Published on August 20th, 2014 | by Silvio Marcacci97
How One Wonky Court Decision Could Unlock Our Renewable Energy Future
August 20th, 2014 by Silvio Marcacci
When it comes to the future of renewable energy in America, most people don’t think about the Federal Energy Regulatory Commission or the United States Court of Appeals.
But a decision last week by the District of Columbia U.S. Court of Appeals upheld FERC’s Order 1000, which would require regional coordinated planning and renewable energy integration for major new transmission line projects.
At it’s heart, Order 1000 would mean states who aren’t part of regional grid operator systems like PJM Interconnection or ISO-New England can no longer make decisions about adding new generation in a vacuum and must consider the renewable portfolio standards or emissions reduction goals of neighboring states – opening the door for vast amounts of new clean energy.
One Solution For Two Renewable Energy Challenges
Adding large amounts of renewable energy to the grid faces two major challenges – getting electricity from remote locations with the best renewable potential to large areas of power demand (meaning they can sell power at market value), and compensating for intermittency created when the wind doesn’t blow or the sun doesn’t shine.
Both those hurdles have been cleared with more and more frequency in regional grid systems. Simple logic dictates that the larger a grid footprint, the easier one power plant can find a customer and the easier a grid operator can balance out when power plants go offline (don’t forget, even the biggest fossil fuel power plants go offline for planned maintenance or unexpected outages).
For context, consider the wind power records being set across regional grids every day, the impact Texas’ Competitive Renewable Energy Zones (CREZ) transmission project has had on the state’s western wind energy resources, or the potential impact of the Clean Line transmission project for Oklahoma wind resources – if remote wind farms can reach populated areas, their capacity factors increase and the percentage of renewable energy consumed rises across an entire region.
What’s America’s Future Power System Look Like?
But in large parts of the American West and Southeast, utility service has remained in monopolistic control. Essentially, if you live in a utility’s service territory, your power demand is guaranteed to their generation and power lines. It’s no surprise that these regions are among the most dependent on fossil fuel and least innovative when it comes to demand response or smart grid technologies. Without competition or input from others, what incentive does any business have to change its model?
Seems only natural, then, that Order 1000 was originally opposed by a glut of 45 state regulatory agencies, utilities, and trade associations representing power companies and supported by multiple environmental organizations and clean energy advocates.
After all, no less than the future of America’s grid system was at stake. “We have an aging grid that needs billions of dollars worth of renovations and the question is how that money will be spent – on the smart grid technology that can hasten reliance on more clean energy or on masking tape and chewing gum solutions that keep us wedded to fossil fuels,” said Abigail Dillen of Earthjustice.
“We No Longer Live In Our Own Small Worlds”
Now that the courts have upheld Order 1000, all that’s set to change. Grid investments like transmission lines across multiple states or utility territories will require mandatory coordinated planning instead of decisions by an individual state’s regulators (often elected by fossil fuel interests) or one utility. Critical stuff, considering nearly 15 gigawatts of new wind power capacity could soon be built across the U.S.
“Among Order 1000’s most important reforms is requiring transmission-owning utilities in regions without electricity markets, like the Southeast and most of the West, to create and participate in regional planning processes with more transparency and stakeholder participation,” said John Moore of the Natural Resources Defense Council. “Order 1000 sensibly recognizes that we no longer live in our own small worlds, at least where the grid is concerned.”
More importantly, any new regional transmission plan will now have to consider the carbon reduction targets or renewable energy standards in place across 30+ states, meaning not only will states have to consider their neighbors’ emissions goals (think California versus Arizona), but states just got another reason to consider regional carbon markets to comply with the pending EPA emissions reductions rule.
“This really is significant because now any time transmission is being considered it will have to take into account states that use renewable energy as a compliance tool to meet greenhouse gas emissions goals,” said Gene Grace of the American Wind Energy Association in a ThinkProgress interview.
U.S. Grid-Renewables Potential, Unlocked
Hundreds of billions of new investment will be needed to maintain grid reliability, especially in an age of extreme weather where one major storm can knock out power to millions and bring major commercial hubs to a halt.
Until now, that smart grid and clean energy future was essentially locked out of major portions of the United States, even as it was proven to cut emissions and keep the lights on in regional transmission areas – for example, the nation’s regional grid operators recently argued regional carbon reduction and planning solutions are more efficient than localized decisions.
But last week’s court decision reiterates the power of FERC, the one regulatory body charged with ensuring the most efficient and reliable grid across America, to knock down those arbitrary walls blocking our clean energy future. “Our nation needs substantial investment in transmission infrastructure to adapt to change sin our resource mix and environmental policies,” said FERC Commissioner Cheryl LaFleur. “Order 1000 is critical to the Commissions efforts to support efficient, competitive, and cost-effective transmission.”
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