Last Thursday, the U.S. House of Representatives’ Subcommittee on Energy, Climate, & Grid Security held a hearing on the state of electric grid reliability in America. The hearing reaffirmed what many Kentuckians already know to be the case – that we are on the verge of an electric reliability and affordability crisis of our own making. Unless something changes, by 2030 our state’s energy landscape may resemble that of Germany’s – fragile, expensive, and inadequate to meet the needs of industry and consumers.
While there are many root causes, among the biggest challenges is the push by the EPA to accelerate a national transition to renewable energy sources without regard for dependability and despite repeated warnings from the very people who are responsible for keeping our grid running. As Subcommittee Chair Jeff Duncan stated at the onset of the hearing, “Federal tax subsidies and state policies designed to prop-up renewables, and EPA regulations targeting coal and natural gas power plants, continue to lead to the premature retirement of the nation’s most dependable generation sources.”
In Kentucky’s case, these warnings couldn’t be more relevant. Representatives of both PJM Interconnection (PJM) and Midcontinent Independent System Operator (MISO) – two regional grid operators serving Kentucky – testified to the urgency of the problem at the hearing. Todd Ramey, Senior Vice President at MISO, sounded the alarm on the premature retirement of dispatchable, baseload energy sources, saying:
“The recent acceleration in the pace of fleet change is increasing risk to system reliability for MISO. Dispatchable generators that we need to ensure reliability are being removed from the system before new resources with the needed reliability attributes are being brought online.”
Frederick S. Bresler III, Senior Vice President at PJM, echoed Ramey’s concern, stating:
“…the tasks of maintaining and ensuring reliability are more challenging today and more complex today than they were just a few years ago” and:
“The rate of retirements of fossil fuel resources largely due to state and federal policies is clearly outpacing the construction of new renewable resources.”
The EPA claims that the deliberate onslaught of regulations forcing the premature retirement of baseload power plants is a non-issue because they can be replaced by wind and solar. Recent events and a basic understanding of power generation suggest otherwise. Not all energy sources are equal in their ability to generate power. For example, while a coal plant and a wind farm might have the same theoretical generating capacity, in practice the coal plant will produce much more electricity over time because its output isn’t conditional on the weather.
To account for this, grid operators and experts at PJM and in MISO, have assigned a “capacity value” to indicate how dependable each source is when electricity demand peaks like it did during last year’s Winter Storm Elliot. The greater the capacity value, the more reliable the electricity source is when electricity demand peaks. These grid operators have proposed a capacity value for coal between 86% and 92%. Other sources like wind and solar are proposed to be valued much lower with a capacity value that ranges from 2% to 45%. These values show that both grid operators recognize that traditional baseload power sources like coal are considerably more dependable than other sources in keeping the lights on across our state.
Even if wind and solar were as dependable as coal, natural gas, and nuclear, bringing new projects to completion would remain a major limiting factor. According to Bressler, PJM has “20 gigawatts plus in the queue and about 97% is renewable and battery.” Consequently, the retirement of existing power plants is far outpacing new generation, creating the risk of a rapidly widening gap between supply and demand during critical moments.
Ultimately, it’s not about renewables vs. fossil fuels, but about ensuring that the inherent and indispensable attributes of baseload power sources are preserved in our energy mix. As Federal Energy Regulatory Commissioner (FERC) Mark Christie said earlier this year, “The core of the problem is actually very simple. We are retiring dispatchable generating resources at a pace and in an amount that is far too fast and far too great and is threatening our ability to keep the lights on.” Unless we take what the experts are saying to heart, Kentuckians and Americans in other states can expect grid reliability to continue to deteriorate.
