Our National Challenge
L to R: Tom Kuhn, Edison Foundation, Dr. Michael Howard, EPRI, and Diane Munns, EEI, at the “Keeping the Lights On: Our National Challenge” two-day conference in New York, April 21-22nd.
By Dick Flanagan, Publisher
U.S. utilities must build at least 150 gigawatts of new generating capacity to meet electricity demand by 2030, at a cost of about $457 billion, according to preliminary findings of a new study being prepared by the Brattle Group on behalf of the Edison Foundation.
An additional $900 billion will need to be invested by 2030 in transmission and distribution facilities to modernize the nation’s power grid, setting the stage for perhaps the largest single electricity infrastructure investment cycle in history.
The Edison Foundation was launched in 2006 in an effort to further Thomas Alva Edison’s spirit of invention. The conference brought together a broad group of stakeholders—including regulators, utility executives, environmental leaders, consumer advocates, labor leaders, Wall Street and media including World-Gen to discuss new electric industry infrastructure investment requirements and the extent to which they can be offset by energy efficiency efforts to rein in America’s appetite for electricity, against a backdrop of looming carbon constraints.
“The power sector is becoming increasingly energy-efficient, and we’re working aggressively to maximize the potential energy savings made possible by new technologies,” said Edison Foundation President Tom Kuhn. “This will become ever more crucial as we transition to a carbon-constrained environment. But we also are acutely aware of our industry’s unbreakable commitment to ensuring a reliable and affordable electricity supply, which means we clearly will have to continue building substantial new generating capacity for years to come.”
The Brattle Study
The Brattle Group’s preliminary findings suggest that efficiency gains could allow utilities to meet this demand by building 150 gigawatts of new capacity, a more realistic projection of efficiency improvements indicates that nearly 190 gigawatts of new capacity will be needed by 2030.
Wind Integration in the USA
By Robert Gramlich, AWEA
Rob Gramlich is the Policy Director of the American Wind Energy Association in Washington, DC.
The optimal conditions for integrating large amounts of wind energy at low cost include a large electric balancing area with access to neighboring markets, a robust electric grid, short-term electricity generation markets, flexible generation and load, the effective integration of wind forecasts into utility operations, and flexible transmission services.
The current state of affairs in the U.S. electric industry falls short of each of these ideals.
Wind generation has become a mainstream utility scale energy source. In 2007, wind generation accounted for 30 percent of new installed capacity in the U.S. In parts of Europe wind is providing 10 to 20 percent of annual electricity needs.
There is a rapidly expanding body of research and experience with integrating wind into electric power systems around the world.
This research and experience is sufficiently developed to indicate both the importance of electric industry structure, rules, and infrastructure, and the particular types of structure, rules, and infrastructure that integrate the most wind energy while maintaining reliability.
Wind energy has four characteristics that affect how it is integrated into power systems: 1) its variability, 2), its near-zero variable cost, 3) the difficulty of forecasting its output precisely, and 4) its remoteness. These characteristics can be better accommodated in some market structures than others.
Larger Balancing Areas
A number of studies have documented that wind integration costs are significantly lower in large balancing areas. Larger balancing areas provide more opportunity for excess generation in one region to be offset by shortfalls in generation in another region. This effect is true even for systems without wind energy. However, this effect is often even more pronounced for wind energy, as variations in wind output tend to be less correlated over larger geographic regions.
