A drought-stricken West is bracing for what is expected to be a hot, dry summer and its strain on a regional power grid that some believe is certain to fall short of demand and leave many in the dark.
The Western Electricity Coordinating Council, which oversees electricity grids throughout the Western U.S. and Canada, estimates Nevada, Utah and Colorado could have a power shortfall equivalent to 34 days this year without power imports from other states. Arizona and New Mexico could be short enough hours to total 17 days. Washington and Oregon could face a shortfall of hours totaling nine days.
There are two reasons behind the power shortfall: Climate change is making it harder to forecast demand for electricity while the shift to clean energy is straining power supplies, according to a report by Bloomberg.
The reasons behind the shortfall are two-fold: Climate change is making it harder to forecast demand for electricity while the shift to clean energy is straining power supplies.
Thanks to the region’s surplus of hydroelectric power, Washington and Idaho aren’t facing the blackout risk this summer, but demand is anticipated to increase how much utility companies could pay for electricity.
That’s because Washington is part of the Western Interconnection, a power grid consisting of 136,000 miles of transmission lines that carry power from hydroelectric resources in the Pacific Northwest to California and other states. Utilities routinely import power from out of state, sourcing electricity to where it’s needed across the transmission lines.
“We are basically tied to what happens in the Western electric grid. It’s a big machine. It stretches a lot of distance,” said Ben Kujala, director of power planning for the Northwest Power and Conservation Council, a regional organization that develops and maintains a regional power plan, as well as a fish and wildlife program. “There can be small local issues that have very limited effects. But, if it becomes a shortage or they’re looking for energy around the entire West, it’s something that will have impacts. Now, those impacts are not that the lights are going to go out. Generally, it’s that the power is more expensive.”
At the Palo Verde hub in Arizona, prices have nearly quadrupled since last summer’s outages, while prices have tripled at the Pacific Northwest’s Mid-Columbia hub, one of eight electricity trading hubs in the Western U.S., according to Bloomberg.
“People are kind of anticipating similar challenges (to last year) and so there’s some very high prices showing up in the summer right now … If (utilities) have to go out and buy power in the market, they’ll be looking at a premium for that power,” Kujala said. “Because there’s a lot of people in California that are buying power, hoping to not have a repeat of the circumstances they saw last time.”
Last year, California experienced rolling blackouts for the first time in nearly 20 years.
Jason Thackston, senior vice president of energy resources at Avista Corp., echoed that prices for the summer are higher compared to prior years.
“We’re already seeing market prices for the summer higher than we would normally expect to see them as a result of a couple of things,” Thackston said. “One is the drought conditions that California and the Southwest are experiencing. And we’ve seen a drier than normal spring, so we’re seeing less hydro generation predicted across the Western U.S. Then, what we saw happening in California last year with rolling blackouts is probably having an impact on prices, power this summer as well.”
Nearly two-thirds of Washington’s power is generated from hydroelectric resources.
“I look at how much hydro generation we are looking at this year, and we’re seeing kind of average-ish, fairly normal stuff,” Kujala said. “So this is not a year that I would be waving a flag around saying, ‘we’re in deep trouble in the Northwest.’”
Avista is constantly evaluating snowpack over the winter to forecast hydroelectric generation for the summer. If there’s a predicted shortfall of hydroelectric generation, it will supplement it with other types of power, Thackston said.
“For example, we might increase our expectations around our natural gas generation that’s available to serve our customers. We will, at times, go into the market to fill a need that we have if that’s more economic in serving our customers,” Thackston said. “But we do that in advance. We’re looking out into the future months and buying power, or increasing our generation expectations, or adjusting our generation expectations based on the conditions that we’re forecasting so that by the time we get to the month, we really have taken all that into consideration and are ready for serving our customers.”
Inland Power and Light Co., a cooperative that purchases power from Bonneville Power Administration, serves 12 counties in Eastern Washington and North Idaho and is anticipating enough supply for its customers, Inland Power spokesman Andy Barnes said.
“It’s a low water year so far, but we have no alerts saying we have a power supply shortage,” Barnes said. “Washington state is fortunate because we have such a megasupplier and producer in the hydrosystem, which is really beneficial.”
Kieran Connolly, vice president of generation asset management for Bonneville Power Administration, said there’s a long history of interregional supply and demand in the Western Interconnection.
“In general, we still expect California to import power this summer, though the volumes from the Northwest will likely be lower due to reduced surplus hydropower arising from lower-than-average water supply,” Connolly said in an email.
The Bonneville Power Administration is a federal nonprofit agency that markets power generated by 31 hydroelectric projects in the Northwest, one nonfederal nuclear plant and several small nonfederal power plants.
Connolly added power shortages elsewhere in the Western Interconnection should have minimal impact on Northwest customers.
“While each situation is unique, reliability standards and Bonneville’s operating procedures are designed to limit the risk that challenges elsewhere in the grid would spill onto the Bonneville system,” he said.
Planning for the future
In the Northwest, each utility creates its own load forecast and is responsible for its own resource needs, according to a report from the Pacific Northwest Utilities Conference Committee’s 2021 forecast.
The Northwest PowerPool Corp., a voluntary association of Pacific Northwest-based utilities, is developing a regional resource adequacy program to evaluate future capacity needs and pool resources to serve demand during stressed grid or market conditions. The program is slated to launch in late 2023 or early 2024.
The majority of Northwest utilities’ generating resources acquired last year and those under development are wind and solar projects. Biomass, hydropower, batteries and imports make up the rest.
More than 2,000 megawatts of coal-fired generation have been retired in the Pacific Northwest. By 2029, only four coal units will remain in operation in the region.
For a variety of reasons, including meeting power demand as well as the state’s decarbonization policies and goals, utilities are exploring adding nearly 7,500 megawatts of potential new supply-side resources over the next decade, in addition to 1,800 megawatts of resources slated to be in operation in the next few years, according to PNUCC’s forecast.
Avista has started in “a really good place with respect to clean energy,” with more than half of its power generation already carbon-free. The company’s power generation is mostly hydroelectric but also includes wind, solar and biomass, Thackston said.
Avista, a co-owner of Units 3 and 4 at the Colstrip, Montana coal-fired plant, is planning to exit ownership by 2025.
Avista and other utility companies in the state will no longer be allowed to distribute electricity from coal-fired generation after 2025 due to the Washington Clean Energy Transformation Act.
“Two years ago, we announced aspirational goals to serve our customers with 100%, clean electricity by 2045 and a carbon-neutral supply of electricity by the end of 2027,” Thackston said. “We believe that as the costs of renewable generation and storage technology continue to drop, and the technologies continue to mature, that we can move toward those goals in a way that for sure balances, affordability and reliability.”
The NPCC, which was created in 1980 after Congress passed the Pacific Northwest Electric Power Planning and Conservation Act, is releasing a draft of its 2021 Northwest Power Plan in August, followed by a public hearing. The 2021 power plan will include a 20-year electricity demand forecast and a portfolio of resources to meet anticipated demand.
Kujala, of the NPCC, said the organization is examining how the power system is adapting to solar resources in the West as utilities are retiring more thermal resources. Some utilities are looking at adding storage into renewable projects to meet demand, he added.
“I guess the question is, ‘are plants actually capturing the sort of investments you need to make to make sure that is a reliable system?’ We are definitely in the process of exploring that, and a lot of work is about that exact question,” Kujala said.
Looking to the future, there might be short periods or hours when electricity is stretched thin, but outages spanning days are not likely in the Northwest, barring some event outside of normal operations, Kujala said.
Kujala emphasizes the power outages that occurred in California and Texas last year were different in the cause and impact.
In a report released in January, California utility regulators determined the Golden State’s rolling blackouts last year resulted from inadequate supply and demand planning, as well as market issues.
The Texas Interconnection is maintained as a separate grid – a key difference compared with the Northwest, which is part of the Western Interconnection.
“I think a lot of people look at what happened in Texas, and that’s their fear. But we have a lot of advantages being tied to that larger grid,” Kujala said. “The costs can impact us, and if something happens in the desert Southwest or California, it can impact our utilities. But it also helps us be able to ride through circumstances like that in a much different way than what happened in Texas.”
Amy Edelen can be reached at (509) 459-5581 or at firstname.lastname@example.org
Editor’s note: This story has been corrected to accurately reflect Bloomberg’s report citing reasons for the power shortfall.