Friday, October 19, 2007

Electrical Demand Projected To Double Resource Commitment

Oct 16: Electricity usage in the United States is projected to grow more than twice as fast as committed resources over the next 10 years, according to the North American Electric Reliability Corporation (NERC) and its annual 2007 Long-Term Reliability Assessment 2007-2016. Unless additional resources are brought into service, some areas could fall below their target capacity margins within two or three years. In parts of western Canada, demand is projected to outpace resource growth within about two years.

Rick Sergel, president and CEO of NERC said, “We are at the stage where emergency situations are becoming more frequent. Though some improvements have been made, we are requiring our aging grid to bear more and more strain, and are operating the system at or near its limits more often than ever before. As operating margins decrease, we are limiting our ability to manage unplanned events like equipment failures and extreme weather."

NERC’s primary roles in providing this assessment are to identify areas of concern regarding the reliability of the North American bulk power system, and to make recommendations for their remedy. This is the second such assessment prepared by NERC in its capacity as the U.S. Electric Reliability Organization. NERC cannot order construction of additional generation or transmission or adopt enforceable standards having that effect, as that authority is explicitly withheld by Section 215 of the U.S. Energy Policy Act of 2005. In addition, NERC does not make any projections or draw any conclusions regarding expected electricity prices or the
efficiency of electricity markets.

The 2007 Assessment provides a high-level assessment of future resource adequacy, an overview of projected electricity demand growth and generation and transmission additions, an analysis of two scenarios that could affect future reliability, and regional self-assessments. This year’s report also includes an in-depth discussion of long-term emerging issues and trends that, while not posing an immediate threat to reliability, will influence future bulk power system planning, development, and system analysis. Specific reliability findings, as detailed in the report, include findings on: wind, solar, and nuclear generation; capacity margins; transmission; aging workforce; and natural gas reliance.

The NERC mission is to ensure the reliability of the bulk power system in North America. To achieve that, NERC develops and enforces reliability standards; assesses adequacy annually via a 10-year forecast and winter and summer forecasts; monitors the bulk power system; audits owners, operators, and users for preparedness; and educates, trains, and certifies industry personnel. NERC is a self-regulatory organization, subject to oversight by the U.S. Federal Energy Regulatory Commission and governmental authorities in Canada.

As of June 18, 2007, the U.S. Federal Energy Regulatory Commission (FERC) granted NERC the legal authority to enforce reliability standards with all U.S. owners, operators, and users of the bulk power system, and made compliance with those standards mandatory, as opposed to voluntary. NERC has similar authority in Ontario and New Brunswick, and is seeking to extend that authority to the other Canadian provinces. NERC will seek recognition in Mexico once the necessary legislation is adopted.

Access a release from NERC (click here). Access the complete 237-page report (click here). [*Energy]