Speaker 1: Hi, it's West Kasova. We're taking a break this week,
Speaker 1: so here's one of our favorite episodes you might have
Speaker 1: missed and an update. Record heat means electricity demand in
Speaker 1: Texas has reached all time highs about a dozen times
Speaker 1: since June. Surprisingly, though the Texas grid has shown few
Speaker 1: signs of stress. One big difference solar generation. It's come
Speaker 1: in roughly double from last summer, and so much sun
Speaker 1: means it's been coming in stronger than expected when it's
Speaker 1: needed most.
Speaker 2: It's going to be extremely humid, disrespectfully humid tomorrow.
Speaker 3: So here's what's happening about.
Speaker 4: One nineteen in Hillsborough, one fifteen in Corsic, fifteen in
Speaker 4: Waksahatchet one sixteen and four one and Taro one.
Speaker 3: O eight and debt in one oh seven and camp.
Speaker 4: So you get the idea dangerous.
Speaker 1: I'm West Kosova today on the Big Take. You think
Speaker 1: it's hot now, well imagine if the AC went out.
Speaker 2: The unrelenting temperature straining the power grid as the state
Speaker 2: set a June record for energy demand, the historic heat
Speaker 2: buckling roads from the Lone Star State to Louisiana.
Speaker 1: The crippling US heat wave that's smothering Texas and spreading
Speaker 1: across the South means millions of miserable people seeking relief
Speaker 1: are doing what you'd expect. They're cranking up the air conditioning,
Speaker 1: and that is pushing America's aging overtext power grid to
Speaker 1: the max. With concerns about rolling blackouts or just playing shutdowns.
Speaker 5: To say it's a lot of work as a massive understatement,
Speaker 5: but there is an urgency to deal with this because
Speaker 5: we do have this very real climate threat and we're
Speaker 5: racing against the clock.
Speaker 1: Nourene Malick reports on the power industry for Bloomberg. She's
Speaker 1: here to tell us about why our grid is so
Speaker 1: fragile and what can be done to future proof the
Speaker 1: system for a world where extreme weather shocks are becoming
Speaker 1: more frequent, and not just in summer, by the way,
Speaker 1: these problems are just as bad in winter, and maybe worse. Noreen,
Speaker 1: you have been writing a lot of stories lately about
Speaker 1: this unbelievable heat wave across the South and especially in Texas.
Speaker 1: Obviously it's making a whole lot of people miserable, but
Speaker 1: it's putting a huge strain on the energy grid and
Speaker 1: the ability just to keep up with the demands that
Speaker 1: everybody has.
Speaker 5: Yeah, So Texas is an outlier in the US because
Speaker 5: demand is growing so fast in Texas, it's one of
Speaker 5: the fastest, if not the fastest outright. What that means is,
Speaker 5: over the last several years, they've had a population boom
Speaker 5: with people moving in from California and other states, and
Speaker 5: then you've had businesses expanding. On top of that, you've
Speaker 5: had strong economic growth. And then you've also had bitcoins,
Speaker 5: which are heavy power users, come in in the last.
Speaker 3: Couple of years.
Speaker 5: So you've set up this base demand for power is growing,
Speaker 5: and then on top of that, every time you add heat,
Speaker 5: it like multiplies how much demand because they're all cranking
Speaker 5: up their air conditioners. And something you may not know
Speaker 5: about Texas is that they use a lot of AC
Speaker 5: compared to the rest of the country. Like one megawatt,
Speaker 5: which is a unit of how you measure electricity, can
Speaker 5: provide power for typically two hundred homes in Texas and
Speaker 5: the rest of the country that's closer to like eight
Speaker 5: hundred homes.
Speaker 1: And that's all because of air conditioning.
Speaker 5: Well, it's just Texas homes are bigger. Somebody wants described
Speaker 5: to me, there's a lot of big foyers and big
Speaker 5: homes there. They all use a lot of electricity, but
Speaker 5: it's also swimming pools. And then of course gadgets and
Speaker 5: evs are coming online, but that's more newer on the
Speaker 5: EV side.
Speaker 1: And the heat in Texas, even for Texas in the summertime,
Speaker 1: is pretty extreme.
Speaker 5: Yeah, So anytime you have any type of weather driven
Speaker 5: demand and the amount of electricity or energy.
Speaker 3: Use escalates very quickly.
Speaker 5: And if you're talking about ninety to eight degrees versus
Speaker 5: one hundred and two degrees, that may seem like four
Speaker 5: degrees is not that much, but when it comes to
Speaker 5: air conditioning demand, the increase is way bigger.
Speaker 1: So noreene just to give people an idea of what
Speaker 1: it means when there's so much demand put on the
Speaker 1: energy grid. What's happened to energy prices in Texas?
Speaker 5: Yeah, so electricity prices are extremely volatile. Just in the
Speaker 5: first fifteen days of June, we've seen prices go from
Speaker 5: like forty dollars per megawatt hour you know, normal demand,
Speaker 5: to forty five hundred dollars when it was an extremely
Speaker 5: hot day for several hours.
Speaker 1: From forty one dollars to over four thousand dollars in
Speaker 1: one day.
Speaker 5: Yeah, I mean it's not impossible to see that type
Speaker 5: of swing within a day, but then also across days.
Speaker 5: So the way power is priced, it's pri on a
Speaker 5: five minute basis hourly basis, so there's a lot of
Speaker 5: way to splice it. So the average for the day
Speaker 5: was not four thousand, It was probably a few hundred dollars.
Speaker 5: But then there are certain hours around six seven pm
Speaker 5: where it was four thousand dollars per megat hour.
Speaker 1: And the reason why energy prices for natural gas, which
Speaker 1: is what the grid mostly operates on, are so high
Speaker 1: is I guess it's sort of akin to uber surge pricing.
Speaker 1: When everybody is looking for an uber the prices go up,
Speaker 1: and if everybody wants your energy, you get to charge
Speaker 1: more for it because there's no other place to go.
Speaker 5: Natural gas is the number one driver, and then you
Speaker 5: also have wind and solar. But what happens is exactly
Speaker 5: what you're saying, when you have those high demand periods,
Speaker 5: the price of electricity is set by the most expensive unit.
Speaker 5: So let's say on an average day, like if you're
Speaker 5: thinking about uber, everyone's driving like a hond or a camera.
Speaker 5: That's pretty fuel efficient. But let's say during rush hour,
Speaker 5: in a thunderstorm or a heat wave, I guess in
Speaker 5: Texas you have to like bring out the Lamborghinis and Ferraris.
Speaker 5: Those are not fuel efficient, but everyone gets paid the
Speaker 5: price of the Ferrari in a Lamborghini, even if it's
Speaker 5: just some of the megawatts used.
Speaker 1: So when it surges like that, how much more does
Speaker 1: it cost? In total?
Speaker 5: It can cost billions of dollars over the course of
Speaker 5: days because you're pricing this every five minutes, every hour.
Speaker 3: Yeah, it quickly adds up.
Speaker 5: It takes time to filter out to customers depending on
Speaker 5: how they get builled. Texas households may have locked in
Speaker 5: a six month power rate, so that sets their price,
Speaker 5: say like ten cents per kilowatt hour. Some power retailers
Speaker 5: will have fine prints. Well, if there is a rally
Speaker 5: in gas or power prices in real time, we will
Speaker 5: push on those costs to you right away. For others,
Speaker 5: there's a lag. Customers will eventually pay for all of this.
Speaker 5: It just depends on how soon.
Speaker 1: And so Texas has been taking all kinds of measure
Speaker 1: to try to cut energy usage, asking people not to
Speaker 1: use as much. Is that realistic?
Speaker 5: So the Electric Reliability Council of Texas or ORCOTT, which
Speaker 5: is what the state grid operator is called, has been
Speaker 5: more proactive and they have been putting out weather watches
Speaker 5: like this is the first summer they started putting out
Speaker 5: a weather watch to warn people of tight conditions, asking
Speaker 5: consumers to make cuts where it was safe to turn
Speaker 5: up their thermostat to help keep the grid stable and
Speaker 5: avoid a shortage.
Speaker 1: Another thing you report, which I thought was interesting, you
Speaker 1: mentioned bitcoin miners which have moved into Texas and they
Speaker 1: use a ton of energy running those big hot supercomputers.
Speaker 1: They have slowed down and kind of stopped operations sometime.
Speaker 5: Yeah, so bitcoin mining is really interesting because these are
Speaker 5: basically computing centers. They look like data centers from the outside,
Speaker 5: but obviously very sophisticated machines on the inside. But they
Speaker 5: have the capability to turn on and off really quick quickly.
Speaker 5: There's about two thousand megawatts of bitcoin mining in Texas.
Speaker 5: That's the equivalent of like, let's say, two large nuclear plants,
Speaker 5: and so they see high power prices in the thousand
Speaker 5: dollars range, it makes sense to shut down and not
Speaker 5: operate because they're not using that much. But at the
Speaker 5: same time, not only are they saving money, but some
Speaker 5: of that is actually participating in a grid program where
Speaker 5: they get paid to curtail. And that's when Urkott, the
Speaker 5: grid operator, tells them, hey, can you like ramp down
Speaker 5: a little bit or a lot so that we can
Speaker 5: reduce stress on the grid and send that power to
Speaker 5: somebody else.
Speaker 1: We're talking about natural gas power, but you know, Texas
Speaker 1: has a lot of sun, Texas has a lot of wind.
Speaker 1: How much can those forms of renewable energy we talk
Speaker 1: about all the time help.
Speaker 5: Out in the current heat wave, Actually solar is doing
Speaker 5: really well. It's maxing out. It's considered to have a
Speaker 5: summer capacity of like more than twelve thousand megawatts, so
Speaker 5: when the sun is shining mid morning to like when
Speaker 5: the sun sets, it's operating pretty much close to max capacity.
Speaker 5: And that's been a real benefit for the grid. If
Speaker 5: you think about twelve thousand megawatts versus like record demand,
Speaker 5: which was eighty thousand megawatts last year a little more
Speaker 5: than that, that's a significant chunk. And then wind has
Speaker 5: actually been low in the middle of the afternoon. That
Speaker 5: has actually been one of the reasons that supply is
Speaker 5: really tight in RKOT.
Speaker 3: They now have so much demand.
Speaker 5: Growth that they actually need renewables to kick in to
Speaker 5: keep the lights on. A regulator recently told me that
Speaker 5: Urkott is beholden to the breath of God. That basically
Speaker 5: means if the wind picks up and it's supposed to
Speaker 5: get stronger, then that gives more bandwidth for Urkott to
Speaker 5: like operate the grids safely and not really worry.
Speaker 1: And of course sun just goes down every day, so
Speaker 1: at night you're never going to have that solar power.
Speaker 5: Actually the riskiest part of the day Historically, you know,
Speaker 5: the grids have always been set up to deal with
Speaker 5: peak summer demand the hottest hour of the day, and
Speaker 5: that was usually like five or six pm. But now
Speaker 5: since we have solar, the risk has actually shifted to
Speaker 5: late afternoon when the sun is starting to set, or
Speaker 5: the evening hours when there is no sun, and that's
Speaker 5: really when you need everything else to like ramp up
Speaker 5: quickly or be strong, and so that risk can actually
Speaker 5: be at like seven, eight or nine pm.
Speaker 1: Noreen, we're talking all about Texas just because so big
Speaker 1: and so hot, but it's also hot across the South,
Speaker 1: and Texas is a bit of an outlier because they
Speaker 1: run their own power grid. What are other states experiencing
Speaker 1: right now and how are they dealing with it?
Speaker 5: Yeah, so Texas is unique because not only do they
Speaker 5: run their own power grid, but they have very few
Speaker 5: links to other grids, so they have to kind of
Speaker 5: be self sufficient. But the nearby grids are also facing stress.
Speaker 5: The one directly to the east and it kind kind
Speaker 5: of like has a slice of Texas and goes all
Speaker 5: the way to the Great Lakes is the MISO Grid,
Speaker 5: the Mid Continent Independent System Operator.
Speaker 3: They have actually put out an.
Speaker 5: Alert for operating the grid conservatively in their southern region,
Speaker 5: which includes Mississippi, Arkansas, Louisiana, these different grids. When they
Speaker 5: see a heat event coming, they will tell any power
Speaker 5: plant or operator of transmission lines or other infrastructure to
Speaker 5: cancel all maintenance so that basically everything is lined up
Speaker 5: and ready to go. And so that's like a first
Speaker 5: call to arms.
Speaker 1: So the storage problem, which is one of the reasons
Speaker 1: why we have these big spikes in energy prices because
Speaker 1: there's no buffer, is something that other states are starting
Speaker 1: to look at. You right about New York, which I
Speaker 1: guess is testing out this giant battery.
Speaker 5: New York's largest battery is about seven point five megawatts,
Speaker 5: and it's a four hour battery. If you ran that
Speaker 5: battery out for four hours at full capacity, that would
Speaker 5: be enough to charge one point five million phones. It
Speaker 5: makes a difference in extreme weather events, but it's the
Speaker 5: tip of the iceberg.
Speaker 1: And I guess that's a really big point that you
Speaker 1: also write about, which is that the US Department of
Speaker 1: Energy says the US is far behind in building what
Speaker 1: we need to keep up with increasing demand.
Speaker 5: Yes, so the energy transition is not going as fast
Speaker 5: as it needs to be. The Energy Department has estimated
Speaker 5: that about thirty to fifty gigawatts of clean energy is
Speaker 5: built a year, and that pace needs to quicken to
Speaker 5: ninety gigawatts. There's a lot of people in finance, in developers,
Speaker 5: venture capital, policy makers on a state federal level trying
Speaker 5: to find a way to make it easier to connect
Speaker 5: these projects so that they could be connected faster. It's
Speaker 5: going to take some time to figure this out, and
Speaker 5: the concern is can you put all these pieces together,
Speaker 5: get through all the red tape To.
Speaker 3: Say it's a lot of work.
Speaker 5: As a massive understatement, there is an urgency to deal
Speaker 5: with this because we do have this very real climate
Speaker 5: threat and we're racing against the clock.
Speaker 1: After the break, even with the heat, the power industry
Speaker 1: is racing for winter.
Speaker 4: A snowstorm and brutal cold hit an unprepared energy system
Speaker 4: and left nearly five million customers in Texas, North Dakota, Arkansas, Louisiana,
Speaker 4: and Mississippi in the dark. Power companies in affected states
Speaker 4: had to resort to rolling power blackouts to save their
Speaker 4: networks from collapsing, leaving households and businesses without power and heat.
Speaker 1: Norien. Here we are sitting in the middle of the
Speaker 1: summer talking about heat. But one really interesting thing you
Speaker 1: write is that the heat is only part of the problem,
Speaker 1: and maybe not even the biggest. It's when winter comes.
Speaker 1: It seems a long way off, but it's the cold
Speaker 1: that often puts the biggest stress on the energy grid.
Speaker 5: Yeah, and actually, how this summer plays out is going
Speaker 5: to directly determine what happens next winter. And what I
Speaker 5: mean by that is the summer months are when you
Speaker 5: refill all the natural gas inventories. You know, the last
Speaker 5: couple summers, demand has been super high for natural gas
Speaker 5: being burned by power generators, and so that limited the
Speaker 5: amount of inventories that were there ahead of winter. So
Speaker 5: if we're burning through that gas now, there's going to
Speaker 5: be less ready in stockpiles for next winter.
Speaker 1: And I want to ask you about one big storm
Speaker 1: that you write about which serves as the kind of
Speaker 1: moment where the energy industry realized they needed to do something,
Speaker 1: and that was Winter Storm Elliot in December twenty twenty two.
Speaker 5: Winter Storm Elliot was a really big wake up call
Speaker 5: because most of the attention at the time was focused
Speaker 5: on like Kentexas survive this after the winter Storm Uri
Speaker 5: like two years ago. And what happened was the greatest
Speaker 5: risks emerged on the East coast. Elliott was a fast
Speaker 5: moving winter storm that moved across from like the northwest
Speaker 5: across the central US and it hit the East coast
Speaker 5: on December twenty third, and the storm moved so quickly
Speaker 5: it caused temperatures on the PJAM grid, which stands for
Speaker 5: historically Pennsylvania, New Jersey and Maryland. It was the cornerstone
Speaker 5: of what is now the largest US power grid, which
Speaker 5: stretches basically from New Jersey to the northern edge of
Speaker 5: North Carolina and out to Illinois. It serves more than
Speaker 5: sixty five million Americans. The storm caused temperatures to fall
Speaker 5: by twenty nine degrees in twelve hours. That was the
Speaker 5: fastest drop in temperature in history for that grid. If
Speaker 5: you had a slower moving storm and you knew it
Speaker 5: was going to get cold, would have power plants that
Speaker 5: would have time to find fuel or to make preparations.
Speaker 3: This was so fast moving.
Speaker 5: It was at the start of a three day holiday weekend,
Speaker 5: when you know people are already on vacation, and so
Speaker 5: there were not enough people around. Trading floors at natural
Speaker 5: gas desks were closed. This is typical every weekend and
Speaker 5: every long weekend, but when you have an extreme weather
Speaker 5: come in, it creates a scramble.
Speaker 1: And so what happened to all those people who were
Speaker 1: supposed to be on the receiving end of all that
Speaker 1: gas powered electricity.
Speaker 5: What was difficult about this storm is that the failures
Speaker 5: were really widespread. In terms of the causes. The gas
Speaker 5: industry was probably the best indicator that there was trouble
Speaker 5: to come. Because gas prices are really reactive to weather events.
Speaker 5: They tend to look at a forecast two weeks out
Speaker 5: in advance, and then if that forecast is reaffirmed every
Speaker 5: day and is still as by the time you were
Speaker 5: five days, three days or the next day out, gas
Speaker 5: prices just like go off the charts. And so what
Speaker 5: happened in the US and in Pjam gas prices started
Speaker 5: rallying ahead of time. So that was a good sign
Speaker 5: and that thing that there could be trouble or that
Speaker 5: there were tight gas supplies. It was on the morning
Speaker 5: of December twenty third.
Speaker 3: It was still.
Speaker 5: Fifty degrees in places like Pennsylvania, but you saw power
Speaker 5: generators start to drop off the grid. And one of
Speaker 5: the concerns we heard was that the rally in gas
Speaker 5: prices was higher than power prices, and so if they
Speaker 5: decided to run on December twenty third, they would have
Speaker 5: been operating at a loss by the time temperatures dropped,
Speaker 5: especially on December twenty fourth, that's when you actually started
Speaker 5: to see significant drops in gas production. The Appalachian regions,
Speaker 5: which is the Marcellus and Utica shale, dropped Significantlyica fell
Speaker 5: by about half and Pennsylvania fell by about twenty percent.
Speaker 5: Anytime you see gas production falling off, so there's less
Speaker 5: gas going onto pipelines and there is high demand on
Speaker 5: the other side, which is homes, businesses, and power plants
Speaker 5: tapping those pipelines more, it creates a pressure imbalance.
Speaker 1: Describe what you mean by pressure issues for people like
Speaker 1: me who don't understand the technical aspects of delivering gas
Speaker 1: through a pipeline to a power plant.
Speaker 5: When you're expecting a cold weather event, pipeline operators will
Speaker 5: do something called line pack. That's when they basically increase
Speaker 5: how much gas is being pumped into a pipeline system,
Speaker 5: and then you want to make sure that it evens
Speaker 5: out like over like long distances. But if you can
Speaker 5: pump these molecules and they're more condensed.
Speaker 3: You have higher pressure.
Speaker 5: The idea is you use the pipelines as a storage system,
Speaker 5: so when demand comes online, you are already instantaneously to
Speaker 5: tap that. Utilities we heard were taking a lot of
Speaker 5: gas off the system because homeowners and businesses were turning
Speaker 5: up their heaters. That means that they're taking off gas
Speaker 5: at a faster rate than it can be put on,
Speaker 5: and so that changes the difference in pressure and that
Speaker 5: can create instability. It's like if you're in a traffic jam.
Speaker 5: If suddenly you have a car that starts and stops
Speaker 5: in the middle, it creates like this halted flow of traffic.
Speaker 5: But if everyone just drives at ten miles per hour,
Speaker 5: you'll all just suddenly keep moving in a flow and
Speaker 5: the exits will keep flowing out if there's no other
Speaker 5: accidents on the end.
Speaker 1: And so the danger is if there isn't enough gas
Speaker 1: coming through, then you lose that pressure. So they have
Speaker 1: to keep up a constant supply.
Speaker 5: Yeah, if the pressure gets too low, you cannot run
Speaker 5: power plants at some level. That happened during winter Storm
Speaker 5: Ury in Texas. There was a sudden drop in gas.
Speaker 5: They couldn't maintain the pressure and power plants have to
Speaker 5: shut down, and that contributed to the blockouts.
Speaker 1: And in this winter storm Elliott in December, you right
Speaker 1: that there is this scramble to try to find gas
Speaker 1: to keep it flowing into the plant, to keep up
Speaker 1: this pressure.
Speaker 5: So there was a mad scramble because the gas industry
Speaker 5: operates on a different schedule from the power industry. When
Speaker 5: you're thinking about buying power for the next day and
Speaker 5: the day ahead market, your day starts at midnight and
Speaker 5: is you know, for the full twenty four hour it's
Speaker 5: for that one day, but the gas day starts at
Speaker 5: ten am. So on Friday, December twenty third, if you
Speaker 5: had a problem at like nine am that you suddenly
Speaker 5: needed gas, you actually had to have that secured on
Speaker 5: Wednesday because that would have fallen into that day ahead
Speaker 5: schedule for a gas So that is a fundamental issue
Speaker 5: that exists every day and is a problem every weekend.
Speaker 5: But you know you don't have a high demand day.
Speaker 5: You know there's ways around it. There's enough spare supply
Speaker 5: to like tap into. The other problem is this is
Speaker 5: a three day weekend. The gas industry basically shuts down
Speaker 5: every Friday. There are always traders and like some folks
Speaker 5: around that can help you fill in for a last
Speaker 5: minute fuel, but for the most part, people are out
Speaker 5: for the weekend. And then on top of that, this
Speaker 5: was a holiday weekend, so they were on vacation for real,
Speaker 5: but also like for three days, So if you were
Speaker 5: trying to buy gas for like Christmas, which is on Monday,
Speaker 5: you had to know what that demand was going to
Speaker 5: be on Friday. When you have a fast moving storm,
Speaker 5: it's always hard to predict what actually is going to
Speaker 5: show up. Usually demand on a holiday weekend is week
Speaker 5: The fact that demand came in really strong was another
Speaker 5: surprising factor, and that added to the scramble.
Speaker 1: So this is obviously a pretty extreme example, but I
Speaker 1: think a lot of people listening to this will be
Speaker 1: pretty surprised to hear just how it kind of catches
Speaker 1: catch can it can be to keep all of our
Speaker 1: lights on how common an occurrence is this.
Speaker 5: I've covered gas for a long time and then covered power,
Speaker 5: and I remember gas every weekend were like, our price
Speaker 5: is going crazy. It's an issue every weekend and every
Speaker 5: long weekend. A power generator executive testified at the Federal
Speaker 5: Energy Regulatory Commission at a mid June meeting, saying the
Speaker 5: Intercontinental Exchange, which is where you buy a lot of
Speaker 5: your spot gas purchases if you are a power plant,
Speaker 5: is telling folks that for the upcoming July fourth holiday,
Speaker 5: you have to buy your gas on Friday. The point
Speaker 5: that this executive was making was that if there was
Speaker 5: an extreme weather event, then that would create another big
Speaker 5: round of uncertainty and another scramble.
Speaker 3: If things got severe.
Speaker 1: When we come back, what can we do to bolt
Speaker 1: up the grid and of divert all these troubles? What
Speaker 1: are the companies actually doing to try to fix this
Speaker 1: boom and bus cycle that seems to happen with great regularity.
Speaker 5: So the boom in bus cycle is kind of like
Speaker 5: subdued or you can ride the waves like on a
Speaker 5: normal day on extreme weather events. There have been a
Speaker 5: lot of efforts in the last decade. This is not
Speaker 5: a new issue to increase coordination communication with the gas
Speaker 5: industry the power industry. Because power is considered a public
Speaker 5: good and you need to keep the lights on to
Speaker 5: keep the economy running. There are standards that power generators
Speaker 5: utilities have to follow to ensure that they can operate
Speaker 5: throughout the year and especially during cold weather events. Now
Speaker 5: there's a lot of criticism that those standards don't go
Speaker 5: far enough, but the gas industry does not fall under
Speaker 5: that realm of oversight, and there have been calls that
Speaker 5: the gas industry needs to have weatherization standards and needs
Speaker 5: to communicate more, disclose more information with the power industry.
Speaker 1: You've talked about PJM and how they've faced some of
Speaker 1: these problems. What does the company say about this.
Speaker 5: PJM is technically a corporation, but it's considered a quasi
Speaker 5: government agency appointed by the federal government to run this
Speaker 5: thirteenth state grid. They have said that the large number
Speaker 5: of outages driven by natural gas plants was unacceptable and
Speaker 5: that a large portion of them were because of equipment
Speaker 5: outages versus gas availability.
Speaker 1: Norim is there concern that we're going to start to
Speaker 1: see more and more of this happening across the country.
Speaker 3: That's certainly the fear.
Speaker 5: I spoke to Mark Christi, who is a commissioner on
Speaker 5: the Federal Energy Regulatory Commission, which is the agency that oversees.
Speaker 3: The power industry.
Speaker 5: He's been warning about these reliability concerns and concerns related
Speaker 5: to the gas deliverability issues for over a year now,
Speaker 5: but then when we spoke with him recently, he said
Speaker 5: that these concerns are accelerating because you can't save power
Speaker 5: like in a barrel of oil.
Speaker 3: The power grid.
Speaker 5: Has to be balanced every minute of the day.
Speaker 3: It's very specific.
Speaker 5: If you lose that balance too much for too many minutes,
Speaker 5: the grid is subject to failure. That's what almost happened
Speaker 5: in Texas in twenty twenty one.
Speaker 3: What Winter Storm Elliott was.
Speaker 5: It was a warning that you cannot say that you
Speaker 5: have a lot of extra power plants on the grid
Speaker 5: and you'll be okay.
Speaker 3: They are now taking another look.
Speaker 5: And saying, we need to see what actually shows up
Speaker 5: in these extreme weather events, whether it's in the summer
Speaker 5: or winter.
Speaker 1: Maurine is a power industry looking beyond natural gas to
Speaker 1: get past some of these problems.
Speaker 5: Yes, the power industry is definitely looking beyond gas, but
Speaker 5: that is a complicated answer because there is no obvious
Speaker 5: replacement to natural gas. Natural gas right now is needed
Speaker 5: to provide a lot of the power on the grid,
Speaker 5: but as we go forward, as we have more renewables
Speaker 5: hook up to the grid, gas isn't going to be
Speaker 5: used as much every hour of the day, but you're
Speaker 5: gonna need it more and more to step in dependably
Speaker 5: on those most critical hours when the sunset and all
Speaker 5: that solar goes offline, or when there's a low wind day.
Speaker 5: There isn't enough battery storage to make up for all
Speaker 5: of that, and you still need to actually like produce
Speaker 5: power to store in batteries. So the benefit we saw
Speaker 5: from gas in the last decade is it was easy
Speaker 5: to replace coal. It was an easy answer. One megawatt
Speaker 5: from a gas power plant was enough to replace one
Speaker 5: mega wat from coal and doing so it helped cut
Speaker 5: costs for consumers because you were tapping this cheap shale gas,
Speaker 5: but it also had a lot of environmental benefit because
Speaker 5: it burns cleaner than coal. We're now at a stage where,
Speaker 5: given the climate crisis, gas isn't clean enough, and so
Speaker 5: there are technologies that are being considered, like carbon capture
Speaker 5: or shifting off of natural gas.
Speaker 3: There is a lot of energy.
Speaker 5: Part of my pun being put into trying to solve
Speaker 5: this problem of what does the grid of the future
Speaker 5: look like. But there is a really hard engineering problem.
Speaker 5: How do you keep this system running? Like a physics problem.
Speaker 5: How do you keep this system running and keep the
Speaker 5: lights on. There's a saying that the power industry likes
Speaker 5: to use. Gas may only be seven percent of the economy,
Speaker 5: but it's the first seven percent the entire economy relies
Speaker 5: on it.
Speaker 1: Noreene, thanks so much for talking with me today.
Speaker 3: Thank you, it was great.
Speaker 1: Thanks for listening to us here at the Big Tay.
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