Biggest Threat, Energy Demand or Climate Change?
- Nov 30, 2021 3:38 am GMT
“The global power market is experiencing rapid power demand growth as markets recover from the pandemic.” Matthew Boyle, manager of global coal and Asia power analytics at S&P Global Platts said to CNBC. All are eager to get beyond the pandemic but as we move forward, several power industry problems are becoming apparent. Of the current threats facing the grid, which is the lesser of two evils, the growing demand for energy or the increasing intensity of climate change? According to the International Energy Agency, global electricity demand is expected to jump by almost 5 percent this year and by 4 percent in 2022. Rising gas prices, a growing population and an overall energy shortage is putting the pressure on energy providers across the country. In Texas, the population has grown by more than 4 million over the past decade to almost 30 million. Despite the existing strain on the grid, ERCOT has welcomed cryptocurrency miners that are projected to increase demand by as much as 5,000 megawatts over the next two years. Moody’s analyst Toby Shea believes the grid will have enough total capacity to meet the forecasted surge in demand. All nine U.S. and Canadian power grids have miners on them, but Texas now has the most, said Gregg Dixon, CEO of Voltus Inc. According to Dixon, Chinese nationals are leading the trend. “They come in and write $100 million checks on the spot,” Dixon said.
Growing demand is threatening the reliability of the grid but many are convinced climate change will be the real culprit. Alice Hill, an energy and environment expert at the Council on Foreign Relations believe more must be done to plan for the future. "It's a little like we're building the plane as we're flying because the climate is changing right now, and it's picking up speed as it changes," Hill says. "Everything that we've built, including the electric grid, assumed a stable climate. It looked to the extremes of the past — how high the seas got, how high the winds got, the heat.” Regarding Hurricane Sandy of 2012, she recalls, "They thought the maximum would be 12 feet. That storm surge came in close to 14 feet. It overcame the barriers at the tip of Manhattan, and then the electric grid — a substation blew out. The city that never sleeps [was] plunged into darkness.” New York utility, Con Edison, has since made numerous improvements to better prepare for the next event. Last summer the company employed climate-change projections in their decision-making and planning purposes. Con Edison established a new executive-level committee focused on climate risk and resilience. They invested $328 million into the distribution system, including $65 million for upgrades to cables and transformers. They buried lines and replaced 158 miles of underground and aerial feeder cables. In a press release last summer the company addressed the issues that lay ahead. "With electricity supplies as tight as they are, people can expect that there will be times when we're going to ask for their help to get over some of the rough spots. When we've made conservation requests in the past, our customers have come through and it's made a difference," Lou Rana, senior vice president of electric operations for Con Edison said. The utility is also turning to demand side management and offering incentives to get customers to cut back on electric use during periods of high demand. Con Edison CEO Timothy Cawley says the company’s future will be “built around lean energy, a diverse and inclusive workforce, and sustainable communities that will thrive in the decades ahead.” How is your utility planning for the rising cost, energy demand and severe weather?
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