NERC Shares Fuel Security Insights with PJM Task Force

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Representatives of the North American Electric Reliability Corporation joined stakeholders Friday to share some of its studies that dovetail with PJM’s initiative to ensure and value fuel security on the bulk power grid.

The stakeholders’ new Fuel Security Senior Task Force was formed to identify potential operational or market changes that could bolster fuel security. It is expected to report preliminary findings by the end of September, when the Markets & Reliability Committee will determine a deadline for the group to complete the rest of its work.

The task force will study the extreme scenarios in which performance of the PJM grid could be impacted, and examine mechanisms to resolve not just security of the fuel supply, but energy and resource security as well. 

NERC’s Presentation

At the initial meeting of the task force April 5, NERC’s Tom Coleman, director of risk, and John Moura, director of reliability assessment, highlighted areas of concern against the backdrop of a changing resource mix throughout the country.

NERC recently conducted a special assessment of generation retirements, Coleman said, spurred by the increase in retirements of fossil fuel-fired plants. NERC found that after plants’ closure plans were announced, their retirements were occurring more quickly than planned.

Coleman noted a continuing trend of renewable energy penetrating the market and the emergence of distributed energy resources, like rooftop solar. This has prompted more analysis of energy assurance, because each type of generation has particular characteristics. For example, renewables operate differently from synchronous generation, which can be regulated more easily to maintain a constant output value.

The biggest player increasing its share in the marketplace is natural gas. Greater dependence on natural gas can make the system more vulnerable to disruptions in fuel supply, transportation and delivery, Coleman said.

Preparing to withstand and recover from a potential disruption involves considering two types of threats posed by this reliance: an interruption, most likely due to fuel contracts, or a curtailment of service caused by a physical disruption such as a storm or an attack.

The risk of interruptions may be addressed through the wholesale electricity market and integrated planning with utilities and regulators. Addressing the threat of physical disruptions, he said, is where resilience planning comes in.

NERC has assembled an electric-gas working group to study these issues.

“With risk-informed planning, there are plenty of regulatory market-based tools that can ensure continued supply,” Coleman said. “You can retire all the generation – you just need time to do that and have plans in place to ensure capacity adequacy.”

Energy Security Timeline

The latest stakeholder engagement is the second of three phases underway at PJM to study the security of energy as part of an ongoing drive to improve grid resilience.

Phase one culminated in the release of the Fuel Security Study in November 2018. The analysis stress-tested the grid under more than 300 scenarios. The findings show the system can withstand an extended period of stress while remaining reliable and fuel-secure. There were combinations of extreme conditions under which the system could be subject to disruptions; any efforts on the fuel-security front most likely would target these scenarios. In phase three – concurrent with phase two – PJM, with guidance from federal and state government agencies, is coordinating with impacted industries to further define fuel security assumptions and scenarios.