Tag Archives: PJM

FirstEnergy and the August 2003 Blackout

The biggest power outage in North America occurred on August 14, 2003.

Why should Marylanders take another look at FirstEnergy’s role in that event?  In the first place, the blackout cascade originated from FirstEnergy’s Ohio territory and spread to neighboring states.   There’s also the fact that proponents of building massive new “coal-by-wire” transmission projects keep bringing up the August 2003 blackout.  This includes FirstEnergy’s proposed merger partner Allegheny Energy who wants to build the PATH power line in Maryland.

Coal-by-wire proponents raise the blackout danger in a thinly veiled attempt to intimidate public officials into approving their wasteful and unnecessary — though very profitable — projects.  If you examine the PATH application (Case 9223) before the Maryland Public Service Commission (PSC), then you will find numerous references to blackouts, including a specific reference to the August 2003 blackout on page 24 of the PATH-supplied testimony by PJM transmission planner McGlynn.  (McGlynn chairs the PJM Transmission Expansion Advisory Committee whose approval of PATH qualified it for FERC’s special 14.3 percent incentive rate of return.)

Unfortunately for PATH proponents, there is no evidence that the August 2003 blackout was caused by a lack of transmission capacity.  A recent report from the Congressional Research Service concluded:

as discussed in the official blackout report and other analyses, the 2003 blackout was not caused by a utility having built too few transmission lines, or because power line towers and substations were falling apart. The blackout was apparently due to such factors as malfunctioning if not obsolete computer and monitoring systems, human errors that compounded the equipment failures, mis-calibrated automatic protection systems on power plants, and FirstEnergy’s failure to adequately trim trees.  (p. 31, emphasis added.)

PATH proponents can’t resist exploiting the blackout talking point because the August 2003 was a big deal that impacted nearly 50 million Americans (and 10 million Canadians).  Michigan Governor Grantholm described the impact of the outage that spilled over from Ohio in Congressional testimony.  The Michigan Public Service Commission issued its own report on the disaster and had some rather unflattering things to say about FirstEnergy’s role.

In his Congressional testimony, FirstEnergy CEO Peter Burg listed several generators which were off-line on that fateful day:

FE units Davis Besse Unit 1 (880 MW), Sammis Unit 3 (180 MW), and Eastlake Unit 4 (240 MW) were off-line for maintenance outages.

This makes it sound as though the Davis Besse nuclear plant outage was routine whereas in actuality that plant was in the midst of a two-year outage caused by what may be the worst nuclear incident since Three Mile Island.

The Michigan report goes on to describe what happened:

…FirstEnergy’s Davis Besse nuclear plant had been out-of-service for some time. It appears that, with the Davis Besse nuclear plant off-line, the tripping of Eastlake Unit #5 was a major event in the northern Ohio region. FirstEnergy was left in a precarious position as far as meeting its load on that day. Power had to come from other sources in order to meet the requirements of the FirstEnergy system. (See page 18.)

All agree that coordination and management problems contributed to the crisis.  MISO is the Midwest Independent System Operator that supervises the transmission system in the Midwest:

According to the MISO telephone transcripts, MISO called First Energy at 3:43 p.m. and questioned FirstEnergy about the Hanna-Juniper line. The FirstEnergy operator was not able to respond to MISO’s questions and said that he didn’t know, that he would have to take a look. MISO requested that FirstEnergy call it back. At 4:04 p.m., FirstEnergy called MISO and stated that they had some problems. The FirstEnergy operator still seemed unsure about exactly what was happening. The operator lists a number of lines that are “off”, the Eastlake Plant unit that had gone off-line earlier in the day and the Perry plant that was “having a hard time maintaining voltage”. The FirstEnergy operator then asks MISO what it has going on. When MISO responds that FirstEnergy Hanna-Juniper line is open, the FirstEnergy operator questions that. MISO responds that it had discussed this with FirstEnergy earlier. The FirstEnergy operator states that they have “no clue” and the computer is “giving us fits.” A FirstEnergy control room operator told a MISO technician minutes before the blackout, “We don’t even know the status of some of the stuff around us.” (See page 19.)

Readers are encouraged to review the Final Report of U.S.-Canada Power System Outage Task Force to better understand this complex event.

If the merger of FirstEnergy and Allegheny is consummated, then FirstEnergy will be operating transmission lines in Maryland.  Furthermore, they will be the owner of the proposed PATH power line.  The Maryland PSC certainly ought to take a close look at FirstEnergy’s role in the August 2003 blackout.

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Electric Cars, Carbon-dioxide Emissions and Air Conditioning

Nissan has released pricing details on its forthcoming electric vehicle, the Leaf:

Contrary to some of the recent rumors, at a base price of $32,780 it is relatively affordable… so affordable, in fact, that, after the $7,500 federal tax credit, Nissan is able to offer the LEAF for a lease price of $349 a month not including generous state incentives. When you add in some of those — like a $5,000 tax credit in California, up to $6,000 in Colorado, $5,000 in Georgia, and $1,500 in Oregon — all of a sudden you might be talking a final price of around $20K. [emphasis added.]

If that assessment by Gas 2.0 is correct, then the Leaf will be less expensive than the Toyota Prius.  And, if this combination of incentives and pricing strategy holds for other companies including GM’s Chevy Volt, then we could see a serious, industry-wide rollout of electric vehicles over the next several years.  This would be in stark contrast to the half-hearted and sporadic attempts of the past.

Adoption of EVs, including plug-in hybrids and electric-only, will start small and grow gradually over many decades.  Nevertheless, it seems to be on the way “for real” this time.  Which means that we all need to think carefully about the possible impacts of this development.  After all, the automobile has been at the center of American life for a century, for better and for worse.  Cars and the power grid dominate the thorny issues of air quality and greenhouse gas emissions, problems for which we have yet to fashion satisfactory regulatory mechanisms.

Energy security is another over-arching concern and here the impact looks to be unambiguous.  Electrification will reduce the amount of petroleum used in personal transportation.  As total U.S. oil use falls, so will imports.  This will moderate pressure on the U.S. trade deficit and balance of payments and reduce our economy’s vulnerability to price risk going forward.  The quantity we import may decline but this will have little impact on the price of oil which is now dominated by economic conditions in Asia.

Electric vehicles will also be positive for local air pollution.  The big question concerns carbon dioxide emissions.  Fuel mix varies in different regions of the country, as reliance on combustion of carbon-intensive coal to generate electricity varies from state to state.

The accompanying graph shows that the greenhouse-gas benefits of plug-in hybrid electric vehicles (PHEVs) are a function of the carbon intensity (X axis) of the power grid.  (See the recent presentation by Dr. Constantine Samaras.)

Maryland is part of the PJM Interconnection, the private regional transmission operator.  PJM controls the dispatch of generation for load throughout our fourteen-state (counting DC as a state!) region.  PJM’s dispatch rules ignore the environmental impact of fuels so coal-fired generation is used when it’s profitable.

It turns out that fuel mix varies greatly by time of day and season of the year.  At night, on the PJM system, demand is very low and is supplied by nuclear power plants and wind mills because they are the cheapest to run (which is different from the cost of building new plants!)  In other words, night-time power is pretty much carbon free.  During the day, as power demand (“load”) ramps up, coal-fired and natural gas-fired plants are switched on at PJM’s command.  Power generated during the morning and evening peaks on PJM is very carbon intensive as PJM gets the greater share of its total energy from coal-fired plants.

Hence, the impact of electrification within the PJM region on carbon emissions depends mainly on whether cars are re-charged at night or during the day.  PJM and other grid operators are preparing for sophisticated, two-way power connections with electric-vehicle batteries, allowing for charging to occur at optimal times (see the recent report from KEMA and the ISO/RTO Council).  Time of day pricing might provide some financial incentive for night-time recharging (although the incentive effect will be softened because the contrast with gasoline fuel costs will be so dramatic).  Exploiting the storage capacity of electric vehicles may allow better use of offshore wind.

Analysis to date has focused on the predictable behavior of fleets (like the U.S. Postal Service) and normal commuting patterns.  This allows for shifting recharging to the low-carbon night-time hours.  However, consumers can be unpredictable and the most favorable outcomes depend on several difference pieces of infrastructure most all be in place and working smoothly together.

Air conditioning looms as one challenge.  Air-conditioning usage in homes and buildings drives summer peak demand currently.  Electrifying vehicles will ADD to this peaking behavior, a factor that energy planners will need to consider.  This could have negative implications for carbon emissions and grid reliability.

We could all sleep better at night — while re-charging our EVs — if we knew that we had a stable and sensible GHG-management policy in place BEFORE we embark on massive new investment in electrifying our transportation system.  One can dream.

[Prius drivers know how AC cuts their miles per gallon.  Toyota now offers a “solar roof” option that uses a PV panel to power a ventilation fan to cool the passenger compartment while the vehicle is parked.  This reduces (at great expense) the AC demand on start-up.]

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Maryland Needs Electric Cars to Use Offshore Wind

The looming electrification of the auto fleet raises a host of important questions, ranging from restructuring manufacturing to the impact on oil imports.  Lost in all this mayhem are the benefits to Maryland’s electricity sector.  (Maryland has announced a $1 million grant program to encourage electric vehicles.)

We’re talking about vehicles that connect to the grid: PHEVs and EVs.  These will mostly charge overnight and store enough power for a round-trip commute.  The batteries in these vehicles are not like the ones you pop into a flashlight or camera.  They are complex storage systems that include sophisticated computer controls that can be integrated with power transmission information systems.

Our electrical grid is in desperate need of storage.  Grid-connected car batteries could perform two very useful functions in Maryland, where transmission is controlled by PJM Interconnection.  These are frequency control and storage.

Frequency control has to do with the delicate balancing act required to maintain the entire power network at 60 Hz (so that clocks won’t run too fast or too slow).  Tiny changes in power are needed to achieve this balance between the massive generation plants and the small, unpredictable changes in load.  (Hour-by-hour changes are more predictable.)  It is difficult and costly for large generators to provide this service.  However, it could easily be provided by a network of auto batteries.  Only a relatively small amount of each battery’s capacity would be required at any time — one percent or so.  PJM would happily pay car owners for this service.

A bigger benefit is the overnight storage capacity.  EVs and PHEVs could be charged when the price of power is lowest — in the early morning hours.  Even with only 3 GWs of wind on the PJM network, the market effect is already significant.  Because the wind blows more at night in the Appalachians and nuclear plants must run at some minimum rate, the cost of generation can be zero during the early morning hours.  This will make electric veheciles ven more economical and low carbon for their owners.

Connecting more wind to the grid will only add to the problem of producing power when it’s not needed.  Increased storage is necessary in order to accommodate more wind — like the massive offshore resources available to Maryland and other coastal states.  Electric vehicles are the best near-term prospect for adding significant storage capacity.

This is why the University of Delaware’s Professor Kempton, a foremost exponent of offshore wind development, favors the rapid introduction of grid-integrated electric vehicles.  Offshore wind and grid-integrated vehicles must develop in tandem.  (UD owns several plug-in vehicles that are already integrated with PJM’s frequency control system.)

PJM needs offshore wind in order to reduce its massive carbon bigfoot.

You can peruse recent presentations on this topic by Professor Kempton and a PJM representative here.

Grid-connected vehicles providing distributed storage will also bring significant benefits in managing the reliability of the grid.

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Peak Demand Falls — PJM Cancels Capacity Auction

PJM Interconnection, the private corporation that manages the regional transmission system including Maryland, has cancelled one of their regular capacity auctions.

These auctions are based on forecast of peak demand during the hottest summer months. Local utilities must purchase contracts for generation capacity to ensure that they will have sufficient power to meet peak demand.

Even before the current recession, demand forecasts were falling because of increasing energy efficiency.

Sent: Thur 02.04.2010 1:01 p.m.

Subject: 2011/2012 Second Incremental Auction Cancelled

Dear Members,

This is to inform PJM Market Participants that the RPM Second Incremental Auction for the 2011/2012 Delivery Year originally scheduled for July 12, 2010 has been cancelled. Through the 2011/2012 Delivery Year, Second Incremental Auctions are conducted only when there is an increase in the RTO’s unforced capacity obligation due to a load forecast increase. As the 2010 RTO peak load forecast for the 2011/2012 Delivery Year is lower than the peak load forecast used in the 2011/2012 Base Residual Auction, the 2011/2012 Second Incremental Auction is cancelled.

Please direct any questions to the RPM Hotline at rpm_hotline@pjm.com.

This provides further ammunition for those who say that PJM’s proposed multi-billion-dollar coal-by-wire transmission projects are not needed.

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A Maryland Strategy for Summer Peak Demand?

Peak summer demand drives the electricity system in important ways.  It determines the minimum amount of generating and transmission capacity that must be on hand.  It drives costs as generation capacity must be kept on standby for peak periods.  Peak demand activates more costly, less efficient and even more polluting generation capacity.  Projected increases in peak demand may tempt system planners into wasteful and controversial transmission expansion plans.  And Maryland clearly needs more leverage in regional power markets.

There must be a better way.  There is — take targeted measures to lower peak demand.

The steady growth of peak demand arises largely from the design of our power market that shelters users from the actual costs of generating power during the hot summer months.  If those astronomical costs were passed through, hour by hour, then users would have a strong incentive to cut back.  Until political leaders are willing to inflict those costs on voters (instead of spreading them over twelve months of electric bills), we need other tools.

The problem centers mainly on air conditioning usage by residential and commercial customers during periods of hot and humid weather.  Thanks the climate change, this will only be more of a challenge in coming decades.

By moderating electricity consumption during hot summer months, we can better control the financial and environmental costs of our power system.

Here are some steps we can take:

1. Cool Roofs.  Roofs that reflect the heat of the sun can lower cooling costs significantly.  While buildings and conditions vary widely, an EPA report found an average savings of 20 percent.

2. Solar PV. The installation of photovoltaic systems on homes, farms and businesses could be greatly accelerated through a program modeled on Germany’s highly successful “Feed-in Tariff.”  After all, there is plenty of sun on hot summer days.  It’s a dependable source of peak power.  SB 355, introduced by Maryland Senator Pinsky and six others is a positive step in this direction.

3. Ice Storage. New systems that retrofit onto existing commercial AC units use cheap power at night to make ice.  During the day, AC refrigerant is cooled by the ice instead of the AC’s compressor, cutting power use dramatically.  The Southern California Public Power Authority has announced a utility-scale project with Ice Energy.

4. Demand-side management. This term includes programs that allow utilities to control residential air conditioners from a central location, through radio or internet controlled switches mounted on AC units.  Customers get a lower bill in exchange for allowing the utility to cycle off their AC for a few minutes every hour.  A local example is the Pepco’s Energy Wise Rewards program.  (This is a revival of Pepco’s similar Kilowatchers plan that was strangled in 2004 by the perverse incentives of Maryland’s deregulation legislation; 162,000 customers took part according to the utility.)

5. Weatherization. We often associate improved insulation with warmth in winer but it also pays off during the hot months.

6. Energy-efficient air conditioning.  Incentives are available to help homeowners replace their old AC units with more efficient ones.  However, without the other elements of a comprehensive strategy for managing peak demand, this step by itself may not be the most cost-effective one for homeowners or society as a whole.

Bits and pieces of this approach are available in Maryland already.  To really make a difference, these components need to be highlighted and accelerated.  The hot days of summer are only a few months away!

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Coal-by-Wire PATH Transmission Project Opposed in Three States

Power corporations American Electric Power (AEP) and Allegheny Energy (AYE), backers of the Potomac-Appalachian Transmission Highline (PATH), would like investors and rate-payers to think that this “coal by wire” plan is a “done deal.” Nothing could be further from the truth.

Construction on the project cannot begin without the approval of public utility commissions in three states. Here’s a round-up of recent action.

In West Virginia, a prairie fire of individual intervenors — more than 250 — has startled the West Virginia Public Service Commission.  Six of the state’s county commissions have intervened.  The WVPSC’s first public hearing on PATH is set for Monday, August 10.  Residents facing the loss of their land through eminent domain want to know how the state will benefit from a project that provides no new electricity to West Virginia rate-payers.

In Maryland, the state’s Public Service Commission asked some very pointed questions about the PATH application at their first hearing on Friday, July 31.  At the very least, more time will be needed to resolve key legal issues.  The PATH education effort has hit YouTube.

In Virginia, PATH opponents turned out in force at a public hearing of the State Corporation Commission in Winchester.  Republican Congressman Frank Wolf led those voicing opposition.

The PATH project is the unfortunate result of a distorted and irrational regional transmission planning process.

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Economist Challenges PJM’s Distorted Planning Process

Tomorrow, I’ll be in Annapolis, Maryland, for the Maryland Comprehensive Energy Outlook Advisory Committee Meeting.

My prepared remarks challenge PJM‘s “hair of the dog” approach to climate change adaptation: If heat waves are getting worse because of carbon emissions, heck, just burn some more coal!

“PJM’s ‘transmission-only’ planning process produced an illogical result: In order to meet the growth in peak demand that is partly driven by climate change, we should burn more coal.”

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