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A couple of months ago, National Grid, one of Massachusetts’ two dominant utilities, announced rate increases of a “whopping” 37 percent over last year. Other utilities in the region are expected to follow suit.
Why, when natural gas prices are at historic lows that have been predicted to lower electricity rates, is the Northeast facing double-digit increases? Changes have been mandated, but the replacements aren’t ready yet.
New England has seen one big power plant close within the past year: Salem Harbor Power Station in Salem, Massachusetts—which went “dark” on June 1. Another major closure is scheduled within weeks: Vermont Yankee nuclear plant.
The Salem Harbor plant is scheduled to be replaced with a new, state-of-the-art natural gas plant—though it has received resistance from Environmental groups who have filed a lawsuit to block it and, once the suit was settled, have threatened other ways to stop the project including civil disobedience. They want the plant to be replaced with renewables.
However, a wind turbine that is iced up or a solar panel that is covered in seven feet of snow doesn’t generate electricity. And the cold days of a Northeast winter are one of the times when energy demand is at its peak.
Remember last winter’s polar vortex, when freezing weather crippled the Northeast for days and put a tremendous strain on the electric supply?
Following the near crisis, utility executives were brought into Congress to explain the situation. Regarding the nation’s electrical output last winter, the CEO of the biggest generator of coal-fueled electricity in the U.S., American Electric Power (AEP), Nicholas Akins told Congress: “This country did not just dodge a bullet—we dodged a cannon ball.” Similarly, Executive VP of Operations for PJM Interconnection (the largest grid operator in the U.S. overseeing 13 states), Michael Kormos, commented on operations during the Polar Vortex: PJM was “never—as some accounts have portrayed—700 megawatts away from rolling blackouts. …On the worst day, January 7, our next step if we had lost a very large generator would have been to implement a small voltage reduction”—industry speak for the last option before power outages.
About last winter’s grid reliability, Glenn Beck claims: “I had an energy guy come to me about three weeks ago. …He said, ‘We were one power plant away from a blackout in the east all winter long… We were using so much electricity. We were at the top of the grid. There’s no more electricity. We’re at the top.’”
We are already facing this winter’s extreme weather. Come January, the Northeast will be down not one, but two power plants since last year—not because they had to be retired, but because of regulations and public sentiment. Without these two vital power plants, what will the Northeast do?
A few months ago, Weather Bell Analytics’ Joe Bastardi told me: “This winter could be as cold and nasty as last year and in a worst case go beyond that to some of the great winters of the late 1970s, lasting all the way into April—though the position of the worst, relative to averages, may be further southeast.” Since then, I’ve been saying that I am afraid people will have to die due to power outages that prevent them from heating their homes in the winter cold, before the public wakes up to the damage of these policies. Atkins seems to agree. He told Columbus Business First: “Truth be known, something’s probably going to have to happen before people realize that there is an issue.”
ISO New England, the agency that oversees the power grid, warns, in the Boston Globe: “Boston and northeast Massachusetts are ‘expected to face an electricity capacity shortage’ that could lead to rolling blackouts or the use of trailer-mounted diesel generators—which emit far more pollutants than natural gas—to fill the gap.”
As seen at Salem Harbor, those new power plants will likely be natural gas and building those new power plants will face challenges from environmental groups. Plus, natural gas faces cost volatility. Natural gas consumption in the Northeast has grown more than 20% in the last decade, and not one new pipeline has been built. Current pipelines are stuffed and can carry no more supply.
The lack of available supply, results in higher prices. In the winter’s cold weather, the gas goes to people’s homes first. Different from coal, which is shipped by train, with a thirty-day supply easily held at the point of use, the switch to natural gas leaves power plants struggling to meet demand, paying higher prices.
These shortages in the Northeast are before the implementation of the Clean Power Plan that is expected to shut down hundreds of coal-fueled power plants nationwide by 2016. New infrastructure needs to be built, but “not-in-my-backyard” attitudes and environmental activists will likely delay or prevent construction as they have done in the Northeast—which will result in shortages and higher costs nationwide.
Two lessons from the Northeast’s far-reaching experiment are:
1) Don’t shut down existing supply, until the replacement is ready as legal action and local attitudes can slow its development.
2) You can cover every square inch of available land with wind and solar, but when extreme whether hits, a reliable energy supply is required—best met by coal and nuclear.
Current policy will have all of America, not just the Northeast, freezing in the dark.
(A version of this content was originally published at Breitbart.com)