NERC Warns about Impact of Coal, Nuclear Retirements on Resiliency

A report by one of the nation’s key bulk power system oversight groups seems to confirm what many in the baseload sector fear—that retiring too many coal-fired and nuclear power plants too early could extensively disrupt the nation’s grid resiliency.

The Generation Retirement Scenario report released by the North American Electric Reliability Corp. (NERC) concluded that the pace of retirements mainly revolves around large baseload, solid fuel plants. An Institute for Energy Economics and Analysis report earlier this month estimated that the U.S. will retire more than 15 GW of coal-fired capacity this year and more than 36 GW by 2024.

Close to one-third of nuclear power plants in this nation are scheduled for closing or will be losing money over the next three years, according to Bloomberg New Energy Finance.

“If these retirements happen faster than the system can respond with replacement generation, including any necessary transmission facilities or replacement fuel infrastructure, significant reliability problems could occur,” reads the NERC stress-test assessment released this week.

Resource levels at the state level and wholesale electricity market operators should carefully manage the pace of retirements and make sure that replacement infrastructure and generation sources are developed and placed into service, according to NERC.

The Trump Administration last year called for subsidaries to buoy fuel-secure power capacity such as coal and nuclear. It sent a proposed rule to the Federal Energy Regulatory Commission to consider some price supports for baseload.

FERC did not see a need for interfering in the market, but did ask independent system operators and regional transmission organizations to offer their concerns on resiliency. ISO New England, for instance, responded that it was vulnerable to a relative lack of natural gas infrastructure and supply, especially during the winter.

This week’s NERC report noted that gas-fired turbines are the predominant replacement for the retiring coal and nuclear, although renewable capacity is increasing significantly. Gas is ever cheaper and abundant, but might present future concerns because it is not stored on-site at power plants, but is moved by pipeline.

“The natural gas-fired generators are expected to provide the same, or at least adequate, levels of voltage support and frequency response as did the retiring resources,” the NERC assessment reads. “However, such a significant shift to natural gas-fired generation could leave the (bulk power system) more vulnerable to natural gas supply and transportation disruption events or curtailments if firm service and new pipeline capacity are not procured for these replacement resources.”

Fuel diversity is a key to providing resiliency for the power generation sector, NERC noted.

Recent U.S. Energy Information Administration figures indicate that natural gas accounts for close to 33 percent of the U.S. power generation mix, while coal and nuclear are at 30 and 20 percent, respectively. Renewables are rising to 17 percent with the exponential growth of wind and solar capacity. Hydropower still accounts for nearly half of that renewable total.

(Rod Walton is content manager for Power Engineering and the annual POWER-GEN International conference and exhibition, which includes sessions on coal, nuclear, gas-fired, on-site power, energy storage and renewables. He can be reached at 918-831-9177 and rod.walton@clarionevents.com).

 

 

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