As we approach the end of 2013, Texas’ power grid is soon to embark on a new clean energy path. While most people don’t get too excited about electrical transmission and distribution lines, the much awaited Competitive Renewable Energy Zone (CREZ) transmission project– set to come online in a few weeks and roll out through 2014 – could be the exception.
Approved by the Public Utility Commission of Texas (PUCT) in 2008, CREZ is a 3,600 mile transmission line that will connect remote West Texas wind energy to the eastern cities that need its power – 18,500 megawatts of power to be exact. This is enough power to energize 3.7 million to 7.4 million homes and increase available wind power supply by a whopping 50 percent.
Much like some other wind-rich regions in the country, wind in the West and Panhandle regions of Texas was partially unused, or curtailed, because local communities could not use all of the available supply and the state’s current, outmoded electric grid could not efficiently deliver the abundant energy to high-demand eastern cities. This "congestion" bottleneck forced wind farms to lower prices and at times pay the utilities to take their electricity. Read More
In the 1983 thriller WarGames, Matthew Broderick plays a teen-age computer geek who unknowingly signs onto a Pentagon computer while hacking into a toy company’s new computer game. Thinking that he’s simply playing a game called Global Thermonuclear Warfare, Broderick launches the game and nearly starts a nuclear war. The North American Electric Reliability Council (NERC) will hold its own war game next month with a simulated attack on the U.S. power grid.
The drill, called GridEx II, will take place on November 13-14 of this year. The participants will include 65 utilities and eight regional transmission organizations, representing most of the nation’s electricity customers. The drill will test how well the electric utility industry and the grid itself respond to physical and cyber attacks.
A NERC Critical Infrastructure Protection Committee (CIPC) working group will begin the drill by sending participants a series of simulated physical and cyber attacks, climaxing in a national security emergency. Participants will then respond and interact with each other, just as they would in a real emergency. The simulation will last 36 hours, and the CIPC working group will evaluate the participants’ responses and provide feedback on how their actions impact the ongoing scenario. After the drill, the working group will analyze the results and prepare a report on lessons learned.
Duke Energy is the largest utility in the United States, so of course it gets a lot of attention in its home state of North Carolina. Yet millions of residents in rural parts of the state rely on electric cooperatives, not Duke Energy, to keep the lights on. In fact, rural cooperatives serve all or part of the customers in 93 of 100 counties in North Carolina.
This is important because rural areas have just as much, if not more, need to increase energy efficiency. Case in point: a seven-county area in eastern North Carolina served by Roanoke Electric Cooperative. The cooperative has made great strides in promoting energy efficiency, yet there are still customers with utility bills that are higher than their mortgage payments some months. Close to half of Roanoke Electric’s customers live in manufactured homes, which typically have less energy-saving insulation than standard homes. And, in an economically-distressed region, few homeowners have extra money to pay for energy efficiency improvements, like caulking around windows or adding insulation.
Now, thanks to a new program offered by Roanoke Electric Cooperative, homeowners can secure low-cost loans from a private lender to make home improvements that will reduce energy use and save money. The loan is paid back on the monthly utility bill, reducing paperwork for homeowners and making repayment easier. In this program, the energy efficiency home loan is made by Generations Community Credit Union, a lending institution focused on assisting underserved rural communities in North Carolina. Homeowners can borrow up to $4,000 for improvements, with interest rates as low as 3.5%.
Last month, the Wall Street Journal reported on an initiative at an increasing number of companies nationwide: on-site, or distributed, power generation. There are many reasons for this growing trend in corporate sustainability, along with many ramifications for the prevailing utility model in the United States – all of which highlight the importance of employing market-based solutions to create a cleaner, smarter, more resilient electric system.
Why Do Companies Unplug?
For companies such as Walmart, increasing the use of distributed, renewable generation is a vital part of larger sustainability goals, including increased use of clean energy and a call for safer ingredients used in the products the company sells. To be sure, however, even the most altruistic companies would be hard pressed to shift off the power grid without sound economic reasons.
A confluence of market factors, including tax incentives that spur attractive returns on investment, advances in solar and wind technologies and policies that encourage greater use of and investments in clean energy (like net metering and time-of-use pricing), has created an economic environment that makes distributed generation not just a viable option, but often a very attractive one. Further, off-grid power can be an effective way for companies to hedge against outages due to storms or unforeseeable catastrophes, a key idea included in the Hurricane Sandy Rebuilding Strategy.
Progressive Power Providers Show a Path Forward
Traditionally, electric utilities have been in the business of providing reliable power to their customers. Prices for each class of customer are fixed by state regulators and a customer’s choice is pretty much limited to whether they want to turn on the switch or not. Much of the EDF Smart Power initiative is focused on helping to create new utility business models that change this paradigm by increasing customer choice, providing market feedback on these choices and incentivizing the use of cleaner sources of power.
Several electric utilities are getting ahead of the curve by embracing these changes. While both own large fossil fuel assets, NRG Energy and NextEra Energy have also been developing utility-scale and distributed renewable generation projects across the country. NRG Energy develops solar and other renewable projects for government, commercial and other institutional customers, and NextEra Energy, the largest generator of wind and solar power in North America, develops and finances large commercial and small utility solar projects through its subsidiary Smart Energy Capital. Cumulatively, they have provided more than 110 megawatts of distributed solar generation capacity to schools, government and commercial facilities, among others.
Over the past week, two other energy providers, Direct Energy and Viridian, have announced deals with SolarCity to offer no-upfront cost solar installations to their current and prospective customers. In many cases, these solar installations will provide clean energy at a lower cost than the customer currently pays for dirtier, fossil fuel power. Direct Energy even took it a step further by agreeing to provide part of the financing for their customers. Since there are few investors that currently finance solar projects, Direct Energy can expect to earn a very attractive return on their investment. While solar financing has been around for several years, Direct Energy and Viridian can now offer customer solutions that bundle solar installations with other energy services.
Source: Winning Communities
Around 20% of the US population lives in an area that is classified as “rural.” The US Census Bureau defines an urban area as a territory with a population of at least 50,000, or a cluster of 2,500 to 50,000 people. Rural is then defined as anything outside of that definition. Rural areas face particular challenges when it comes to energy and water use. For example, utilities are met with higher costs and often find it harder to implement new clean technologies to modernize their energy infrastructure because of the great distances between customers and an irregular patchwork of reliable resources. Besides, many system planners and thought leaders for innovative energy technologies live in urban or suburban areas and may find it harder to relate to the specific challenges of rural settings.
It’s likely that climate change will impact rural communities in different ways than it will urban areas, due to a number of factors including the types of common occupations, poverty levels and demography. Of particular concern is the “climate gap”, which refers to the lower economic and physical adaptability of rural communities. It will vary based on region, but research indicates that rural communities in the Southeast and Southwest could face particularly dire circumstances due to changes in electricity prices and water scarcity.
Over the past few weeks, I’ve written a number of posts to help shed light on the fundamental connection between energy and water. Because many of our energy sources gulp down huge volumes of water, it’s imperative that we break down the long-standing division between energy and water planning — especially in drought-prone states like Texas. I’d like to take a step back and look at how Texas’ neighbors are addressing energy and water co-management. While Texas may be an extreme example, looking toward its immediate neighbors could provide ideas and best practices to improve the state’s situation.
A number of western states are facing many of the same challenges as Texas. Electricity production is a major drain on the region’s water supply. A study co-authored by Western Resource Advocates and EDF showed that thermoelectric power plants, such as coal, natural gas and nuclear, in Arizona, Colorado, New Mexico, Nevada and Utah consumed an estimated 292 million gallons of water each day in 2005 — roughly equal to the amount of water consumed by Denver, Phoenix and Albuquerque combined (and we’re talking water consumption, not just withdrawals). Like Texas, the western states face a future of prolonged drought. Scientific models predict climate change will increase drought throughout the Southwest, placing greater stress on the region’s delicate water supply.
Additionally, electricity production, numerous thirsty cities and widespread agricultural activity all strain the water system, too. Because so many flock to western states for fishing, kayaking, rafting and other recreational water activities, setting the region’s water system on a sustainable path is a critical economic issue. The exceptional challenges facing western states have already prompted some states to consider the energy-water nexus when planning to meet future water and electricity needs. Read More
This commentary originally appeared on EDF's Voices blog.
Source: Department of Energy Solar Decathlon/Flickr
These days, the future is often in the news. It’s not uncommon to come upon articles about cars that drive themselves, vacation trips to space, and automated smart houses a la the Jetsons.
I don’t know much about space tourism or self-driving cars,
but I do know that smart homes and the associated technologies are already allowing for the possibility of environmental benefits and economic savings that are nothing short of futuristic.
Our utility grid is the largest machine in world. Unfortunately, however, this machine exacts human and environmental costs all the way down the line — from extraction to combustion. But we’re at the beginning of an energy revolution in home energy management systems that may make consumers key players in solving these problems.
If Ben Franklin lived today, he might say that nothing is certain but death, taxes and cyber-attacks. Cyber-attacks occur when individuals or groups hack into another group’s computer information systems to steal, alter or damage key infrastructure. Our nation’s electric grid is under constant attack according to a survey of electric utilities by U.S. House Representatives Henry Waxman and (now) Senator Edward Markey. The grid was the greatest engineering achievement of the 20th Century, but cybersecurity was equally unknown to those grid engineers as it was to Ben Franklin. We need to do more to protect our energy infrastructure.
The U.S. has finally called out China for repeated and pervasive cyber-attacks. Mandiant, a cybersecurity firm, released an alarming report in February 2013 regarding the ongoing cyber-attacks by the Chinese army. James Clapper, the Director of National Intelligence, described cyber-attacks as a soft war already underway and a dire global threat in his April 2013 World Threat Assessment to the U.S. House Permanent Select Committee on Intelligence. In May of this year, for the first time, the Pentagon’s annual report to Congress on the Chinese military openly accused China’s military of repeated cyber-attacks on the U.S. government and defense contractors.
Cyber-attacks are underway not only by China, but also by Iran, Russia, Al-Queda, organized crime, industrial spies, ex-utility employees and rogue hackers. The U.S. Department of Homeland Security investigated over 200 serious cyber-attacks against critical infrastructure during the first half of 2013. The electric grid was targeted in over half of these attacks. At the recent Black Hat security conference in Las Vegas, Cyrill Brunschwiler of Compass Security explained how the smart grid’s wireless network can be easily exploited to steal electricity and to cause massive blackouts. Though innovation and new clean energy technologies are key to modernizing our antiquated energy system, the electric grid is more vulnerable to cyber-attacks with increased use of smartphones, tablets, mobile apps and electric vehicles to connect with our home electronic devices. A July 2012 report by the Government Accountability Office (GAO) outlines the various threats to the electric grid.
The electric utility industry faces the risk of declining revenues as more customers install solar panels on their homes and businesses. Solar power currently supplies 2% of the country’s electricity needs, and is projected to grow to 16% by 2020. In 2013, solar panel prices for commercial installations fell 15.6%, from $4.64/watt to $3.92/watt. To protect their revenues, some utilities are raising electricity costs for solar panel owners – but with mixed results. Credit ratings agencies are also expressing concern. Is there real cause for alarm or are these companies crying wolf? Judging by one customer segment – big-box retailers – the threat is real.
The Solar Energy Industries Association (SEIA) ranks U.S. companies based on their solar energy capacity, and the top five companies on the list are big-box retailers:
- Walmart tops SEIA’s list with 65,000 kW of solar power, which is enough to supply the annual energy needs of over 10,000 homes. They recently installed ten new solar rooftop systems in Maryland, totaling more than 13,000 panels. Walmart is the largest retailer in the U.S. and in the world by revenue, with 4,423 U.S. stores and over 10,000 stores worldwide. Walmart and EDF have been working together since 2004 to reduce the Walmart’s environmental footprint. With more than 200 solar installations across the country, Walmart plans to have 1,000 solar installations by 2020. Walmart’s goal is to eventually supply 100% of its energy needs with renewable energy.