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When much of the Midwest and Northeast United States faced extreme cold weather the past two weeks, fossil fuels like natural gas kept the nation warm.
“Renewable energy is not dispatchable,” John Harpole, founder and President of Mercator Energy, told Western Wire. “There’s no such thing as utility scale electric storage.”
“With electricity you are either producing it, transmitting it, or using it,” Harpole said. If you can’t call upon an energy source. “Fossil fuels are more critical to the operation—to the maintenance and reliability of the grid,” Harpole continued.
Non-dispatchable sources, like wind and solar, are “use-it-or-lose-it,” Harpole said. Harpole said the extreme cold weather also affects wind turbines by affecting load control or necessitating heating, ice throw or unbalanced spinning, and decreased performance with colder temperatures.
When those sources falter, utilities must call on other sources like natural gas, the nation’s leading electric generating fuel since 2016, when it overtook coal.
“When the grid is truly tested, as in the current cold snap, the weakness of renewables is exposed. It is natural gas, coal, and even oil as we are witnessing in the Northeast and Midwest, that keeps our homes warm. All this talk of wind and solar replacing energy from hydrocarbons is Pollyannaish and even reckless,” Thomas Pyle, President of the American Energy Alliance, told Western Wire.
Much of the Midwest and Northeast, hit by the recent prolonged cold weather, appeared to confirm Pyle’s assertion that when demand soars, fuel sources like natural gas are called to fill in the gap—but at an elevated cost, thanks to government policies that penalize certain fuels and promote others, not a lack of supply in the fuel channels.
“Nowhere is this more true than in the Northeast, where government interference in energy markets is putting people at risk, especially our elderly,” Pyle said. “It’s time for these politicians to stop bowing down to the keep-it-in-the-ground crowd and let our energy providers build new energy infrastructure, like pipelines and transmission lines, so they can deliver low cost, reliable power to American families and businesses.”
Limiting pipeline construction in the Northeast intensified the strain when the record cold wave hit.
“Limitations on capacity for regional natural gas into New England and New York City have resulted in higher prices and increased burning of oil for electric generation,” the Energy Information Administration reported in its January 5 Winter Fuels Markets Update.
“Major pipelines to the Northeast are full,” EIA warned. An examination of prices for natural gas showed strong regional variation, with prices in the Northeast skyrocketing.
“This past week, increases in demand led to higher prices in natural gas and electricity markets,” according to EIA. “Because the spot price of natural gas affects power prices in many parts of the United States, spot wholesale electricity prices also rose, surpassing $200 per megawatthour (MWh) in New York City and $185/MWh in New England, according to data from SNL Energy,” EIA wrote in a blog post.
The Northeast drove record consumption of 150.7 billion cubic feet of natural gas on January 1, 2018, breaking a four-year-old record by 7.4 Bcf. EIA noted that localized supply issues are possible even with ample supplies, but cautioned that additional fuel oil supplies, in particular, would provide a buffer of “more days of burn” in adverse weather conditions.
Some providers expressed concern about inadequate supplies, including Southwest Power Pool in the Midwest. SPP’s Dustin Smith told Bloomberg that some natural gas plants were struggling with supply chain adequacy, and were switching to fuel oil or forcing outages. ISO New England Inc. spokeswoman Marcia Blomberg said that those power plants already burning fuel oil were running low, but that government air emissions restrictions were limiting their use.
“As oil inventories are depleted, replenishment of these fuels will be important given the uncertainty around weather and future fuel demands for the remaining two months of the winter period,” she told Bloomberg last week.
According to the EIA’s Winter Fuels Outlook, approximately half of all U.S. households use natural gas to heat their homes. While only 5 percent of U.S. households nationwide use heating oil to heat their homes, the Northeast tops out at 21 percent.
But for the two-week cold snap that began just after Christmas, that figure jumped to 30 percent of New England’s electricity generation, exacerbated by a lack of pipeline capacity in the region.
An increased demand and lack of supply leads to higher electricity and heating costs, especially those in elderly or low-income households.
An EIA pre-winter estimate of energy costs projected a 12 percent increase for natural gas, a 17 percent bump for home heating oil, and 8 percent for electricity.
Harpole pointed to the fuel switch from coal to natural gas over the past decade as both a dispatchable energy source, baseload fuel, and backup for intermittent renewable sources. He pointed to a recent Forbes article that pointed out the reliability of natural gas in situations like the Northeast’s demand for fuel and electricity. It also argued that a lack of policy foresight, not supplies of the fuel, hurt the region’s ability to respond.
A lack of pipeline capacity leads to natural gas shortages especially in times of peaking demand, cascading to skyrocketing prices for fuels for heat and electricity generation, according to energy analyst Jude Clemente.
Electricity provides 16 percent of the remaining home heating for the Northeast, while the nationwide rate is 40 percent. The Northeast also leads the nation in burning wood or wood pellets for space-heating fuel, at 20 percent, compared to 2 percent nationwide. Two-thirds of homes in the South—which also faced a prolonged cold spell last week—derive their heat from electricity, which relies upon a wide and varying range of fuels for generation, depending on the local utility.
Natural gas serves a dual function in extreme cold, providing heat as a primary or secondary fuel, depending on local consumption and utility use.
“Natural gas consumption is typically highest in the winter months, when residential and commercial demand for heating fuels increases,” EIA wrote. “Many homes and commercial buildings use electricity either as their primary or secondary heating fuel, and overall increases in electricity demand are often met by natural gas-fired generators.”
For example, across the PJM Interconnection, which covers all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia, and the District of Columbia, renewable sources such as wind and solar were only producing between 2-3 percent the past two days, according to analysis done by Western Wire. Natural gas, along with other baseload sources like coal and nuclear, were providing 97 percent of PJM’s generation fuel mix.
