Posted on 04/23/2014 7:49:05 PM PDT by Vince Ferrer
CHICAGO, April 23, 2014 — Americans take electricity for granted. Electricity powers our lights, our computers, our offices, and our industries. But misguided environmental policies are eroding the reliability of our power system.
This past winter, bitterly cold weather placed massive stress on the US electrical system―and the system almost broke. On January 7 in the midst of the polar vortex, PJM Interconnection, the Regional Transmission Organization serving the heart of America from New Jersey to Illinois, experienced a new all-time peak winter load of almost 142,000 megawatts.
Eight of the top ten of PJM’s all-time winter peaks occurred in January 2014. Heroic efforts by grid operators saved large parts of the nation’s heartland from blackouts during record-cold temperature days. Nicholas Akins, CEO of American Electric Power, stated in Congressional testimony, “This country did not just dodge a bullet―we dodged a cannon ball.”
Environmental policies established by Congress and the Environmental Protection Agency (EPA) are moving us toward electrical grid failure. The capacity reserve margin for hot or cold weather events is shrinking in many regions. According to Philip Moeller, Commissioner of the Federal Energy Regulatory Commission, “…the experience of this past winter indicates that the power grid is now already at the limit.”
EPA policies, such as the Mercury and Air Toxics rule and the Section 316 Cooling Water Rule, are forcing the closure of many coal-fired plants, which provided 39 percent of US electricity last year. American Electric Power, a provider of about ten percent of the electricity to eastern states, will close almost one-quarter of the firm’s coal-fired generating plants in the next fourteen months. Eighty-nine percent of the power scheduled for closure was needed to meet electricity demand in January. Not all of this capacity has replacement plans.
In addition to shrinking reserve margin, electricity prices are becoming less stable. Natural gas-fired plants are replacing many of the closing coal-fired facilities. Gas powered 27 percent of US electricity in 2013, up from 18 percent a decade earlier. When natural gas is plentiful, its price is competitive with that of coal fuel.
But natural gas is not stored on plant sites like coal. When electrical and heating demand spiked in January, gas was in short supply. Gas prices soared by a factor of twenty, from $5 per million BTU to over $100 per million BTU. Consumers were subsequently shocked by utility bills several times higher than in previous winters.
On top of existing regulations, the EPA is pushing for carbon dioxide emissions standards for power plants, as part of the “fight” against human-caused climate change. If enacted, these new regulations will force coal-fired plants to either close or add expensive carbon capture and storage technology. This EPA crusade against global warming continues even though last winter was the coldest US winter since 1911-1912.
Nuclear generating facilities are also under attack. Many of the 100 nuclear power plants that provided 20 percent of US electricity for decades can no longer be operated profitably. Exelon’s six nuclear power plants in Illinois have operated at a loss for the last six years and are now candidates for closure.
What industry pays customers to take its product? The answer is the U.S. wind industry. Wind-generated electricity is typically bid in electrical wholesale markets at negative prices. But how can wind systems operate at negative prices?
The answer is that the vast majority of U.S. wind systems receive a federal production tax credit (PTC) of up to 2.2 cents per kilowatt-hour for produced electricity. Some states add an addition credit, such as Iowa, which provides a corporate tax credit of 1.5 cents per kw-hr. So wind operators can supply electricity at a pre-tax price of a negative 3 or 4 cents per kw-hr and still make an after-tax profit from subsidies, courtesy of the taxpayer.
As wind-generated electricity has grown, the frequency of negative electricity pricing has grown. When demand is low, such as in the morning, wholesale electricity prices sometimes move negative. In the past, negative market prices have provided a signal to generating systems to reduce output.
But wind systems ignore the signal and continue to generate electricity to earn the PTC, distorting wholesale electricity markets. Negative pricing by wind operators and low natural gas prices have pushed nuclear plants into operating losses. Yet, Congress is currently considering whether to again extend the destructive PTC subsidy.
Capacity shortages are beginning to appear. A reserve margin deficit of two gigawatts is projected for the summer of 2016 for the Midcontinent Independent System Operator (MISO), serving the Northern Plains states. Reserve shortages are also projected for the Electric Reliability Council of Texas (ERCOT) by as early as this summer.
The United States has the finest electricity system in the world, with prices one-half those of Europe. But this system is under attack from foolish energy policies. Coal-fired power plants are closing, unable to meet EPA environmental guidelines. Nuclear plants are aging and beset by mounting losses, driven by negative pricing from subsidized wind systems. Without a return to sensible energy policies, everyone must prepare for higher prices and electrical grid failures.
EPA policies, such as the Mercury and Air Toxics rule and the Section 316 Cooling Water Rule, are forcing the closure of many coal-fired plants, which provided 39 percent of US electricity last year. American Electric Power, a provider of about ten percent of the electricity to eastern states, will close almost one-quarter of the firm’s coal-fired generating plants in the next fourteen months. Eighty-nine percent of the power scheduled for closure was needed to meet electricity demand in January. Not all of this capacity has replacement plans.
Wait until the Obamanoids find out that their messiah’s policies are going to make it tough for them to find a place to plug in their ObamaPhone.
talk about the TSHTF!
Shutting America Down....what a Legacy the Democrats will have..
What do they all have electric heat and electric stoves there?
We use natural gas for those here.
PING
For the Preppers List
There are big problems in the North whenever gas is used for heating and cooking. It is difficult to maintain gas pressure in cold weather because the lower temperatures reduce the volume and pressure. (Boyles Law)
Impossible!! Our President, the magnificent Barack Obama has been focused like a lazier on the infrastructure with his “shovel ready” jobs.
All of this and soon electric cars as well.
I spent 25 years as an engineer in the electricity business until I couldn’t take it any more. The constant meddling by regulators and extreme environmentalists, the take-over of utility boards and chairmanships by extreme environmental kooks, the marketing programs to pay customers to use less of your product, the lack of will to meet the old-fashioned “obligation to serve” and instead utilities kowtowing to the idiots bent on destroying what used to be the world’s greatest generating and T&D system, the constant caving-in to NIMBYism. That industry is an awful place to work...unless you are without scruples and become a corporatist who sucks off the government teat and enriches yourself at the expense of the nation’s welfare.
Good riddance. I haven’t missed it a day since I got out.
After >5 years, is the XL Pipeline almost “Shovel Ready?”
Every home and business ought to have its own power supply. It’s a matter of national security. The larger grid is fine, too, perhaps as a back up.
Where are we going to plug in our electric cars if there is no electricity? Have they no compassion?
Will the last real American shut off the light? Oops, I think that was taken care of already. B-P
You would think that coming this close to a crisis would cause some of those “deep thinkers” in D.C. to realize that this is maybe not the ideal time to take any of the RELIABLE power sources off-line to replace them with the unproven “green” sources. Their ego is going to be the death of many.
Well it’s clear that we need to take the electrical grid operations out of the hands of the greedy corporations and have the federal government take over.
Evidently Harry Reid is not on schedule with his Solar Companies to keep things up and running!
Good. The sooner the grid starts crashing on a regular basis, the better. There is practically no better way to start waking up those in this country who don’t really understand what is going on “behind the scenes”.
ping
On the map linked below mouse over the colored points and the LMP is the power price per MW. The different colors reflect different prices and also represent “binding constraints” which are bottlenecks on the grid for reasons like power lines down or transformer problems.
Even though this is MISO, which represents MidUS, you can mouse over various colored points in the eastern US from Canada down to Florida.
https://www.misoenergy.org/LMPContourMap/MISO_All.html
At the time of this post power was about $200 MW from the Dakotas to the east coast and down to OK and TN! (That is equal $.20 per KW!)
I watched the entire eastern US grid at max capacity many times this winter. I’ve wondered if shutting down so many coal plants in the east is part of the reason. Many utilities chose to shut down coal plants instead of try and meet the new mercury and NOx control EPA mandates. The average customer doesn’t have a clue what is going on behind the light switch and blames the utilities for rising power prices.
Artificially raise the price of energy and you will kill the economy - no way around it.
MISO real time and predicted wind power; https://www.misoenergy.org/MarketsOperations/RealTimeMarketData/Pages/DayAheadWindForecast.aspx
I pinged everyone on this thread because most people don’t know real time information on the grid is on the web.
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