January’s polar vortex renewed Trump administration calls to subsidize uneconomic coal-fired generation to improve grid resilience through on-hand fuel supplies, but reality is disproving this contention — coal is increasingly a grid liability during extreme weather.
From bitter cold in North America to historic heatwaves in Australia, coal — and on-hand fuel security — simply won’t provide the grid resilience federal officials claim direct subsidies would provide. And as global warming intensifies extreme weather, this problem will only worsen.
The smarter way to secure a reliable grid that proves resilient against climate change impacts is through generation diversity, grid automation, distributed resources and interagency planning. This trend is already being realized by the U.S. Department of Defense (DOD), while remote California communities and Puerto Rico’s rebuilding grid move to test and scale clean, resilient solutions.
Coal crashes in extreme cold and extreme heat
Data from PJM Interconnection reported severe cold forced 7.3 to 7.7 gigawatts of coal generation (roughly 12 percent of the market’s total installed coal capacity, or enough to power 5 million homes) offline during January’s polar vortex. A total of 18 to 23 percent of coal plants facing retirement, those most in need of subsidies, were forced offline — nearly double the PJM average forced outage rate of 7 to 10.6 percent during the same time.
Source: Data via PJM/Figure via RTO Insider
These forced outages slightly improved from the 2014 polar vortex, when nearly 14 gigawatts of PJM’s coal capacity (roughly 20 percent of PJM’s total coal capacity at the time) was forced offline due to cold-induced power plant equipment failures and frozen coal piles.
Coal’s brittle performance in extreme weather was also apparent at the other end of the spectrum in Australia’s recent historic heatwave. Temperatures exceeding 120° Fahrenheit forced up to 40 percent of the state of Victoria’s coal generation capacity offline, causing brownouts for thousands of homes, while wind and solar energy outperformed expected output.
“We have aging coal-fired power stations," said Energy Minister Lily D’Ambrosio. “They are becoming less reliable.”
Australian coal outages weren’t limited to its record heatwave. Coal-fired power plants broke down 135 different times nationwide during 2018, or once every 2.7 days, often due to extreme heat. “Coal-fired power is simply unreliable in the heat,” said Mark Ogge of The Australia Institute.
Solar, on the other hand, performed “the best of all energy sources” during the record-breaking Australian heatwave, according to the Australia Institute’s National Energy Emissions Audit for January. “Solar saved the day,” said Dr. Hugh Sadler, the report’s author.
Even the U.S. Department of Energy’s analytical staff found fuel security is not synonymous with resilience in 2017. DOE examined the role of baseload generation in resilience, and a leaked report found no threat to reliability from losing coal and nuclear generation based on recent reliability analyses from the North American Electric Reliability Corporation, echoing similar findings from U.S. wholesale market operators. More recently, a Rhodium Group analysis showed the grid’s wires, not its plants, were more vulnerable to climate impacts.
Extreme weather to become the norm
Extreme weather driven by climate change increases electricity demand and coal outages — and the problem will only worsen as temperatures rise and the weather gets more extreme. The U.S. government’s 2018 National Climate Assessment (NCA) forecasts increases in extreme heat waves and more intense and more frequent hurricanes, along with other climate change impacts, which could cost hundreds of billions in economic damage.
The NCA also predicts increased drought and water supply stress, threatening coal, gas, and nuclear plant operations by cutting off water sources or increasing the cost of water needed to generate steam to power plant turbines.
Far from disproving global warming, polar vortex events actually may result from rising global temperatures, and could increase in frequency as average global temperatures rise. Increasing average temperatures also threaten coal generation as previously rare extreme heat events become much more frequent — exceptionally hot summers that previously occurred less than once every 300 years represented a significant fraction of all summers from 2005-2015. By the end of this century, sections of Texas, Arizona and California could swelter in 95° F or hotter conditions for a third of the year or more.
Source: Reproduced by Energy Innovation from publicly available U.S. government data, from James Hansen et al., “Public Perception of Climate Change and the New Climate Dice”
Sensible responses to resilience concerns
Despite political claims, “fuel security” of on-hand coal supplies doesn’t always help plants operate successfully or supply customers through a vulnerable grid during extreme weather. Resources should be paid for their actual performance; this doesn’t mean paying them to be around in advance (i.e., forward capacity markets), it means paying for actual energy delivered
Enhancing generation fleet resilience is a relatively small, costly and low-probability problem compared to the magnitude of resilience challenges across the entire power system. The better solution to resilience challenges starts with customers — residential, commercial and industrial users — then transmission and distribution, and finally generation.
According to a recent study by Alison Silverstein, lead author of the DOE’s resilience report, customer strategies like real-time communication and automation, local generation for life-saving infrastructure, regional coordination, and better emergency preparedness make much more sense for improving resilience than focusing unrealistically on saving unreliable coal plants from bleak economics.
DOD efforts show distributed clean energy makes customers and communities more resilient to transmission and distribution-caused outages during extreme weather. Many military bases concerned about fuel security are switching from gas- and oil-fired generators to renewables-plus-storage alternatives to improve resilience under emergency conditions.
Remote communities like California’s Borrego Springs, connected by a single transmission line to the San Diego Gas & Electric grid, are using renewables-plus-storage to increase resilience to wildfires and storms created by vulnerable transmission links. This could be a model for California utilities, which recently proposed safety plans to prevent power lines from sparking wildfires.
Puerto Rico is similarly confronting the challenge of extreme weather destroying its grid and putting lives at risk. The Puerto Rico Electric Power Authority’s 2019-2038 integrated resource plan aims to rebuild the grid after Hurricane Irma and wean the island from fossil fuels through 2.2 GW of distributed solar and 1 GW of local energy storage, and projected reduced costs and increased resilience. The proposal also calls for a system of eight distributed “mini-grids” to reduce the risks of cascading grid failure during disasters.
Assessing the move to gas-fired generation
Considering the risks of generation-related outages, replacing unreliable coal with gas isn't a perfect long-term resilience solution, either — as Consumers Energy's gas plant emergency during the 2019 polar vortex indicates.
In the ISO New England and PJM wholesale electricity markets, a primary-generation-based resilience concern arises from potential gas shortages during extreme cold or heat when peak building heating needs coincide with peak electricity demand.
In both regions, market forces replaced oil and coal-fired plants almost entirely with natural gas over the last decade. Natural gas provided nearly 50 percent of ISO New England's regional power in 2017, while regional renewable energy supplies only rose from 8 percent to 11 percent over the last 20 years (excluding distributed solar), despite state policy goals. PJM trends are similar, where coal generation nearly halved, gas generation increased 60 percent, and renewables barely budged from 2013-2017.
Operational fixes like greater transparency into bilateral gas contracts and greater coordination between gas delivery and electricity dispatch can help limit gas-related issues, but they don’t fix underlying risks associated with over-reliance on a single fuel-based resource.
States can bolster resilience by reducing gas use in buildings, while turning new electric end uses into flexible demand-side resources. While it is not cost-effective today to switch from gas to electric heat in existing buildings, it is already cost-effective in most regions of the country to ensure all new homes are electric.
And building retrofits are getting cheaper as technologies like high-efficiency cold-weather heat pumps scale up. Massachusetts is an example of how to do this, by reforming utility efficiency programs to incentivize efficiency and electrification of gas appliances.
Resource diversity is also essential. PJM’s recent market maneuvers prevent the retirement of unneeded coal generation, crowding out renewables. With limited options to site solar, wind or the transmission needed to connect renewables to demand centers like Boston, the Northeast should turn to offshore wind for resilience, and wean itself from gas dependence, while cutting power costs.
During 2018’s bomb cyclone weather event, 1.6 gigawatts of planned offshore wind additions in Massachusetts would have provided consistent power, saved up to $80 million, and reduced gas use 20 percent, according to an ISO New England assessment. Offshore wind is nearly cost-effective even at its low market penetration in the Northeast.
Climate change threatens power supplies – coal isn’t the answer
Burning fossil fuels for electricity accelerates climate change and extreme weather, creating a vicious cycle that threatens power supplies precisely when our communities’ need for reliable and renewable electricity is most acute.
Australia’s extreme heat, the Northeast U.S.’ extreme cold, and the Southeastern U.S.’ extreme storms all prove one point: Fuel security does not equal grid resilience, and a diverse set of distributed and clean energy resources holds more potential than centralized coal baseload or singular dependence on a vulnerable gas system.
Ultimately, focusing on generation for resilience is mostly misguided, as the grid itself is most vulnerable to extreme weather and physical attacks. Still, preparing for a future of warmer temperatures and increasingly extreme weather means embracing renewable energy and local generation backed by energy storage as a promising path toward a resilient grid.