2 Dec 2011

EPA emissions rules igniting protests about grid reliability from guess who: coal-fired utilities

Written by theenergyfix

Once again the BENEFITS of cleaner power generation in the U.S. are absent from an escalating debate over court-ordered clean air rules by the Environmental Protection Agency (EPA) set to be finalized by December 16, 2011. This time it’s about reliability. For the most part, it’s a smog screen designed to distract from the far more important challenge and opportunity of improving air quality.

If the U.S. is to continue making progress reducing harmful emissions, then the largest source of those emissions — coal-fired power plants — needs to scaled back. And the most logical way to accomplish that is to retire the oldest and dirtiest plants still belching harmful emissions and causing countless mountain tops throughout Appalachia to be shaved off.

Coal plant retirements can be monitored prudently with plenty of checks and balances along the way provided by the Federal Energy Regulatory Commission (FERC), the North American Electric Reliability Corporation (NERC) state utility commissions and regional grid operators such as PJM Interconnection and the Midwest System Operator (MISO).

The crux of the latest debate is whether some sub-regions of the U.S. power grid may lose so much coal-fired generation that the lights will go out. Well not exactly blackouts per se. The key here is the “reserve margin” utilities and grid operators need to fall back on during surges in demand on very hot summer weekdays. This is the amount of extra power available over what is actually needed.

The North American Electric Reliability Corporation (NERC) monitors each of the three major North American grids and their ability to generate enough power to meet demand. CREDIT: NERC

Through their coalition, the Electric Reliability Coordinating Council (ERCC), utilities that rely heavily on coal warn some reserve margins will be compromised by existing and soon-to-be-issued rules capping emissions of mercury and various airborne toxic substances. The Council further warns that the North American grid (accompanying map) is so inter-connected that a declining reserve margin in one sub-region can have harmful impacts on adjoining sub-regions. (Regions are indicated by different colors.)

That may, conceptually, be true. But there are well-trained, competent and expert electrical engineers who think and plan about just these types of challenges in all of the reliability regions monitored by the NERC.

Over the past several decades, on the few occasions there have been blackouts (e.g. early September in Southern California and August 2003 in the Northeast) the causes were due to errors by utility operators. In most such cases, the reserve margin has had little, if anything, to do with why power was lost. Ergo the less-than-responsible claim the reliability is truly at risk.

Full disclosure: Jim Pierobon of The Energy Fix has worked previously with one of the regional grid operators, PJM. It is from that experience he drew lessons learned that contributed to this post.

It is duly noted that as more coal plants shut down or are replaced by far less-expensive (and less polluting) natural gas, wholesale and retail prices for electricity may go up. That is a price every nation must pay to reduce its reliance on sources of energy that not only pollute the air and atmosphere we all — globally — share, but cause myriad health ailments and put the lives of coal miners at serious risk.

If health expenses and operational risks were priced at a level approximating their cost to human health, the environment and society at large, coal would be nowhere near as cheap to burn. On the contrary, it would  so expensive that utilities would be moving far more quickly to shift to natural gas, scale up renewable sources and invest in more aggressive energy efficiency initiatives.

According to NERC’s “Long-Term Reliability Assessment” issued this past Monday, November 28, the so-called Cross-State Air Pollution Rule (CSAPR) and Utility Air Toxics Rule may potentially cause between 8.6 and 16 gigawatts of coal-fired plants to retire or scaled down by 2018.

In a statement to POLITICO published Nov. 22, EPA said “Many of the plants that will retire in the coming years operate infrequently, are decades old and do not have modern pollution controls installed.”  The Congressional Research Service said in its own report, “Older, smaller and less efficient (generating) units already face a train wreck.”

The EPA assessment examined 32 sub-regions and found the average reserve margin is about 25 percent, more than enough of a buffer under any scenario. Some sub-regions that rely on coal barely exceed their recommended margins. Still others have margins of as much as 50 percent.

Michael J. Bradley, executive director of the Clean Energy Group, a coalition of utilities supporting the EPA’s rules, has said this is the opposing utilities’ “endgame” and the NERC Assessment should put any concerns to rest.

“The NERC report findings, along with the well-documented range of options available to the industry and regulators to manage electric system reliability, prove that with proper planning and coordination, the electric industry can comply with EPA’s proposed air regulations consistent with the Clean Air Act. There is no reason to delay the implementation of the clean air rules.”

That said, politics could very well get in the way of cleaner air. Last month, 11 governors wrote to the EPA to protest the mercury and air toxics  rule, warning that “full-time power availability could be at risk.” Jumping on the bandwagon were 25 state Attorneys General—including four Democrats—who filed suit to lift a legal document known as a consent decree that the EPA, according to an editorial in The Wall Street Journal, is using as a “fig leaf for its political goals.”

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