How will climate change affect our electricity system? And how will the impacts effect ratepayers?
A guest post by Nathan Lott, energy policy expert.
Last week the White House released the latest National Climate Assessment (NCA). Following on the heels of a UN Intergovernmental Panel on Climate Change (IPCC) Fifth Assessment Report, the NCA begins with the premise that climate change is already underway and effecting the lives of millions of Americans. Electric grid security, agriculture, transportation and commerce, public health, and our coastline are all being affected by aggregate global temperature rise.
It is widely known that our electricity grid is a driver of climate change; fossil fuel power plants in particular are responsible for a third of US greenhouse gas emissions. But how will climate change affect our electricity system? And how will the impacts effect ratepayers?
Storms and Blackouts Residents of Louisiana and our neighbors on the Gulf Coast are no stranger to hurricanes, and many of us might consider ourselves lucky if the next category IV storm does nothing more that take out our electricity for a few days. However, those lost work days add up to decreased productivity for businesses; traditional industries and the technology startups currently flocking to New Orleans are equally dependent on reliable power. Hurricanes force the suspension of offshore oil and gas operations and may force refineries to temporarily shutter, leading to gasoline price spikes. Most importantly, the loss of electricity due to sever weather complicates disaster recovery and can be a matter of life or death.
Increased Peak Demand If intensified storms are the first thing that comes to mind when you ask a Louisiana resident how climate change will affect daily life, higher AC costs are a close second. The hot, sticky summers are part of the reason Louisiana ranks second in the nation in per capita energy use (although industrial use is also a major factor). Add to that the fact that many residences use less-efficient electric heating during the winter, and erratic weather is poised to drive up demand for electricity. When electric utilities are unable to meet demand in real time, they typically purchase “merchant power” off the regional grid, paying a premium price. Absent a mechanism such as time-of-day-pricing, those costly purchases are absorbed by all consumers. In short: Even if you are content to open the windows and sweat it out, you could see your bills inching up with the mercury.
Line Loss High voltage transmission lines, which carry electricity from generation facilities to distribution hubs, and low voltage distribution lines, which carry electricity to end users lose energy in the form of heat. They fluctuations in current associated with peak demand cause lines to function less efficiently. So, while demand is peaking, more energy is leaking out of our transmission system. The correlation between line loss and high temperature means the grid will be less efficient in a warmer world (unless of course we make other improvements).
Carbon Cost Economists will tell you putting a price on pollution is the best way to taper reliance on fossil fuels; most politicians will tell you that’s a nonstarter. Instead of putting a price on pollution via a carbon tax or cap-and-trade system, the US is poised to use regulation. Tougher standards for mercury and cross-border pollution have already forced the costly retrofitting of many coal-fired plants. EPA’s looming carbon rules appear likely to make coal-fired electricity cost prohibitive in the US. (Although coal mined here may still find its way to markets overseas.) Many utilities are turning to natural gas as the preferred fuel for new power plants. However as utility demand for gas increases, prices may rise. Louisiana’s fuel mix already includes more gas and less coal than most states; so we are vulnerable to commodity price spikes.
Water availability A cynic once described nuclear power as the most expensive way to boil water. That glib remark may deny nuclear energy its due as a low-emissions baseload generation source, but it points to a central truth about the way we make electricity in America. Most of our power plants still boil water to create steam to turn turbines to make electricity. Hence power stations frequently abut reservoirs or rivers. As growth in population and per capita usage strains freshwater resources, increased periods of drought due to climate change will worsen the situation. The trend away from coal and toward natural gas in the US power sector has the benefit of reducing water demand because combined cycle gas plants require significantly less water. Upstream water use, however, is greatly increased because of the intensive water use at hydraulic fracturing gas wells.
Renewable Energy Strain on freshwater supplies could limit hydroelectic production in some parts of the world. More germane to Louisiana is the prospect that shifting weather patterns will affect solar harvesting. Frequent cloud cover is part of the reason that Louisiana’s solar resource, while better than much of the nation’s, is not as great as that of Southwestern states on similar latitudes. According to the IPCC the global availability of wind and solar resources will be stable but the optimum location may shift with the winds. Predictive weather models are not sufficiently reliable to surmise just how Louisiana’s cloud cover may change but according to the EPA, they suggest longer periods without rain punctuated by more intense precipitation events.
Stay tuned for Part 2 of this series, in which we’ll tackle the all important question of how to prepare our grid for these changes.
Nathan Lott lives in New Orleans with his wife and two children. Before relocating to Louisiana, he spent seven years as Executive Director of the Virginia Conservation Network. During that time, he advocated successfully for pro-consumer, pro-clean energy policies, including a landmark law to allow utilities rate of return on energy efficiency investments. Nathan served on a renewable energy task force convened by the mayor of Virginia Beach and on the steering committee for the Chesapeake Bay region’s Choose Clean Water coalition. He began his working life as editor for a Birmingham-based publisher of outdoor and travel guides. Currently enrolled in graduate studies at Tulane University, he enjoys exploring New Orleans architecture and culture as all as the surrounding bayous and trails.