While most of the U.S. faces little risk of systemic electricity shortages this summer, that’s not the case for Texas and California, according to both the North American Electric Reliability Corp. and the Federal Energy Regulatory Commission. NERC issued its summer reliability assessment this morning, while FERC’s summer assessment came May 17.
The yardstick both institutions used to gauge reliability is the reference margin the NERC reliability regions have established for their territory, a somewhat arbitrary measure. Nor do the NERC and FERC analyses predict generating shortfalls, only that the margins in the Electric Reliability Council of Texas market and that of the California Independent System Operator are below their planning target.
In Texas, according to NERC, the predicted reserve margin of 10.9 percent compares to the planned margin of 13.75 percent. This equates to a “capacity shortfall of 2,000 MW,” says NERC. FERC’s assessment noted that ERCOT saw 4.5 GW of coal-fired capacity retired in January and February. Late last year, ERCOT also had a retirement of 806 MW of gas generation and construction delays in new plants of 2 GW. NERC said the projected margin means that “the deployment of ancillary services and contracted load control programs may be required during peak demand periods.”
In California, NERC said, “CAISO faces significant risk of encountering operating conditions that could result in operating reserve shortfalls. The increased risk is primarily a result of lower hydro conditions and the retirement of 789 MW of dispatchable natural gas generation that had been available in prior summers to meet high load conditions.” For Southern California, the restrictions on the Aliso Canyon storage field could put that region of the state in a greater risk of generation outages. Reporting on the FERC analysis, POWER magazine said, “For now, CAISO is banking on demand response and consumer conservation to alleviate possible tight supply conditions.”
NERC also highlighted possible problems in the Midcontinent Independent System Operator market. “Although MISO projects adequate reserves,” said NERC, “more frequent reliance on behind-the-meter generation and demand response will occur to meet reliability requirements. To access these resources, MISO operators will have to take actions to initiate emergency operating procedures more often than in the past. These actions are anticipated to provide sufficient energy or load relief to cover the normal forecasted system conditions.”
NERC also commented on the continuing growth in the dominance of natural gas as a generating fuel. “Despite substantial progress made in addressing and coordinating the interdependencies between natural gas and electric infrastructure, the growing reliance on natural gas continues to raise [bulk power system] reliability concerns,” NERC said. “As underscored in NERC’s recent special assessment report, Potential Bulk Power System Impacts Due to Severe Disruptions on the Natural Gas System, planning approaches, operational procedures, and regulatory partnerships are needed to assure fuel deliverability, availability, security (physical and cyber), and resilience from potential disruptions.”
It is interesting to note that ERCOT, CAISO and MISO do not have capacity markets, while PJM, NYISO, and ISO-NE have active markets for reserve capacity.
–Kennedy Maize