to a review NERC produced of the incident.
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NERC’s report also recommended grid operators and policymakers include extreme weather scenarios in resource and system planning, as well as more rigorously consider how the expansion of electric vehicles and the electrification of other technologies will affect future electricity demand and infrastructure.
Biden seeks to cut U.S. greenhouse gas emissions from 2005 levels by at least 50% in 2030 and is aiming for a 100% carbon emissions-free power sector in 2035.
