by jennifer mckevitt
As autumn fades and November winds swell into December squalls, those in temperate climates wonder, “What should we expect this winter? What should we do to prepare?” Multiply that concern by 10,000 and one will get an idea of the pressure facing staff at PJM Interconnection, the regional transmission organization (RTO) in charge of ensuring electricity availability for roughly 65 million people in Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia.
Coal Age recently spoke with Jeffrey Shields, media relations manager at PJM Interconnection, about the company’s winter preparation efforts.
“We always have a healthy reserve of megawatts or MWs,” Shields said. “We hold an annual auction for our providers where we offer payment for their commitment to make energy available at a set price three years in advance. This process also allows new providers the opportunity and time to enter the market. Basically, we’re operating on a three-year timeline, which ensures that we can guarantee sufficient energy three years from now.”
Terms are established during the auction, when providers bid in. Once there’s a clearing price, and “x” amount of capacity at “x” payment per megawatt is set, PJM will purchase.
Because the process is competitive, a “capacity performance” standard exists, where providers are expected to perform when called upon, particularly when the grid is stressed. There are rewards for good performances and penalties if the unit flounders, Shields noted. Anecdotally, PJM has benefited from greater generator performance, meaning fewer outages, since it began the program after the 2013 and 2014 polar vortex, when consistently low temperatures taxed the system and numerous outages resulted.
Safeguards are built into the process of estimating how many MWs are needed. PJM estimated its resources are in a “peak load” scenario and will proceed accordingly.
That means that forecasts for peak demand are part of the company’s business model. For example, in 2015, PJM predicted a likely need for 135,506 MW, for which it banked a reserve of 185,611 MW. Unexpected and excessive cold resulted in higher than usual demand, meaning that the original estimate of 135,408 was exceeded on February 20, 2015, at 143,434 MW, more than 8,000 MW than originally anticipated, yet still well below the reserves established.
In addition, throughout the cold season, resources are routinely tested, along with emergency procedure drills plus surveying active generator sources for sufficient fuel inventories.
In the PJM region, a diverse mix of fuel powers electricity generation. For instance, coal-fired generators contributed 37% of energy in January 2018, and 34% in January 2019. Natural gas was the second most popular fuel source, at 22% in 2018 versus 31% in 2019. Nuclear power came in third in both January 2018 and 2019, at 26% and 24%, respectively. Other sources include wind, solar and hydroelectric power. PJM attributes the increased amount of gas as stemming from lower prices in 2019, while the decrease in coal’s contribution is mostly attributed to the retirement of approximately 3,300 MW of coal units between January 1, 2018, and February 1, 2019.
In addition, the public receives regular reports on PJMs performance. The company shares details of its winter operations in an annual news release. A breakdown of the 2018-2019 season was released in March, revealing that forced outages were down to 8.6% and 10.6%, respectively, during cold snaps experienced on both January 20 and 31. In the 2017-2018 season, forced outages reached 12%, while in the 2013-2014 season, when excessive cold severely taxed the system, outages were as high as 22%, meaning that dramatic improvement in generator performance has occurred in the interim. The current reduction in outages was achieved despite damage to a major natural gas pipeline in Ohio, which affected the supplier Texas Eastern. No service interruption resulted. According to Shields, the Capacity Performance program is believed to have contributed to this positive development.
In response to concerns about the security of the natural gas supply voiced by some regulators and elected officials, PJM has devoted considerable resources over the past few years to studying what is known as “fuel security.” Fuel security deals with the dependability of generators that do not have on-site fuel availability, instead relying on pipelines, trucks and barges for delivery.
As a result, more than 300 different scenarios that could potentially occur up to and throughout 2023 were routinely imagined and tested by PJM. Situations as varied as extreme cold coupled with winter storm conditions to fuel line breaks and attacks on the fuel supply chain and infrastructure were part of the mix. Ultimately, PJM determined that sustained cold will not drain its resources and that its system is secure enough to endure extended external strain.
According to the company, some of those potential challenges were identified as:
Availability of non-firm gas service;
Ability of the fuel-oil delivery system to replenish oil supplies during an extended period of extreme cold weather;
Physical breaks at key locations on the pipeline system;
Customer demand (load);
Generator retirements, replacements and resulting installed reserve margin;
Use of operating procedures to conserve fuel during peak winter conditions.
None of the above scenarios are likely to occur before 2023, while advance consideration allows PJM to address each pain point well before a potential event. In addition, some have already occurred — namely, high customer demand and physical breaks on the pipeline system — and were easily managed.
Though winter’s cold seems to present the greatest challenge to its various sources of power, Shields observed that it’s actually summer that most taxes PJM’s resources, deep as they are.