At Wednesday afternoon’s session on the challenges of low-carbon generation, Benjamin Borsch told an interesting story: At a planning meeting about environmentally-friendly power in North Carolina, a supporter of renewable energy declared that wind power was the only way forward in the state, a pronouncement that earned the approbation of the environmental activists in the room. In quick response, another attendee stood up to make clear the wisdom of this idea, but only if such wind power was not located on the ridges of the region’s many mountains. On cue, the same environmental activists likewise cheered this idea. It took a minute for the hard reality to set in. If wind power was to be installed in the region, it would have to be located in areas that actually received wind. Sadly, the only areas that met this requirement were the much-lauded mountaintops. The activists’ contradictory mandates could not be reconciled. Turns out you can’t have your cake and eat it too. Renewable energy offers many advantages, but a panacea it is not.
And so the stage was set for a theoretical discussion about how best to plan and implement low-carbon power. Moderated by Duke’s Bradley Patterson, the session entitled “Low-Carbon Challenges, Industry Developments and System Impacts” included presentations by Borsch, who is director of integrated resource planning and analytics at Duke Energy Florida. It also featured presentations by Kyle Hill, market research analyst, Mitsubishi Hitachi Power Systems Americas; Dr. Radha Soorya , associate director of transmission operations and planning, Navigant Consulting; Shilpa Kokate, principal consultant, ABB; and Phillip Graeter, Analyst, Energy Ventures Analysis.
Continuing his presentation, Borsch further commented about how utility planning has evolved over the last few years. Utilities have a lot of stakeholders, he said. There are customers, investors, and activists. And customers have changed in their desires. Where they used to simply want low rates and reliable electricity, he explained, they now also want clean power and more choices. The goal of low-carbon power adds an additional layer to the challenge of meeting demand. It also exacerbates economic considerations. “Carbon consciousness has a multiplying effect,” he said. Most utilities believe there is a carbon-constrained future coming, he continued, but they have no clear path forward by which to plan for it. “Carbon is different than other emissions,” he explained. “There is no single technological approach to deal with it. It rewrites the rules. You don’t just need a scrubber anymore; you need new resources.”
Hill views the quest for low-carbon power through decidedly political and economic lenses. Citing President-Elect Trump’s prickly relationship with environmental issues, he sees uncertainty on the horizon. Whether because of oversupply, the strength of the dollar, or new technologies for extraction, uncertainty remains in the price of natural gas, he says. He also sees a renewed emphasis on the reliability of power. “Reliability has never been more valued in the market place than it is today,” he asserted.
After offering a brief background of the Clean Power Plan (CPP), Graeter said the mandate is “likely dead”. He expects Trump to appoint a ninth justice to the Supreme Court, and that the body will then “overturn the CPP on merits”. Graeter does, however, expect subsequent carbon regulations to take shape at the federal level, perhaps by 2030. He continued his presentation by saying that nuclear power is essential to meeting low-carbon options. “When nuclear plants are retired,” he said, “they are not always replaced with low-carbon options; they are replaced by the lowest cost option, which is usually combined-cycle gas plants.”