Oil & Gas News

Most of North America at Risk of Energy Shortfalls This Summer

Extreme energy shortfalls forecasted due to extreme demands this summer

Story by Andreas Exarheas|Rigzone| Two-thirds of North America is at risk of energy shortfalls this summer during periods of extreme demand, the North American Electric Reliability Corporation (NERC) has revealed.

According to the NERC’s Summer Reliability Assessment, which was released recently, the Midcontinent ISO (MISO), NPCC-New England, NPCC-Ontario, SERC-Central, Southwest Power Pool (SPP), Texas (ERCOT), and U.S. Western Interconnection areas “face risks of electricity supply shortfalls during periods of more extreme summer conditions”.

In a statement accompanying the report, NERC noted that areas in the U.S. West are at elevated risk due to wide-area heat events that can drive above-normal demand and strain resources and the transmission network and highlighted that, in SPP and MISO, wind energy output will be key to meeting normal summer peak and extreme demand levels due to little excess firm capacity.

The risk of drought and high temperatures in ERCOT may challenge system resources and may result in emergency procedures, including the need for operator-controlled load shedding during periods of low wind and high generator outages, NERC said in the statement, adding that the SERC Central region is forecasting higher peak demand and less supply capacity, “creating challenges for operators to maintain reserves in extreme scenarios”.

NERC went on to note in the statement that New England has lower available capacity than last year, “resulting in a higher likelihood of system operators using emergency procedures to manage extreme demand conditions”. In Ontario, the extended nuclear refurbishment has reduced available capacity, limiting system reserves needed to manage peak demand, NERC warned in the statement.

“Increased, rapid deployment of wind, solar and batteries have made a positive impact,” Mark Olson, NERC’s manager of Reliability Assessments, said in a NERC comment.

“However, generator retirements continue to increase the risks associated with extreme summer temperatures, which factors into potential supply shortages in the western two-thirds of North America if summer temperatures spike,” he added.

Recent Actions

Earlier this month, NERC announced that it had issued the Level 3 Essential Actions alert – Cold Weather Preparations for Extreme Weather Events III. The purpose of the Level 3 Alert is to increase the readiness of reliability coordinators, balancing authorities, generator owners, and transmission operators for mitigating operational risk for winter 2023–2024 and beyond, the organization noted at the time.

The alert contains a set of eight specific actions that NERC determined to be essential for certain segments of owners, operators, or users of the grid to undertake to ensure its reliable operation, the organization highlighted, adding that this is the first time that NERC has issued a Level 3, which it said is the highest severity level in NERC’s alert classification structure.

Back in April, NERC revealed that it had filed a report evaluating the CIP-014 Reliability Standard with FERC. The report, which was directed by FERC in a December 15, 2022, order, called for NERC to study the applicability criteria of the standard and the adequacy of the risk assessment and to assess whether a minimum level of physical security protections should be established for all bulk power system transmission stations, substations, and primary control centers, NERC noted at the time.

“This evaluation was important given the heightened physical security threat environment and the high profile attacks which occurred in the fourth quarter of 2022,” Jim Robb, NERC President, and CEO, said in an organization statement in April.

“Our study outlines actions to strengthen the physical security standard and foster robust stakeholder engagement to consider additional risk-based enhancements,” he added.

Get the Weekly Newsletter Thousands of Mineral Rights Owners and Investors Rely On.

Read Also: Extreme measures required to solve debt-ceiling crisis

Winter Storm Elliott

In December last year, NERC announced that it, NERC’s regional energy entities, and FERC, would open a joint inquiry into the operations of the bulk power system during the extreme winter weather conditions that occurred during Winter Storm Elliott.

NERC noted that the time that the severe cold weather contributed to power outages affecting millions of electricity customers across the United States. Although most of these outages were due to weather impacts on electric distribution facilities operated by local utilities, utilities in parts of the southeast were forced to engage in rolling blackouts and the bulk power system in other regions was significantly stressed, NERC stated.

“This storm underscores the increasing frequency of significant extreme weather events (the fifth major winter event in the last 11 years) and underscores the need for the electric sector to change its planning scenarios and preparations for extreme events,” Robb said at the time.

NERC describes itself as a not-for-profit international regulatory authority whose mission is to assure the effective and efficient reduction of risks to the reliability and security of the grid. NERC’s area of responsibility spans the continental U.S., Canada, and the northern portion of Baja California, Mexico.

The organization is the Electric Reliability Organization for North America, subject to oversight by the Federal Energy Regulatory Commission (FERC) and governmental authorities in Canada. Its jurisdiction includes users, owners, and operators of the bulk power system, which serves nearly 400 million people, NERC’s website highlights.

To contact the author, email andreas.exarheas@rigzone.com

READ NEXT: Europe’s Energy Market Faces 3 Key Challenges


Energy, oil and gas mineral owners

To Top
Lease or Sell Your Minerals Rights in Oklahoma or Texas ➡️(405) 492-6277

Have your oil & gas questions answered by industry experts.