POWER July 2022 - 37

MID-YEAR INDUSTRY FORECAST
Texas. " While not as severe as the risk
faced in the Midwest, the risk is driven
by similar patterns of higher than typical
temperatures, driving increased demand,
coinciding with the potential for
reduced wind and/or solar, with droughtrelated
wildfires and hydro availability
also contributing, " he said.
Supply Chain Woes Continue
POWER has covered supply chain prob2.
Hydropower production from the Glen
Canyon Dam is being threatened by historically
low water levels in Lake Powell, an artificial
reservoir on the Colorado River in Utah and
Arizona. At the end of May, the reservoir was
26% full-its lowest level since it was filled.
Source: Bureau of Reclamation
Summer Heat Presents
Additional Risks
In addition to the drought, heat presents
risks for power generators. Last summer,
temperature records were shattered
across many parts of the Pacific Northwest
in late June. Portland, Oregon, and
Seattle, Washington, broke all-time highs
by significant margins, with temperatures
in the two cities hitting 116F and
108F, respectively. In Lytton, British Columbia,
the temperature hit 121F, setting
a new national record in Canada.
" The biggest risks are typically those
where common drivers both increase
electric demand and decrease available
supply. That's what happens when you
have extreme heat or cold that increases
customer electricity usage for cooling or
heating, while at the same time potentially
impacting a generator's ability to produce
at expected levels, " Daniel Brooks,
vice president of Integrated Grid and Energy
Systems with the Electric Power Research
Institute (EPRI), told POWER.
" The recent NERC [North American
Electric Reliability Corp.] Summer Reliability
Assessment highlights a few
regions where widespread, prolonged
extreme heat could result in insufficient
supply to meet demand and the need
for rolling load shed, " Brooks said. " The
NERC assessment identifies MISO [Midcontinent
Independent System Operator]
as the largest risk this summer. This
is where hotter than average summer
highs, over a wide region, could result in
higher demand for electricity with potential
lower output from the growing wind
generation in the region, compounded
by a slightly lower supply available due
to recent retirements. "
Brooks also noted that risks were elevated
in both the Western U.S. and in
July 2022 | POWER
lems in previous issues this year (see
" Optimism Is Warranted in the Power Industry
in 2022 and Beyond " in the January
issue and see " Supply Chain Issues
Mean Planning Is More Important Than
Ever " in the May issue). Still, troubles
persist and warrant further attention.
" Current supply chain issues continue
to impact the global solar industry driving
up costs, " Grant Thornton's Stilwell said.
" Solar module suppliers, manufacturers,
renewable energy developers, and utilities
all face great uncertainty surrounding
the immediate future of the solar
module supply market. While in the macro
context, supply chain pressures are increasing
shipping and equipment costs
for cells and panels, several immediate
micro factors exist that will continue to
drive up pricing and market uncertainty. "
Stilwell also suggested the conflict in
Ukraine was impacting supply chains.
" Supply chain disruption is a major factor
on both focused and broader levels
of the current conflict. Imports of components
for batteries, microchips, auto
parts, and petrochemical production are
at risk. Russia is the world's third-largest
producer of aluminum and nickel, which
are key elements in the production of
lithium-ion batteries. Ukraine is a major
producer of rare gasses essential in microchip
production. Disruptions in these
markets could further exacerbate the
global microchip crisis, already exacerbated
by the pandemic, " he said.
" In concert with other global pressures,
it seems possible that the Ukraine
Crisis may develop into the biggest test
of the global supply chains yet, " Stilwell
said. " European leaders are already
looking to diversify sources and supply
routes where possible and preparing risk
response plans for the most vulnerable
supply chains. "
Demand for Power Is Growing Quickly
Despite these challenges, electrification
will continue to grow. " EPRI's models
show that the electric sector's share
of end-use energy will increase two to
three times in the most affordable pathwww.powermag.com
ways
to reaching economy-wide net-zero
by mid-century. That means much more
of society will depend on the electric
sector as we go forward, " said Brooks.
" Electric grid reliability and resilience is
not a barrier to achieving decarbonization.
It's a prerequisite. "
Among the areas of highest growth in
the U.S. is Texas. Oncor, the largest energy
delivery company in Texas with more
than 140,000 miles of transmission and
distribution lines serving more than 400
communities and 98 counties, offers a
case in point. Speaking at the co-located
POWERGEN and DISTRIBUTECH events
in Dallas, Texas, on May 23, Jim Greer,
executive vice president and COO of Oncor,
said, " Here in the Oncor area we are
experiencing customer and load growth
at unprecedented levels. "
Greer noted that the population of
Texas is expected to double by 2050. He
also suggested the state's industrial sector
is expanding equally fast, mentioning
a $30 billion facility Texas Instruments is
constructing and a $15 billion plant that
Samsung is currently building in Oncor's
territory as examples of the growth. " ERCOT
[the Electric Reliability Council of
Texas, the independent system operator
that manages about 90% of the state's
electric load] currently estimates that approximately
17 GW of crypto-mining load
is looking to interconnect to the grid, "
Greer said. He further explained that ERCOT's
current peak load is 74 GW, meaning
the crypto mining additions would
increase load by more than 20%.
The adoption of electric vehicles (EVs)
will add even more demand to the grid.
A common thumb rule suggests one EV
draws about the same load as adding one
new single-family home to the system.
That's significant. Furthermore, fleets offer
perhaps even greater potential for growth.
" Oncor has identified more than 24,000
fleets in our service area, " Greer said. " It's
an interesting time to be in our industry. "
Of course, planning is crucial to accommodate
for these and other power grid
changes. " System operators need to ensure
their resource adequacy planning processes
reflect future risks with a changing
resource mix and changing extreme
weather patterns, " said Brooks. " EPRI's
Climate READi [Resilience and Adaptation]
and Resource Adequacy initiatives
are engaging system operators and other
stakeholders to develop the processes
and tools to provide forward-looking risk
assessment and investment planning. " ■
-Aaron Larson is POWER's
executive editor.
37
http://www.powermag.com
POWER July 2022

Table of Contents for the Digital Edition of POWER July 2022
