Summer Heat May Be Brutal But What Does That Mean for Fossil Fuels?

A thermometer showing hot temperatures with the sun in the background

(Credit: Canva Pro)

by | Aug 15, 2023

A thermometer showing hot temperatures with the sun in the background

(Credit: Canva Pro)

When the heat is unbearable, is it time to double down on fossil fuels or speed up the switch to renewables? That question posed to panelists at an energy industry forum has significant implications for commercial and industrial customers.

Panelists, some of whom oversee regional transmission grids — called independent system operators (ISOs) — are charged with providing reliable electricity services. And then, they manage the flow of electrons across their systems to avoid congestion and potential brownouts. While bullish on green energy, they contend that thermal energy provides the certainty that commercial and industrials require.

“I’m not saying it is the time to double down. I’m just saying it is time to slow down on the removal of the thermal assets from our footprint,” said Lanny Nickell, executive vice president, and chief operating officer of the Southwest Power Pool, at the United States Energy Association discussion where this reporter was on the panel. We’ve seen about 8,000 megawatts of thermal generation removed, while we’ve seen about 28,000 megawatts of wind generation added.

“That sounds like a pretty good tradeoff,” he added. “But we can count on 90% of the thermal on average to show up, whereas only 15% to 20% of the wind on average will show up. That causes these problems and the challenges we see growing every day.”

He goes on to say that wind is typically the region’s largest electricity supplier. But the wind does not always blow. And until long-duration battery storage matures and scales up, ISOs need reliable and ready-to-dispatch energy resources.

The PJM Interconnection, which serves about 13 states in the East, shares similar views. It said that the electricity growth rate will continue through 2030. At the same time, it says the thermal generation — mostly coal — will continue to retire, and that will outpace the growth of alternative generation.

Are the Carbon-Reduction Goals Realistic?

It says that 40 gigawatts are at risk of retirement by 2030. It will get replaced by renewables at 94% and natural gas at 6% — if it gets built at all, given supply chain and regulatory issues. Meanwhile, PJM’s long-term load forecast shows demand growth of 1.4% annually over 10 years.

“PJM’s interconnection queue is composed primarily of intermittent and limited-duration resources. Given the operating characteristics of these resources, we need multiple megawatts of these resources to replace 1 megawatt of thermal generation,” its paper says. “The amount of generation retirements appears to be more certain than the timely arrival of replacement generation resources and demand response.”

Natural gas is the obvious choice to back up renewables when the weather does not permit. They can fire up almost instantaneously. But Michael Bryson, senior vice president of operations for the PJM Interconnection, says that building those plants is getting increasingly difficult. “And some of the proposed EPA rules will put a bite in that getting those built as well.”

That refers to the Environmental Protection Agency’s proposal to limit future power generation to non-emitting resources or those that can capture and bury carbon within 15 years. While EPA is agnostic about which technologies industry applies, it is committed to cutting CO2 levels from a 2005 baseline by 40% by 2030. The goal is carbon neutrality by 2050.

Are microgrids an effective way to combat these oppressive heat waves? The Tri-State Generation and Transmission Association, which serves four western states, says rural mountainous regions are good prospects for distributed energy using localized microgrids. But it adds that their business case is limited because of scalability and cost.

Barry Ingold, chief operating officer, told the audience that Red Feather Lakes, Colorado, suffers from frequent outages because of winter storms. A single transmission line serves it. It now has rooftop solar panels connected to battery storage and a microgrid — with a propane-fueled backup generator. But this is uncommon — that it is more economical to build at a utility scale.

“It’s done in the name of reliability — and less in the name of cost,” he said.

The broader question is whether the 2050 net zero goals and interim 2030 targets are realistic. If exponentially increasing renewables is the goal, then batteries and hydrogen storage are critical. If “zero-carbon” is the aim, nuclear energy is instrumental — the most reliable no-carbon electric generation fuel that runs daily. And the quest to build carbon capture and storage at scale must continue.

“This is a conversation centered on prioritization of investments,” said Morgan Scott, director of climate and sustainability for EPRI. “That includes reliability, flexibility, safety, and decarbonization” — under the banner of how to plan for and invest in tomorrow’s power system in the age of climate change and extreme heat.

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