NERC 2022 Assessment, Part 1: Are US Power Grids Reliable This Summer?

Michael Tobias
Author : Michael Tobias
May 23, 2022
4 Minutes Read
  
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    KEY TAKEAWAYS

    - The North American Electric Reliability Corporation (NERC) conducts a detailed reliability assessment of US power grids before each summer.

    - The NERC assessment is divided by territories, considering the area managed by each grid operator: MISO, NPCC, PJM Interconnection, SERC, SPP, ERCOT, and WECC.

    - NERC has not identified major reliability issues in the eastern US states for summer 2022. In general, their assessment is favorable for the NPCC and PJM Interconnection regions.

    - The MISO region could be vulnerable to an above-average number of power plant outages, but no issues are expected under normal conditions.

    Each year, the North American Electric Reliability Corporation (NERC) publishes a detailed assessment of all major power grids in the US and Canada. NERC considers their current condition and expected summer load, to determine if they can operate without power supply issues. The assessment also includes an analysis of blackout risks, including the regions where they are more likely and the conditions that could cause them.

    According to the NOAA, there is a probability of over 99% that 2022 will be among the top 10 warmest years ever registered. This means building owners should make sure their air conditioners are in good condition, and power companies should be ready to handle the incoming load. There are two major reasons to implement energy efficiency measures: building owners can expect high electricity prices based on recent inflation trends, and energy conservation helps the grid remain stable at times of high consumption.


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    Here we will summarize the NERC assessment for the major US grids, including the Northeast  Power Coordinating Council, which serves New York and other northeastern states. We will cover the MISO, NPCC and PJM Interconnection regions in this article (the SERC, SPP, ERCOT and WECC regions are covered in the second part).

    Power Grid Reliability: What is the Reserve Margin?

    reserve margin

    The reliability of a power grid depends on several factors, but the NERC uses a metric called the reserve margin as a starting point. In simple terms the reserve margin can be defined as the percentage difference between the projected demand and the generation resources available.

    • If a power grid has 100 GW available and the expected demand is 80 GW, the generation capacity is higher by 20 GW. 
    • Dividing this value by demand, the reserve margin is 25% in this example.

    NERC specifies a reference reserve margin for each region, and grid operators should ideally operate above that value. When the reserve margin of a power grid is too low, the risk of blackouts is increased.

    Assume the grid in the example above experiences a summer demand above the forecast, reaching 85 GW, and unexpected power outages reduce generation to 90 GW. In this case, there would still be a 5 GW difference between generation and demand. However, a grid with an expected peak of 80 GW and only 90 GW of available capacity would be in trouble with 5 GW of extra demand and 10 GW of generation outages.

    MISO: Midcontinent Independent System Operator

    MISO is the system operator in several regions located to the west and southwest of the Great Lakes, and also most of Louisiana and Arkansas. The MISO grids are strongly dependent on fossil fuels, and most of the electricity comes from natural gas and coal. 

    NERC has determined that MISO could have reliability issues in the North/Central region, due to a capacity shortfall of 1,230 MW in the planning resource auction. There is enough capacity for normal conditions, but unplanned outages could shrink the reserve margin.

    NERC has estimated that MISO will have access to 143.2 GW, and demand is expected to reach 118.2 GW. This means the region will operate with a reserve margin of 21.1%, slightly above the 17.9% reference level recommended by NERC.

    NPCC: Northeast Power Coordinating Council

    new york

    NERC has provided a favorable assessment for the NPCC in the New England region, forecasting 29.9 GW of anticipated resources and a demand of 24.8 GW. This means there is a reserve margin of 20.6%, well above the reference level of 14.3% provided for the region. The assessment is also favorable for New York state, with 39.9 GW available and a summer demand of 30.6 GW. The reserve margin is 30.4%, twice the reference margin level of 15.0%.

    Power supply issues are not expected for New York and the New England region this summer, but the same cannot be said of electricity prices. More than 50% of electricity used in the region comes from natural gas, and its prices have been greatly affected by inflation. As summer approaches and power consumption increases, gas and electricity prices can both be expected to increase more. Energy efficiency measures can help building owners mitigate this price hike.

    PJM Interconnection

    The PJM Interconnection coordinates the electric supply in 13 eastern states and the District of Columbia. The power supply in the region is dominated by natural gas, followed by coal and nuclear power. NERC has provided a very favorable assessment for the PJM Interconnection, since the anticipated resources are much higher than the expected summer demand: a total capacity of 185.0 GW to meet 140.4 GW. The reserve margin is 31.7%, more than twice the reference level provided by NERC (14.9%). 

    PJM has been managing fuel inventories carefully and securing supplies in advance, to make sure that supply chain issues don’t affect the reliability of the local power supply.

    Tags energy news | power grids | NERC | North American Electric Reliability Corporation | power grid reliability

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