Written by NextGen Energy Council
Conducted by The NextGen Energy Council Management Information Services,
Enviro Group Lawsuits, Cost Concerns, Climate Regulation Uncertainty Cited As Major Obstacles To Grid Improvements
Denver, CO (Oct. 1, 2008) -- A new study released this week highlights what experts have been saying for years: the U.S. faces significant risk of power brownouts and blackouts as early as next summer that may cost tens of billions of dollars and threaten lives.
The study, "Lights Out In 2009?" warns that the U.S. "faces potentially crippling electricity brownouts and blackouts beginning in the summer of 2009, which may cost tens of billions of dollars and threaten lives."
"If particularly vulnerable regions, like the Western U.S., experience unusually hot temperatures for prolonged periods of time in 2009, the potential for local brownouts or blackouts is high, with significant risk that local disruptions could cascade into regional outages that could cost the economy tens of billions of dollars," the report warned.
U.S. baseload generation capacity reserve margins "have declined precipitously to 17 percent in 2007, from 30-40 percent in the early 1990s," according to the study. A 12-15 percent capacity reserve margin is the minimum required to ensure reliability and stability of the nation's electricity system. Compounding this capacity deficiency, the projected U.S. demand in the next ten years is forecast to grow by 18 percent, far exceeding the projected eight percent growth in baseload generation capacity between now and 2016.
The study, which can be downloaded here, estimated that the U.S. will require about 120 gigawatts (GW) of new generation just to maintain a 15 percent reserve margin. That will require at least $300 billion in generation and transmission facility investments by 2016.
"The facts presented in this study should stimulate a call for action by policymakers everywhere. Our nation's electricity system is clearly in trouble and we need to take rapid steps as soon as possible to remedy the situation," said Bob Hanfling, Chairman of the non-profit NextGen Energy Council, which conducted the study. "This isn't the first study to come to these conclusions, and it won't be the last. We hope it illuminates current policy debates, from those on climate change to resource development to infrastructure build-out to national security. We also hope it will sound the alarm for every elected official, policymaker, business leader and citizen concerned about the future prosperity and security of our nation."
The study also identified the primary barriers to getting new power plants and transmission lines built. Chief among these is the "opposition of well-funded environmental groups that oppose and file lawsuits against virtually every new infrastructure project proposed."
Other obstacles include opposition to natural gas production, which is needed to fuel the growing reliance on natural-gas fired power plants; challenges associated with putting more intermittent renewable power sources on the grid; regulatory uncertainty associated with climate change policy development; reluctance by state regulators to approve rate increases related to the imposition of new environmental or climate-related regulation; and the relatively shorter-term approach to resource planning and acquisition that industry has been forced to adopt because of all of the above factors.
Among its other findings were these:
The study also presented a survey of political developments and trends that amount to "structural political barriers being erected to system reliability." It pointed to the fact that "environmental activist groups" are now:
The NextGen Energy Council is a non-profit, 501(c)(3) organization comprised of a wide variety of energy and technology leaders and companies that work collaboratively with Governors, federal and state officials, academic institutions and others to promote the rapid development and commercialization of cutting-edge energy technologies.