Balancing the electric grid today during a period of surging load growth and a significant influx of variable resources is posing challenges for US utilities also tasked with making investments for the grid of 2050, industry leaders said.
When considering generation and resource adequacy, electric utilities must consider, "Do we have the capacity and do we have the energy that is necessary to serve our customers as we move forward, particularly as we're adopting variable new resources on the system?" Alice Jackson, senior vice president of strategy and chief planning officer at Xcel Energy Inc., said during a panel discussion at the Energy Thought Summit in Austin, Texas.
The April 15 panel was titled "Proactively building resilient infrastructure" and featured representation from investor-owned and municipal utilities, as well as the Environmental Systems Research Institute Inc., known as Esri.
Utilities and grid operators must now account for "every hour of every day and the multiple scenarios" that could impact the system, ranging from changes in weather patterns to the addition of thousands of megawatts of intermittent resources, especially solar generation, and newer technologies such as battery storage, Jackson said. "It is about getting the right confidence level of what it is that we're investing in to make sure that we can continue to provide the services for our customers."
Jackson said load factor is a "huge conversation," especially as it relates to connecting datacenters, the electrification of transportation and "people potentially converting their home heating or businesses from gas to electric."
Lincoln Electric System CEO Emeka Anyanwu said the municipal electric utility, which is owned by the city of Lincoln, Neb., operates about 1 GW of generating resources split fairly evenly among coal, natural gas and renewables, primarily wind obtained through power purchase agreements.
"We are seeing limitations on fuel systems, fuel supply. We are seeing the weather impacts of things that we have not previously sort of contemplated," Anyanwu said.
"So, this layering on of new resources, both renewables that we're seeing at scale but also the new technologies, is critically important to the resiliency conversation," Anyanwu said. "There is a role for all of these fuel-saving renewable technologies that allow us to extend beyond the limitations of our existing fuel systems."
Jackson added that Xcel Energy, like the utility industry in general, has had to adapt to changes driven by customer preferences while weighing the costs and variability of the transition.
"When you think about what a utility is compensated to take on, risk is not in the top 10. Risk is not in the top 20," Jackson said. "If you throw variability into the mix, it becomes a problem. It becomes something that we are reluctant to take on."
But when customers ask for their utility to look at embracing new resources, "you start looking at it," Jackson said.
"I am fully anticipating that the customer we have 20, 30 years from now is very different than the customer we have today," Jackson said. "In fact, that is what we're working on right now.
"When we invest in infrastructure, the steel that goes into the ground to serve our customers, we're not doing that and looking at it like 'Oh, this is for the next two years,'" Jackson said. "Those assets and that investment is going to be there in 30, 40, 50 years in many, many cases.
Meanwhile, the average age of Xcel Energy's distribution system "is in the mid-50s and we built it over the past 80 years," Jackson said. "We're expecting the capacity to double in the next 25 years and anticipating the energy that is going through that system to triple."
Infrastructure that has taken nearly a century to build will have to be replaced in the next 25 years, according to Jackson, driving a "step change" at Xcel Energy, which intends to identify by the end of the year investments necessary for its clean energy future.
