The PJM system can remain reliable with the addition of more natural gas and renewable resources, an analysis released today concludes. However, the report notes that an increased reliance on any one generation type brings resilience risks not accounted for under traditional reliability standards.
The report, “PJM’s Evolving Resource Mix and System Reliability,” responded to questions about the effects of fuel diversity on reliability. PJM stakeholders had questioned whether the system is losing too many traditional resources as coal plants retire and nuclear owners consider their future.
“This analysis underscores our responsibility to continue to operate the system reliably, and explore the role of resilience, the ability to tolerate unforeseen shocks and continue to deliver electricity,” said PJM CEO Andy Ott. “Different resources provide different reliability attributes, though new technology or regulations have the ability to improve those capabilities.
“PJM needs to work with stakeholders and the industry to determine whether markets and operation structures need to shift to make sure that necessary levels of generator reliability characteristics are maintained in future resource mixes.”
The report also notes that Federal Energy Regulatory Commissioner Cheryl LaFleur had noted the importance of fuel security as early as 2014, in a hearing at the FERC after the polar vortex (see Page 1 of the report for LaFleur’s comments).
The report analyzed the availability of generator reliability attributes essential to the grid under potential resource portfolios. Those qualities include frequency response, voltage control, ramp, fuel assurance, flexibility, black start, environmental restrictions and equivalent availability.
“We found that the risk to the system wasn’t that resources couldn’t necessarily provide reliability attributes but that the potential concentration of a single fuel source or low-probability, high-impact events could cause significant impacts to the system,” said Michael Bryson, vice president – Operations, who led the study. “The study concluded that our current portfolio is both reliable and diverse.”
PJM created a “composite reliability index” to assess the operational reliability of various resources across four scenarios: normal peak conditions, light load, extremely hot weather and extremely cold weather.
The study found that a more diverse fuel portfolio isn’t necessarily more reliable. Certain resource blends that fall between the least and most diverse offer the greatest number of key generator reliability attributes. An adequate level of diversity fosters flexibility and adaptability in mitigating risks associated with equipment failure, fuel price volatility, supply disruptions, extreme weather and other unforeseen system shocks.
PJM’s current resource profile includes natural gas, coal, nuclear, renewables, demand response and other generation types. The analysis identified no limit to the amount of natural gas-fired generation that could be added to the system before it affected reliability; however, highlighted the potential increased dependency on fuel infrastructure and the need for PJM to further explore grid resilience.
The report did not address the economics of resource types, factors that might impact a fuel’s deliverability or public policy issues such as environmental impact and the use of subsidies.
It is the latest in a series of PJM white papers analyzing issues important to the grid operator and to the electric utility industry in general. The topic will be the focus of the upcoming Grid 20/20: Focus on Resilience (Fuel Mix Diversity & Security), to be held April 19.