Balancing the risks and benefits of environmental initiatives
By Pragmatic Environmentalist of New York, Roger Caiazza
Pragmatic Environmentalist of New York
Balancing the risks and benefits of environmental initiatives
NYISO Comprehensive Reliability Plan
On November 29, 2023 the New York Independent System Operator (NYISO) released its 2023-2032 Comprehensive Reliability Plan (CRP). This is a key part of New York’s reliability planning process and addresses the Climate Leadership & Community Protection Act (Climate Act) net zero transition mandate for the 70% renewable energy by 2030 and the zero-emissions grid by 2040. The report includes recommendations that are odds with climate activists’ demands. This post summarizes recommendations related to the Climate Act.
I have followed the Climate Act since it was first proposed, submitted comments on the Climate Act implementation plan, and have written over 350 articles about New York’s net-zero transition. I have devoted a lot of time to the Climate Act because I believe the ambitions for a zero-emissions economy embodied in the Climate Act outstrip available renewable technology such that the net-zero transition will do more harm than good by increasing costs unacceptably, threatening electric system reliability, and causing significant unintended environmental impacts. The opinions expressed in this post do not reflect the position of any of my previous employers or any other organization I have been associated with, these comments are mine alone.
Overview
The Climate Act established a New York “Net Zero” target (85% reduction and 15% offset of emissions) by 2050. It includes an interim 2030 reduction target of a 40% reduction by 2030 and a requirement that all electricity generated be “zero-emissions” by 2040. The Climate Action Council (CAC) is responsible for preparing the Scoping Plan that outlines how to “achieve the State’s bold clean energy and climate agenda.” In brief, that plan is to electrify everything possible using zero-emissions electricity. The Integration Analysis prepared by the New York State Energy Research and Development Authority (NYSERDA) and its consultants quantifies the impact of the electrification strategies. That material was used to develop the Draft Scoping Plan. After a year-long review, the Scoping Plan recommendations were finalized at the end of 2022. In 2023 the Scoping Plan recommendations are supposed to be implemented through regulation, PSC orders, and legislation.
In order to ensure that the onslaught of regulations and orders is feasible the NYISO follows its reliability planning process. The press release for the 2023-2032 Comprehensive Reliability Plan (CRP) says that it “highlights growing risks to electric system reliability, including: projected increases in peak demand due to electrification of the transportation and building sectors; additional generator deactivations; delayed implementation of planned infrastructure projects; and extreme weather.” It is a part of the NYISO reliability planning process that “sets forth a plan to maintain a reliable bulk electric grid based on expected changes and conditions over a ten-year planning period.” It is issued every two years. The report and appendices are available from the NYISO.
Press Release Highlights
In this section I will annotate the points made in the press release. The first paragraph after the introduction notes:
In addition to rising demand due to continued electrification, several large commercial projects in upstate New York are in development and are forecasted to significantly increase energy use over the planning period. Further, state legislation enacted last year will require the phase-out of the New York Power Authority’s small natural gas plants located in New York City by December 31, 2030. If demand on the grid grows at a rate greater than the buildout of new generation and transmission, reliability deficiencies could arise within the CRP’s ten-year planning period.
Electrification of the transportation and building sectors is a direct consequence of the Climate Act plan to reduce greenhouse gas emissions (GHG) by electrifying everything possible. The building and transportation sectors are the two largest sectors of emissions. There is no question that replacing energy used by direct combustion of fossil fuels with electricity will increase loads. NYISO is particularly concerned that this transition will not only increase the loads but also shift the peak loads from summer to winter and affect the daily load patterns as well.
The electric grid is an incredibly complex system best left to experts. The hubris of the progressive wing of the Democratic majority in the New York State Legislature that they should get involved in power planning is blatant pandering to favored constituencies. The NYPA legislation is a case in point. Phasing out the New York Power Authority’s small natural gas plants in New York City by any date certain is a risk that is major issue in the CRP. Increasing load on one hand and retiring generation at the same time is a primary risk identified in the report.
The press release explains how the problem can be addressed:
The potential risks and resource needs identified in the CRP may be resolved by new capacity resources coming into service, construction of additional transmission facilities, increased energy efficiency, integration of distributed energy resources and/or growth in demand response participation.
I do not think that there are any surprises in these recommendations. It is imperative to build more, connect more, and reduce load to the extent possible but electrification of buildings and transportation means we cannot expect much help there.
The press release highlights risks related to deployment of new resources:
“Our latest report demonstrates the continued importance of the NYISO’s in-depth planning process and the need to closely monitor the rapidly changing electric grid,” said Zach Smith, Vice President, System and Resource Planning. “In this CRP, we highlight several risk factors that could adversely affect system reliability in the months and years ahead.”
The plan underscores the importance of the timely completion of planned transmission projects – primarily the Champlain Hudson Power Express (CHPE) project – to maintain system reliability. Without the CHPE project in service by May 2026 or other offsetting solutions, reliability margins within New York City would be deficient beginning in 2026.
I cannot over-emphasize how important the NYISO planning process is during this transition. It is the most prominent process to introduce reality. Unfortunately, I am concerned that the transition to weather-dependent resources that cannot be dispatched and do not provide ancillary transmission support services is unprecedented and that even the experts at the NYISO will be unable to anticipate all the possible problems. This could result in blackouts that will be more impactful than any of the potential impacts of a tweak to climatic conditions due to GHG emissions.
In the politicized energy policy environment of New York the NYISO cannot come out and say that risking the reliability of New York City’s electric grid by counting on a specific transmission project is unacceptable. Underscoring the importance of “timely completion” really means we should not make any changes to the existing system until the Champlain Hudson Power Express project is complete. In addition there are risks to the technology. I have heard anecdotal evidence that there have been issues with underwater electric cables connecting Long Island to the mainland that lasted longer than expected. CHPE is mostly underwater from Quebec to New York City but there are above ground lines in Quebec that are even more liable to disruptions.
The strategy to electrify everything will shift the peak load from summer to winter. This introduces additional issues:
Transition from a summer peaking system to a winter peaking system also poses challenges to grid reliability. This shift, driven by the electrification of the building and transportation sectors, is forecasted to occur within ten years. A winter peaking system introduces new reliability concerns, particularly around fuel availability for gas-fired generators. Based on a recent assessment of New York’s fuel and energy security, the CRP states the following:
Preliminary results of the 2023 Fuel and Energy Security study demonstrate that NYISO will need to rely significantly on dual-fuel generation resources to support winter system reliability into the next decade and changes to the resource mix may complicate system operations during multi-day cold snap conditions. The frequency and severity of projected potential loss of load events grow over the modeling time horizon as the generation mix evolves and the demand for electricity increases.
One of the prominent claims of the Scoping Plan is that the “zero-emissions” electric grid of the future will be “diverse”. Nothing could be further from the truth. The ugly secret of wind and solar resources is that their output is correlated. The CRP notes: “Solar resources will have little to no output during the evening and nighttime hours and reduced output due to cloud cover, while wind resources can experience significant and sustained wind lulls. Periods of reduced renewable output will occur for short durations due to cloud cover or changes in wind speed and for prolonged periods across a daily/seasonal cycle.” The CRP does not point out that wind lulls frequently occur over the entire state which magnifies the difficulties.
The New York generating system used to be more diverse than today. New York regulated coal-firing out of business but the coal plants could store on-site fuel. Natural gas is cheaper and has less environmental impact, but it is also used for home heating and thus subject to curtailment. New York has significant oil-fired resources that have the advantage that they can be store oil on-site. The reference to dual-fuel generation refers to the ability of certain facilities to burn oil and natural gas so that they can provide power when natural gas is curtailed.
The press release closes with the following:
Given the rapid pace of change on the bulk electric system, the NYISO will continue to monitor these and other developments to determine whether changing system resources and conditions could impact the reliability of the New York electric grid.
The competitive wholesale electricity markets administered by the NYISO are an essential tool to mitigate risks on the electric system, as well as facilitate the transition of the grid to increased renewables and decarbonization as required under state law. The competitive markets continue to evolve and adapt to guide and attract new market entry and retention of resources that support reliability.
The NYISO is a product of the de-regulated electric system that depends on markets. I am not as optimistic as NYISO that the markets will succeed as suggested. Energy developers have to be consider the risks and rewards of all the investments they make. One of the problems in New York City is that the in-city peaking power plants are old. I know that many of the facilities had plans to re-power with new and much cleaner units and had all the permits in place to build them. However, market uncertainties led to the decision not to build them. Without expensive guaranteed subsidies I expect that this will be the case for renewable developments. That sounds less and less like a de-regulated system to me.
Key Reliability Risk Takeaways
The CRP Executive Summary outlines the reliability risks. There is an important caveat:
The CRP’s finding of no long-term reliability violations reflects the Reliability Planning Process assumptions, which are set in accordance with applicable reliability design criteria and NYISO’s procedures. There are, however, risk factors that could adversely affect system reliability over the planning horizon. These risk factors may arise for several reasons including climate, economic, regulatory, and policy drivers.
The ultimate concern is whether the risk factors are so problematic that it is appropriate to consider if a implementation pause is in order. It is de rigor to say that climate will affect the availability of electricity, but they are really talking about extreme weather not climate. There are economic issues associated with the renewable developers that could slow or cancel developments, The Hochul Administration is trying to remove all regulatory barriers but the Federal Energy Regulatory Commission, New York State Reliability Council, New York Public Service Commission, and even the NYISO have regulatory requirements that can affect implementation particularly on the arbitrary schedule of the Climate Act.
The following list of key risks are all the result of the Climate Act net-zero transition. In this overview I will include some brief comments.
The CRP is concerned with the speed of change in the electric grid. Unsaid in the following is that there are no in-kind replacements available for the NYPA small gas plants. Legislators may think that replacement is only a matter of political will, but reality is different.
The pace of generation retirements has exceeded the pace of resource additions to date. Should this trend continue, reliability needs will be identified both locationally and statewide. For example, retirement of the NYPA small gas plants without adequate replacement would result in a deficiency in New York City of more than 600 MW.
The list includes concerns related to the CHPE project which I addressed earlier:
The reliability of the grid is heavily reliant on the timely completion of planned transmission projects, chiefly the CHPE project. Without the CHPE project in service or other offsetting changes or solutions, the reliability margins would be deficient for the ten-year planning horizon.
The Climate Act transition to electrified heating and transportation is unprecedented.
There is a clear upward trend forecasted in peak demand over the next ten years, with significant uncertainty driven by electrification of heating and transportation coupled with the development of multiple high-electric demand facilities (e.g., microchip fabrication and data centers). As the demand on the grid grows at a rate greater than the build out of generation and transmission, deficiencies could arise within the ten-year planning horizon.
The NYISO is making their best estimates of the effect on peak load but the estimates are uncertain. Another big concern is the potential addition of major high demand facilities. At the top of the list of high demand facilities is the proposed Micron chip fabrication plant near Syracuse which is expected to need as much power as Vermont and New Hampshire combined.
Another key risk is imported power:
New York’s current reliance on neighboring systems is expected to continue through the next ten years. Without emergency assistance from neighboring regions, New York would not have adequate resources throughout the next ten years.
Extreme weather has always been the biggest threat to reliability. This risk is also listed:
Extreme events, such as heatwaves or storms, pose a threat to grid reliability throughout the planning horizon and could result in deficiencies to serve demand statewide, especially in New York City. This outlook could improve as more resources and transmission are added to New York City.
The CRP links imported power and extreme events. The document states that:
Statewide resource adequacy during these extreme events relies on neighboring regions for assistance during emergencies. Grid analysis demonstrates that New York would not have adequate resources throughout the next ten years if not for emergency assistance. Such emergency assistance assumes availability of resources from neighboring systems to send power to New York in an event that New York resources are inadequate. The NYISO will maintain interregional collaboration with neighboring systems to monitor the availability of emergency assistance as the resource mix transitions throughout the entire Eastern Interconnection.
I think the extent of the reliance on imported power represents a new paradigm. It is not clear to me that it is in the best interests of New York to be dependent upon other jurisdictions. This is especially true as the dependency upon wind and solar resources increases throughout the Eastern Interconnection. The fact is that the winter worst-case coldest temperature extreme events are associated with low wind and solar resource availability. The under appreciated problem is that the extent of the low resource availability during those events goes beyond adjacent systems. Those systems may not be able to provide emergency support even if they wanted to.
There is an unmentioned reliability risk with the potential for devasting consequences. Projections for future New York electrical energy generation (MWh) call for offshore wind to provide between 15 and 20% of the annual energy needs of the grid. If a category 4 hurricane hits the offshore wind farms, then a significant fraction of the wind turbines could be damaged or destroyed. Replacing them in a timely fashion would be a huge problem.
The problems of a winter-peaking system are another reliability risk. I cannot add anything to the CRP summary:
The New York statewide grid is projected to become a winter-peaking system in the mid-2030s, primarily driven by electrification of space heating and transportation. The New York statewide grid is reliable for normal weather in the winter for the next ten years, but deficiencies would arise as early as winter 2027-2028 for an extreme 1-in-100-year winter cold snap coupled with a shortage of gas fuel supply. This deficiency would grow to a 6,000 MW shortfall by winter 2032-2033. Additional deactivations of dual-fuel generation beyond what is planned will exacerbate the winter reliability risk.
The final reliability risk addresses changes to the planning process:
Planning for the more extreme system conditions of heatwaves, cold snaps, and fuel availability is currently beyond established design criteria. However, several reliability organizations are investigating whether applicable reliability rules and design criteria should be revised to account for these events.
I am disappointed that the CRP did not mention the link between low wind energy resource availability and heatwaves and cold snaps. Large and intense atmospheric high-pressure systems lead to the most extreme temperatures and cause light winds over enormous areas. The reliability organizations are just getting their heads around the ramifications of the magnitude, duration, and extent of these events. They have not addressed the effect on design criteria. One of the primary criteria today is the loss of load expectation over a ten-year period. If analysis determines that once every fifteen years that the expected availability of wind resources requires additional support, that means a new planning horizon.
The unaddressed issue is where do you stop. A 15-year criterion could require a substantial investment for some resource that will only be used once every fifteen years. The problem is that you must make the investment because the weather conditions that cause the problem will occur- it is only a question of time. If the investments are not made, then electricity won’t be available and a catastrophic blackout will occur. In February 2021, the Texas electric grid failed to provide sufficient energy when it was needed. The storm was the worst energy infrastructure failure in Texas history and 4.5 million homes and residences were without power, at least 246 people died, and total damages were at least $195 billion.
Conclusion
The North American electric power grid has been described as the largest machine in the world. Incredibly all the fossil, hydro, and nuclear generating stations in the Eastern Interconnection from Saskatchewan to Florida, Oklahoma to Nova Scotia are connected and work together. It relies on the ability of operators to constantly match load demand with generation output. In order to provide 60 Hz power, the generating turbines are synchronized to run at 3600 revolutions per minute. Operators keep the voltages as constant as possible in the entire area but have the advantage that those turbines provide inertia, and they can dispatch generating resources as necessary.
The CRP raises important reliability issues, but I think it does not fully convey the magnitude of the proposed “zero-emissions” transition challenge. The success of the existing power grid and the benefits of affordable and reliable power it provides developed over decades. Converting the existing system to one that relies on weather-dependent resources and does not inherently provide the ancillary services such as inertia that are inherent to the turbines relied on presently is a massive challenge. Meeting the ”zero-emission” by 2040 schedule mandated by politicians without relying on nuclear energy exacerbates that challenge. It is not politically correct for the NYISO to call out this challenge in detail or to explicitly suggest that it is not possible without enormous reliability risks. I have no such restraints. Unless the Climate Act mandates are modified and the schedule changed, blackouts will result, and people will freeze to death in the dark;