Invoking national security in the resilience debate

Source: Peter Behr, E&E News reporter • Posted: Thursday, June 28, 2018

Retirements of coal and nuclear plants are increasing the vulnerability of the western U.S. power grid in extreme scenarios, according to a new analysis for the Western Electricity Coordinating Council (WECC).

“Coal and nuclear retirements create a deficit of baseload generation capacity in the bulk power system, increasing the dependence on gas,” according to the report by the Wood Mackenzie consulting firm, Argonne National Laboratory and Energy and Environmental Economics. “Large additions of renewables help mitigate the loss of coal- and nuclear-generated power,” the report says, but can’t fill the gap.

On its face, the regional assessment sounds in sync with the Energy Department’s warning about the damage that coal and nuclear plant retirements are doing to power grid “resilience” — the ability of the nation’s electrical systems to withstand and recover from extraordinary assaults, whether from nature or human attackers.

A key hazard scenario in DOE’s draft plan is the loss of natural gas supply for power plants, which is the core of DOE’s proposal for federal subsidies to keep some number of nuclear and coal plants from retiring.

But when the WECC report turns from problem to remedy, it leaves DOE’s proposed solution.

Operators of the Western Interconnection — the synchronized grid west of the Rocky Mountains — have no choice but to strengthen their reliance on gas resources, while continuing to invest in more renewable energy, demand response and dual-fuel capacity that permits some gas generation to keep running on oil in emergencies, the report says.

The WECC report mirrors resistance to the DOE plan from other regional power grid operators and monitors, notably ISO New England and the PJM Interconnection in the Mid-Atlantic region.

Rather than supporting federal subsidies for older, higher-cost coal and nuclear plants, the New England operator has asked for stronger, explicit authority to keep particular plants in operation to back up the grid. PJM has called for federal rules requiring gas pipelines to provide more information on their operations that affect fuel supplies for power plants.

DOE’s problem is how to justify payments to coal and nuclear plants it wants to prop up if the department isn’t basing its decision on the grid operators’ analysis of their needs.

The answer may be to invoke national security as its ace in the hole, saying that the gravity of cyberthreats to gas networks and key grid installations requires keeping many more coal and nuclear plants in operation. Where the threat scenarios are based on classified information, the case is harder for grid operators to challenge.

Last week, DOE Assistant Secretary for Electricity Bruce Walker stressed DOE’s national security responsibilities in an interview about the department’s resilience proposal on the Columbia Energy Exchange podcast.

“It gets back to the core function of the Department of Energy,” Walker told podcast host Bill Loveless. “And DOE’s role is a national security role.”

Asked how DOE would justify the still-undefined cost of keeping at-risk coal and nuclear plants in business, Walker replied, “The question I would pose is what’s the value of national security … which I think is priceless.”

‘We will act’

Walker added, “Where we understand the vulnerabilities based on our position within the intelligence community, we will act. We will not stand back and not act. So we’ll continue to work and evaluate our strategies, and when we’ve decided what that strategy is, we’ll act on it.”

Energy Secretary Rick Perry made the same point in a briefing Monday with reporters, saying, “The world has really changed from the standpoint of cyber. … [Y]ou know all the different scenarios that are out there, whether it’s a natural disaster with a massive heat wave … or another polar vortex in the Northeast and you have a cyberattack to complicate things from the standpoint of getting your system back online; at that point in time, you start seeing the potential for really chaotic events in the country.

“So that is the Department of Energy’s responsibility to make sure, to do everything we can that that doesn’t happen.”

Yesterday, the Nuclear Energy Institute zeroed in on the security argument, releasing a letter to Perry from nearly 80 former leaders from the U.S. military, federal agencies, energy firms and Congress urging him to see that no more nuclear plants are shuttered, in the name of security.

The letter noted the actions underway at the Federal Energy Regulatory Commission; regional transmission organizations like WECC, PJM and ISO New England; and state utilities commissions to safeguard the power sector. “Although those entities’ discussions are vital, their purviews do not include the national security attributes of nuclear power. Thus, their important considerations must be integrated with the broader national security imperatives and perspectives, and that integration can only occur at your level,” it said.

The letter did not address whether all U.S. nuclear plants or some are essential to keep open to protect the grid in emergencies, and if only some are essential, how they should be chosen.

The DOE plan has driven a new wedge into the U.S. energy sector, splitting nuclear and coal interests from gas and renewable power — grid providers that stand to lose business to coal plants and reactors that would be saved from retirement by federal subsidies. The DOE critics charge that the move to buttress coal is a political favor that President Trump is insisting on, and their lawsuits are in preparation if the DOE plan becomes administration policy.

The controversy could delay or disrupt action on policy issues that could directly improve the grid’s resilience, or perhaps might speed responses by FERC and regional organizations.

PJM has argued, in a filing with FERC, that the commission needs to take responsibility for ensuring that gas-fired power plants can depend on gas supply surviving cyberattacks or natural disaster, or see that backup alternatives are in place.

Judah Rose, chairman and executive director of ICF, a consulting firm that has investigated vulnerabilities of gas pipelines to cyberattacks and natural disasters, said the problem for grid operators is that they are supposed to consider the loss of power plant fuel supplies in their contingency planning, but they have no authority to deal with the risk.

DOE is not raising that issue now, he added.

“You could ask, what if I added another transmission line or another gas pipeline, or doubled or tripled the size of [backup] oil tanks at gas power plants, or required every power plant to put on tank?” Rose said. “There are other things that can be done. Some are more difficult than others.

“If you’re looking at every [threat] contingency on the power system and totally ignoring fuel supply, you’re in a Kafka-esque situation.”

If DOE or FERC told grid operators and gas companies that the security of fuel supply had to be ensured, that confronts the challenge, he said. “You say, ‘You must plan to survive fuel contingencies.'”