Comments Off on Power Outage Rapid Response Toolkit
Interruptions in electricity supply – ‘the lights going out’ – make for arresting headlines and capture public attention. Yet it is strikingly rare for any kind of electricity generation shortfall to trigger blackouts: major reliability events are nearly always the result of grid failure incidents such as wires frying or being damaged by trees.
Furthermore, none of the recent events that have occurred in markets with high shares of renewables have been caused by over-reliance on renewables to provide sufficient electricity supplies. In spite of this, the fossil energy industry has a track record of seizing on any opportunity to promote the narrative that more fossil generation is needed and that the growing shift to renewables is undermining and driving up the cost of secure supplies.
To dispel many of the myths surrounding the causes of recent significant power outages, the toolkit looks at four case studies: Texas 2021, California 2020, Great Britain 2019 and South Australia 2016.
These case studies prove it is important that advocates for a clean energy transition can set the record straight quickly, credibly and substantively. This package equips advocates with information and tools to respond quickly to the misinformation that spreads rapidly in the wake of power grid reliability events, and in particular:
introduces the advocate to reliability events, and their causes and consequences;
provides a checklist for advocates to understand and analyse emerging reliability events (a separate, interactive checklist can be downloaded here: Power Grid Rapid Response Checklist);
provides holding lines for advocates during the information vacuum that normally proceeds a reliability event;
explains why large-scale reliability events are almost always caused by network failures and not renewable electricity generation.
Comments Off on FERC Transmission: The Highest-Yield Reforms
Most of America’s transmission grid was built in the 20th century to serve central power stations burning coal, oil, more recently, fossil gas, and nuclear stations. In a world where solar and wind energy are now less expensive than fossil-fuel generated energy — and much less expensive with the costs of pollution are considered — it is indisputable that this old transmission system requires a major overhaul. Order 1000, issued by the Federal Energy Regulatory Commission (FERC) in 2011, lowered some barriers to competition, but regional transmission organizations have by and large not aligned their transmission planning and funding with state policies and objectives. A broader, more interregional approach to transmission is also needed to make the grid more flexible and reliable. And the rapid development of offshore wind requires better transmission planning in order to avoid capacity constraints and unnecessary costs.
In this brief, the authors consider FERC’s current efforts to reform interconnection and transmission planning and ask the question: What is the best focus for reform of federal regulation of this complex and disparate set of transmission grids across the United States? The brief answers this question in five parts:
What FERC did think about: interconnection;
What FERC should be thinking about: competition;
What else FERC should be thinking about: integrating offshore wind transmission efficiently and reliably;
What FERC can do to drive effective implementation: oversight; and
What FERC knows: To be effective, standards need to be mandatory for RTOs and transmission organizations.
Comments Off on Regional Operational Centres: A review of the Commission’s proposal and recommendations for improvement
Close coordination of Europe’s power networks on a regional basis is important, as illustrated vividly in November 2006, when Europe came close to experiencing a widespread blackout. Since that time, Transmission System Operators (TSOs) have voluntarily worked together to increase regional coordination. In its ‘Clean Energy for All Europeans’ legislative package, the Commission has proposed to further increase regional cooperation within the Internal Electricity Market. Specifically, the proposed Electricity Regulation will create Regional Operational Centres (ROCs) that build on the framework established by Regional Security Coordinators through EU Network Codes.
The Commission’s proposal to create ROCs is a step forward in establishing an institutional framework for regional system operation and optimal use of interconnectors, and will also help to increase economic welfare at both the regional and European level. RAP and Client Earth recommend the following improvements to the Commission’s proposal:
ROCs should be given a bigger role in risk-preparedness in recognition of the fact that ROCs will, in time, develop the regional knowledge, necessary expertise, and analytical capability that will allow them to identify regional crisis scenarios more effectively than ENTSO-E or individual Member States. We therefore suggest that the ROCs should be responsible for identifying crisis scenarios.
The Commission’s proposal should anticipate that, ultimately, ROCs should oversee the real-time operation of Europe’s regional transmission networks in addition to providing near-real-time analysis and guidance. While both the TSOs’ regional security coordination initiatives, later formalised as Regional Security Coordinators, and the Commission’s ROC proposal recognise the need for near-real-time transmission planning activities to be carried out on a regional basis in the interests of increased market efficiency, neither addresses the eventual need to take a similar approach to real-time activities.
A strong governance structure is imperative for the ROCs to function as intended. Suggested additions to the governance framework include ensuring independence, establishing a clearer mission for the ROCs, and empowering the Agency for the Cooperation of Energy Regulators to exercise stronger oversight of the ROCs. These steps should ensure that ROCs operate freely from any national bias that would be in conflict with the interests of all consumers in the region. We also recommend including a legal mechanism for promoting transparency, public scrutiny, and meaningful participation of stakeholders.
These recommendations will allow the Commission’s proposed Electricity Regulation to fully optimize the transmission system in the interests of market efficiency and ensure a least-cost transition to a decarbonized power system.
Comments Off on Regulatory Approaches to Grid Resiliency and Security
Ensuring a stronger grid that is capable of withstanding a catastrophic event, or alternatively a grid for which outage durations can be minimized in such an event, involves several steps. First is prevention: identifying the grid’s weaknesses and how to mitigate them. Second is recovery: steps to ensure quick restoration of service after a major event. Third is survivability: measures taken to encourage and safely enable customers, neighborhoods, campuses, and communities to physically isolate themselves from a disabled wider grid system during an outage. All of these options require regulatory leadership in terms of authorizing inquiries into grid resiliency, approving cost recovery mechanisms, and designing rates that encourage innovative solutions. This paper offers options and recommendations for identification of grid weaknesses and solutions; investments in software and cloud-based information data systems; investments in hardware and assets to strengthen reliability; and rate designs that complement these policies.
Comments Off on If Europe Wants Integrated Markets, it Should Take the Leap to Regional Grids
Europe is progressing towards an integrated, interconnected pan-European electricity market. However, the governance and regulatory arrangements that the EU has established to support this process are inadequate to the task. They are more focused on preserving the sovereignty of national TSO and regulators than addressing the wider interests of the market. According to Baker, the EU needs to create genuine regional markets with regional regulators and system operators similar to the Regional Transmission Organizations in North America. Eventually, this should lead to the creation of an EU regulator and EU system operator.
Electricity market integration is progressing across Europe towards the goal of a truly pan-European electricity market, albeit more slowly than originally envisaged. At the same time, Europe’s generation portfolio is rapidly changing, with the introduction of renewable, often intermittent, generation capacity that will replace aging and inflexible fossil-fired plant as Europe advances toward its decarbonisation targets.
Market integration and decarbonisation will, however, bring many challenges, not least in operating Europe’s interconnected transmission grid. Not only will the grid need to be reinforced and interconnection between Member States increased, it will also need to achieve much higher levels of utilisation if the benefits of market integration are to be fully realised. In addition, increasing amounts of intermittent renewable generation such as wind and solar will cause transmission flows to become more volatile and more difficult to predict.
Coordinating Outages
Ensuring security and safe operation in the face of these challenges will require significant changes to the way Europe’s interconnected electricity grid is managed. In particular, national transmission system operators (TSOs) will need to cooperate more closely in coordinating outages, carrying out security assessments, calculating available grid capacity, and preparing regional operating plans to be implemented in real time. In fact, this process is already underway with the development of Network Codes that aim to harmonise market and grid operation activities across Europe, and with the creation of regional security coordination service providers (RSCSPs) that provide a regional short-term planning capability. Building on experience with Coreso, the first RSCSP, these facilities will eventually cover all of Europe and provide services to Europe’s 42 TSOs.
Once fully established, the RSCSPs will collect real-time data on the status of all of Europe’s national transmission networks and the power flows between them. Collectively, they will provide a unique real-time oversight of the state of Europe’s interconnected transmission grid that no individual TSO could possibly have. However, despite this potential, the RSCSPs will have no executive powers and their activities will be restricted to providing planning services to individual TSOs, who can choose to accept or reject those services and who will retain full control of and accountability for the short-term planning and real-time operation of their individual networks.
Given the challenges that market integration and decarbonisation will impose in operating Europe’s interconnected electricity grid, this situation represents something of a lost opportunity and does not seem tenable in the longer term. As market integration and decarbonisation progress, the efficient and safe operation of the interconnected grid will demand that decisions are taken on a regional, and ultimately pan-European, basis.
Power flows are governed by the laws of physics rather than national boundaries, while power markets will reveal deeper cost savings when resources can be shared across broader market areas. Plus, operating a highly interconnected electricity grid at higher utilization rates and, at times, much closer to its operational limits will require a much greater degree of centralised planning and real-time operation. The currently envisaged RSCSP arrangements, providing only for advisory “coordination” in planning timeframes is an inadequate response to these challenges.
US and Canada
Insights into how the operation of Europe’s interconnected transmission grid may be better organised to face the challenges that lie ahead may be gained by looking at the Regional Transmission Organizations (RTOs) established in North America. Direct comparisons between Europe and North America should be made with some caution given differences in the political, regulatory, and governance environment—the European Union is a collection of sovereign Member States rather than a federal entity, has no overarching electricity regulator, and has a very different electricity market model.
However, RTOs were designed to address many of the challenges that Europe is currently facing, including improving market efficiency, planning and coordinating investments in linked transmission assets among multiple utility owners, and providing real-time control of those assets on a regional basis. Since 1999, ten RTOs have been created in the US and Canada, with seven of them serving about 2/3rds of the US customer load. Europe may therefore have something to learn from the arrangements that have developed on the other side of the Atlantic.
Over time, Europe’s RSCSPs could grow to look more like RTOs. Rather than just providing short-term planning advice to national TSOs on a “take it or leave it” basis, the RSCSPs could take on decision-making responsibilities for all “market-critical” assets (i.e. those assets that significantly impact market operation) in these timescales, providing regionally coordinated plans to be implemented by individual TSOs in real time. As market integration progresses, and the focus moves from implementation to realising the very substantial economic and welfare benefits of efficient market operation, the RSCSPs could begin to exploit their unique access to regional real-time data. Using these data, they could provide real-time operational oversight of the interconnected grid, much as the RTOs do in the United States.
Ownership of all transmission assets would remain with individual TSOs, as would the control and management of “non market-critical” transmission assets, i.e. those that do not significantly impact the operation of the integrated electricity market. Looking further into the future and the development of a truly European integrated electricity market, the activities of the various RSCSPs could be combined to provide the European-level oversight necessary for the safe and efficient operation of the European interconnected grid.
Fundamental Changes
For all this to happen, fundamental changes to Europe’s governance and regulatory arrangements would be required. Current arrangements seem more focussed on preserving the sovereignty of national TSOs and regulators, rather than addressing the interests of European electricity consumers or the functional needs of an integrated European electricity market supported by an interconnected electricity grid. Member States and national TSOs would need to surrender some of their responsibility for short-term planning and real time operation to the new RSCSPs in order for activities in these timescales to be “regionalised.”
Similarly, a European regulator would be required to oversee these regionalised activities and to regulate what would ultimately become a European System Operator. There is currently no clear locus of responsibility for regulation of cross-border market activity. National Regulatory Authorities would therefore need to cooperate via binding regional mechanisms or EU legislation would need to assign responsibility for regulating cross-border activities to the new European regulatory entity.
These fundamental changes would not need to happen overnight but could occur gradually to keep pace with the evolving needs of increased market integration and decarbonisation. Implementation would progress as the need developed and as confidence in the new arrangements became established. However, the logic of moving away from the current disaggregated arrangements where Europe’s interconnected transmission grid is operated by 42 independent TSOs, and developing a regional and ultimately European-level capability to support the secure and efficient operation of a fully integrated and decarbonised electricity market, seems irrefutable and the benefits to consumers seem irresistible.
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While utilities may own their own generating stations and power lines for distributing electricity to their customers, much of the operation of these assets occurs through their participation in a regional transmission organization (RTO), sometimes called an independent system operator (ISO). RTOs operate the transmission grid over a multi-state region on behalf of utilities—ensuring greater system reliability and reducing costs. As part of this process, RTOs “dispatch” power plants to start running as electricity demand increases, and they stop the plants when demand decreases. Typically, RTOs dispatch plants based on cost (lowest cost first), regardless of where in the multi-state region they may be located. As a result, overall cost and emissions implications can be complex, and may take little account of state borders.
Join us for a 60-minute webinar on April 20th, at 1:00 pm EDT, as veteran air and utility regulators David Littell of RAP and Doug Scott of Great Plains Institute examine:
The evolution of RTOs;
How RTOs work today;
The cost and emissions implications of their operations; and
How state policy decisions may affect these regional entities.
