On February 27, the Senate Environmental and Consumer Protection Committees held a joint hearing on electric grid reliability and Winter Storm Elliot that covered lots of ground as it looked at issues on the continued unreliability of natural gas-fired power plants, the potential gap between fossil fuel power plant retirements and renewable energy coming online and the lack of technology deployed to make renewables similar in reliability to baseload power plants.

Key Takeaways

Here are some key takeaways from the hearing--

-- Natural Gas Continues To Have A Reliability Problem: 70% of the PJM electric generation that failed to perform during the December freeze were natural gas-fired power plants. Natural gas had the same problems during a cold weather event in 2014 and the polar vortex in 2018. That’s problematic for Pennsylvania because the state depends on natural gas for 53% of our electric generation and the electric grid generally as it becomes more dependent on natural gas.

-- Not Address Was The Spike In Natural Gas Prices: The hearing did not address the natural gas price spikes caused by international market forces that resulted in natural gas costs going up by as much as 128% for Pennsylvania consumers and electricity costs by as much as 34%.  [Read more here]

-- Renewable Energy Generation Isn’t Coming Online Fast Enough: A study PJM released February 24 showed renewable energy generation sources were not coming online fast enough to replace fossil fuel plants that are retiring. PJM has started a critical path analysis to avoid this mismatch that could affect the ability of the grid to reliably supply electricity.  Read more here.

-- 35,000 MW Of Renewable Generation Approved By PJM, But Not Connected: PJM said 35,000 MW of renewable resources are through the PJM approval process, but not commercially interconnected to the PJM grid due to issues like supply chains and siting.

-- 95% Of Proposed New Generation In PJM Is Renewable & Storage: 95% of the new energy generation seeking to connect to the PJM grid is solar, wind, and energy storage because renewable energy is cheaper than natural gas and nuclear.

-- Baseload-type Reliability Of Renewable Generation An Issue: While PJM said renewable energy performed “up to their capability,” it does not have the same “essential reliability services,” i.e. continuous baseload generation ability, as thermal generators.  Renewables could, if long duration battery storage or other technology is deployed at scale.

-- Independent Energy Office Proposal: Sen. Gene Yaw (R-Lycoming), Majority Chair of the Senate Environmental Committee, said he is working on legislation to create an Independent Energy Office for energy planning and related issues, along the lines of the Independent Fiscal Office established for budget issues.  Read more here.

Key Points Made In Testimony

PUC Chairman Gladys Brown Dutrieuille said there were three reasons the December storm “had a much more profound impact on the wholesale generation market”-- the “precipitous drop” in temperature and a PJM electricity demand forecast that was significantly under-projected.

“Third, a significant number of electric generation resources which were expected to be able to generate were in fact unable to do so. This was the result of a number of factors including plant equipment failure and fuel supply issues.

“Of the units unable to perform about 70% were natural gas, 16% were coal, with the remainder made up of a mix of solar, wind, and nuclear.

“The Commission is continuing to work with PJM to evaluate the results of the storm. These evaluations will be key to determining market or operational modifications to reduce the likelihood of recurrence of these types of events.”

In 2021, Pennsylvania relied on natural gas for 53% of its electric generation capacity; 31% on nuclear; 12% on coal and 4% on renewables and other sources, according to the U.S. Energy Information Administration.

Chairman Dutrieuille noted, “The U.S. Energy Information Administration projects that coal-fired generation capacity will decline through 2030 and then remain relatively flat, as coal plant retirements slow and utilization of the remaining coal fleet increases.

“So, it appears that coal generation is not “dying,” but rather, moving to become more efficient, with fewer competitive plants going off-line. One other reason coal has been competitive is the increase in natural gas prices.

“Meanwhile, right now, over 90% of the new energy seeking to interconnect to the grid in our region is comprised of solar, wind, and storage. For resources seeking capacity accreditation, about half have yet to be built.

“This is a massive change in electricity generation, and Pennsylvania, the PJM region, and the nation as a whole, will have to determine the role that existing fossil and nuclear plants will play in state and local economies, along with their roles in the resilience of the grid and “carbon emissions.”

“As you can see from this testimony, the issues and concerns about electric power transmission are as wide-reaching and diverse as the power lines and entities that deliver energy to our homes and businesses.”

Click Here for Chairman Dutrieuille’s testimony.

Asim Haque, PJM Interconnection, “Factoring in a number of reserve generators that missed scheduled start times Saturday morning [December 24] or operated at less than capacity, combined with PJM’s inability to replenish pumped storage based on the lack of availability of generators overnight, PJM was missing approximately 57,000 MW of its generation fleet by the morning peak of December 24, the coldest day of the holiday weekend.”

Haque confirmed  70% of the outages were natural gas, 16% were coal, with the remainder made up of a mix of solar, wind, and nuclear.

“More than 90% of the forced outages came with no notice or less than one hour’s notice. That meant that PJM Control Room dispatchers were calling generators to bring them online, only to be told for the first time that the unit was not available.”

“During Winter Storm Elliott, generators were subject to 277 five-minute PAIs [Performance Assessment Intervals] over the 23 hours that emergency procedures were in effect during the December 23–24 period.

“Analysis of Capacity Performance requirements, including penalties and bonuses, are being refined and reviewed.

“Given the number of underperforming generators, preliminary estimates of total penalties are between $1 billion and $2 billion. However, the final calculation process will take several months.”

“Those dollars have to come from the generators themselves, which unless it's a new set of issues, we've got potential for some defaults, for some bankruptcies,” explained Haque.  “We're trying to work with our generator community to deal with these penalties. So it brings its own set of issues, but those penalties are not meant to come from consumers.”

While Haque said renewable energy performed “up to their capability,” they do not have the same “essential reliability services,” i.e. continuous baseload generation capacity, as thermal generators.  Renewables could if long duration battery storage or other technology is deployed at scale.

He noted 95% of the proposed new electric generation in the PJM queue was solar, wind or storage facilities.

Haque also referenced the study PJM released February 24 showing renewable energy generation sources were not coming online fast enough to replace fossil fuel plants that are retiring.  Read more here.

The study noted the growth rate of electricity demand is likely to continue with electrification of transportation and buildings and with the huge growth of data centers [not mentioned, but included are cryptocurrency mining operations].

As part of the study’s release, the PJM Board of Managers issued a letter initiating the Critical Issue Fast Path (CIFP) process to tackle the resource adequacy and reliability issues that are currently before stakeholders in the Resource Adequacy Senior Task Force (RASTF) that focuses on avoiding the mismatch of new renewable energy generation with existing plant retirements. Read more here.

“PJM serves a region made up of diverse states with complex policies impacting the bulk electric power grid. These policies include Renewable Portfolio Standards, carbon cap-and-invest programs, electrification goals and offshore wind auctions.

“Cumulatively, these policies are driving the next energy transition in PJM, marked by an increase in renewable generation and energy storage, along with retirements of traditional thermal generation.

“As we continue on this transition, it is important to recall that the grid has successfully endured multiple energy transitions in the past.

“PJM has reliably and effectively weathered these transitions due in large part to the value that comes with being a regional transmission organization with a robust planning process, efficient capacity market design, access to fuel and geographically diverse generating resources, and a highly resilient network of transmission facilities.”

Click Here for Haque’s testimony.

Diane Holder, ReliabilityFirst Corporation, said, “From our standpoint, the key pillars of a successful grid transition require an optimal balance of environmental/sustainability factors, cost, and reliability. Reliability is RF’s area of expertise.

“There are three reliability topics that broadly apply across our region regarding the changing resource mix: the pace and complexity of change, resource adequacy, and essential reliability services. These are not the only reliability considerations, but they drive many conversations with states.

“I will start with the pace and complexity of change. To be clear, grid transformation can be achieved in a reliable way with appropriate tools to understand and plan for the impacts of the transforming BPS [bulk power system].

“Managing the pace of change is the central challenge for reliability. The rapidly changing generation resource mix is driving BPS transformation.

“Traditional baseload generation plants are retiring, and replacement energy is largely supplied by significant amounts of new natural gas and variable generation resources (mostly wind and solar) that do not yet have the same operating features essential for reliability, commonly referred to as Essential Reliability Services (ERS).

“Until energy storage is fully developed and available at scale, sufficient amounts of flexible, dispatchable generation will be needed as a balancing resource for grid reliability. Transmission is also critical for reliability.

“New inter-regional transmission can provide operating flexibility to import power where it is needed most during potential energy shortages.

“In addition, new transmission is critical to supporting state clean energy goals, where is it necessary to import renewable energy from remote sources to load centers.

“Natural gas dependency also presents reliability challenges, as a greater reliance on natural gas- fired generation elevates the risk from weather-induced natural gas fuel supply disruptions.

“Given the new portfolio of generation resources, the BPS has grown more sensitive to the effects of extreme weather.

“As the grid continues to undergo rapid transformation, managing the pace of change is a central challenge for reliability. RF and the ERO Enterprise are taking specific actions to identify, assess, and mitigate these risks.

“We are also making it a priority to serve as a resource for the states on these issues, in forums such as this hearing.”

Click Here for a copy of Holder’s testimony.

Rachel Gleason, PA Coal Alliance, said, “PJM has faced gas supply problems from cold weather before, during a cold weather event in 2014 and the polar vortex in 2018, but it’s a growing problem becoming more pronounced as the gas generation sources account for a larger share of the grid’s dispatchable baseload generation.

“In February of 2014, during a cold snap, PJM found that 23% of total generator outages were due to interruptions of natural gas supply, and in January of 2018, during the polar vortex, half of the total PJM natural gas capacity was not available to supply peak demand.

“In 2014, 2018 and two months ago, it was coal generation that came to the rescue, ramping up power supply when gas couldn’t, when nuclear stayed the same because it cannot ramp, and renewables did what renewables do, worked some of the time and didn’t work some of the time.

“Based on preliminary data, of the 30 GW of additional generation needed during Winter Storm Elliot, coal provided 47%.

“PJM’s coal fleet was the principal source of increased power generation to meet demand during Winter Storm Elliott.

“Without adequate and comparable replacement capacity with the same reliable and resilient attributes, grid failures are increasingly likely during future extreme weather events.”

Matt Crozat, Nuclear Energy Institute, said, “The reason for nuclear’s unique ability to maintain reliable operations is in its different approach to fuel availability. Unlike natural gas or coal generation, nuclear plants do not need to be continually fed new fuel supplies to produce electricity."

“It is also worth noting that these nuclear plants are providing this reliable, around-the-clock power without releasing carbon emissions.

“Nuclear energy’s combination of being able to provide electricity 24 hours a day, 7 days a week while also being a carbon-free source of generation has led to a broad reconsideration of the role nuclear energy could play as part of the future energy mix.”

"Six or seven years ago we were working with state policymakers to ensure that these very power plants were not allowed to close prematurely in the face of low power prices. These efforts were largely successful, and the performance of those plants during Elliott was a testament to the wisdom of those policies, but some of those efforts were unsuccessful and plants such as Three Mile Island unit 2 were not available in this moment.

"The U.S. energy system is likely to look quite different in twenty years than it does today. It will include more low-carbon technologies and it will likely be a system in which more of the economy uses electricity.

“Events like Winter Storm Elliott are a stark reminder that this evolution will need to be predicated upon reliable operations. Pennsylvania’s nuclear plants represent an important starting point for that transition.”

Andrew Williams, Solsystems, said, “The planned versus unplanned outages is a key distinction in reliability planning. The threat to reliability comes from unplanned outages – units that say they will be there, customers pay to be there, and then unexpectedly do not show up when called.

“On Christmas Eve 2022, nearly one- quarter of the generation capacity PJM expected to rely upon did not show up.vi Around forty- four percent—nearly half—of the gas plants in the region wholly or partially failed to meet their commitments.

“Thus, Winter Storm Elliott highlighted the importance of reliability through generation diversity. Our overreliance on one or a few generation types left the PJM grid vulnerable and risked the public’s safety.”

Click Here to watch a video of the hearing and for written testimony.

Sen. Patrick Stefano (R-Fayette) serves as Majority Chair of the Consumer Protection Committee and can be contacted by calling 717-787-7175 or sending email to:  pstefano@pasen.gov.   Sen. Lisa Boscola (D-Lehigh) serves as Minority Chair and can be contacted by calling 717-787-4236 or sending email to: boscola@pasenate.com.

Sen. Gene Yaw (R-Lycoming) serves as Majority Chair of the Senate Environmental Committee and can be contacted by calling 717-787-3280 or sending email to: gyaw@pasen.gov.    Sen. Carolyn Comitta (D-Chester) serves as Minority Chair and can be contacted by calling 717-787-5709 or sending email to: senatorcomitta@pasenate.com.

Related Articles - Winter Storm Elliot:

-- PJM’s Preliminary Review Of Christmas Storm Electric Generation Failures Shows Natural Gas Units Failed To Provide Power At Over Triple The Rate Of Other Generation  [PaEN]

​​-- PJM Interconnection: PJM Operated Reliably Throughout Winter Storm Challenges, But ‘Generator Forced Outages Were Unacceptable’

-- PA Capital-Star: After A Series Of Winter Storms, FERC Approves New Standards For Power Plants To Prevent Power Failures During Extreme Weather  [PJM’s December Freeze Included]

-- Guest Essay: Forestall Or Foresee - The Energy Transition And The Pennsylvania Legislature - By Ralph Kisberg, Responsible Drilling Alliance, Lycoming County [PaEN]

PA DEP Public Notice Dashboards:

-- Pennsylvania Oil & Gas Weekly Compliance Dashboard - Feb. 25 to March 3; More Well Plugging Sites Inspected [PaEN]

-- PA Oil & Gas Industrial Facilities: Permit Notices/Opportunities To Comment - March 4 [PaEN]

-- DEP Posts 63 Pages Of Permit-Related Notices In March 4 PA Bulletin  [PaEN]

PA Oil & Gas Compliance Reports

-- Feature: 60 Years Of Fracking, 20 Years Of Shale Gas: Pennsylvania’s Oil & Gas Industrial Infrastructure Is Hiding In Plain Sight [PaEN]

-- Conventional Oil & Gas Well Owners Failed To File Annual Production/Waste Generation Reports For 61,655 Wells; Attorney General Continues Investigation Of Road Dumping Wastewater  [PaEN]

-- DEP Issued 754 Notices Of Violation For Defective Oil & Gas Well Casing, Cementing, The Fundamental Protection Needed To Prevent Gas Migration, Groundwater & Air Contamination, Explosions  [PaEN]

-- DEP Report Finds: Conventional Oil & Gas Drillers Routinely Abandon Wells; Fail To Report How Millions Of Gallons Of Waste Is Disposed; And Non-Compliance Is An ‘Acceptable Norm’  [PaEN]

-- DEP 2021 Oil & Gas Program Annual Report Shows Conventional Oil & Gas Operators Received A Record 610 Notices Of Violation For Abandoning Wells Without Plugging Them  [PaEN]

-- PA Oil & Gas Industry Has Record Year: Cost, Criminal Convictions Up; $3.1 Million In Penalties Collected; Record Number Of Violations Issued; Major Compliance Issues Uncovered; Evidence Of Health Impacts Mounts  [PaEN]

Related Articles This Week:

-- Bay Journal: PA Conventional Gas Wells Routinely Abandoned, Left Unplugged - By Ad Crable, Chesapeake Bay Journal  [PaEN]

-- PA Capital-Star Guest Essay: It’s Time To Hear Bold Leadership On Oil & Gas In Gov. Shapiro’s Budget Address - By Melissa Ostroff, EarthWorks, Member Shapiro Transition Team   [PaEN]

-- Better Path Coalition, FracTracker Alliance Release Pennsylvania Is Worth Protecting, A Visual Reminder Of The People, Places & Natural Resources Worth Protecting From Environmental Devastation, Climate Change  [PaEN]

-- Senate Committee Meets March 6 On Bill Prohibiting Elected Officials In Local Governments From Moving To Cleaner Energy Sources To Combat Climate Change  [PaEN]

-- Senate Committee Meets March 8 To Consider Bill Allowing General Assembly To Kill Regulations By Doing Nothing [PaEN]

-- Senate Hearing On Electric Grid Reliability: Natural Gas Continues To Have Reliability Problems; Renewables Aren’t Coming Online Fast Enough; Energy Office To Be Proposed  [PaEN]

-- Sen. Yaw Proposes Independent Energy Office To Promote Development Of PA’s Diverse Energy Portfolio - Natural Gas, Nuclear Power, Coal [PaEN]

-- PJM Interconnection Study Shows Renewable Energy Sources Not Coming Online Fast Enough To Replace Fossil Fuel Plants; Critical Path Analysis Started To Avoid Grid Reliability Risks  [PaEN]

-- Latest PJM Interconnection Electricity Capacity Auction Shows Price Decrease, But Mixed Results In PA [PaEN]

-- Independent Fiscal Office Reports 4th Quarter 2022 Natural Gas Production Decreased 1.6%; Average Price Increased By 82.5% Compared To Last Year [PaEN]

-- Senate Republicans, 4 Democrats Pass Resolution Urging Restart Of Keystone XL Oil Pipeline Abandoned By Company [BTW Not In PA]   [PaEN]

-- Republicans On Senate Committee Report Out Bills On Decommissioning Solar Energy Facilities, Limiting 1 Use Of PFAS Chemicals, Resolution Calling For Restart Of Keystone XL Pipeline  [PaEN]

-- Solar United Neighbors Helping Lancaster Residents Harvest Sunshine With New Solar Co-Op  [PaEN]

-- Observer-Reporter Guest Essay: Natural Gas Pipelines Can Secure Our Energy And Economic Future - By Republican Sen. Bartolotta  [DEP hasn’t denied any pipeline permits in PA, But they are the most heavily penalized for violations of any industry in PA history]

-- Washington & Jefferson College Hosts March 8 Webinar On Renewable Natural Gas  [PaEN]

[Posted: February 27, 2023]

3/6/2023