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The Nation's Grid: 'On the Edge of Complete System Failure?'

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Nevelyn Black's picture
Writer, Independent

Nevelyn Black is an independent writer with a background in broadcast and a keen interest in renewable energy.  In the last few years, she transitioned from celebrity interviews and film shoots...

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  • Jul 6, 2021

“I would probably give our power grid maybe a C minus,” Kyri Baker, an engineering professor at the University of Colorado Boulder. “It’s like this perfect storm of extreme temperatures, more electricity consumption, and aging infrastructure.”  A ‘C’ minus is a passing grade but certainly not worthy of any accolades.  Have millions of energy professionals picked the wrong career?  Can the nation's infrastructure excel or must we settle for mediocrity?  Before we write off the grid, it is important to note that the success rate of the nation’s grid far outweighs its failings.  But with more frequent mishaps, some even fatal, experts feel we’re just getting a glimpse into the inevitable.  A complete system failure.  “I think everyone is tired because the system is strained and it feels like we are on the edge of complete system failure far too often," Michael Webber, chief science and technology officer for French electric utility Engie SA and a University of Texas mechanical engineering professor said. 

Doom and Gloom

Global electricity consumption continues to increase faster than the world population, leading to an increase in the average amount of electricity consumed per person, according to the U.S. Energy Information Administration’s (EIA) International Energy Statistics.  An estimated increase of almost 3 billion people in need of an additional 10 trillion kWh/year, along with the rapid, global growth of the middle class, electricity is in high demand.  Future projections aside, the energy sector is facing several real challenges to meet global needs, whether residential, commercial, industrial or otherwise.  After population growth, there’s climate change, cryptocurrency and electric vehicles to contend with. 

Climate Change? Bah Humbug! 

Ok so you don’t think it’s climate change but you know it’s really hot outside. In fact, it’s too hot.  The current heat wave has overloaded the country’s system in one place after another.  Power cables on streetcars in Portland melted during record heat last week.  From coast to coast, California and New York but urged consumers to conserve energy. And in Texas, where they’re still recovering from last winter, people have lost faith in ERCOT and are resorting to portable generators to get through the summer.  “This grid is unreliable,” said Darryl Ford, generator sells representative.  Texans are currently waiting 25 weeks or more for generators and the orders continue to flood Ford’s office.  If Texas does have a summertime power failure, it would be a first for the ERCOT system.  But that doesn’t provide much comfort since as winter has proven, there’s a first time for everything.   Experts say it’s clear, it’s not just Texas but the entire United States power grid isn’t ready for a growing population, an increase in demand or the effects of climate change.  The inability to predict energy consumption and frequent extreme weather events leave utilities struggling to maintain balance.  “We’re trying to project the weather two years from now or five years from now, and climate change is making it more difficult,” Anjan Bose, an electrical engineering professor at Washington State University. “If you can’t project the weather, you can’t project the load demand.”  Referring to the same problem, Bob Jenks, executive director of the Oregon Citizens’ Utility Board, said, “That is scary, because that means you don't know what's happened.  That means the past is no longer predictive of the future.”  Extreme heat also threatens the water supply which has a direct effect on power generation.  “Researchers have shown that drought threatens coal and nuclear power plant water supplies in the Upper Midwest, and the southeastern U.S., in New England as well as the western U.S.,” Joe Smyth of the Energy and Policy Institute, a watchdog group, said.  Tracey LeBeau, who runs the U.S. Department of Energy’s Western Area Power Administration added, "Less water often results in less water running through turbines and creating electricity.  Right now, in many regions, power is in higher demand because of the higher temperatures. So it's really a double whammy for us.”

Crypto - Friend or Foe? 

The problem with cryptocurrency mining is the staggering amount of electricity required to do so.  For example, one report has suggested that the bitcoin network will start using as much electricity as the entire world does today.  High performance computing software used for mining consumes around 110TW hours per year.  Amounting to 0.55 percent of global electricity production, it is the equivalent to the annual energy draw of small countries like Malaysia or Sweden.  However, studies by ARK Invest and Square’s ‘Bitcoin as key to an abundant, clean energy future’ and CoinShares’ Bitcoin Mining Report have suggested that cryptocurrency mining could drive investment in renewables and produce more energy available to the grid.  One line of reasonings is when there is an energy surplus on the grid, a renewable energy developer could make money mining cryptocurrencies.  But everyone’s not convinced renewables and cryptocurrency are compatible.  In China, where the majority of mining is done, insufficient grid penetration and a lack of high-quality grid infrastructure have limited the power export capacity of the region.  China Water Risk (CWR) explains that ‘‘hydroelectricity cannot be generated year-round’’ to power mining because of ‘’variations in water availability through rain/floods/droughts.’’   Seasonal variability in hydropower is already higher than 30% and expected to increase further because of climate change.  But to fill the gap the increased demand may only encourage the construction of new coal-fired power stations.  In the interest of making a profit, agents are incentivized not just to use the most efficient hardware but also to seek out the cheapest electricity.  Chris Bowden, managing director of clean energy firm Squeaky, said, “Some miners are suspending their operations, because it’s just not profitable enough for them to mine. Since the energy consumption is high, bitcoin and other cryptocurrency technologies are sharpening up. Beyond bitcoin, ethereum is moving to a low-energy technology model, which has significant processing power and consumes much less energy.”  Ethereum is a decentralized, open-source blockchain with smart contract functionality. After Bitcoin, it is the second-largest cryptocurrency by market capitalization. 

Bad Business or Bad Business Model?

Should utilities partner with mining firms? Recently, Greenidge Generation announced a new Bitcoin mining operation in Spartanburg, S.C., but the locals are not happy.  "These crypto operations are looking for anywhere that has relatively cheap power in a relatively cool climate," said Yvonne Taylor, vice president of Seneca Lake Guardian, a nonprofit conservation advocacy. "It's a horrible business model for all of New York State, the United States and for the planet.”  Atlas bought the coal-fired plant a few years ago and converted it to a natural gas plant.  At the time, the plant generated energy to the gird only at times of high demand.  But in 2019, they began to use the plant to power mining and increased the output.  Back in Texas, lawmakers are trying to encourage Bitcoin miners to relocate there.  China has had a change of heart and is cracking down on Bitcoin mining. In June, Gov. Gregg Abbott signed Texas House Bill 4474 into law.  The bill regulates the legal status of virtual currencies under Texas’ Uniform Commercial Code and clarifies the legal environment for Bitcoin investment and its use as collateral for economic operations. Counting the costs, for an already strained infrastructure, is paramount.  Ultimately, winterizing the grid and adopting Bitcoin mining operations will be expensive for the state.  Will the benefits to the economy offset the risks to the grid?  That question brings to President Biden’s American Jobs Plan.  These days you can’t address the grid without mentioning Biden’s $1.2 trillion plan to repair the county’s infrastructure.  Biden’s plan addresses the grid but also includes an initiative to boost clean transportation, which presents another concerns.

EV’s, The Problem or The Solution?

Half a dozen automakers have already announced plans to go all-electric.  Biden’s plan proposes $174 billion toward new charging networks and consumer incentives.  Is the grid ready for that incentives and the growing number of electric vehicles that could soon be filling the roads? Rocky Mountain Institute (RMI) has estimated that electrifying all of the roughly 251 million light duty vehicles on US roads today would increase annual electricity demand by about 25 percent.  The Federal Energy Regulatory Commission, which oversees the nation’s grid, recently warned that electrification of transport will mean the U.S. needs to double its electricity generating capacity by 2050. The grid must be able to handle double the current demand in less than 30 years.    That estimate focuses on electric transportation alone and doesn’t account for the vulnerabilities mentioned so far. Simply put, the increase in EV’s over the next decade will overload utility capacities. 

Is There Light at the End of The Tunnel or Is That a Train?

It’s not all doom and gloom but how can you prepare for an anomaly?  With a contingency plan.  So we can’t predict the future but we know as the population increases, energy demand and consumption will also increase.  Could a virtual power plants (VPP) be the answer to the future of energy distribution?  Giovanni Bertolino, head of e-Mobility for Enel X North America said, “VPPs provide a necessary method of flexible, decentralized power generation to make renewable energy more affordable and more reliable.  As we consider the growth of urban markets and growing population density, they are also an efficient way to relieve the strain placed on the grid during peak usage times in high-population areas. As we continue the move toward renewable energy, VPPs will remain important as an efficient, cost-effective way to balance generation and consumption.”

Meteorologist try but we aren't able to accurately predict when and where the next extreme weather event will take place or how it will impact the grid. However, software companies are working on predictive analytics and machine learning technologies to help improve resilience and reliability. Hitachi ABB Power Grids, soon to be Hitachi Energy, just launched its Smart Digital Substation.  The system couples digital substation technology with the predictive, prescriptive and prognostic capabilities.  For end-use, California will provide smart thermostats to alleviate the strain.  To help prevent blackouts this summer, OhmConnect began a new "EndCABlackouts" initiative that will provide free smart thermostats to 1 million California residents.

Regarding grid capacity in China, there may even be hope for cryptocurrency/bitcoin mining. As already mentioned, generating enough hydropower year around would be impossible but seasonal mining could be implemented as a solution. Regarding a shift in mining operations to the wet season, Chris Bowden, Squeaky, managing director concluded, “During this time, massive amounts of clean energy are wasted every year in Sichuan and Yunnan, as production capacity significantly outstrips local demand and the cost of grid infrastructure to transport this energy to urban areas doesn’t make economic sense.  As a result, it makes a lot of sense to shift bitcoin mining operations to these areas in the wet season and this is why China is responsible for almost 10% of global bitcoin mining in the dry season and 50% in the wet season.” Others are also optimistic looking to partnerships between utilities and mining operations.  Zula Luvsandorj, project finance advisor to the UK Cabinet Office said, “In countries like the US and Canada, there have been good collaborations with their excess energies, such as hydro, which they could not sell otherwise. They provide a good collaboration with the bitcoin mining industry.”

Finally regarding EV's, can V2G technology alter the problem of increased load demand caused by large-scale EV integration? If so, success will hinge on sufficient technology and customer participation.  Two California utilities have studied V2G. Southern California Edison (SCE) has plans for a demonstration project and Pacific Gas & Electric (PG&E) is working with BMW on a study with EV owners. Tokyo’s Electric Power Company (TEPCO) has dubbed the technology V2X, for vehicle-to-everything, because the possibilities are endless.

According to experts, to fill the gap left by renewable energy sources, greenhouse gas emitting options like coal and natural gas must be relied upon more heavily.  However, burning those fossil fuels produce more greenhouse gas and worsen climate change by trapping heat into the atmosphere. Striving to overcome that vicious cycle and increase the capacity of the grid is the real challenge.  What’s your contingency plan?  


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