Wind Will It End?

Please forgive me for the cheezy post title, but if you choose to read on I think you will see it is relevant. When we discuss the challenges facing wind energy we hear about the intermittency and storage issues, destroying the visual landscape, lack of transmission and even the dangers posed to birds. Many people also raise valid concerns regard whether or not wind can be economically feasible without government subsidies, regulations and mandates. A recent Scientific American article shows that wind proponents should also worry about the challenges we don’t hear about every day.

Not surprisingly, a lot of these less discussed challenges are coming from wind’s competitors. The Coalition for Fair Transmission Policy believes wind producers should fork over the funds needed to expand the transmission infrastructure from the areas of the country where wind energy is produced (the Midwest) to the areas with the highest energy demand (the East Coast). While this seems like a reasonable idea on the surface you should be asking yourself who is this Coalition?  Turns out the Coalition for Fair Transmission Policy is made up of East Coast utilities.

Closer to home we have players in the natural gas game demanding that wind developers be held responsible for some of the costs associated with running backup natural gas generators. These generators are essential in providing electricity when the wind slows down and is unable to produce the needed amount of electricity. As before this appears to be a reasonable suggestion. Why shouldn’t wind energy producers help foot at least part of the costs generated when a gas turbine is turned on to make up for a decline in wind energy? At the same time this seems like an attempt by the natural gas industry to increase their competitions costs and help keep natural gas competitive on price.

Anyone who is familiar with the wind industry understands the large role played by the government. While people can certainly debate whether the government should be involved at all and if so to what level, nobody can deny the importance of politics in the past or in the future. In my podcast I touched on the concerns Senator Charles Schumer raised regarding the spending of stimulus funds on projects that were creating more jobs in China than in the United States. Now Schumer and three other Senators proposed a plan that would prevent federal grants being issued to any project used blades or turbines manufactured outside of the U.S. opponents of the Senators’ plan claim that the U.S. cannot afford to slow or limit the growth of the wind industry because it will only put us at risk of falling behind Chinese and European manufacturers. They also point out that Schumer and his colleagues are simply trying to funnel jobs to their states and the number of jobs going overseas has been exaggerated. As with most things in politics the number of jobs being created in and outside of the United States differs significantly depending on who you talk to and before you know it the whole issue has taken a nasty turn towards “he said, she said”-ville.

It is obvious each of these parties (Senators, utilities, the natural gas industry) and their actions are motivated through their own self-interests, but it should be just as obvious that we cannot simply dismiss these legitimate concerns simply because we do not support the people raising them. In a perfect world we would be focused on finding solutions for the “natural” problems facing wind instead of creating additional artificial roadblocks. In that same perfect world everyone would be working towards the common goal of creating clean renewable energy and the traditional utility, natural gas and coal industries would be okay with that. Reality is the world isn’t perfect and the future of wind energy is hardly certain. For the wind industry to continue its impressive growth they will have to learn to be just as focused on navigating the wonderful world of politics and viciously competitive energy industry as they are with coming up with solutions to their storage issues.

The Generation and the Transmission

Texas recently hit a milestone: as reported in the New York Times on their “Green, Inc.” blog, early in the morning on March 5, 19% of the electricity in the ERCOT grid was wind-generated. The article, Setting Wind Power Records in Texas” goes on to describe how one of the greatest challenges associated with the developing wind power is ensuring access to the electric grid. While the absence of transmission is a constraint in many areas, Texas has been further out front than many areas in making sure we invest in the transmission lines to make greater wind development possible.

Having been in New York during the blackout in the summer of 2003, I can easily remember that the next few months featured many articles and exposes on the poor condition of much of our national electricity infrastructure. Following 9/11, more policymakers began to worry about the vulnerability of the grid as a national security matter. While the odds of a cascading blackout like in 2003 are incredibly low, such “black swan” events severely disrupt lives and economies.

Major Challenges: Growth, Deregulation, and Adding New Generation

The 2002 National Transmission Grid Study from the Department of Energy describes many of the present and future challenges for grid management. Largely built a century ago by vertically-integrated utilities, interconnection slowly grew in order to help transfer power during periods with heavy loads. (3)

One of the greatest challenges is the sheer growth in demand – DOE estimated in 2002 that peak summer demand and capacity would grow by almost twenty percent per year for the next ten years. (4) As grid operators have struggled to meet this growth and changing usage patterns, “bottlenecks” have grown, causing many more near-overloads and forcing the purchase of more expensive local sources, increasing the price of electricity for consumers. Deregulation brought many changes in the different businesses and actors directly involved in grid operations and management.

According to a study by Electric Transmission Texas, there are three additional challenges to incorporating wind power: the fact that both wind availability and load are variable and constantly changing; conditions in one part of the grid affect operations in other areas; and “[t]he power system has to be continuously prepared to withstand the sudden failure of any generator or transmission line.” (5)

The National Response

Investment in new transmission fell steadily from the 1970s to 2000, so that at the time of the DOE study, only 6 percent growth in the transmission system was expected, in contrast to the 20 percent growth in load. (7) The American Recovery and Reinvestment Act (ARRA) last year provided $11 billion for different transmission-related activities. Almost half of the funds went to the Office of Electricity Delivery and Energy Reliability at the Department of Energy; the rest went to the federal Power Marketing Authorities such as ERCOT for modernizing the grid. Much of the focus is on “smart grid” technology to increase the flow of information between individual consumers and the grid. This month, an additional $100 million was made available for more transmission-related projects. Some ARRA funds to stimulate growth in the wind industry have gone to fund studies on how to incorporate large amounts of wind power in transmission; one of the grants came to UT.

Texas has been ahead of the national curve on dealing with the challenge of providing additional transmission for wind projects. The Public Utilities Commission approved a plan to add 18,500 MW of transmission lines to for wind power in ERCOT through the Competitive Renewable Energy Zone 2 (CREZ 2) in 2008. A year later, it awarded $5 billion in contracts to build the lines. However, in January, a Texas court delayed the project by siding with the City of Garland, who claims that they could construct the lines more cheaply than private contractors. Hopefully, this dispute can be resolved quickly – it can be difficult to secure funding for new renewable energy projects unless there are transmission lines in place or forthcoming.

As described in the DOE study, the grid is “an interstate highway system for wholesale electricity commerce.” (xi) Large-scale investment to improve the capacity and reliability of transmission can increase energy security, reduce the cost to consumers, and increase the return on investment in renewable energy sources and smaller-scale “distributed generation” facilities. But only if the investment is done well. Transmission lines are expensive; line-losses increase as electricity travels hundreds of miles from generation to distribution, and as a town in California learned the hard way last week, there are significant environmental and scenic consequences.  Short-sighted or uncoordinated efforts are missed opportunities.