Challenged By Crisis, The Electric Grid Decentralizes

Feb 25, 2019 No Comments by

The U.S. electric power grid is undergoing a slow but steady shift to decentralize.

The change is remaking the structure of the century-old grid, which has been hailed as one of the world’s greatest interconnected systems of machines.

Industry experts say that 20th century engineering marvel is being challenged by technology innovations such as energy storage and solar photovoltaics, by government policy changes that encourage what are known as distributed generating resources and that seek to decarbonize the economy, and by consumer behavior that is blurring traditional definitions of who is a producer and who is a consumer of electricity.

The changes also are being driven by a growing sense of urgency as disasters that range from hurricanes and flooding to wildfires expose vulnerabilities in a grid that has long been built around the concept of centralized power plants and networks of transmission and distribution lines.

Consider these examples:

  • Puerto Rico’s power grid was largely destroyed in 2017 when Hurricane Maria swept across the island. The storm largely wiped out transmission lines that connected generating resources on the south side of the island with load centers on the north. In what is widely regarded as the largest power failure to hit the U.S., service to many parts of the island was not restored for months after the storm.
  • On a smaller scale, a California wildfire in late July 2018 destroyed the only transmission line serving Anza Electric Cooperative, a rural electric provider around 100 miles east of Los Angeles. Miles of line were destroyed, knocking out the co-op’s only incoming source of electric power. The co-op, with the help of the Energy Department and the National Rural Electric Cooperative Association, installed 2 MW of solar to help ease capacity shortages and provide 14% of the co-op’s annual energy needs.
  • Farther north, a wildfire that ignited close to transmission assets owned by Pacific Gas & Electric grew in size in early November to become the Camp Fire. Before it was contained weeks later, the fire had burned an area the size of Chicago, killed 85 people, and almost entirely destroyed the town of Paradise. By mid-January, the utility said it was preparing to file for Chapter 11 bankruptcy protection in the face of potential fire-related liabilities that it said could top $30 billion.

 

“Extreme events like these represent a new normal that is driving investments both to harden the existing grid and accelerate deployment of more decentralized technologies,” said Gil Quiniones, president and CEO of the New York Power Authority.

In mid-December, NYPA announced plans to spend $250 million through 2025 to accommodate increasing amounts of renewable energy, expand the use of so-called behind-the-meter distributed generating resources and deploy energy storage devices. The latter technology not only helps to form the backbone of microgrids that are experiencing widespread adoption, but also helps utilities delay or avoid altogether big investments in transmission and distribution assets.

For example, to serve new customers in a growing community some 90 minutes northeast of Phoenix, utility Arizona Public Service was faced with rebuilding 20 miles of power lines over rough terrain. A review of the rural service area’s needs showed that adding battery storage would provide benefits at a similar cost to rebuilding transmission lines. Work began in 2017 to install two, 4 megawatt-hour battery energy storage systems. The utility said that it plans to install as much as 500 megawatts of storage capacity across its service territory over the next 15 years.

And just days before California’s Camp Fire ignited, state regulators approved a proposal by PG&E to build four energy storage projects, totaling nearly 570 megawatts (MW) and 2,270 megawatt-hours south of San Francisco. Regulators in January 2018 had rejected payments for three gas-fired power plants, moving them closer to shutdown, and directing the utility to procure new energy storage capacity.

The Long Island Power Authority’s 2018 budget message said that it considered investing in large new power plants to be “risky business” and that distributed energy resources like solar and energy storage were “rapidly declining towards parity with newly built natural gas plants.”

Grid Failures… and Sinatra

Grid failures are not a new thing by any means. Equipment failures plunged large parts of the northeastern U.S. and Canada into darkness in 1965, 1977, and 2003. Electromagnetic disturbances caused by solar activity impact power transmission from time to time in Canada, and a January 1998 ice storm left an estimated 3 million Hydro Quebec customers without power for days.

Even Frank Sinatra’s Rat Pack used a transmission line failure as a story element in their 1960 film Ocean’s 11. To pull off a Las Vegas casino heist, the Pack blew up a transmission tower in the Nevada desert and blacked out the Strip. But the event that may have linked grid vulnerability with climate-enhanced events was Hurricane Sandy, which hit the northeastern U.S. in September 2012.

“Sandy was a catalyst” that led utility and political leaders in New York to adopt and implement investments not only to harden the grid, but also to increasingly decentralize it, Gil Quiniones said. The Long Island Power Authority is implementing more than $700 million to protect critical pieces of equipment from flooding. Nearby, Consolidated Edison is spending around $1 billion on similar efforts in New York City.

In 2015, Con Edison used a Siemens automation system to control underground switches and circuit breakers, enabling the utility to separate two of its power distribution networks into four sub-networks. The configuration will allow the utility to continue delivering power to parts of Lower Manhattan, including Wall Street, in the event of flooding to coastal areas.

In practice, the technology allows the system to issue open and close commands within four milliseconds from field devices that control the circuit breakers and underground sectionalizing switches that in turn switch the power to the sub-networks. The system operates across more than 40 primary circuits and was designed to be interoperable with Con Edison’s control systems and installed primary switchgear.

The T&D Culprit

 

“Hurricane Sandy was a wake-up call,” agreed Peter Lilienthal, president of Homer Energy, which consults on microgrid projects from its home office in Boulder, Colorado. “Almost all outages are caused by problems in the T&D network.”

To address that, Lilienthal and Homer Energy advocate putting small-scale generating resources close to load centers. That approach points to generating resources such as rooftop solar, battery energy storage systems that include electric vehicles, and microgrids that can disconnect from the wider grid and continue to operate in “island” mode for days or weeks if needed.

In November 2018, Lazard released its annual studies comparing the costs of energy from various generation technologies and energy storage technologies for different applications. Its analysis showed that, in some scenarios, alternative energy costs have fallen to the point that they are now at or below the marginal cost of conventional generation.

 

“Although diversified energy resources are still required for a modern grid, we have reached an inflection point where, in some cases, it is more cost effective to build and operate new alternative energy projects than to maintain existing conventional generation plants,” said George Bilicic, vice chairman and head of Lazard’s Power, Energy & Infrastructure Group in a statement. “As alternative energy costs continue to decline, the energy storage remains the key to solving the problem of intermittency that characterizes both solar and wind energy resources. We are beginning to see a clearer path forward for economic viability in storage technologies.”

In particular, the firm said that the low-end levelized cost of onshore wind-generated energy is $29/MWh. That compared to an average marginal cost of around $36/MWh for coal. The levelized cost of utility-scale solar is nearly identical to that of coal, at $36/MWh. Counting subsidies for onshore wind and solar, levelized costs of energy fall to around $14/MWh and $32/MWh, respectively.

 

“Nationally, the grid is becoming more decentralized,” said NYPA’s Gil Quiniones. Technology, customer preference and favorable government policies all are playing a role. In addition, everyone also needs to address the new normal caused by natural and man-made disasters. We don’t have a choice. It goes on every year.”

 

Source: IEEE Global Spec

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