The Energy Secretary Is Wrong: The Grid is Ready for Renewables

U.S. Energy Secretary Rick Perry is expected to issue a report saying renewables pose a threat to the electricity grid. But the truth is that advances in technology and battery storage are making the grid ever-more capable of accommodating wind and solar power.

The U.S. Department of Energy (DOE) will soon release a study asserting that wind and solar energy are undermining the electricity grid and that only fossil fuel and nuclear plants can assure the grid’s reliability.

Making this prediction requires no extrasensory powers. It stems directly from the April 14 memo by Energy Secretary Rick Perry that ordered the study. Echoing a popular argument of the fossil fuel industry, Perry wrote that pro-renewables regulations issued by past U.S. administrations “threaten to undercut the performance of the grid” and have caused “the erosion of critical baseload resources” derived from coal, natural gas, and nuclear energy. In stating these controversial views, Perry seemed to dictate the study’s findings.

The study is being led by Travis Fisher, who, until he became a DOE senior advisor in January, worked for the fossil fuel-funded Institute for Energy Research. While at the institute, Fisher published a report calling clean energy policies “the single greatest emerging threat” to the nation’s grid. Given the potential risks to the grid from cyberwarfare, terrorism, and extreme weather, that’s a highly dubious allegation.

Perry and some fossil fuel industry officials maintain that because wind and solar power are intermittent — that is, they function only when the wind blows or the sun shines — they threaten the grid’s stability. They argue that only fossil fuel and nuclear plants can provide a constant flow of power, which they say the grid needs.

A range of measures should enable the grid to maintain stability as renewables spread.

But a succession of rigorous studies — including a widely cited two-year study conducted by the DOE itself in 2012 — has found that renewables can provide as much as 80 percent of the nation’s energy supply without disrupting a properly managed grid. And that doesn’t mean that 80 percent is the upper limit of renewables — it indicates only that levels beyond 80 percent weren’t thoroughly investigated. A range of measures should enable the grid to maintain stability as renewables spread. These include broadening each regional grid’s reach to take in a greater variety of energy sources, installing more transmission lines, and increasing electricity storage, mostly in the form of batteries. The 2012 DOE study foresees a five-fold growth in the use of batteries by 2050, a realistic goal given batteries’ increasing efficiency and plummeting cost. 

In contrast to the earlier studies, Perry’s is cursory — he wanted it completed in 60 days — and appears to address political concerns, not technological ones. David Pomerantz, executive director of the Washington D.C.-based utility watchdog Energy and Policy Institute, calls the study “a politically motivated effort by the Trump administration to create some kind of justification for pro-coal policies when, in reality, no such justification exists.”

President Trump has vowed to revive the reeling coal industry, and administration officials blame regulations that facilitate renewables — including former President Barack Obama’s Clean Power Plan — for coal’s rapid decline. 

But contrary to Perry’s memo, the success of renewables is not what has rendered coal plants uneconomic —  the extremely low cost of natural gas, which sets prices in the energy market, has done that

Wind turbines at Storm Lake, Iowa.

Wind turbines at Storm Lake, Iowa. DEPARTMENT OF ENERGY

Perry’s line of thinking is far from unanimous even among Republicans. Iowa Senator Charles Grassley, whose state generates a third of its electricity from wind, the highest percentage of any state in the nation, dismissed the study in a letter to Perry as “anti-wind.” Six other Republican senators wrote Trump to object to his proposed cuts in DOE research and development funding, including a 70 percent cut in renewables research. 

Not coincidentally, the renewables-are-destroying-the-grid argument has arisen while their production is soaring. In fact, renewables are triggering a transformation in the power sector, as lethargic utilities awaken to the widespread opportunities of a decarbonized, electrified energy system. In some areas, new unsubsidized wind and solar energy is already cheaper than natural gas and promises to get cheaper still, as a slew of innovations and economies of scale are rolled out, including new materials for photovoltaic cells and more sophisticated ways to shift electricity use from high-cost to low-cost times of the day.

Renewables have accounted for a majority of the nation’s new electricity-generating capacity since 2015, and that proportion is expected to grow. Leading industrial and commercial corporations are loading up on renewable energy. One example is Berkshire Hathaway, Warren Buffett’s behemoth holding company, which has invested more than $6 billion in five solar farms, two of which will be the nation’s largest solar installations.

The grid operates under certain inescapable realities. The amount of electricity delivered to the grid must equal the amount that consumers take from it, or else power stations and transmission lines can break down, causing blackouts. And wind and solar are variable sources of energy: wind turbines don’t turn without wind, and solar panels don’t work without sunlight. Fossil fuel and nuclear advocates like to contrast this set of attributes with their favored energy sources, which, they claim, provide an unvarying flow of energy — a dependable “baseload” supply.

“The idea that intermittency is a challenge for the grid fundamentally misunderstands how the grid operates,” says one expert.

But as Matt Roberts, executive director of the Energy Storage Association, which represents the energy storage industry, puts it, ”The idea that intermittency is a challenge for the grid fundamentally misunderstands how the grid operates. We have a whole toolbox of ways to deal with intermittency.”

The truth is that every source of energy is variable in its own way. For example, the cold wave that struck the U.S. Northeast in early 2014 disabled three-quarters of New England’s gas-powered generation capacity because contractual limitations and exceptional demand impeded supplies.

“Hardly a month goes by,” the DOE’s Energy Information Administration reported in 2006, that delivery from Wyoming’s Powder River Basin, the nation’s largest coal reserve, “somewhere in the supply chain is not interrupted by a derailment, freezing, flooding, or other natural occurrence.” Amory Lovins, cofounder of the energy research-focused Rocky Mountain Institute, reported in a May article in Forbes that coal plants experience outages 6 to 10 percent of the time, and are unavailable for one reason or another for about 15 percent of their maximum theoretical output. That compares unfavorably with solar and wind equipment, which contains few moving parts and rarely breaks down.

The grid was built around the idiosyncrasies of fossil fuels, so long ago that they’re taken for granted. In optimum circumstances, fossil fuel and nuclear plants deliver a constant supply, which meets the system’s minimum daily electricity demand. As demand rises to a late-afternoon crescendo, when commercial and residential devices are both in use, the increase is met with idle plant capacity and smaller “peaker” plants that function only during peak hours. This arrangement works, but it wastes unused plant capacity.

By current standards, coal and nuclear plants are also clunky: They lose efficiency when they don’t run at full capacity, and they take hours to start and stop. Refueling takes them out of service — in the case of nuclear plants for weeks at a time. They are slow to adjust to the never-ending fluctuations of electricity demand, which occur not just day to day and season to season, but minute to minute. 

By contrast, the implements of the modern grid — renewables, electricity storage, and smart grid technology — respond quickly to shifts in electricity demand, and show promise of greatly reducing electricity costs. For example, with the aid of Internet links, “smart” refrigerators and water heaters track changes in electricity prices and maximize electricity use when supply is high and prices are low. When Perry declared in his memo that baseload power “is necessary to a well-functioning grid,” he was dating himself, like a horse enthusiast in the era of cars. 

One lesson ought to hold special appeal for Republicans: Where free enterprise is fostered, renewables thrive.

A Pacific Gas & Electric vice president’s explanation in December for the utility’s closing of California’s Diablo Canyon nuclear power plant can be read as an epitaph for the baseload concept. “With 50 percent renewables on the system, the idea of a large baseload generator that runs pretty much all the time, every day, 24 hours a day, just doesn’t have as good a fit to the market as we expect to see,” PG&E’s Steve Malnight said. 

The modern grid, it turns out, prizes not baseload power but flexible power. When electricity supply suddenly outstrips demand, solar farms can be quickly turned off, as happens occasionally at midday in California. And if a grid covers a wide enough geographical area, variations in supply are evened out — if there’s no sun in southern California, there may be plenty in Arizona. A grid that reaches into two time zones further flattens electricity demand, since, for example, people in one time zone get home from work and turn on their air conditioners at different times from those in the other. That enables existing infrastructure to be used more efficiently, and obviates the need to build more.

For the last century, utilities have considered the amount of electricity demand as a given and have adjusted supply to equal it. Now, however, it’s increasingly possible to shift demand as well as supply. With time-of-use pricing, utilities can alter consumer behavior by dropping prices at midday, when renewable electricity is bountiful, and increasing prices during the late-afternoon demand peak. In addition, the electricity storage industry is growing at a rate of more than 200 percent a year and is making the grid even more efficient. Batteries can store midday renewable energy, then provide it a few hours later when demand is higher.

Even the batteries of electric cars can become grid components. Electric vehicles are still seen as luxuries (Tesla) or curiosities (the Chevrolet Bolt), but sales are likely to take off soon, and not just because of the cars’ lack of emissions, according to Julie Blunden, an energy consultant and California Clean Energy Fund board member. Electric cars’ engines are far simpler than internal combustion engines, which means that they require much less maintenance, and they will cost less than gasoline-fueled cars once economies of scale are reached.

California, the nation’s automotive market leader, has set a target of 1.5 million electric cars on the road by 2025 — which will help drive sales. Parked electric cars can take advantage of the midday peak in renewable electricity supply by charging then, while their owners are at work. With a modernized grid, in the event of a sudden drop in electricity supply or increase in demand, the car-charging could be suspended while the electricity is diverted elsewhere, and owners could be compensated for the interruption.

The biggest obstacle to the ongoing paradigm shift is the slowness of utilities and regulations to adapt. On one level, it’s hard to blame utilities, for they are organized to make profits by expanding infrastructure, not by being efficient or facilitating the distribution of other generators’ electricity. And many regulations were written before the advent of renewables, and don’t take account of new technologies.

For example, the Midcontinent Independent System Operator (MISO), which manages the grid in the Midwest, requires systems in the fast-frequency electricity response market to use governors, which modulate electricity transmissions from coal plants. The fast-frequency market handles second-to-second imbalances between electricity supply and demand. Because transmission from batteries is instantaneous, they’re perfectly suited to fast-frequency transmission, but batteries don’t need governors. And according to MISO’s regulations, that lack excludes them from the market. In the face of all this, utilities and public utilities commissions are beginning to take on the enormous task of redesigning utilities’ business models and regulations to remain viable.

Much of this ought to be familiar to Perry, who was governor of Texas as it became the nation’s leader in wind energy production — the state has an installed wind capacity of more than 21,000 megawatts, more than triple that of Iowa, the second-ranking state. During Perry’s tenure, Texas promoted wind energy by building transmission lines, which are far cheaper than gas pipelines. Wind energy production promptly skyrocketed even though, unlike most states, Texas lacks a potent “renewable portfolio standard” — a regulation requiring increased renewables production. The lesson ought to hold special appeal for Perry and other Republicans who profess to embrace free markets: Where free enterprise is fostered, renewables thrive.