In the 15 years since the American fracking boom unleashed a torrent of abundant, cheap and domestically available natural gas, the country has leaned into the fuel — and hard. Hundreds of new, state-of-the-art gas power plants have come online with tens of billions in Wall Street backing in what’s now the biggest gas-producing nation in the world. Given its reputation for low-cost, clean and stable generation, gas dethroned coal in 2016 as the US’s No. 1 source of electricity. This year, it will make up a record 41% of power production, more than solar, wind, hydro and coal combined.
The grid’s newfound reliance on natural gas was for more than a decade hailed as a breakthrough. It’s now one of its biggest vulnerabilities.
Although natural gas is often promoted as a “bridge fuel” to span the transition from coal power to renewable energy, the country’s vast network of gas plants, pipelines and the regulations that govern them was largely built without the realities of extreme weather in mind. Facilities aren’t uniformly winterized, and some rely on a single gas pipeline for supply. Many generators don’t have the ability to burn an alternate fuel or keep back-up gas on hand in case of emergencies. The US has the most sprawling and interconnected gas pipeline network in the world, stoking complacency that the fuel will always be there when needed. But increasingly it’s not, contributing to more than seven hours of power interruptions for US households on average in 2021, more than double the rate reported in 2013.
Because the American gas system operates with just-in-time delivery in mind, it’s hard to adapt when a climate calamity hits, especially in winter. Eventually, the country will utilize less natural gas amid the shift to renewables, but it relies heavily on the fuel in the meantime. And since even the newest gas plants are at risk of becoming obsolete once the transition to clean energy is complete, it’s hard to get the support to build more pipelines and the other key infrastructure that’s needed to shore things up.
That’s the takeaway from more than two dozen interviews with traders, regulators and power-plant operators, many of whom weren’t allowed to talk publicly because of $1.8 billion in pending fines for generators that failed this past winter on America’s biggest grid.
“If you have assets that you can’t get fuel to, it’s useless,” said Thomas Coleman, executive director of Grid Security Project and a former adviser to North American Electric Reliability Corp. “We have a broken system, and it’s threatening our national security and it’s threatening our economic viability.”
Just look at the grid operated by PJM Interconnection LLC. It’s the largest in the country with a reputation as one of its most reliable. And yet, in the days leading up to Christmas 2022, when a brutal cold snap hit much of the continental US, PJM’s system was pushed right to the edge of rolling blackouts.
And gas was largely to blame.
To be sure, every type of power plant on the grid that spans from North Carolina to Illinois had some failures in the bone-chilling storm that rolled eastward on Dec. 23 and 24, including nuclear and coal. But natural gas was the standout: Those units accounted for 63% of the failures while representing around just 44% of the total installed capacity. Generation performance during the storm “was not acceptable,” PJM spokesperson Susan Buehler said in an emailed response to questions. “What we need, and what we are working on with all of our stakeholders, regulators and policymakers, is for all of our resources to perform when called upon.”
PJM isn’t unique — in fact, by most accounts, it performed better than many neighboring grids, some of which reported widespread electricity interruptions or blackouts. But if one of the safest power networks just barely scraped by in December, experts can’t help but wonder: How will any of the country’s multiple and highly fragmented grids possibly manage to stay afloat long-term, especially as America uses more and more electricity all the time?
“That’s a crisis that’s coming,” Mark Christie, a member of the Federal Energy Regulatory Commission and one of the most powerful US energy regulators, said when asked about the state of the country’s overall power system. “It’s coming a lot closer and a lot nearer and a lot faster than even I thought a year ago when I first said we’re facing a reliability crisis.”
The colossal shift in America’s power supply toward natural gas has been decades in the making. Large-scale gas production from shale began around the turn of the millennium with the invention of modern-day hydraulic fracturing, a process that involves blasting water, sand and chemicals into underground rock formations to unlock energy reserves previously considered impossible to reach. Commercial output really took off around 2007 and 2008, ultimately ushering in a period of low and stable prices for domestic natural gas and kicking off a race to export the fuel in liquid form. Companies jumped at the chance to finance and install gas generators, which produce power with less than half the carbon emissions of coal. PJM’s grid alone added about 33 gigawatts of new natural-gas fired capacity between 2014 and 2022, enough to power more than 26 million homes, Bloomberg’s analysis of EIA data shows.
“I don’t think that transition is inherently problematic for grid reliability,” said Dustin Meyer, senior vice president of policy, economics and regulatory affairs at American Petroleum Institute, a trade group that represents the US oil and gas sector. “Nor do I think there is anything unique about natural gas that makes it more inherently unreliable or predisposed to fostering these sort of situations in a crisis.” Extending the gas infrastructure, including building more generators and pipelines, would make the system even sounder, advocates say.
For many, the first wake-up call to the system’s potential vulnerabilities was in January 2014, when the phrase “polar vortex” entered the American lexicon. As an unusual blast of arctic air slammed the lower 48 states, electricity use on PJM’s grid soared, forcing it to issue an emergency alert as generators tripped offline. Between plant malfunctions and fuel shortages, natural gas accounted for about 47% of outages in that event, despite making up around 36% of capacity, EIA data show.
“As you rely more on natural gas, or one fuel, you will see more and more spikes in power prices,” Roshan Bains, then director of utilities power and gas at Fitch Ratings who’s now at Siemens Financial Services, said at the time. “Rolling blackouts would be more of the norm because of the aggravated fuel supply.”
Nearly a decade after Bains’ dark prognosis, the grid — now even more reliant on natural gas than before — was again put to the test. As a flash freeze caused temperatures to plummet this past December, PJM lost nearly a quarter of its power supply.
Of course, the power almost always goes out for some consumers during big weather events, either from downed wires or breakdowns at aging plants. But the big surprise during this past winter’s frigid weather was the sheer number of gas plants, including newly constructed ones, that were offline for some or all of the storm. During PJM’s two emergency calls to ramp up to maximum output, more than 20% of its operating gas-powered plants never got above even half capacity, Bloomberg’s analysis of data from power-market data provider Yes Energy show.
And some gas plants, like Indeck Niles Energy Center in Michigan, didn’t produce any power at all during the grid’s emergency calls to action, the data show. At that brand-new facility, which had only been commissioned a couple of months prior, severe winter weather caused critical equipment like transmitters and valves to freeze, said people familiar with the operations who asked not be identified because they weren’t authorized to speak publicly. Indeck Niles management declined to comment.
“Market dynamics during the storm make it clear that the overwhelming majority of facilities that didn’t run were failing to perform,” said Alex Bennitt, manager of fundamental analysis at Live Power, a unit of Yes Energy.
A disproportionate number of new-model combined-cycle gas plants failed, despite being younger and more efficient on average than other gas models. And perhaps most troubling of all, they didn’t all stumble for the same reason.
Some plants reported mechanical issues or failures to start, according to people familiar with the operations and official filings. Others couldn’t get the fuel they needed as frozen wells, falling pipe pressure or compressor station failures triggered a reduction in gas output or even force majeures — often without much communication from the producers themselves, the people said. Some plants tried and failed to schedule enough gas since they couldn’t reach any off-the-clock gas traders during the holiday weekend; instead, they were left scrounging for spare fuel in a series of frantic phone calls and texts. Others couldn’t get gas because they’re supplied by local utility pipelines that have to ship to households and businesses first, the people said.
More detail and some cool graphic animation at the link:
Finally, if you still haven’t seen my explainer of the 2021 Texas Blackout, here it is.
Nobody mentioned the need for Texas to connect to other states; I guess most people have guv up onit, knowing ERCOT provides the oiligarchs millions in windfall profits every time there’s a big outrage, er, outage. Seems like someone needs to step in and take the toddlers’ toys away before someone loses an eye. Failing an invasion by the EU, it’ll have to be the Union.
Alex Wagner:
That is the essence of the Texas Republican politicians: They’re just as callous and spiteful about gun deaths and women dying from problem pregnancies. They hold their constituents in contempt.
Bloomberg:
That’s an unwarranted reputation on all three counts, of course:
With LNG export growth, gas is potentially much more expensive in the US. Europe has learned the cost of relying on Gazprom as a supplier.
The “clean” aspect only applies to breathing when comparing burning gas vs. coal, but fugitive methane probably makes gas worse in terms of GHGs.
As for being stable, we here in Texas understand that this is a myth.
Not sure about methane leaks making NG worse than coal – methane also leaks from coal mines, especially deep underground ones – shallow beds used for open cast generally have already leaked most of the methane co-generated with coal. ironically, one benefit of coal over gas is it’s sulfur dioxide emissions – though bad for forests, and people’s lungs, the enhanced albedo from SO2-enhanced clouds negated some of the warming from greenhouse gases. The cleanup of coal emissions in most advanced countries, and the recent banning of high-sulfur bunker fuel in international shipping, could take the human-induced brakes off of human-induced GHG warming.
Hate to agree with Trump, but coal is also a surer bet than gas at keeping the lights on during weather crises (unless it gets frozen, and cant go through the hoppers, but that can be mitigated.). It’s easily stockpiled at the power plant, unlike ‘just in time’ gas, which can also be under demand during a cold snap for home heating.
Recommended reading – ‘Shorting the Grid – the hidden fragility of our electric grid’, by Meredith Angwin. She describes the ‘fatal trifecta’ of over-reliance on uncertain renewables, just-in-time gas, and imports from other grids, versus the traditional model of coal and oil, the latter replaced by nuclear since the 80s, which had enough fuel on hand for tiding over emergencies.
Renewable energy makes grids more reliable. That’s been proved over & over & over all over the world. It’s yet another reason to categorize the intelligence, honesty, & emotional health of O’Neill as well below average that despite being a regular reader here, and being in the world, where reality is, & the information is freely available, he’s still saying the opposite.