by Planning Engineer (Russell Schussler)
There are many reasons why grid experts within the electric utility industry have not spoken out when unrealistic “green” goals were being developed and promoted over the last 20 years or so. A more open debate during this period might have helped provide a more realistic foundation for future development. This posting describes some reasons as to why at the corporate level electric utilities did not speak out more in defense of grid reliability. Collectively these factors tended to eliminate grid experts from playing any role in the development of policies impacting the grid.
Speaking Out Risked Negative Consequences
Utilities have many stakeholders with varying degrees of power. Utilities depend on good relations with Public Service Commissions, other regulators, consumers and policy makers. The stereotype of electric utilities as uncaring, selfish, greedy destroyers of the environment tends to make utilities very cautious and careful in critiquing anything perceived as “green”. The media and press attention from any such statements would likely not be favorable.
Utilities need support to acquire right-of-way, for financing, for cost-recovery and to avoid adverse legislation. Poor press and the associated public disapproval loomed as strong disincentives for speaking out. Furthermore, as will be discussed later, expressing concerns over emerging reliability issues, could be interpreted by some as implying that perhaps you were not as capable as others appear to be.
The Waiting Game: Short-Term versus Long-Term Goals
The short-term consequences of objecting to “green” initiatives impact were swift and near and would be specifically painful to the offending party. The potential benefits of speaking out on reliability would be collective, diffuse and farther into the future. Who as one of hundreds of utilities would want to be the first to speak out? The near-term burden of “green” goals at very low penetration levels was small enough that it might seem prudent to wait for others to speak up.
It can be observed already how these reasons worked together to stifle dissent. Areas with greatest pressures for green initiatives were held back because speaking out would have more severe consequences for them. Areas with lesser pressures were also less likely to be impacted in the near term, so they were less incentivized to speak out. Many hoped that maybe they could ride this out and learn from the mistakes of others. Unfortunately, mistakes and problems don’t seem to be slowing things down.
Utilities Are Not Experts, But Rather a Collection of Experts
There is not a common single body of expertise commonly shared by the many experts that make up an electric utility. Rather than are many experts with differing areas of expertise with demands that can place them at conflict with those operating within other areas of expertise. Effectively managing an electric utility is highly dependent upon balancing the input of many competing “experts”. The goals and priorities of large areas such budgeting, rates, maintenance, operating, environmental, planning, construction, compliance, marketing, R&D, legal, strategic planning. as well as sub areas within these, will often be in conflict as to the actions a utility should take. Leaders have to weigh the inputs from these areas to provide direction and make decisions.
Competing Experts and Goals
Healthy competition is good and necessary. The goals of maintenance are worthwhile, but sometimes in order to best utilize our resources and address other concerns, utilities might need to temporarily depart from what the maintenance experts advocate. The experts in projects tell us how long it should take to complete a project. But in emergencies, other experts might insist that this project must be completed in a much shorter time frame to allow for an upcoming summer peak. Transmission planning and distribution planning experts within the utility might favor different solutions for correcting an area problem: do you beef up the area distribution or do you add more support from the transmission system? With conflicts of this sort, sometimes you find a compromise, but in others one set of experts must give in.
There are many incentives for increasing wind and solar generation (if it works). For some areas of expertise, wind and solar integration pose no special problems. Experts and executives from these areas often were wind and solar boosters. Similarly to academics as described in a previous post, some utility experts argued that (some) problems with wind and solar could be solved, and it was often mistakenly interpreted to mean all problems could be solved.
During my career I would manage several different areas that at times would be in conflict. I would tell my key people, “You are the experts here. You must be a strong advocate for your area of responsibilities. Sometimes I and others in upper management will have to place other concerns over yours. You will need to be a team player and accept the situation. That doesn’t mean you should be any less of an advocate for these concerns in future situations.” Good management balances the inputs of different experts. Utilities found that near term imperatives were in conflict with more distant reliability concerns. Unfortunately, it was almost exclusively the case that emerging reliability concerns were judged as something better addressed later.
Margin, Experts, and Who Are You Going to Believe?
In advocating for their specific areas of concerns, often experts will build in a little margin. I’ll use the example of budgeting here. Although it took me while to get on board, many people are probably familiar with how that process works. Initially when we I would hear of dire budget woes, I would heed the call and cut things as close to the bone as I could. Those of you who are not as naïve as I once was, know that the next step is to squeeze even more out of EVERYONE. At that point it didn’t matter what you had given up in step 1, more was needed and everyone must contribute. My nature was to be a team player and head the original call, but after getting burned a few times, I learned that I must play the margin game.
Competing experts should be “expected” to build in margin within their various areas of expertise. The projects area may pad their schedules with some extra time to give themselves some flexibility. Maintenance might aggressively schedule maintenance and replacement so that they are ok if hard times later put a cut in their resources. Initial designs of projects may be “Cadillac” level to better survive cost pushbacks which might emerge under review.
In the area of grid reliability, the grid depends on margin. It should survive without a hiccup for once every 50-year events, because hundreds or more of those type events can and will happen in the normal operation of a system. Conflations of equipment outages, extreme weather, and other unanticipated events hit the grid many times during a given year. The consequences can be huge. However, if you push back on reliability for a short time in one area, there’s a good chance you will be fine. Negative consequences will likely be unobservable. But continue to do so and severe consequences will begin to emerge.
The large chorus of outside “experts” saying that wind and solar can be integrated successfully complicated the situation. Executives with other responsibilities see that government, academics, consultants, consumers, policy makers, and experts within parts of the utility industry are all pushing higher levels of wind and solar. Similarly, the industry sponsored research arms did not help much, but rather pushed new technology as well. Perhaps because they saw a “gold mine” in potential “green research projects”. This all lead to confusion around grid capabilities.
Lastly, grid experts were disregarded partly due to their great success in the past. The fact that modern power systems have a high degree of margin makes it harder to argue that the system is not sufficiently robust to allow for high penetration levels of wind and solar. The ability of grid engineers to meet emerging challenges to-date have led many to believe they could continue to do so, not matter what might be thrown at them.
Specialization and Silos
In additions to problems of breadth of expertise, problems around specialization also confound attempts at expert consensus. Understanding the full extent of emerging grid reliability problems requires an understanding of generation planning, transmission planning and systems operations. Intermittent, asynchronous wind and solar energy sources impact generation planning, transmission planning and system operators. These three areas have differing expertise and experts within these areas that are not always well informed of the concerns of the others. Generation planners are concerned with providing generation 24 hours a day 367 days a year far into the future. They assume transmission planners will take care of delivery problems. Generation modelling is focused on energy production and they look at megawatt-hours. Transmission Planners are worried about the transmission system during peak times of stress. They make efforts to understand the implications of potential generation, but intermittent sources make that challenging. Their focus is based on demand levels so they look at megawatts. System Operators worry about issues of generation and transmission but they operate day to day and in the near term. Their focus is on dealing with the system as it is, not determining what it might be or handle scenarios in the far future. Further within these areas, there are specialists who go deep and do not well understand the problems within their own broader area.
Within critical areas around grid reliability, there are various specialist who may not see the big picture. For example, those who model the transmission system who may see problems now, may be optimistic or agnostic as to how future versions of wind and solar may work to better support the system. Those who work more directly with wind and solar and know their inherent capabilities probably don’t fully understand their impact on the transmission system. It takes an understanding of both areas to see the emerging problems that are confronting the system.
Hope and the Benefit of the Doubt
Despite what you may have heard, most engineers want to be environmentally responsible. Instead of being opposed to new technology, most of us have sought to support potential “green” applications that had at least small hopes of promise. I was never aware of anyone stacking the deck against “green” options, but the reverse frequently occurred. It’s evident that conventional generation options are productive many years longer than competing solar or wind options, but most comparative analyses assumed 30 year lives for all alternatives including Green ones. I don’t know of any significant objections to wind and solar leaning on the system a little for support, or raising costs a little. The concerns only came when the impacts are particularly egregious or approaching unsustainability.
The support for “Green” options extended to optimistic assumptions about future development, performance and capabilities of those resources. Often instead of focusing on what might be probable in the future, utilities hoped for what might be possible. Many have hoped that maybe wind and solar coupled with batteries and a lot of technological development will allow asynchronous intermittent wind and solar to replace higher levels of conventional synchronous generation. Such hopes have for many clouded the clear evidence that increasing levels of wind and solar presented reliability threats.
FERC and NERC’s Impacts
In the U.S., the Federal Energy Regulatory Commission (FERC) and the reliability oversight organization (NERC) that they empowered, have served to inhibit the industry from voicing reliability concerns. FERC’s open access policy and the resultant standards of conduct in 1996 have segregated the functions of generation planning and transmission planning. FERC’s goal was to prevent generation providers, who owned transmission as well, from having any competitive advantage over other generation providers. Previously, managers and VPs might have responsibility for both groups (as I did at one point), but FERC required that those functions be separated and it was important that information not be shared between them. FERC effectively shut down reliability discussions between in-house generation experts and transmission experts. Coordinating a reliable grid was well served by interplay, dialogue and coordination between those planning and managing generation and transmission. Understanding emerging problems similarly is best served by having experts with a sound grounding in both generation and transmission.
NERC and the regional reliability entities initially were formed and controlled by the utilities to coordinate reliability efforts amongst the participants. In 2006 FERC established NERC as the national reliability organization with enforcement powers. Making NERC the master over utilities versus their servant has had various consequences. Beginning in 2007, NERC and the regional entities could impose large fines for violating NERCs’ reliability criteria. Before that time, utilities would share any problems that they were seeing at reliability meetings, they were seeing as well as emerging concerns in an open and frank manner. Despite utilities differences in some areas there was a strong joint commitment to reliability and all felt it was best to learn from each other’s mistakes. But when the regulators had the ability to impose fines of a million dollars a day, it no longer made sense to share reliability concerns. Publicly expressing reliability concerns might predispose NERC to lean towards findings of noncompliance should problems emerge.
Perhaps the greatest impact came in the shift of responsibilities. Utilities used to have responsibility for ensuring reliability. They had skin in the game. They had a number of tools including generation and transmission options to better ensure reliability. But regulation by FERC through NERC, took the reliability function away from utilities. Utilities are no longer responsible for ensuring reliability. They are responsible for compliance with reliability standards. That was a profound and consequential change. Utilities are no longer developing reliability experts; they are developing experts in standards compliance. When outages occur, it’s hard to figure out where blame lies now. Will there ever again be grid experts who have skin in the game again?
Summary and Conclusions
There were a lot of utility experts with grid concerns. You might ask, “Why didn’t more people speak up?” But maybe the better question is, “Why would anyone speak up?” A lot of people could have said the type things I started saying about a decade ago, but they had no incentives to speak out and there were few influential people who cared to listen. In summary:
- There were few to no near-term incentives for individual utility experts or for utilities corporately to speak up as regard planned threats to reliability
- There were significant near-term disincentives for speaking up
- Limited to no platforms for voicing concerns
- Waiting and hoping for others to speak up seemed a prudent path for many
- Competing “experts” and diverse areas of specialization confused understandings of risk
- Past success of grid experts made it harder to take future reliability threats seriously
- Strong widely present desires support “clean” wind and solar
- Federal Actions served to quite dissenting voices and eventual remove dissenting experts
The days of utility-based grid experts who’ve had skin in the game are over. Utility experts are charged with complying with reliability standards rather than maintaining reliability. Where utilities once had variety of tools at their disposal to better foresee and forestall reliability problems, utilities now follow compliance standards and hope for the best.
Story tip: Deadly shooting at Denver car charging station
Deadly shooting at Tesla charging station started as a fight between two drivers, police say – YouTube
A short fuse?
They were charged with assault and battery.
winner
A highly charged debate.
Obviously polarising.
You know the drill, conform or be cancelled.
We must remember GW Bush was inclined to green arguments, “addiction to oil” and all, and the Democrats exploited that.
The obvious fact that most Democrats could not manage a Burger King profitably enters into this. NERC and FERC almost certainly provide bureaucrats nice cushy jobs, with no real responsibility or expertise required. I am reminded of Thomas Sowell stating the folly of giving control to those who bear no consequences for failure.
Well written article! Good at explaining the politics of the grid.
When I worked in the utility industry, I was told that if the public wanted a particular environmental initiative–at the time, acid rain control–we the utility should give it to them, even if it cost more, etc. This is just more of the same, except the public, and its elected and appointed representatives, don’t understand that the consequences are not just higher costs, but much lower reliability. Thank you for the more detailed explanation of what happens in the corner offices of the utilities.
Excellent article!!
‘[W]hy more people don’t speak up?’ is an excellent question. The irony is that we’ve been castigating Germans for nearly a century for not having strolled down to SS or Gestapo headquarters to complain about the camps, while maintaining a deafening silence about our own loss of liberty, urban thuggery, men competing in girl’s sports, election fraud, stupid war mongering, etc., etc, etc…
“we” again. Yeah I know it’s hard to avoid.
In Sacramento, David Freeman, was the GM and pushed the utility into closing its Rancho Seco plant as he was anti-nuke.
He also canceled a dozen TVA nukes in the eighties. A very bad energy administrator.
The utility companies have been stupid for not speaking up. When things come crashing down they will ultimately be blamed. If they point out times where “we told you this and this and this are problematic and won’t work” then they’re on the hook.
Assumption of a fair trial? Assumption of any trial?
You didn’t actually read the article, did you?
“Where utilities once had variety of tools at their disposal to better foresee and forestall reliability problems, utilities now follow compliance standards and hope for the best.” I fear the same thinking has overtaken the nuclear utility business since the Nuclear Regulatory Commission was established.
Most reliability standards were published in 19xx
Hats off for the photos you select to accompany postings.
I can’t wait to see what you chose for my next posting.
Neither can I. One picture is worth a thousand regulatory compliance words.
Eight years ago, I made this comment on a Planning Engineer article published on Climate Etc. in October 2014:
= = = = = = = = = = = =
Beta Blocker | October 22, 2014 at 1:02 pm |
It would be in the nation’s great interest if one large and geographically diverse state would agree to become the pathfinder for experimenting with what does, or does not, work well in attempting an accelerated adoption of renewable energy resources.
California is the logical choice for performing a large-scale experiment in how best to adopt renewable energy technology as the primary source of electric power generation in America.
The voting public in California has indicated its strong commitment to a renewable energy future, and the state’s voters have indicated their strong concerns about climate change. California also has the necessarily diverse mix of geographic landscapes, weather patterns, business activities, cultural groups, and socio-political attitudes so as to allow a useful assessment of what kinds of environmental, economic, and lifestyle impacts would be acceptable to a representative sample of American society.
Californians are ready and willing to take on this challenge. Let’s state the objectives for The California Experiment as being 60% renewables by 2030 and 80% renewables by 2040, using a plan which forbids further construction of fossil-fuel plants within the state’s boundaries and which enforces an exceptionally high cost penalty against fossil-fuel electricity imported from outside the state’s borders.
Hey, if California can’t make the grand vision work, nobody can.
= = = = = = = = = = = =
In October 2014, I noted in a subsequent comment that I had left-leaning relatives in California who had at the time expressed reservations about using their state as an all-up test bed for wind and solar energy.
These California relatives were, and still are, strongly anti-nuclear and supported the closure of the Rancho Seco plant in 2013.
Eight years later, these relatives have no reservations about wind and solar and are now 100% on board with Net Zero — regardless of what it will cost, and regardless of the consequences if reliable sources of baseload electricity are shut down without reliable replacement.
As might be expected, they are opposed to any and all efforts to keep Diablo Canyon open past 2025.
I have other relatives in upstate New York, on Long Island, and in Manhattan who are also anti-nuclear and who are also 100% on board with the state’s 2019 Climate Act. Closing down the Indian Point reactors was very much a good thing, in their opinion.
I’m admittedly pessimistic here.
My relatives in California and in New York State are like the great majority of the voters living in both of those two states. They will not admit their energy lifeboat is sinking even while the cold ocean waves are washing over the gunwales.
Hi Beta , I 2nd your pessimistic view. I have the exact same experience with my family. I have tried everything: polite debate with evidence data, logic ( you can’t fix anything if you disable your society) But to no avail. Same problems across the board on other issues. A fear only “correction through catastrophe” is pretty much baked in now
During the Enron days, most utilities in CA went that way but LADWP kept using more traditional planning approaches, LADWP did not suffer the disasters that the others did. No one wanted to look at that as an experiment.
Good article. A comment on what it looked like on the ground.
Deregulation came top down in Pennsylvania.
Very few below CEOs and Presidents knew what was happening. The legislature, PUC and administrative/influential entities participated. I suppose my utility holding company helped lead the breakups, with a fully outside board
Utilities contributed to the problem with individual, self-interested capital goals, in massive generation construction while interest interest costs, inflation, and costly regulations rose.
Pennsylvania could have created a statewide advisory/approval group that reviewed composite utility growth forecasts, for consistent analysis, and approve/disapprove new construction. Fractional ownerships among companies was common and when used, mitigated the costly or unneeded capacity overshoots.
The interconnection transmission system for Pa and parts of several other states, was run by PJM, already a well-run, grid management organization.
Everything you say is right on.
It does understate a bit the often ugly internal positioning that happened, and family, friend damage/destruction.
“…utilities now follow compliance standards…” is the same as saying “are just following orders”. Now, can anybody think of a time when that didn’t work out so well?
Climate activists now dominate the press and public policy process, largely ignoring the IPCC’s physical scientists and WG1 reports. See the IPCC Synthesis Report, converted into claims that the Earth will become uninhabitable (said by the UN Secretary General, the Pope, etc).
Climate scientists’ silence even to wild claims endorse these activists. This deference has made climate science irrelevant to public policy.
We can’t change the radical greens’ policies, so we discuss their effects and how to prepare. Articles like this one and others at Climate Etc lead the way.
when the effects of these policies become blindingly obvious, then it might (might!) become possible to change them. The passive acceptance of rapidly rising electricity prices and renewable subsidies – amidst continued claims that green energy is cheap – indicates that the Left’s growing hold on our societies will be difficult to overcome.
Mockery and pearl-clutching won’t do it. Nor will parading facts before those who already know.
The people with the most expertise are rarely the ones that interact with politicians or the public.
“There are over 1,500 NCAA Division I basketball players this year”
“The National Basketball Players’ Association (NBPA) is a union made up of active professional basketball players on the rosters of NBA teams. Established in 1954, the NBPA currently has 450 members.”
Engineers are not usually known for crossover dribbling, but the big idea has to do with how many people are very good at what they thought they did best at 18. NCAA Division I does not floor many unqualified daydreamers.
Occupational specialization and political self-sorting mute some of the points. The place the capital-intensive industry finds unity is avoiding dramatic change.
e.g. the IT guy might not know what a 480v socket look like.
I couldn’t understand why utilities sat back and allowed a bunch of crackpots environmentalists to compromise their grid.
In the UK National Grid is Leading the Way (one of its scenarios!) in pushing the Net Zero agenda. They provide the cover for the Climate Change Committee by producing their Future Energy Scenarios, to which government is beholden. They are the technical regulator. They spend a lot of research effort on how to manage grids as they transition towards higher renewables shares – and they have in fact come up with a number of world leading technological solutions to some of the problems. What the cost is, is quite secondary. Any solution that entails more grid assets – more transmission lines, more interconnectors, more fancy kit to help stabilise the grid – is a bonus, because that means a bigger asset base and more profits and a growth industry future. The greens have taken over the asylum.
By way of example, I am currently researching what has been happening at the Beatrice Wind Farm, in the Moray Firth off Northern Scotland. It was one of the first wind farms to be given a CFD, which is on fairly lavish terms, currently paying £186.32/MWh. Being so far North it is in the area which is frequently subject to transmission constraints, with more power than the lines South can handle being generated. Up until a couple of years ago it would be the onshore wind farms which were being paid much less generous subsidies then worth about £50/MWh that would win the bids on curtailment (passed on to consumers), as when market prices fall to zero they only lost that subsidy, so it was all they could reasonably ask in compensation, and there was enough competition to prevent them getting away with much more. A wind farm like Beatrice stood to lose the entire £186.32/MWh on power it did not produce, so had every incentive to keep generating at maximum. However, some time in 2021 – possibly when prices started to go ballastic, National Grid appear to have changed the rules. The result is that Beatrice is agreeing to curtailment, but bidding for much less compensation from the Balancing Mechanism than their revenue loss – for example around £58/MWh in one example I found. Presumably The Powers That Be have arranged for them to be paid the balance of their compensation in other ways that are not transparent. Here’s an example of a week with a lot of curtailment, sometimes applied to individual metering banks (the wind farm has 4 separate meters), and sometimes only partial, and sometimes the whole wind farm.
Here in the US, it’s the same situation as it is in the UK. Wind farm and solar farm operators will get their reward for supporting Net Zero one way or another. Either transparently or very un- transparently, in some unholy combination as is necessary to keep the scam going.
The only way this will change is if some outsider takes power at the top and sweeps the whole mess away in one fell swoop.
Not likely, though. With Labour all but certain to take power in the UK in 2025, and with the Democrats likely to retain the White House in the 2024 election cycle, that kind of event is a long, long way off.
Correct – and there is a recent example in Australia.
A key player in the Australian power supply industry dared to challenge the government NetZero fantasy and no longer has a job. But he is now getting serious air time:
https://www.abc.net.au/news/2023-05-04/ex-snowy-boss-blows-fuse-over-bullshit-green-energy-target/102305062
Paul Broad was CEO of Snowy Hydro. The business responsible for the current hydro operation and the construction of the 350GWh pumped storage hydro project. They also own gas plants and happen to own my retail provider so a big player in the Australian electricity market from generation to retail.
If you value your employment then get with the story line. It certainly shows how Hitler could come to power.
“Generation planners are concerned with providing generation 24 hours a day 367 days a year far into the future.”
367 days?
Something like giving 110% effort.
No big surprise – the authorities have many ways to silence critics or actual experts. In my city (Regina, SK) city council formed a committee to get to net zero (Renewable Regina). A look at the committee make up showed the conclusions before the committee did any work, A lot of activists and those with a stake in the outcome (such as solar panel producers) and some ‘engineers’ but usually in areas that has little experience in actually developing and maintaining the electric grid such as electrical engineers. When I asked the council why, I got a big nothing response.
My father was an electrical engineer and spent most of his career developing and building electrical grids. Before he died, EVs were just getting talked about in any serious way and he did some back of the envelop calculations and concluded that, at best, my residential street would be able to charge ONE EV at a time (my street was built in the late 1950/early 60s) and even if every house upgraded their electric service, only 3 or 4 EVs would be able to charge at one time.
Right now, power outages are common and the time of year is predictable – hot summer days when temps are +40C and everyone throws their A/C on or on cold January nights when temps hit -40C and the gas furnace is on but unless the electric motor is working constantly and circulating the heat through the ducts – no warmth. As well every car on the street has its block heater plugged in to keep the car warm. Those are the times when huge pressure is on the existing grid and it buckles. Sure it is often only for 30 minutes or so, but putting any more pressure on the existing grid (by Net Zero) will break it for sure.
No one will give even an ballpark estimate of what it would cost to upgrade the grid to accommodate net zero. Why is that?
Why is no one giving even a ballpark cost estimate? Because if someone in authority did that, Net Zero wouldn’t be happening at all.
Maureen:
One of the largest consulting corporations [McKinsey] did a cost analysis of
NetZero by 2050. The take home#: $275 Trillion [not billion]. So $9T per year, but its worse: you need to front-load the spending in the early years. One guess who is expected to pay for it !
And it included a number of caveats & limits that make it a fantasy to think it could actually be done. Magical thinking indeed.
https://www.scribd.com/document/555773648/McKinsey-The-Net-Zero-Transition-What-It-Would-Cost-What-It-Could-Bring-250122
I wish I could stack the deck against wind turbines as I am dead set against them.