Want to increase the use of green energy and reduce the level of harmful emissions? Invest heavily in the grid to both modernize and expand it, which will accomplish such aims while also building the US economy.
That’s the view of energy and utility experts assembled by Public Utilities Fortnightly at its energy, money and power conference last week in Washington, DC. A smarter and more extensive grid that is able to distribute greener power is expensive. But the benefits of creating a modern infrastructure are huge.
“This vision is also about job creation and economic benefits,” says Massoud Amin, chairman of the IEEE Smart Grid and a professor of electrical engineering at the University of Minnesota. For every $1 invested in the nation’s network, as much as $6 is returned, not to mention the 47,000 new jobs since 2012.
Just ask CenterPoint Energy Inc. and DTE Energy Co., which have invested hundreds of millions of dollars (with some federal help) to improve performance over their wires. Those who run electricity systems can now apply algorithms to tell operators which units to run and where to avoid congestion on the lines, all of which favors wind and solar energy that is variable in nature.
Today, the bulk power system -- as it is known -- is comprised of 10,000 power plants, 170,000 miles of high-voltage transmission lines and nearly 6 million miles of low-voltage distribution lines. It also has more than 15,000 substations.
The pressure to increase the use of renewables will only intensify, in part because of EPA’s proposed Clean Power Plan to reduce carbon dioxide emissions by 30 percent by 2030. As such, the proposal will require more centrally-generated wind and solar energy that need access to the transmission lines. Professor Amin says that if wind energy is to swell by 40 percent during this time, high-voltage, long distance transmission will need to enlarge by 9 percent.
To that end, the PJM Interconnection that manages the transmission grid over 13-states in the Mid-Atlantic and Midwest regions says that it has approved hundreds of upgrades and additions that will entail $24 billion of new capital in the coming years. Specifically, 10 of its 13 states have renewable portfolio standards that will require more green energy. With that, it sees 19,700 megawatts of wind going up before 2020 that will also demand investments in energy storage that can harness the power and then inject it later on to the grid.
“Expansion is happening,” says Terry Boston, chief executive of PJM. “The planning process is not broken. But the siting process is time consuming.”
“It won’t get much easier to site transmission,” adds Philip Moeller, commissioner at the Federal Energy Regulatory Commission (FERC). “You can’t just snap your fingers. Congress “needs to restore FERC’s backstop authority,” which it was given in 2005 as a way to facilitate much-need transmission projects if the states refused to act. But the courts later clarified the law to say that FERC cannot override the states if they decline to permit a project.
The American Wind Energy Association says that up to 60,000 megawatts of new wind energy development is possible if planned transmission expansions actually occur. In Texas, for example, it says that wind is generated in rural sections and transported to population centers, allowing the transmission operator known as ERCOT to nearly double its use of wind energy. There, nearly $15 billion has been invested to generate about 19,500 megawatts of wind energy.
Meantime, it says that transmission operators in the Midwest and the Southwest are enacting similar policies. The Mid-continent Independent System Operator is integrating 14,000 megawatts of new wind while the Southwest Power Pool is doing the same with 3,000 new megawatts there.
But what about solar energy? The Obama administration’s Clean Power Plan could also boost that industry, says Julia Hamm, chief executive of the Solar Electric Power Association. The recent past has seen such mega-deals as the 392-megawatt concentrated solar plant called Ivanpah, which is joint venture among NRG Energy, Google and Brightsource Energy.
That project takes 173,000 mirrors and focuses the sunlight to the plant’s solar receiver steam generator, when then produces electricity. However, it’s costly and out-of-favor, given that it is much easier and much less expensive to put rooftop solar panels on homes and businesses -- not to mention the headaches of trying to get new transmission built to carry the power to where it would be consumed.
That’s why Hamm says that the trend now is to build smaller utility-scale projects that may total 30 megawatts. Some of the biggest names in the solar industry are headed this way, she adds, pointing to First Solar Inc. and SunPower Corp.
“They can do it on the distribution side, not on the transmission side,” she says, who adds that “community solar” is also becoming a viable option: It permits consumers to buy into a larger project that it is taking place in a jurisdiction, which can also avoid high-voltage interfaces as well as the cross-subsidization battles now occurring between rooftop solar customers and their electric utilities.
The existing grid is becoming better and smarter, allowing for more efficient and cleaner transportation of energy. But network expansion will also be necessary, not just to accommodate a growing economy but also to satisfy pending clean air rules. Roadblocks persist. But it is an effort and an investment that will pay off both environmentally and economically.
