From Watts Up With That?

Kevin Kilty

On February first I attended a Wyoming Public Service Commission (PSC) meeting regarding public need and public convenience (PNPC) of a purchase and construction of electric generation and transmission assets in southeastern Wyoming. During the seven hours I attended the meeting I provided public comment on three separate topics. However, I spent most of the meeting listening to presentations by Rocky Mountain Power (RMP) and Q&A exchanges between representatives of PacifiCorp, the parent of RMP and the commission. Despite some of the background information being proprietary and not available to the public, there was much to learn in what was made public. A template for the next two decades to make our modern electric grid is becoming clear – details required to make this vision actually work are not made clear, however.

The central focus of this meeting was allowing RMP to justify their acquisition of a wind power plant (Rock Creek I and Rock Creek II) and associated transmission lines and substation modifications it requires to connect to the RMP grid through a build transfer agreement (BTA) with the developer. With the blessing of the PSC, the developer can proceed with purchases of materials and supplies and begin construction.

Let’s be clear about two things

How does the deceptively named Inflation Reduction Act (IRA) impact the spread of renewable energy? This hearing provided an answer.  Last fall a number of people suggested here on WUWT and in other places that the prevailing wage demands of the IRA would put the kibosh on renewable energy plants. I crossed my fingers then, but it is quite apparent now that the IRA contains tax subsidies so sweet that it actually encourages renewable energy adoption even though the prevailing wage demands make all these projects more expensive. This is obvious when one sees the enthusiasm of the PacifiCorp and developer of the Rock Creek projects over the opportunities provided by the IRA. On the part of PacifiCorp, they are convinced that benefits will flow through to ratepayers despite Rock Creek I and II being made more expensive by the IRA.

However, subsidies do not make anything less expensive. They simply shift costs from one economic group to another. Furthermore, it is very difficult to figure out who benefits from tax credits. Empirical data shows that vendors manage to capture the tax benefits often because they are in the best position to do so. If you do not believe this, just read the provisions of the IRA dealing with tax credits for purchasing environmentally preferred vehicles (H.R. 5376, Subtitle D, part 4 – clean vehicles).

Finally, despite the executive order signed by Biden enabling this legislation claiming that it will lower energy costs for consumers and encourage good paying union jobs nationwide (E.O. 14082 of Sep 12, 2022)[1], a revealing exchange during the meeting between the PSC and PacifiCorp reveals that no one thinks energy costs will fall. Instead what is being promised is that what rates result from our adventure in energy systems design by voting will be lower than all competing options. How could it be otherwise?

It is a mathematical certainty that if one searches for an optimum in a very constrained space of possibilities the best one can expect is merely a local optimum possibly very far from any global best solution.

Rock Creek I and II

According to projections and modeling by PacifiCorp there will likely be a shortfall of 1,800MW of generating capacity within their service area beginning in 2023, mainly during summer months. This combination of adjacent wind plants Rock Creek I and Rock Creek II, near the town of McFadden, Wyoming represent part of an effort to build or acquire assets to close this deficit. Rock Creek I and II have a combined nameplate rating of 590MW. However, nowhere in the preliminary remarks was any clarification of the difference between nameplate capacity and deliverable capacity. As everyone who visits WUWT knows, wind plants present a large and highly variable difference between the two measures of capacity. Thus in my first public comment I made clear that what 590MW of nameplate capacity means is probably 200MW of deliverable capacity on the basis of an annual average but the actual capacity on any given day, or fraction of a day, could range from zero to perhaps 400MW.

To emphasize the consequences of this variability I appealed to empirical observations regarding the reserve capacity estimations of the Ercot network. Ercot had in 2016 projected year 2019 reserve margins (based on seasonal capacity averages) during the summer to be nearly 20% of system capacity. However, with changes to generating sources, renewables replacing fossil fuel fired assets mainly, the actual 2019 reserve margin had shrunk to less than 9% and on various days was less than 2%.This should have raised alarm bells about possible reserve deficits in future years, and in winter as well as summer, but failed to do so. Nowhere, I pointed out, does empirical data support the notion that addition of so-called renewable energy to an electrical grid ever results in lower prices for consumers.

Late in the meeting, in response to a line of questioning by the PSC, PacifiCorp admitted that purchase of this 590MW of nameplate wind plant would only add somewhere between 59MW and 100MW of real capacity to fill the 1,800MW shortfall. For all their hoopla and fanfare wind plants don’t add much.

Externalities

The Executive Director of the Albany County Conservancy in her public commentary made a pitch that the external costs of wind power should be made a consideration of costs of power. These externalities are not negligible. They include destruction of viewshed, which even various county ordinances make explicitly clear cannot be mitigated, and hazards to wildlife.

In regard to hazards to wildlife one cannot help but mention Bald and Golden eagles in particular. The Bureau of Land Management (BLM) in an environmental assessment (EIA) dated to December 2022 estimated that the complex of energy facilities within an 89 miles radius of the town of Medicine Bow, Wyoming including some 2,000 square miles of wind plants, operating, permitted and planned would lead to a mortality of some 28% of the local area population (LAP) of Bald eagles. This exceeds the typical take allowed in a incidental taking permit of 5%, but also greatly exceeds an estimated growth of eagle populations across Wyoming in general – a growth enabled by careful management of resources and consideration of hazards during the past 50 years.

Moreover, research conducted by a Laramie-based wildlife biologist calls into question any utility to the idea of a local area population. Through a decade of careful tracking of eagles he has shown that eagles residing for parts of the year in southeastern Wyoming can migrate to western Canada or into Central Mexico over a period of 10 days. The local area population is possibly a North American continental population and these wind plants are right on the flyway.  

There are potential impacts to game animals, recreation and tourism, as well as significant threats to employment in the region. The externalities are not negligible.

The PacifiCorp 2021 IRP

The template for this clean grid is PacifiCorp’s 2021 integrated resource plan (IRP). The non-proprietary version of this plan is available here. I see there is now a 2023 version, but the 2021 version seems more complete. Those noteworthy parts of this plan for purposes of the PNPC hearing are:

1. Dispatchable assets employing combustion are gone by 2040 and replaced with wind, storage, solar+storage, a great deal of energy efficiency gains, demand side management, a small amount of nuclear and unspecified “non-emitting peaker” plants.
2. Storage is listed in terms of MW not MWhr and mainly consists of batteries colocated with solar with a small amount of pumped hydro.
3. Modeling is done through Monte Carlo simulation of random draws of a small set of sources from a finite distribution of loads and some unspecified distribution of weather-related disturbances. The modeling effort was largely directed toward obtaining a lowest-cost combination of resources.
4. Reliability is evaluated by requiring that suitable model results always managed to achieve a 13% of capacity reserve margin.

Figure 2. Six days of electrical energy generation in the Northwest region according to the EIA, midnight January 18, 2023 to midnight January 24, 2023. This figure includes many utilities in addition to PacifiCorp.

Figure 2 is extremely current data showing much about operating an electrical grid containing significant non-dispatchable wind and solar. I used it in my final public comment to introduce a number of questions about the IRP. First, the character of solar is easily visible as the pulses of capacity along the bottom of the graph. Solar takes a couple of hours to ramp up to its full value each day, remains flat for five to six hours then ramps down over a couple hours more. The pulses being different heights reflect variations in weather day to day. These day-to-day variations amount to one third of typical capacity as the difference between the 19th and 21st shows.

PacifiCorp said during testimony that coal plants balance solar, and while Figure 2 shows that coal does curtail slightly on most days as solar capacity rises, it is natural gas plants that provide most of the balance. Figure 2 clearly shows it. Up goes solar capacity; down goes gas. Once I illustrated the clear relationship between gas and solar, I proceeded to show the same was true of wind as balanced against the sum of natural gas, coal and hydro. Apparent clearly is the rising baseline of gas and coal on the early morning of January 19 just as wind is fading away, combined with the decline in coal plus natural gas as wind recovers at mid-day on the 21st. Then again during the morning of the 22nd wind fades again while gas and coal rise to backfill the deficit. On the 22nd I drove past the Roundhouse I wind plant near Cheyenne, Wyoming twice to observe only a few of its turbines turning in the morning, and none turning at all later in the afternoon. Thus, the wind deficit made apparent by motionless blades in the far east of RMP territory is shown by Figure 2 to have extended throughout the entire Northwest. The low point of wind turbine capacity reached on the 30th at mid-day was a paltry 1,600MW or about 5% of regional wind capacity. There was nothing special about this time period – one would expect to see such weather, and such variations in solar and wind, a dozen times during a winter. It ought to be obvious that one cannot run a grid with solar and wind without the balancing capacity of gas and coal, or something like gas and coal.

Many dispatchable assets shown operating in Figure 2 are scheduled for retirement in the near future. Three Wyoming coal fired units (Jim Bridger 1 and 2 and Naughton 3) will be converted to gas peaker plants in 2024 but even these will be retired by 2037. What will replace them is non-emitting peaker plants which are left completely unexplained in the IRP. The IRP also envisions a Natrium 350MW (electric) SMR plant becoming available in western Wyoming in 2028, which seems a bit optimistic for a design not yet approved. Only the Nuscale SMR is presently approved.

What balances solar and wind is storage – mostly batteries colocated with solar plants and a small amount, nearly insignificant compared to the nameplate capacity of wind resources promised, of new pumped hydro. The IRP lists a capacity for the planned storage assets in MW, but not a figure for available energy in MWhr.  In my comments I pointed out that without clear language about what is being proposed one cannot determine if the balancing can last 3 hours, or a day, or what is likely needed, many days in a row. The wind deficits shown in Figure 2 go on for days and can be backed-up with coal and gas as long as fuels are delivered or available on site – batteries and pumped hydro lasts only as long as its total storage in MWhr.

Reliability

Reliability claims are vague in my view, but are built on Monte Carlo simulations. PacifiCorp claims that there is at least a 13% reserve in their lowest cost mix of sources. This seems already slim enough. However, it appears that one-half this reserve exists on the demand side – load shedding in other words. 

In addition to their own modeling PacifiCorp did examine Western Electricity Coordinating Council (WECC) Western Assessment of Resource Adequacy Report and the Long-term Resource Adequacy (LTRA) study of the North American Electric Reliability Council (NERC). These assessments date from before the Texas February 2021 fiasco, and one might wonder if they are still relevant. In particular WECC uses a One Day in Ten Years (ODITY) planning threshold, which they believe a 15% reserve margin can meet (note this is above the IRP reserve minimum of 13%). WECC also recommends in portions of the NW region that “…as more variable resources continue to be added to the grid, a larger planning reserve margin may be needed to compensate.”

In addition, in subportions of the NW region there are potentially 200 hours to as many as 4,000 hours per year of potential reliability problems without import of energy from other grid sub portions.

Perhaps PacifiCorp has modeled all the way to a probability of service disruptions of all sorts and this information is proprietary and available only to the PSC. Yet, there is the tendency, groupthink-like, to view climate change as increasing reliability problems in warm months rather than in cold, which is exactly how Ercot was thinking pre-2021. I suggested that PacifiCorp could help their case by demonstrating a reasonable reserve in weather like January, 1963 – pick a most troublesome historical analog and demonstrate reliability.

Take-away

Reading through the 2021 IRP for PacifiCorp reveals how utilities are hemmed-in by state laws, Federal laws, and the magical thinking of voters. I don’t know if their plans represent the best possible responses to their constraints, but they are sincerely trying. The Q&A between PacifiCorp and the PSC suggests to me the PSC are grappling with this complex problem and trying their best as well. Yet, what I absorbed from the hearing shows that in addition to the constraints being applied there is also some unrealistic group think. The entire process could use many knowledgeable independent critics to help guide it.

Wind turbines seem to me the worst possible way to deliver electrical energy. For the capacity they actually provide they impose costly externalities through destruction of wildlife, scenery, and the unknown cost of failure to show up when needed most; no matter where they are located – onshore or offshore. They require very great amounts of resources in terms of steel, concrete, other highly processed materials, and transportation to build plus the fossil fuels expended to do all this. They impose complications on the operation and maintenance of the grid in addition to a need for other expensive physical assets to run the grid reliably that would not be needed in their absence.

One statement made by PacifiCorp pointed out a final worrisome hazard for Wyoming in particular. Wyoming produces 12% of the U.S. energy supply. Our entire economy is built around energy, fossil fuels overwhelmingly, and extractive industries. This applies to most of the service industry as well. Perhaps government can maintain their own employment with the new energy excise and ad valorem taxes replacing sources of revenue destroyed, but everyone cannot be employed by government in anything other than a make-believe way; the transition time available to make an entirely new economy is very short.[2] In the worst case we will go from the sixth best per capita income to a rival to Mississippi for the lowest.

PacifiCorp stated that the best options for their future grid are solar plus co-located battery storage in Utah and wind plants in Wyoming. This is where the resources are. Given the constraints involved (and potential group think on the part of voters and politicians) no can reasonably think otherwise. What this means is that Wyoming will end up with the worst performing and most costly and destructive portions of the grid. I fear we are the sacrificial state. 

Notes:

1.Implementation of the Energy and Infrastructure Provisions of the Inflation Reduction Act of 2022, A Presidential Document by the Executive Office of the President,

E.O. 14082 of Sep 12, 2022

Section 1 . Background. The Act is the single largest and most ambitious investment in the ability of the United States to advance clean energy, cut consumer energy costs, confront the climate crisis, promote environmental justice, and strengthen energy security, among other vital provisions that will lower costs for families, reduce the deficit, and grow and strengthen the economy. The Act will:…

2. As an example of groupthink, during the Energy Conference I described on WUWT last year I heard many people exclaim that they didn’t want other state’s nuclear waste coming to Wyoming. Yet, a safe and lucrative recycling industry meant to recover the enormous energy potential of spent nuclear materials stored onsite around the U.S. is exactly the sort of opportunity we should pursue. It is anyone’s guess if this might be considered rationally.