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February 5, 2018 Viewpoint

Power grid solutions needed to avoid blackouts

Gordon van Welie is the ISO New England president and CEO.

In late December and early January, New England experienced bitter cold temperatures and multiple snowstorms. Across the region, temperatures fell below normal for at least 13 consecutive days, with 10 days averaging more than 10°F below normal.

ISO New England, the independent power system operator, saw firsthand the impact this historic cold snap had on New England's electric grid.

Increased demand for natural gas from heating customers drove up prices for natural-gas fired power plants. That meant that older oil- and coal-fired power plants, which were less expensive to run than their gas counterparts at the time, were operating most of the time. Fuel supplies at the oil-fired power plants rapidly depleted, and refilling tanks was complicated by storm conditions.

ISO managed the power system reliably, but the conditions drove up wholesale electricity prices, left the region at risk if a major power plant or transmission line went down, and highlighted a growing concern regarding fuel security.

Last month, the ISO released the “Operational Fuel-Security Analysis,” a study began in 2016 to quantify the risks posed to the regional grid when natural gas power plants – which produce nearly half of the electricity in New England – have difficulty accessing fuel. The study assumed there will be no major build-out of the natural gas pipeline system over the next decade, and focused on 23 scenarios to analyze whether enough fuel would be available to meet demand in the 2024/2025 winter.

The scenarios looked at variables like increased levels of renewable energy, including offshore wind, solar and energy efficiency; increased retirements of older oil- and coal-fired power plants; varying levels of imported electricity from neighboring regions and liquefied natural gas (LNG); and the availability of oil for dual-fuel power plants during gas shortages.

The analysis found energy shortfalls due to inadequate fuel supply would occur with almost every fuel-mix scenario in winter 2024/2025, requiring frequent use of emergency actions, including rolling blackouts, to protect the grid. The analysis shows if fuel challenges in New England are not addressed, power system reliability will be at risk.

Expanding natural gas pipeline capacity, investment in renewable resources and related transmission infrastructure, increased power imports, changes to fuel infrastructure and contracting for adequate fuel are all possible solutions. These solutions each have different costs and benefits, but our experience during the recent cold snap and the fuel-security analysis show inaction has costs: greater risks to reliability, higher energy prices and higher emissions.

The challenges to power system reliability require action from policymakers, regulators and the energy industry. ISO will evaluate improvements to price these challenges and incentivize investment. And, if needed, ISO stands ready to assist regional decision-makers as they evaluate the costs and benefits of potential solutions.

Gordon van Welie is ISO New England president and CEO.

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