Happy New Year! Now the holidays are over, and it’s time to get back to work, but am I really ready? There is a lot of catching up to do with the things put off in the last month. I had over 500 emails in my virtual inbox, but before I could get started a news item caught my attention. I guess I should not have opened that browser. So much for good intentions.
Anyway, I found a news item from the New Mexico Public Regulation Commission. They had held a special meeting about the electric power supply in New Mexico. The Commission was concerned about the ability of the state’s electric providers to meet power demands during the peak seasons in 2023 brought about by a major coal-fired power plant closing down last year.
Prior to the shutdown there were several replacement power projects that had been developed and were underway. Solar-plus-storage systems had been selected, but the transitioning from fossil-fueled generation to renewables is sometimes a bumpy road. In this case it appears to be growing pains!
What’s Going On
Utility-scale solar-plus-storage are one of the most prevalent technologies when it comes to clean energy sources. There are also problems with the supply chain that has been intensified by increasing global demand for renewables. This has resulted in shortages in everything from wind turbine blades to transformers, from solar panels to inverters and the list grows daily. As I read, I wondered was this a problem unique to New Mexico or was it more widespread.
It turns out that the supply chain has issues. It’s a global problem for just about everything from renewables to electric vehicles. The major players are raw materials, manufacturing, and availability of skilled workers, and that’s not all. There are also challenges from extreme weather events, tariffs, and regulatory approvals, which are hurdles everyone is struggling to overcome.
On a brighter note, I found a paper from FERC (Federal Energy Regulatory Commission) titled “Winter Energy Market and Reliability Assessment.” FERC’s report provided some great background on grid factors. Overall the 2022 – 2023 winter season looked pretty good for the power grid. Long range weather forecasts predicted higher-than-average temperatures in many regions of the country. FERC indicated that this “should translate into reduced electric demand.”
FERC also discussed the additions to the winter capacities of electricity generation in 2023 and they were generally positive. The report said the generation additions would total about 43 gigawatts (GW) of winter capacity. On the flip-side about 15 GWs of winter generation capacity is expected to be retired.
There’s More
The breakdown of the winter additions was interesting. Of the 43 GWs, 64% comes from solar and wind generation with 14% from battery storage. Natural gas generation makes up the remaining 22% of the capacity. The 15 GWs being retired is mostly coal-fired generation. FERC also noted the expected these additions could be affected by extenuating circumstances.
Those extenuating circumstances included component availability, shipping, and labor shortages – growing pains. That is what started us off in this discussion and it appears to be a trending topic. With 78% of FERC’s 2022-2023 winter capacity additions being wind, solar and storage, there isn’t a great deal of room for supply chain problems and meeting project deadlines.
Exploring further, other utilities, operators, and developers also are running into similar concerns. According to EIA (U.S. Energy Information Administration) developers planned to install 17.8 GWs of planned utility-scale solar photovoltaic generating capacity in 2022. During the first six months (latest available statistics) EIA said that approximately 20% of the planned capacity was delayed.
The story for planned wind generation additions tells a similar story of project delays. A press release from Siemens Gamesa reported that lead times on big components are typically running 200 days plus. It also said that importing components from Asian suppliers were being affected with their own supply chain issues like backlogs in ports.
Energy storage systems are also recording comparable delays. Wood Mackenzie reports that 1.1 GW of new storage projects were cancelled or delayed in the second quarter of 2022. They are also expecting utility-scale energy storage projects in the pipeline for 2023 to face delays.
Last year “Charging Ahead” discussed rooftop solar-plus-storage for customers. I thought the economics weren’t there for me, but with this information a lot of us are going to be revisiting our spreadsheets. I wonder how many will ask, “Why didn’t I install solar-plus-storage last summer?”
