Every U.S. Grid Is Getting a Lot Greener, Except the One That Matters

(Bloomberg) — Every major U.S. electricity grid is getting significantly greener.

Except for the massive one serving 65 million Americans.

That’s just as problematic as it sounds for the policymakers, power providers and climate activists looking to wean Americans off fossil fuels. While members of other systems move quickly to add solar and wind to their mixes and slash carbon emissions, the network that keeps the lights on from Chicago to Washington has effectively doubled down on natural gas.

In the past two years, it has boosted the amount of power generated with gas by 11,131 megawatts. And developers are planning 34,507 megawatts more. Meanwhile, solar and wind account for 1% of the grid’s installed capacity. 

“How do you manage the gas build-out with more states boosting renewables targets?” asked Toby Shea, a New York-based analyst at Moody’s Investors Service. “There’s already an overbuild of gas.”

It’s not that there’s no interest in the renewable trend in the 13 states connected to what’s called the PJM Interconnection. In fact, it has been inundated with applications from renewable developers — 67,000 megawatts of wind and solar in total, from 684 projects.

But there’s also this economic reality: PJM crisscrosses a section of the U.S. that’s home to some of the world’s most abundant natural gas reserves. As fast as the cost of wind and solar energy has been dropping, gas in some of these parts is cheaper.

The hundreds of cities, counties, states and utilities linked to PJM have different and often competing goals and interests. Some are keen on getting greener, and the continued gas build-out threatens those ambitions.

But the rush to make electricity without carbon emissions could put the gas plants in a bind. The potent brew of falling costs for emissions-free renewables could jeopardize facilities that are built to last for decades. They could end up as expensive bit players, filling in only during extreme weather or when the wind or sun aren’t cooperating.

By 2035, it will be more expensive to run 90% of the gas plants being proposed in the U.S. than it will be to build new wind and solar farms equipped with storage systems, according to the Rocky Mountain Institute, a nonprofit supporter of cleaner energy. It will happen so quickly, the institute says, that plants will become uneconomical before their owners finish paying for them.

More than half of U.S. states — including New Jersey, which is in PJM — have required renewables in their electrical blends. This group includes California, which aims to get all of its electricity from emission-free sources by 2045. Even oil-mad Texas is favoring clean power, because wind and solar are so cheap in the Lone Star State.

There’s little debate, though, that natural gas is still needed. A Texas heat wave that drove its grid to the brink of blackouts last month was a reminder of how essential the fuel remains. Even in California, gas continues to provide round-the-clock power.

“We just can’t turn that gas off today,” said Joseph Fiordaliso, president of the New Jersey Board of Public Utilities. “The infrastructure was built years ago. We have to build the infrastructure for wind.”

As a grid, PJM is most focused on providing reliability at the lowest cost, said Stu Bresler, its senior vice president of markets and planning. In other words, just because projects are in the queue — gas-fired, wind or solar — doesn’t mean they’ll come to fruition.

There is, however, a $70 billion offshore wind market forming off the Atlantic coast. And while renewable energy is still a fraction of PJM’s grid today, Bresler said, ``It’s still growing, and we're going to continue to see penetrations of solar and wind’’ as some states work to meet their renewable energy goals. He also pointed out that renewable energy makes up a larger share of the actual power generated in PJM -- as much as 5%. It makes sense, considering solar and wind farms have essentially zero fuel costs and can produce cheaper than other resources.

https://www.chicagobusiness.com/utilities/every-american-power-grid-getting-lot-greener-except-one-matters