NewEnergyNews

NewEnergyNews

Gleanings from the web and the world, condensed for convenience, illustrated for enlightenment, arranged for impact...

The challenge now: To make every day Earth Day.

YESTERDAY

  • Monday Study: The High Cost Of The Climate Crisis
  • THE DAY BEFORE

  • Weekend Video: A New Energy Unification Emerges
  • Weekend Video: Can’t Deny This Climate Crisis
  • Weekend Video: The Urgent Need For New Wires
  • THE DAY BEFORE THE DAY BEFORE

  • FRIDAY WORLD HEADLINE-Better Ways To Talk About The Climate
  • FRIDAY WORLD HEADLINE-The World’s Huge New Energy Need
  • THE DAY BEFORE THAT

    THINGS-TO-THINK-ABOUT WEDNESDAY, June16:

  • ORIGINAL REPORTING: Arizona Climate Deniers Using The Law
  • New Energy Going Up, NatGas Use, Emissions Going Down

    THE LAST DAY UP HERE

  • Monday’s Study: Keeping The Lights On In Texas
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    Founding Editor Herman K. Trabish

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    Some details about NewEnergyNews and the man behind the curtain: Herman K. Trabish, Agua Dulce, CA., Doctor with my hands, Writer with my head, Student of New Energy and Human Experience with my heart

    email: herman@NewEnergyNews.net

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      A tip of the NewEnergyNews cap to Phillip Garcia for crucial assistance in the design implementation of this site. Thanks, Phillip.

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    Pay a visit to the HARRY BOYKOFF page at Basketball Reference, sponsored by NewEnergyNews and Oil In Their Blood.

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  • THINGS-TO-THINK-ABOUT WEDNESDAY, June 23:
  • ORIGINAL REPORTING: Bankers Call For Scrutiny Before Securitization
  • The New Texas New Energy Boom

    Wednesday, June 23, 2021

    ORIGINAL REPORTING: Bankers Call For Scrutiny Before Securitization

    Possible hundreds of billions in US power sector securitizations spur ratepayer protection debate; Securitization can ease impacts of COVID-19 moratoria debt, stranded asset costs, and extreme weather losses, but bankers and regulators agree that customer costs need oversight.

    Herman K. Trabish, Feb. 22, 2021 (Utility Dive)

    Editor’s note: More scrutiny is needed of how the hundreds of billions – if not trillions – of customer dollars will be spent to cover accrued power sector costs for COVID and the climate crisis.

    Securitization is a financial tool that can reduce utility debt with low interest bonds secured by ratepayers, and with utilities' growing costs related to COVID-19, the energy transition, and climate change, interest is accelerating. But utilities and their customers are facing hundreds of millions or even billions of dollars in such costs, which is raising oversight concerns. When oversight has been introduced, it has led to lower interest rates and lower transaction costs, stakeholders in such proceedings told Utility Dive.

    Duke Energy's $1 billion proposal to use securitization to meet storm recovery expenses in North Carolina provides the criteria necessary for the commission to evaluate Duke Energy's proposed transactions, Duke spokesperson Meredith Archie said in an email. It allows the commission "to determine whether and to what extent it wants to be involved in the transaction once it issues its order."

    But clear state laws on securitization are needed to "protect the public," former Colorado Public Utilities Commission Chair and authority on securitization Ron Lehr said. State laws "should encourage regulators to ask what incentives are involved when big banks and a big utility work together and whether those incentives align with the public interest."

    Utilities and customer advocates differ on oversight. Duke, though committed to legislative and regulatory guidance on securitization, argued in its proceeding that it can manage bond term negotiations, and the financial transactions that follow, on its own. But with hundreds of billions in potentially securitized dollars at stake, customer advocates contend experts representing ratepayers should have a role in those negotiations.

    Securitization allows utilities to offer long-term bonds to investors to pay off short-term debt. Ratepayers benefit because the cost of the securitized debt is lower than the utility's typical cost of debt, which reduces the monthly bill impact, Moody's added. The bonds have lower interest rates because they are long-term and secured by the high likelihood of customers paying their bills. But enabling state legislation is necessary for credit agencies to provide the AAA credit rating for securitized debt that makes interest rates low.

    At least five states passed legislation approving regulatory consideration of securitization by utility regulators in 2019, and at least 18 others have some kind of regulatory, legislative or advocacy effort in the works, according to Energy Innovation and others. The 2020s are likely to see a lot more securitizations, said RMI Electricity Practice Principal and Stanford-Precourt Institute for Energy Research Associate Uday Varadarajan. The Biden administration's commitment to addressing climate issues is likely to accelerate retirements among the approximately 130 GW of remaining operating coal plant assets, he said, leaving about $90 billion in stranded costs eligible for securitization, not counting gas plants or other infrastructure that could be eligible… click here for more

    The New Texas New Energy Boom

    Texas likely to add record utility-scale solar capacity in the next two years

    Suparna Ray, April 21, 2021 (U.S. Energy Information Administration)

    “…Texas will add 10 gigawatts (GW) of utility-scale solar capacity by the end of 2022, compared with 3.2 GW in California. One-third of the utility-scale solar capacity planned to come online in the United States in the next two years (30 GW) will be in Texas…The installation of 2.5 GW of solar capacity in 2020 marked the beginning of the solar boom in Texas…[It is expected] add another 4.6 GW of solar capacity in 2021 and 5.4 GW in 2022, which will bring total installed solar capacity in Texas to 14.9 GW…

    Utility-scale solar projects that start construction in 2021 or 2022 are eligible for a 26% [investment tax] credit. The tax credit drops to 22% for projects that start in 2023 and to 10% for projects that start in 2024 or later…Other factors driving solar investment in Texas include lower solar technology costs and plentiful sunlight, particularly in West Texas’s Permian Basin, where about 30% of the state’s planned solar capacity will be built. In addition, because solar generation is greatest in the middle of the day, when wind generation is typically lower, available transmission lines that already handle the large amount of wind power in the state have helped set the path for record-breaking planned solar capacity additions…

    …[U]tility-scale solar only made up 4% of the state’s generating capacity in 2020 and 2% of in-state electricity generation. In comparison, natural gas made up 53% of Texas’s capacity in 2020 and 52% of in-state generation; wind made up 23% of capacity and 20% of in-state generation…[But] solar is expected to make up the largest share of the state’s capacity additions between 2020 and 2022. Almost half of the additions during this time period will be solar, surpassing wind (35%) and natural gas (13%) additions.” click here for more

    Monday, June 21, 2021

    Monday Study: The High Cost Of The Climate Crisis

    The economics of climate change: no action not an option

    April 2021 (Swiss RE Institute)

    Executive Summary

    The world economy could be 10% smaller if the 2050 net-zero emissions and Paris Agreement targets on climate change are not met.

    The world stands to lose close to 10% of total economic value by mid-century if climate change stays on the currently-anticipated trajectory, and the Paris Agreement and 2050 net-zero emissions targets are not met. Many emerging markets have most to gain if the world is able to rein in temperature gains. For example, action today to get back to the Paris temperature rise scenario would mean economies in southeast Asia could prevent around a quarter of the gross domestic product (GDP) loss by mid-century that they may otherwise suffer. Our analysis in this report is unique in explicitly simulating for the many uncertainties around the impacts of climate change. It shows that those economies most vulnerable to the potential physical risks of climate change stand to benefit most from keeping temperature rises in check. This includes some of the world's most dynamic emerging economies, the engines of global growth in the years to come. The message from the analysis is clear: no action on climate change is not an option.

    Under the current trajectory, global GDP could be 11–14% less by mid-century than in a world without climate change. The loss under Paris Agreement targets would be significantly less (around 4%).

    Recent scientific research indicates that current likely temperature-rise trajectories, supported by implementation of mitigation pledges, would entail 2.0–2.6°C global warming by mid-century. We use this as the baseline to simulate the impact of rising temperatures over time, while also modelling for the uncertainties around most severe possible physical outcomes. The result is that global GDP would be 11–14% less than in a world without climate change (ie, 0°C change). Under the same no climate change comparative, the Paris target too result in negative GDP impact, but less much so (–4.2%). We also consider a severe scenario in which temperatures rise by 3.2°C by mid-century, with society doing nothing to combat climate change. In this scenario, the global economy would be 18% smaller than in a world without warming, reinforcing the imperative of, if anything, more action on climate change.

    Economies in south and southeast Asia are the most vulnerable to climate change effects; advanced economies in the northern hemisphere least so.

    In terms of exposure to severe weather risks resulting from climate change, south east Asia and Latin America will likely be most susceptible to dry conditions. Many countries in north and eastern Europe, meanwhile, are set to see more excess precipitation and flood events. Combining these observations with our GDP-impact analysis, our Climate Economics Index indicates that many advanced economies in the northern hemisphere are least vulnerable to the overall effects of climate change, being both less exposed to the associated risks and better resourced to cope. The US, Canada and Germany are among the top 10 least vulnerable. Of the major economies, China ranks lower, in part due to lesser adaptive capacity in place today relative to peers. However, with rising investment in green energy and increasing awareness of climate risks, we believe China is on course for rapid catch-up here.

    Climate change also poses transition risks: Asia may be most impacted.

    In addition to physical, climate change also gives rise to transition risks. These can show in large shifts in asset values and higher cost of doing business as the world moves to a low-carbon economy. As a separate exercise, we use carbon-tax scenario analysis as a proxy to gauge the associated financial and economic impacts. We find that earnings in the utilities, materials and energy sectors would be the most impacted and lose between 40–80% of earnings per share by immediate imposition of a global carbon tax of USD 100 per metric ton. By region, revenue-weighted earnings would fall by about a fifth in Asia Pacific, and by 15% in the Americas and Europe. The scale of loss depends on the speed at which carbon taxes and mitigation actions are implemented, and the pace of technological adoption.

    More than what is being pledged today is needed to achieve the Paris agreement. International convergence on data, standards, metrics and disclosure of roadmaps towards “net zero” are key

    Climate risk is a systemic risk, one that can be managed with coordinated global policy action. There exists a unique opportunity to green our economies. The public and private sectors, including insurers as providers of risk transfer capacity, risk knowledge and long-term investment, can facilitate transition to a low-carbon economy. Increasing transparency, data and disclosure to price and transfer risks is needed. To this end we should see more policy action on carbon pricing coupled with incentivising nature based and carbon-offsetting solutions. International convergence on the taxonomy on counts for green and sustainable investments is also needed. As part of corporate reporting, institutions should also disclose their roadmaps on how they intend to reach the Paris and 2050 net-zero targets.

    Key Takeaways

    Global temperature rises will negatively impact GDP in all regions by mid-century. The current trajectory of temperature increases, assuming action with respect to climate change mitigation pledges, points to global warming of 2.0–2.6°C by midcentury. The loss in global economic value in this scenario could be up to 10% higher than if the Paris Agreement of much less than 2°C rise in temperatures is reached. Economies in southeast Asia (ASEAN) countries would be hardest hit. In a severe scenario of a 3.2°C-rise in temperatures, the global GDP loss could be as much as 14% higher than that under the Paris targets

    Achieving the Paris Agreement temperature target is the most-desirable outcome. Compared to 2.6°C warming, if the Paris Agreement target of well below 2°C warming is met, up to 10% of anticipated mid-century global GDP loss could be prevented. As the figure below shows, in more exposed regions, the benefit in terms of mitigated or prevented GDP-loss by mid century if the Paris Agreement target is met as opposed to a 2.6°C rise in temperatures, could be as much as 25%. Many emerging markets would benefit most, with Indonesia, Thailand and Saudi Arabia among the biggest relative winners.

    Top- and bottom-five Climate Economics Index rankings. Economies in south and southeast Asia are particularly vulnerable to adverse effects of climate change, and advanced economies in the northern hemisphere least so. In simple ranking terms, our index considers the GDP impact of the physical risks emanating from gradual climate change over time, and vulnerability to extreme weather risks (wet and dry conditions). The index also factors in countries’ existing levels of adaptive capacity.

    Transition risk. Imposition of a global carbon tax of USD 100 per metric ton would impact the energy, materials and utilities sectors most. By region, revenue-weighted earnings would fall by a fifth in Asia Pacific, and by 15% in the Americas and Europe.

    Saturday, June 19, 2021

    A New Energy Unification Emerges

    “Dreaming bigger and reaching higher,” the New Energies have come together to lead a transition for “the United States of clean power.” From American Clean Power Association via YouTube

    Can’t Deny This Climate Crisis

    All anybody needs to know is what they see in the headlines. From Today via YouTube

    The Urgent Need For New Wires

    It is time for a transmission planning process that supports the energy transition, not one that resists it.From Grid Strategies via YouTube

    Friday, June 18, 2021

    Better Ways To Talk About The Climate

    Tailoring climate change messaging for conservatives could shift understanding of crisis: Study; Researchers studied how to make climate change communication more persuasive.

    Julia Jacobo, June 14, 2021 (ABC News)

    “…Tailoring online messaging and advertising toward Republican voters could shift their views on climate change…[Research shows that in 2020,] 73% of Americans believed that global warming was happening, and 62% think that it was caused by human activities…[up from 2010’s] 57%...But, the shift in public opinion on climate change has largely been driven by Democrats…just 22% of Republicans said it should be a ‘high’ or ‘very high’ priority, compared to 83% of Democrats…

    …[A]ltering the messages to appeal to conservative ideals can increase Republicans' opinions of climate change…[according to a] one-month advertising campaign field experiment that tailored climate change-themed online messaging for conservative voters in two competitive districts -- Missouri-02 and Georgia-07…The campaign presented a series of videos called ‘New Climate Voices,’ which used social identity theory, elite cues and theories of persuasion presented by spokespersons who were likely to resonate with conservatives… [The videos increased by several percentage points] understanding among Republicans in the two districts on two topics: that global warming is happening and that it's being ‘caused mostly by human activities.’

    …The belief that climate change is ‘somewhat,’ ‘very’ or ‘extremely’ personally important and that it would cause ‘moderated’ to a ‘great deal’ of harm to future generations also increased…The tricky part is getting the messaging through in a competitive environment where people are fielding messages across multiple platforms…[and] it is unclear how much results might vary depending on geographic location or cultural context…” click here for more

    The World’s Huge New Energy Need

    The Future Of Wind Power Depends On Deployment

    Felicia Jackson, June 15, 2021 (Forbes)

    “Fossil fuel’s share in the energy mix is as high today as ten years ago, despite the falling costs of renewables. [With less than a decade to embed low carbon transition in the energy markets, politicians and policy makers must] stop talking and start acting…The coming decade is critical, as infrastructure built over the next few years will lock in path dependency for years to come…[The world needs to be installing wind power at around 3-4 times the level of 2020, which saw a record 93GW installed. In these scenarios, wind and solar PV make up 70% of electricity generation by 2050…

    Despite a growing acceptance that the world is facing a climate emergency, and increasing country and corporate commitments to net zero, fossil fossils have continued to dominate growing energy demand…[T]he share of fossil fuels in the global energy mix was 80.2% in 2019, compared to 80.3% in 2009, while renewables such as wind and solar made up 11.2% of the energy mix in 2019, up from 8.7% in 2009…It is increasingly clear that commitments alone are not enough.

    …Many existing planning frameworks, subsidy regimes and market designs are woefully out of date…The scale of renewable energy deployment is no longer about cost…The economic argument has been won, and there is no lack of appetite from investors…What is necessary is a change in culture around planning, permitting, priority access to the grid and subsidy regimes. One question as to whether or not the industry can scale up at such a rapid pace…[T]here are certain barriers to entry, for example the cost of infrastructure can be high…[But the] opportunities are as high as the potential investment…” click here for more

    Wednesday, June 16, 2021

    ORIGINAL REPORTING: Arizona Climate Deniers Using The Law

    Arizona showdown: Lawmakers face regulators in fight over zero-emissions mandate; Conservatives say regulator's proposed zero-carbon mandate oversteps its constitutional authority while defenders say the legal debate is an excuse to impede the state's climate fight.

    Herman K. Trabish, Feb. 10, 2021 (Utility Dive)

    Editor’s note: After this story ran, the legislature took control away from the commission and essentially stopped the zero-emissions initiative.

    Controversial proposed Arizona legislation would impose limits on the authority of the state's elected utility regulators and make their recent groundbreaking zero-emissions mandate unconstitutional.

    Senate Bill 1175 expresses longstanding concerns from some lawmakers regarding overreach by the elected Arizona Corporation Commission (ACC), stakeholders agreed. But those concerns were aggravated by the ACC's November approval of draft energy rules that included a zero emissions by 2050 mandate for electric utilities in the state, seen by some as an attempt to reverse the 2018 defeat of Proposition 127 and its 50% renewables by 2030 mandate.

    Legislators are following Republican Gov. Doug Ducey's lead in attempting to amend Arizona law and prevent ACC from using its constitutional power to set "critical energy generation" policy. "I want to see the corporation commission setting rates and the legislature setting energy policy and I hope that will be straightened out in this session," Ducey told the Arizona Chamber of Commerce Jan. 15.

    The ACC voted 4-1 Nov. 13 to approve its draft rules. Three Republicans and one Democrats voted in favor, with only Republican Commissioner Justin Olson voting against. But the debate over SB 1175 has turned highly partisan, and opponents believe its inception was driven largely by that November vote.

    The legislation "seems to be about the clean energy rules and not the constitutional issue because it is suspiciously retroactive to June 30, just before ACC staff filed the rules in July," said Democratic Sen. Kirsten Engel, who is leading opposition to the legislation. "And I have not been impressed by Republican bill supporters' constitutional arguments, which seem really about opposition to the clean energy rules."

    The 2050 mandate can grow Arizona's economy and jobs, many in the business community say, but advocates for SB 1175 say the rules could raise electricity rates. The bill debate, however, centers on interpretations of constitutional law, and the final word may come from Arizona's Supreme Court after a long legal battle, both sides acknowledged… click here for more

    New Energy Going Up, NatGas Use, Emissions Going Down

    Short-Term Energy Outlook

    June 8, 2021 (U.S. Energy Information Administration)

    …We forecast that retail sales of electricity in the United States will increase by 2.3% in 2021 after falling by 3.9% in 2020. The largest increase in consumption will occur in the residential sector, where [due primarily to 1Q cold temperatures] we forecast retail sales of electricity will grow by 2.8% this year…[The forecast increase in electricity consumption in the commercial and industrial sectors reflects improving economic conditions in 2021…We expect the share of electric power generation produced by natural gas in the United States will [due to an average $4.09/MMBtu in 2021 compared with an average of $2.39/MMBtu in 2020price] average 36% in 2021 and 35% in 2022, down from 39% in 2020…

    …[The renewables share of U.S. generation [is forecast to] rise from 20% in 2020 to 21% in 2021 and to 23% in 2022…[T]he U.S. electric power sector added 14.8 gigawatts (GW) of new wind capacity in 2020. We expect 16.0 GW of new wind capacity will come online in 2021 and 5.3 GW in 2022. Utility-scale solar capacity rose by an estimated 10.5 GW in 2020. Our forecast for added utility-scale solar capacity is 15.5 GW 2021 and 16.6 GW for 2022…[plus] 4 GW to 5 GW of small-scale solar capacity…

    We estimate that U.S. energy-related carbon dioxide (CO2) emissions decreased by 11% in 2020 as a result of less energy consumption related to reduced economic activity and responses to COVID-19. In 2021, we forecast energy-related CO2 emissions will increase about 6% from the 2020 level as economic activity increases and leads to rising energy use…” click here for more

    Monday, June 14, 2021

    Monday Study – Keeping The Lights On In Texas

    Never Again: How To Prevent Another Major Texas Electricity Failure

    Pat Wood III (PUCT Chairman 1995-2001, FERC Chairman 2001-2005), Robert W. Gee (PUCT Chairman/Commissioner, 1991-1997), Judy Walsh (PUCT Commissioner 1995-2001), Brett Perlman (PUCT Commissioner 1999-2003), Becky Klein (PUCT Commissioner/Chairman 2001-2004), Alison Silverstein (PUCT advisor 1995-2001, FERC advisor 2001-2004), June 3, 2021 (The Cynthia and George Mitchell Foundation)

    The historic weather system that hit the South Central United States in February 2021 led to the deaths of nearly 200 Texans[1] and caused over $100 billion in damages to Texans’ homes and property.[2] Its impacts on power, natural gas, water, and transportation infrastructure were profound, leading the power grid operator, Electric Reliability Council of Texas (ERCOT), to order all local utilities to immediately decrease power demand early on February 15. This grid reliability order led to cuts in electric service to over four million premises, leaving millions of Texans out of power and in miserable conditions for up to four days.

    The Texas Legislature has sent to Governor Abbott new statutes to address some of the problems that contributed to this disaster. But beyond these new laws, Texas has more work ahead to protect customers and ensure that our energy infrastructure works adequately. The February outages were triggered by an extreme weather event but were exacerbated by underlying problems that affected the entire energy system from the production of natural gas to the delivery of electricity to the customer.

    These problems extend beyond the Electric Reliability Council of Texas (ERCOT) and the Public Utility Commission of Texas (PUCT) to include parts of the energy system regulated by the Texas Railroad Commission, the Texas Reliability Entity, and the North American Electric Reliability Corporation, all of which bear some responsibility for the reliability of our energy system. If Texas is to mitigate future energy system disasters and restore our state’s reputation, we must do more than just tighten governance on ERCOT and the PUCT, weatherize power plants, patch the electric market, and reform some utility and retail practices.

    As past PUCT Commissioners, the authors helped to design and implement many elements of ERCOT’s electric system and market structure between 1995 and 2004. The mission of the PUCT is to protect customers, foster competition, and promote high-quality infrastructure. Until this February, the Texas electricity system had largely achieved that goal. We created a strong, competitive, reliable electricity system whose overall performance for more than 20 years lowered electric bills for all customer classes, created innovative options for electricity customers, attracted an unprecedented level of new natural gas and renewable generation, and kept the lights on as our state population grew by 40%.

    While the February 2021 event was clearly unprecedented, prior outages should have provided a wake-up call to policymakers and regulators to address reliability issues. The events of February 2021 resulted from several policy failures as well as from operational and planning failures across our state’s electric, natural gas and water systems. We must address the causes of this winter’s weather challenge and prepare to deal with emerging economic, technology and extreme weather realities.

    Texas is the world’s ninth-largest economy. We owe it to our families and fellow citizens to learn from this event, plan for the future, and do the right thing for the good of Texas. We offer the following observations and 20 recommendations, which are organized based on the outage’s contributing factors. Some of these require further legislative action; others can and should be implemented by the PUCT under existing authorities.

    Problem 1¬—Almost half of ERCOT’s gas, coal and nuclear plants failed to produce when needed

    ERCOT’s publicly released data[3] and other analyses indicate that almost 9 GW (8%) of ERCOT’s generation fleet was already out for maintenance on February 14 and another 22 GW (21%) of ERCOT’s total generation fleet failed before 1am on February 15, when ERCOT was forced to initiate customer load-shedding. Natural gas generators represented the greatest loss of production (26 GW, including units out for maintenance). Most of those plants failed due to insufficient preparation for the intense winter storm and/or because fuel became unavailable (whether on-site, like coal plants, or due to lack of natural gas availability or delivery capability). Forty-six percent of ERCOT’s total thermal generation capacity was unavailable or failed during the outage.[4] SB3, the new reliability statute, requires the PUCT to adopt power plant winterization standards, informed by adverse weather forecasts, with compliance requirements and penalties for non-performance. This is a good start, particularly given that a recent analysis from the Federal Reserve Bank of Dallas suggests that the weatherization of Texas gas and wind power plants would be cost-effective.[5] The PUCT and ERCOT will have to ensure that these standards are appropriately rigorous and receive adequate enforcement.

    SB3 directs the PUCT to examine ancillary services and incentives for dispatchable generation such as natural gas plants, and modify the design, procurement, and cost allocation of ancillary services to assure that appropriate services are available for weather emergencies. ERCOT and the PUCT are also directed to look at whether dual-fuel capability, fuel storage and different fuel procurement supply policies are appropriate solutions for extreme weather performance. The statute even calls for operation under drought conditions. These measures are a good start to assure that gas-fired power plants retain reliable fuel access.

    Recommendation 1-1—Mandatory weatherization to minimum standards for natural gas production and pipelines, with meaningful enforcement…

    Problem 2—Electric demand skyrocketed 20% over forecast

    In February, Texas and its neighboring states experienced a multi-day run of Arctic temperatures and winds that drove ERCOT electricity demand for heating to unprecedented levels. As much as 35 GW (over 40%) of the total Texas electric demand was for heating. Much of Texas’ housing stock has little or no insulation and relies only on electric resistance heaters rather than gas heat, but at such low temperatures, uninsulated homes cannot be heated effectively. This drove ERCOT’s winter electricity demand to unprecedented levels; had ERCOT not called rolling outages early in the morning on February 15th, we were on the way to an all-time system peak later that day. Between leaky buildings, lack of electricity and poor public communications, over 100 Texans died of hypothermia or carbon monoxide poisoning during the February blackout.

    Texas must fix this by improving the energy efficiency of our buildings. Over half of Texas homes were built before the state adopted building energy codes with insulation requirements in 2001. And over 60% of Texas homes are heated with electricity rather than gas. If these homes had energy-efficient building shells and heaters before February 14, that could have reduced electricity demand by at least 15 GW—enough to drop peak demand down to 62 GW and offset the loss of most of the generators that failed on February 14 and 15. Estimates developed for the U.S. Department of Energy indicate that Texas could use cost-effective energy efficiency measures to reduce 2030 residential electricity use by 18.5% and total electricity sales by 17%.[6]

    Recommendation 2-1—Update Texas building energy codes and require them to be automatically updated as international building codes are updated…Recommendation 2-2—Raise TDU energy efficiency program goals to increase both annual kWh savings and peak reduction…Recommendation 2-3—Increase energy efficiency retrofits for low-income and multi-family housing across Texas…Recommendation 2-4—Increase demand response for grid emergencies…

    Problem 3—Distribution utilities didn’t rotate outages, leaving two-thirds of Texans without electricity for up to 70 hours

    SB3 requires the PUCT and utilities to update criteria and recognition of critical residential customers and critical facilities. It also requires the utilities to conduct annual load-shed exercises. These are valuable first steps. But if Texas identifies more critical customers yet cannot manage distribution outages more effectively, this measure may not help us better manage future outages.

    Texas’ electric utilities had to cut service to millions of customers because the critical facilities (those they knew of) are located on large circuits serving large numbers of customers and high electric loads on every circuit. Once those circuits were protected, there was no electricity left to serve the remaining circuits that don’t serve critical facilities, so all the remaining circuits were cut. Although utilities aim to rotate small-scale outages across many circuits, in February there were so many circuits out relative to the available generation that there was no way for the utilities to rotate the outage burden among circuits and customers. Thus, many customers on circuits without critical facilities stayed out of power for several days in a row. The lack of outage rotation in February was the most customer-impacting part of this disaster—many homes reached freezing temperatures during multi-day outages, causing many deaths from hypothermia and carbon monoxide poisoning, and millions of frozen pipes and damaged property and possessions.

    This outage management process must be overhauled. It is easier to manage outages and rotate outages fairly if circuits containing critical facilities are smaller and require less power, and if non-critical circuits are smaller so that outage burdens can be shared. Dividing the grid into smaller operational segments will enable the utilities to conduct smaller, more granular and targeted outages affecting fewer customers.

    Texas customers have funded major utility investments in smart meters and other smart grid infrastructure. But the utilities have not yet leveraged these investments for better outage management. Extreme weather conditions are a perfect opportunity to deliver that functionality. Until it is clear that meter functionality and control capability can be used dependably for surgical outage management, other solutions are needed…

    Recommendation 3-1—Require TDUs to modify distribution circuits for more granular outage management…Recommendation 3-2—Require large industrial and commercial customers to be able to reduce load remotely…Recommendation 3-3—Require all critical facilities to have two days’ worth of backup power

    Problem 4—Poor demand and supply forecasting and planning by ERCOT…Recommendation 4-1—ERCOT should improve demand forecasting capabilities…Recommendation 4-2—ERCOT should broaden its use of scenario analysis with more aggressive worst-case outcomes…Recommendation 4-3—Acknowledge changing extreme weather threats…

    Problem 5—Power market operation was ineffective…Recommendation 5-1—Evaluate whether ERCOT needs different winter versus summer planning, operations and protocols…Recommendation 5-2—Reassess requirements and compensation for black-start capacity and test and drill twice/year…Recommendation 5-3—Do not add an out-of-market “generation capacity reserve” scheme…

    Problem 6—Inadequate or inappropriate governance…Recommendation 6-1—Strengthen Texas’ Public Utility Commission…Recommendation 6-2—Give ERCOT an independent, expert Board of Directors…Recommendation 6-3—Establish active reliability compliance oversight…Recommendation 6-4—Study the potential benefits and costs of adding additional high-voltage transmission between ERCOT and its neighboring interconnections…

    Problem 7—We don’t have full information on the contributing causes of the blackout and the sequence of events and actions by ERCOT, power plants, fuel suppliers, regulators, and customers before and during the event…Recommendation 7-1—Release all Texas investigative findings to the public…Recommendation 7-2—Routinely collect data on all grid and fuel supply failures and make it public…

    Conclusions

    SB3 and other new statutes adopted by the Texas Legislature have provided a swift and focused response to the February disaster, but there is more work to be done to address all of the causes of the February 2021 Arctic outage and prepare for the challenges ahead.

    This paper offers a broad set of recommendations; with multiple investigations under way, we hope to learn more to refine these and other solutions in the future. Although the Legislature has taken initial action, many of the recommendations above can be implemented by the PUCT, RRC and ERCOT under existing statutory authorities, as indicated in the table below.

    Saturday, June 12, 2021

    The Water-Wanting West

    Lake Mead is at 37% of it’s capacity. “It’s an existential issue…” From CBS This Morning via YouTube

    Never Mind Water In The Idiocracy Future

    This is what it has been like talking to climate change deniers for the last decade. From Dan Nguyen via YouTube

    The American Clean Power Association Takes Center Stage

    White House Climate Advisor Gina McCarthy, Sen. Chuck Schumer, and other national and New Energy industry leaders address the Clean Power Virtual Summit 2021 and talk about the need for an energy transition. From via YouTube