The United States has a grid problem, but the federal government’s proposed fix is misguided.
Recently, the White House ordered the Department of Energy to take immediate steps to stop the loss of “fuel-secure” energy generation to protect grid resilience.
{mosads}A draft memorandum leaked from DOE describes the government’s concerns about the resilience and security of the U.S. electric grid, and proposes using emergency authorities to subsidize uneconomic coal and nuclear power plants around the country. This action follows several other attempts to prevent planned power plant retirements by the administration.
The DOE memorandum identifies the right diagnosis but the wrong prescription. The electric grid is vulnerable to emerging and increasing threats, but bailing out uncompetitive coal and nuclear power plants would be a strategic misstep for U.S. energy policy. Not only would it not strengthen grid resilience, it would waste billions of dollars and impede the distributed energy revolution that promises real resilience benefits.
While it was once named the greatest engineering feat of the 20th century by the National Academy of Engineering, today’s electric grid relies on aging infrastructure.
Most of the transmission and distribution power lines in the United States are far past their life expectancy, and were not designed to meet today’s demand or severe weather, which is why the American Society of Civil Engineers gave the electric grid a D+ in its infrastructure report card last year. In fact, a vast majority of U.S. power outages are not caused by power plant disruptions, but by transmission and distribution infrastructure.
Our grid also faces increasing threats from determined adversaries. The U.S. Department of Homeland Security and Federal Bureau of Investigation recently issued alerts concerning Russia’s persistent and successful attempts to access to our critical infrastructure, including gaining access to a power plant’s critical controls. “They got to the point where they could have thrown switches,” said a DHS official recently.
China, Iran and North Korea are also actively strengthening cyber-capabilities to target critical infrastructure, and utility experts have noted an escalation in attacks over the past 18 months.
These threats are evolving in the context of a rapidly transforming electric grid. The old centralized model is changing, with batteries, solar and other distributed sources of energy generation and storage growing exponentially. The total capacity of flexible energy resources on the U.S. electric grid is expected to more than double in the next five years. The global energy storage market is set to grow six-fold by 2030, following solar power’s explosive growth.
In light of these dynamics, propping up aging power plants that have reached or surpassed their retirement age just doesn’t make sense.
The actions suggested by DOE to subsidize plants that can’t compete in the market will cost consumers and taxpayers up to $34 billion over the next two years. And financing this bailout of the companies that own and operate retiring power plants will hamper the growth of renewable and distributed energy resources.
Furthermore, there’s strength in numbers. A more distributed energy grid, with thousands of energy generation and storage sources, will be inherently more difficult to disrupt than one built around large centralized power plants.
The future electric grid will be diverse, intelligent and distributed, with cities, military bases and even neighborhoods connected to the larger grid, but able to power themselves during critical events.
Smart improvements to the grid system will minimize the risks of cascading outages, such as the 2003 power outage that affected more than 50 million people, or the largest power outage in U.S. history in Puerto Rico last year that knocked down 80 percent of the island’s power lines.
There are a host of actions we can take that would be less costly and more effective to protect our electric grid.
We should implement and exercise cybersecurity standards for distribution grids, which experts point to as a soft target. We should also mandate cybersecurity standards for natural gas pipelines, which received bipartisan support from commissioners on the Federal Energy Regulatory Commission earlier this year. And we should develop market-based, technology-agnostic tools that can be used to prioritize and justify resilience investments.
It seems the only people that seem to want a 20th century grid system to be preserved are companies that stand to directly benefit — an estimated 80 percent of coal subsidies would accrue to just five companies.
It’s time to get serious about reforming the grid to ensure resilience and protect national security, but this administration’s proposed solutions don’t add up.
Michael Wu is a fellow at the Resource Security Program at New America and a principal at Converge Strategies, LLC.
Kevin Johnson is president of GlidePath Federal Solutions and is a board member of the American Resilience Project and Clean Energy Leadership Institute (CELI).