PUC Vice Chairman: During Winter Storm Elliot We Learned Natural Gas Can Be An Intermittent Generator Of Electricity Just Like Renewables
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On June 13, Public Utility Commission Chairman Gladys Brown Dutrieuille told the House Consumer Protection, Technology and Utilities Committee Winter Storm Elliot has again demonstrated extreme weather can have a significant impact on electric grid operations in terms of reliability and resilience.

“Our country continues to experience an increase in significant weather events- the 2014 Polar Vortex, successive hurricanes, fires, and Winter Storm Uri in 2021, which brought down Texas' grid,” said Chairman Dutrieuille.  “The more recent Winter Storm Elliott which brought another severe and sudden cold snap- along with urgent calls for conservation -to our region during Christmas weekend is the latest example of extreme weather affecting the grid.

“The Commission thus finds that it must even more closely monitor the rules and mechanisms put in place in the competitive generation market, as well as the resiliency of the interstate transmission grid, to ensure that these markets are optimizing and prioritizing resiliency as well as affordability,” she added.

Multiple presenters noted the PUC no longer regulated the electric generation market in Pennsylvania as a result of deregulation.

Natural Gas Is An Intermittent Generator

Rep. Craig Williams (R-Delaware) noted the PUC’s testimony said natural gas provides 53% of elected generation in Pennsylvania in 2021, nuclear power 33%, coal just 12% and renewables and other sources the remainder.

“There's a recognition that nuclear and natural gas are fueling our state, and that there's now a downward trend, both economically and in policy, for renewables,” said Rep. Williams. “And given where customers are today, as you've heard from many of our colleagues here, in getting absolutely flat lined in costs.

“That maybe today is not the opportunity for large investments by utilities that will be subsidized by ratepayers to make new generation. What are your thoughts on that?”

PUC Vice Chairman Stephen DeFrank responded, “Thank you for the question Representative. It is a growing concern.

“As you know, PJM has been having issues struggling with their queue and how to address that, how to bring projects online. We see a lot of developers having entered that queue and get a project so far, and they're doing that to sell the project.

“PJM has worked to address those queue concerns, and then we see new concerns.

“I think that Winter Storm Elliot, over the Christmas holiday, showed some vulnerabilities in our grid and in our system. Particularly from the amount of generators that did not show, we had over 40,000 megawatts not respond, with little to no notice to the grid operator.

“Coupled with estimates, that weekend they were below estimate, I think about 10,000 megawatts under estimate. So when you compare the two, we were very close to some rolling blackouts over the Christmas holiday.

“That being said, we've seen intermittent resources and we've talked about renewables being intermittent resources.

 “But we also learned over the Christmas holiday that natural gas resources can also be intermittent, whenever we have those drastic drops of temperatures like we experienced. The issues were actually at the wellhead.

“It was not at capacity agreements, we had hard commitments for natural gas at generators that simply did not show.

“So, as a result, that's been the discussion with PJM, how we correct that. I believe they levied about $1.8 billion in fines to generators that did not respond, but it's certainly something that we need to work on,” said DeFrank.

Both Rep. Williams and Commissioner DeFrank noted nuclear plants were online and providing power.

Commissioner DeFrank’s comments echo the findings of a joint inquiry by the Federal Energy Regulatory Commission and North American Electric Reliability Corp into the impact of Winter Storm Elliot that caused a wave of unplanned power plant outages in December 2022, particularly in the PJM Interconnection electric grid region.

They found the reliability of the natural gas system to be a continuing concern.  Read more here.

The PUC’s written testimony noted--

“For Winter Storm Elliott, PJM has assessed more than $1.8 billion in performance penalties on about 200 market participants for falling short on their required power deliveries on December 23-24, 2022.

“PJM has indicated that the figure number of violators is subject to change. The penalties sparked at least 10 complaints pending at FERC.

“For those entities that may qualify to receive bonus payments for stepping in to provide needed supply, those amounts will not be known until PJM billing is complete. Originally scheduled for April, PJM now plans to issue its Winter Storm Elliott report in July 2023, with a further report to follow in the Fall.”

The PUC also noted, “On February 16, 2023, FERC [Federal Energy Regulatory Commission]  approved new extreme cold-weather reliability standards stemming from a series of recommendations proposed in the wake of the February 2021 Winter Storm Uri event.

“The reliability standards contain new and revised requirements to advance reliability of the grid during extreme cold weather temperatures.

“They include implementation of generator freeze protection measures, enhanced cold weather preparedness plans, identification of freeze-sensitive equipment in generators, corrective actions for when equipment freeze issues occur, annual training for generator maintenance and operations personnel, and procedures to improve the coordination of load reduction measures during a grid emergency.

“The [Public Utility] Commission will monitor the FERC cold-weather reliability standards carefully and continue tracking these issues through our membership in the Organization of PJM States, Inc. (OPSI).

“Through this organization, the 13 states within PJM along with the District of Columbia coordinate efforts and advocate on numerous issues related to PJM markets and operations.”

PJM Market Reforms

The PUC’s written testimony also noted PJM’s capacity market reforms are being fast-tracked due to reliability concerns with the regional electric grid.

“While capacity market reform is a wholesale market issue, the tie-in to transmission cannot be ignored.

“The [Public Utility] Commission, along with other PJM states, have communicated to the PJM Board that the problem is not simply too many retirements, but that the interconnection queue process for new generation resources is too slow to reliably bring new resources online.

“The Commission suggested several methods the PJM Board could use to speed up the queue to increase the new entry of resources.”

Electric Transmission

The PUC’s written testimony said, “It does not matter how much power is generated, or what its fuel source is, if there are not sufficient transmission lines to get the power to customers.

“When discussing current and future transmission needs, it is important to consider dual concerns- that transmission is a key variable in how successful the ongoing transition to a low-carbon generation fleet will be, and that the increase in renewables will require the utilization of balancing resources.

“Those balancing resources likely will be fossil or steam generators powered in large part by plentiful natural gas, until such time as energy storage resources can scale up.

“FERC, to its credit, saw the changes already occurring in the generation fleet- the gradual shift away from large fossil fuel generators located close to load centers; the steady growth in smaller renewable generators located farther from load centers; and the Clean Energy Transition that was already underway.

Click Here for a copy of the PUC’s written testimony.

Click Here for a video of the House Committee information session.

Rep. Robert Matzie (D-Beaver) serves as Majority Chair of the House Consumer Protection, Technology & Utilities Committee and can be contacted by calling 717-787-4444 or sending email to: rmatzie@pahouse.net.  Rep. Jim Marshall (R-Beaver) serves as Minority Chair and can be contacted by calling 717-260-6432 or sending email to: jmarshal@pahousegop.com.

NewsClips:

-- Utility Dive: Power Plants Remain Vulnerable To Outages In Extreme Cold, Despite Warnings, FERC, NERC Find

-- Utility Dive: PJM Interconnect’s Electric Power Capacity Market Is Sound, But Changes Needed To Adapt To Evolving Grid Mix, Extreme Weather: FERC Panelists

-- Utility Dive: FERC Approves PJM Electricity Capacity Auction Delays To Incorporate Potential Market Reforms

-- PA Business Report: PECO Prepares Electric, Natural Gas Delivery Systems For Year-Round Weather Resiliency

-- PA Capital-Star: As Temps Rise, Advocates Call On PA To Dial Up Aid For Cooling Costs

-- Observer-Reporter Editorial: The Struggle Between [Electric] Power And Money

Related Articles:

-- PUC Releases Summer Readiness Reports From Electric Utilities - Adequate Capacity And Supply To Meet Summer Energy Needs  [PaEN]

-- PJM Interconnection: Summer Electricity Supplies Should Be Sufficient Under Anticipated Conditions; Higher Than Expected Generator Outages, Extreme Scenarios Could Bring Risk To Reserve Margins  [PaEN]

-- PJM Interconnection Issued Hot Weather Alert For Entire Footprint For June 2  [PaEN]

-- PUC Alerts Consumers To Electricity Price Changes Coming June 1-- From 20.7% Increase To 17% Decrease; Driven By Price Of Natural Gas  [PaEN]

-- Senate Hearing: Wholesale Electricity Prices Too Low To Support Coal, Natural Gas Power Plants In Market; Natural Gas Reliability Issues Will Continue   [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]

-- PJM This Week Sends Penalty Assessments Of Up To $2 Billion To Electric Generators That Failed To Perform During December’s Winter Storm Elliot; Natural Gas Power Plants Had 63% Of Outages   [PaEN]

PA Oil & Gas Public Notice Dashboards:

-- Pennsylvania Oil & Gas Weekly Compliance Dashboard - June 10 to 16 -- Leaking Conventional Wells; 5 More Abandoned Conventional Wells; Using Tape To Repair Containment Liner [PaEN]

-- DEP Finds PA General Energy Installed Its Shawnee Water Withdrawal On The Exceptional Value Loyalsock Creek At Sizes Larger Than Authorized By Its SRBC, DEP Permits  [PaEN]

-- PA Oil & Gas Industrial Facilities: Permit Notices/Opportunities To Comment - June 17  [PaEN]

-- DEP Posts 69 Pages Of Permit-Related Notices In June 17 PA Bulletin  [PaEN] 

Related Articles This Week:

-- S&P Global: Federal Inquiry Finds Same 3 Causes Driving U.S. Generate Outages In Extreme Cold - Reliability Of Natural Gas System Remains A Concern  [PaEN]   

-- PUC Vice Chairman: During Winter Storm Elliot We Learned Natural Gas Can Be An Intermittent Generator Of Electricity Just Like Renewables  [PaEN]

-- Robinson Twp., Washington County Seeks Answers To Cleanup Of MarkWest Liberty Midstream 10,000 Gallon Spill Of Natural Gas Condensates After Company Sends Notice To Wrong Municipality  [PaEN]

-- DEP Invites Comments On MarkWest Liberty Midstream Project To Expose 1 Mile+ Of 2 Natural Gas Pipelines To Prevent Longwall Coal Mining Damage In Washington County  [PaEN]

-- DEP Posts Solicitation For Bids To Plug 23 Abandoned Conventional Oil & Gas Waste Injection Wells Owned By ARG Resources, Inc. And Pennzoil Company In Elk County  [PaEN]

-- Casey, Fetterman Announce $5.5 Million In Federal Funding To Plug Abandoned Conventional Oil/Gas Wells In The Allegheny National Forest  [PaEN]

-- Bay Journal: Satellites, Drones, Special Cameras Join The Fight Against Methane/VOC Pollution From Oil/Gas Wells, Petrochemical Plants, Landfills, Coal Mines In Pennsylvania - By Ad Crable, Chesapeake Bay Journal  [PaEN]

[Posted: June 14, 2023]


6/19/2023

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