Saturday, April 20, 2024

Round table: Energy, flipping the switch

When it comes to renewables, North Carolina is charged up. It’s ranked third in the nation for overall solar power, up from fifth in 2020. While that’s a step toward reaching decarbonization goals, there’s still a way to go. North Carolina needs more renewable generation and transmission infrastructure. Threats, including cyberattacks, need to be addressed, and technology must be developed and implemented, ensuring the amount and type of power needed reaches customers, including individuals, companies and the military. Business North Carolina and trade association e4 Carolinas recently gathered a group of energy industry experts to discuss the needs and how to meet them.


ElectriCities, EPIC and Pine Gate Renewables sponsored the discussion, which was moderated by e4 Carolinas President and CEO David Doctor. It was edited for brevity and clarity.


How is the energy industry changing?

FUSCO: In the past, utilities centrally generated electricity and delivered it to customers. Distributed energy resources and various grid-edge technologies are turning utilities into orchestrators. Readily available, easy to implement and affordable digital technologies — smart grid, 5G communications and other forms of computing — have allowed utilities to meet changing demands. Retail and banking customers, for example, expect a technology-driven experience. Now they want the same from utilities, along with inexpensive and reliable power. These technologies also help utilities understand who wants what. Many commercial and industrial companies, for example, have carbon-dioxide reduction targets. Technology enables us to give those companies the power supply that they want.

KOLLINS: Decarbonization will become more important. We can’t begin to imagine how different energy generation and consumption will look in a decade. There will be more solar on the grid, and wind will be an important part of that mix. We will need to diversify.

NAGLE: Solar panels, for example, were one-sided a few years ago. Now many are bifacial; both sides generate electricity. They also capture solar energy that’s reflected off the ground. And when the ground is covered in highly reflective snow, energy capture quadruples. These improvements ultimately benefit ratepayers. The more energy captured with each panel, for example, the cheaper the energy. Storage technology is developing quickly. Its cost is rapidly declining and is where solar was a couple years ago. It’s no longer restricted to two or four hours of deployment. Energy captured during the daytime can be deployed over four, eight or 12 hours. So, you can have a 24/7 product completely generated by wind or solar. It’s a fascinating time for the industry in North Carolina and around the world.

CHERRY: There are two big energy changes for the military. The first is the growing importance of energy resilience. Military bases need energy 24/7. Most want a secure 14-day supply. The notion of global energy resilience while dealing with legacy systems, such as diesel generators, is surfacing. We’re at risk in terms of natural disasters and cyberattacks, such as what recently happened to the Colonial Pipeline. Installations are identifying critical components that demand uninterrupted power. Security is critical, especially building it into something rather than adding it afterward. The North Carolina Military Business Center has staff dedicated to ensuring cybersecurity requirements are met. Energy and cybersecurity are linked more than most people realize.

MAZZOLA: I’m an electrical engineer, so fancy wireless gadgets should interest me. But I’m a power guy. I want to talk about solar panels, wires and similar items. At EPIC, we realize that transitioning to a zero-emissions future is a foregone conclusion. Everyone who matters has committed to it. What remains is determining when, the cost and the technology. We can’t become overly dependent on unproven technologies or cost projections. Customers are an untapped resource for grid integration of more intermittent resources such as solar and wind. The target cost for future energy is $50 per kilowatt hour. There are thousands of megawatts of opportunity to have consumers participate in the management of the energy supply at prices less than that. The Joules Accelerator, a Charlotte-based operation that collaborates with e4 Carolinas and helps energy startups, is working with a company that’s exploring building energy interactivity as a storage solution that costs less than $50 per kilowatt hour.

How must the energy industry evolve?

MAZZOLA: We should’ve been building gigawatts of zero-emission resources last year and adding a couple gigawatts every year for the next several decades. That’s the scale needed for energy transformation. Most people can’t comprehend how much energy is used nationally or globally. All of the integrated resource plans for North Carolina call for considerably more solar and wind generation. But neither can do it all, so we need to apply for 20-year extensions for all our nuclear plants’ licenses, too. One recent estimate calls for our current nuclear fleet to operate through the end of the century, so we don’t go backward in terms of generation. We need more nuclear and energy storage. We also need transmission infrastructure. Offshore wind generation, for example, won’t be any help unless its electricity flows onshore. That requires retooling energy infrastructure. It will take a lot of work. We have to start now.

NAGLE: If a builder wants to construct a massive housing complex, but its site isn’t connected to the main city by roads, how good will it be? Solar and other new forms of generation are in a similar situation. We can’t replace each retiring generation unit with an equivalent of solar. So, we’re more likely to see plants return but not where solar or wind is placed. We work closely with Duke Energy, one of the country’s largest utilities. It has identified pockets of transmission constraint. That’s good, because it allows us to plan around them. I worked at a utility, planning transmission for more than 10 years. It’s a complex process. You have to think outside the box. Utilities are here to keep the lights on, maintaining grid reliability while improving its efficiency. The Southeast needs an organized energy market, where excess energy can be sold and needed power purchased. The solar industry, along with wind and other sectors, is pushing for it, but it’s far from reality. We also need energy buyers beyond regulated utilities and cooperatives. Technology giants, such as Amazon, Google and Microsoft, want to build more data centers, which use a tremendous amount of electricity, in North Carolina. But first they need market structure and more deregulation. It’ll take time to clear those hurdles.

KOLLINS: North Carolina has focused on growing land-based wind generation for a long time. It needs to remain on the table, but we see more opportunity offshore because of scale. It’s impossible to build thousands of megawatts of wind generation — which will be needed to decarbonize energy production — on land within one permitting pass. That’s not an issue with offshore wind, which matches daily and seasonal patterns of electricity demand. Solar continues to be the cheapest and easiest renewable to build, so there will be more solar developments in the Carolinas. But if you diversify your intermittent energy resources, backup generation is needed less. Offshore wind requires significant amounts of new high-voltage transmission. It can double to alleviate some transmission constraint pockets.

CHERRY: There is a desire for self-generation. House Bill 589, comprehensive energy legislation that was passed by the N.C. General Assembly three years ago, included Green Source Advantage, a program that allows universities, large companies and the military to directly purchase renewable energy. None of North Carolina’s military installations took advantage of it. It’s transactionally difficult. The desire to provide 24/7 power to ensure uninterrupted operations makes managing energy yourself attractive. It’s not ignoring everything. It’s a push to deal with things within your control. It can be challenging when you have staff used to maintaining the current system. When you want to dispose of your 200 or 400 diesel generators and move to a distributed energy resource system that focuses on self-reliance, you have to train your engineers and staff on that technology. It’s more challenging if you deal with a third-party provider, especially in an emergency. Installations must complete an energy security plan. It identifies challenges to being energy resilient within a 14-day window and which projects can be completed now and which later to reach that goal.

FUSCO: Supply is not a problem as different types of resources come on board. There’s a vibrant wholesale market in the region. We interact with it to balance our energy needs. Utilities deal with daily issues, and that list of issues is growing. While reliability is a challenge, it’s a strength for public power. On average, municipal utilities experience fewer outages per customer per year. And their outage durations are shorter per customer per year as compared to other utility models. They respond faster because their employees live in town. And if it’s a big problem, fellow municipal utilities can and do collaborate. Cybersecurity isn’t new, but the threat is worsening. Hackers are incentivized to continue their cyberattacks, and they’re getting smarter. We have to get smarter, too. The good news is that the utility sector has been on top of that for a long time. Cybersecurity is part of the mandatory North American Electric Reliability Corp. standards. As utilities and other energy entities deal with cyber threats, the cost of electricity will rise and efficiency and innovation will be impacted. We’ll find solutions to that.

The energy industry has endured severe weather events and cyberattacks in recent years. Can its systems be designed and built to overcome these challenges?

CHERRY: Many military installations call it global energy resilience. You have to identify the critical mission-ready elements and make them energy resilient. That is challenging. There are technology projects, such as a floating solar array at Fort Bragg and a microgrid project at Camp Johnson, Marine Corps Base Camp Lejeune. But those are pilots; they’re not serving the entire installation. You can’t have a microgrid for an entire base. The budget process makes it difficult, too. Budgets are passed by Congress for the Department of Defense, then they go to the military branch. By the time one arrives at the base, people are focused on the next technology. It’s a timing problem. But as important as the military is and as exposed as it is to natural disasters, North Carolina should be where it all comes together. We can get there, but it will take a lot more work.

NAGLE: Pine Gate has an extremely robust system. It can withstand winds upward of 250 miles per hour. Solar panels are about 10 feet above the ground, keeping them safe from flooding. They are angled so snow slides off them. If it doesn’t, we have equipment to quickly remove it. We recently brought our first North Carolina solar and storage project online in Enfield. Energy storage’s role will grow as it improves and matures. The technology currently provides a sustainable solution for about four hours. It gets extremely expensive beyond that. Businesses have to decide if it’s worth the investment. Whether it’s weather, forced outage or maintenance, you need the ability to bring power in when your generation is down. The solution is a combination of market reform and technology advancements such as storage. We’ll see more smaller entities, including some businesses, create their own microgrid. They can’t rely on the main grid in certain situations.

KOLLINS: We heard a lot about wind earlier this year, after severe winter storms brought widespread power outages to Texas. What we didn’t hear about much was the reliability of coastal wind because it’s extremely reliable. It’s an amazing complement to our energy generating system. Those turbines have heated blades, which allow them to run in the coldest temperatures. Texas didn’t spend money on weatherization for wind turbines or gas pipelines, which is standard practice elsewhere. Residents paid the price. Wind is like other energy production; it’s built to withstand a lot, including the strongest hurricanes. That doesn’t mean it can withstand everything. Only diversity — from generation to transmission — provides true resiliency. Energy is a complex issue. We need to decide what is most important and balance competing interests.

FUSCO: Hackers view municipalities as soft targets. Municipalities are more than a utility. So, while its utility may be spared from a cyberattack, the rest of city services may be exposed. In many cases, municipalities rely on their utility department to help elsewhere, so its defensive measures pervade throughout all enterprise resource management systems. It’s one thing to address resiliency or reliability when you’re talking about an industrial campus or military base. A downtown, for example, may have parts that are more important than the rest. Hospitals, for example, need power before private homes. Sometimes something as simple as placing wires underground instead of overhead creates reliability. Communities close to or on the coast are more likely to flood. And when your substation is inundated, you only can wait for the water to subside. So, they’re being built on higher ground. These fundamental changes work with technology to increase reliability.

MAZZOLA: If you view the Texas outages in the terms that utilities measure reliability, it hardly creates a blip. That’s because power is on almost all the time. Technology isn’t the real obstacle. It’s the willingness to implement it. The real threat is that old cliché: We’ve seen the enemy, and they are us. So, “not in my backyard” — NIMBY — shoots down public policy. How could you be against an underground transmission line in a neighborhood filled with trees and frequented by storms? We’re moving up decarbonization goals, so we have to do a better job of making some of the needed changes publicly acceptable. During a recent visit to my family’s home on the Outer Banks, I sat outside, enjoying the last sand beach before Europe and watching lightning dart from a passing tropical storm. I was glad I didn’t see a bunch of wind turbines standing in the water. So, as long as they are on the other side of the horizon, I don’t think there will be an issue. It’s more their cost and building transmission infrastructure.

What issues are caused by integrating large amounts of renewables into the grid? How can technology help?

MAZZOLA: With the old system, if customers didn’t need as much electricity, you could close the throttle on generation and produce less. But with renewable energy, we’re at the mercy of when it can be generated. We’re learning to manage it, and North Carolina does a really good job of it. We use energy storage, including pumped hydro in the mountains of western South Carolina and the ability to move large amounts of excess solar across North Carolina. But doing thousands of megawatts more, which is in every integrated resource plan, will be a challenge. It’s more than an engineering problem, so EPIC works with social scientists and computational social scientists. We need the customer to help us integrate renewable energy. We have to understand how they think, how they use energy and how to convince them to give up a bit of control to get something, maybe less expensive energy. I ask my students this trick question: Should we only ask consumers to reduce their energy use? The answer is no. At noon on a sunny North Carolina day, we should ask them to use more, if they can transfer their use to that time. We have new technologies that will let them do that. One is electric vehicles.

NAGLE: Duke Energy has several scenarios for renewable integration scenarios — between 6 and 30 gigawatts by 2030. They won’t happen without transmission infrastructure, and that’s not enough time for it to be planned and built. Some of my colleagues are in Washington, D.C., trying to get it built within the overarching infrastructure plan. Cost allocation is tricky; people don’t want to pay for somebody else’s power. Our transmission infrastructure is conservatively operated. Transmission lines, for example, are operated as if the ambient temperature is always 95 degrees. That sounds right in July, but it’s stifling delivery most days. That will improve if we had a device that monitors transmission infrastructure in real time, telling the control center to push more power or divert some from constraint infrastructure. We’re collaborating with technology companies on that.
It’s the bridge that will get us to when infrastructure is built.

CHERRY: There will be more “islanding,” and old technology, such as diesel generation, will disappear. It won’t happen immediately. It’ll take five to seven years because of budgetary issues. If you want to be 24/7 ready, then switching to something new over what’s working is a tough argument. Partnerships around technology, training and research through higher-education institutions are needed. Staff training, which is often overlooked, will be a big component. The military is often lacking staff to accomplish everything it’s trying to do. It’s daunting to hear its responsibilities. It’s a huge mission. That opens the door for contractors, but you have to figure out how to do that. It can be challenging.

Where and how can the energy industry help with economic development?

KOLLINS: There are offshore wind commitments on the order of more than 25,000 megawatts along the East Coast, from Virginia to Massachusetts. That’s a more than $70 billion economic development opportunity. Many Northeastern states are clamoring for it. Virginia dedicates several full-time employees at the state level to offshore wind industry recruitment. There is some momentum in the Carolinas. Gov. [Roy] Cooper’s recent executive order steered more resources toward bringing these thousands of jobs to North Carolina. The Carolinas are well-positioned to take advantage of these opportunities. Many of the industry’s suppliers are here. Saertex in Huntersville, for example, weaves fiberglass fabrics that are the basis of every wind turbine blade. SpanSet in Sanford supplies pieces that lift components as offshore projects are built in place. These machines are so large that the final components are built at ports, giving coastal states an advantage.

FUSCO: Foreign-direct investment is behind much of the economic development activity in the state. Foreign companies that want to sell their products here need factories here. Many of them have sustainability and carbon-dioxide reduction targets. In cities with their own electric department, economic development folks can work hand in hand with the utility. One of our member agencies provides Huntersville with energy that’s 97% non-carbon emitting, predominantly nuclear and renewables through Southeastern Power Administration. That’s a recruitment tool. We’ve seen a significant uptick in this activity, including a number of announcements statewide since the first of the year, despite travel and other restrictions that were enacted in response to the COVID pandemic. ■

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