Adding Renewable Energy to the Power Supply Will Challenge Planners to Maintain Reliability

The Council's Draft 2021 Northwest Power Plan envisions a future with more electricity from renewable sources, particularly solar and wind, and less from generating plants fueled by coal and natural gas. The plan recognizes that as this happens the power supply will have to be carefully managed to ensure it remains adequate and reliable as we rely increasingly on sunshine and wind to power our homes and businesses.

The Council is not alone in recognizing that the future will be much different than the past, as presentations on the integrated resource plans (IRPs) of two Northwest investor-owned utilities demonstrated at the Council's October meeting. While the Council's plan looks at the entire region, the utility IRPs focus on their service territories and identify similar concerns.

Ben Fitch-Fleischmann, energy supply and planning manager for Northwestern Energy, a Montana utility, said the 2020 supplement to the utility's 2019 Electricity Supply Resource Procurement Plan identifies a concern about reliability of the power supply as large amounts of renewable power come online.

"The region faces an increasing probability of near-term deficits in its power supply during peak load conditions, and the chance of shortages is expected to grow unless the region invests in new capacity," he said, quoting from the plan. He said recent outages in California suggest that shortages may be arriving sooner than expected, and that the outages occurred because, according to the utility's plan, "resource planning targets have not kept pace to lead to sufficient resources that can be relied upon to meet demand in the early evening hours."

In other words, when the sun goes down or the wind dies, solar and wind generators stop producing, and it is increasingly difficult to build new power plants that burn fossil fuels. In fact, many aging and inefficient fossil fuel plants, particularly those that burn coal, will be retired over the next decade. Northwestern is concerned about how the power supply remains adequate during the typically high-demand early evening hours as people arrive home from work, cook dinner, and turn up their furnaces or air conditioners. This is a problem the Council's draft power plan identifies, as well.

In the resource development section, the draft power plan states: "the electric grid is shifting to renewable resources at an aggressive pace; this shift, along with the speed at which the system must react to demand for power, creates potential risks to system operations." The answer, according to the plan, is to pay close attention to supply and demand: "It is through the efficient management of these resources that the region will assure a reliable and economical power supply."

Northwestern's plan also recognizes the benefit of efficient management, while localizing the issue to its circumstances.

"NorthWestern currently stands out among our regional neighbors as the utility that relies most heavily on others to meet peak needs," the plan states.

NorthWestern can't expect other utilities to add sufficient capacity to meet NorthWestern's needs in addition to their own. So it is important that utilities across the region "… are taking action to maximize the cost-savings from coordinated and efficient sharing of generation resources by taking advantage of geographic diversity in the timing of renewable generation and peak loads," according to the plan.

NorthWestern's plan supports efforts to address the diversity of utility loads, which are affected by weather conditions, by improving the coordination and sharing of generation and, as a result, reducing the cost of maintaining a reliable and adequate power supply. Sometimes, utilities just get lucky. Fitch-Fleischmann recalled a recent winter cold snap during which energy from the Colstrip power plant in Montana could not be exported to a utility west of the Rockies that is a part owner of the plant, and so Northwestern was able to buy the energy for its own use.

While taking advantage of such emergencies is not a desirable type of coordination among utilities, it is an example - if an extreme one - of how decisions about the power supply that are made in one area of the West can affect the power supply in other areas. The Council's plan recognizes the need for better coordination of the power supply throughout the West in response to shifting demand and generation.

"Because our region is connected to the rest of the West, policies and decisions outside the region have an impact on our adequacy," the plan states in Section 4, which addresses regional power reserves and reliability requirements. The draft plan continues: "With the anticipated pace of development of renewable resources and the currently announced generating resource retirements outside the region, our analysis shows shifting market dynamics impacted by surplus renewable generation as soon as 2025. … The region should be mindful of this adequacy challenge and attempt to make resources more accessible to help navigate these near-term challenges."

The Council's plan predicts that it likely will be necessary, given these changes, to "rethink how system capacity needs are measured and what different resources accomplish in providing for those needs." NorthWestern's plan says essentially the same: "Efforts to develop a program to coordinate the sharing of resources will allow the region's utilities to capture potential benefits of diversity in loads and weather-driven generation and thereby reduce the total cost of a reliable and adequate power supply for the region as a whole."

Meanwhile, the 2021 IRP of PacifiCorp, a Portland-based utility that serves customers in several western states, identifies future investments in renewable energy including solar, wind, batteries, and pumped storage, as well as advanced nuclear power, demand response, energy efficiency, and modernized transmission in order to meet future demand for power. Like the Council's draft power plan, PacifiCorp's 2021 IRP accounts for the retirement of inefficient coal and natural gas power plants and replacement of that generation with thousands of megawatts of energy efficiency and renewable power, primarily solar with storage, and wind.

Shay LaBray, PacifiCorp's vice president of resource planning and acquisitions, said implementation of the IRP should result in a 74-percent reduction in greenhouse gas emissions from 2005 levels by 2030, and a 98-percent reduction by 2050. The IRP also envisions several new transmission projects that will improve grid resiliency and power system reliability.

"By investing in resilience, through expanded transmission lines, a hardened grid, and a diverse, increasingly clean portfolio, we are delivering on our commitment to ensure safe, reliable, affordable power for our customers, now and for generations to come," she said.

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