Heatwaves Shouldn’t Cause Blackouts. It’s Time to Rework How We Manage Demand

Summer is just beginning,?and we’re already seeing record-setting heat waves across the?country.?Texas and California?were among the first states to experience?large?temperature spikes this year, and since,?new records?were set in cities across?Washington and Oregon. The Northwest,?not?well equipped for triple-digit heat, faced?rolling blackouts ?as a result.??

No state is in the clear – these heatwaves?are putting?lives in danger, increasing?the risk of wildfires and costing?states?billions of dollars ?during power outages.?Just last?month,?Portland?suffered infrastructure damage as?the?heat melted streetcar power cables .?

These record high temperatures?put?immense?strain on?our?power grids?because they?not only cause?an increase in electricity demand as residents crank up their air conditioners,?they?also?create?more difficult conditions for?power plants and?supply generation.??

As we continue to combat climate change,?these extreme weather events?are not going?away?anytime soon.?At Enel X,?we’re expecting to see energy emergencies in most North American markets this summer,?similar to?the?record demand response activity we experienced last June ?– a 22% spike year-over-year.?

We can mitigate the?impact?of extreme weather to the grid?in more ways than one; states, cities and businesses alike?must?take action?sooner rather than later.?But we are past?the point?of incremental approaches. We need to?accept that these kinds of events will continue to?happen?regularly?and we need bold action now?—?we need to fully incorporate?distributed?energy?resources?into the generation mix?and be more aggressive?in our?efforts to utilize these resources?to improve grid?reliability and?resiliency.?

Extreme Heat Calls for?Energy?Flexibility??

Truly modernizing our electric grid to meet?evolving?energy needs will take?both?time and commitment from regulators and legislators. Our energy infrastructure needs a comprehensive revamp to account for factors like new technology,?decentralized supply resources?and climate change.?On the supply side, we are facing a 2-4-year lead time for new generation,?at a minimum.?An?increase in?available?transmission?capacity,?or?new?agreements on energy?resource sharing?(i.e.,?imports and exports)?between states,?could?take?a decade?or more to put into place.?

However, for the purpose of this article, I want to focus on some?steps we can take?right?now to improve our energy reliability?from the demand side.?Businesses?can?help keep the grid online?and reap the benefits of more reliable power by seeking out energy flexibility solutions.??

Expanding?Demand Response?

During heat waves?when the grid is in a fragile state,?we can immediately impact?reliability by?reducing electricity demand.?This takes massive coordination to do at the scale needed to make an impact – which is where demand response comes?into play.?When businesses enroll in demand response?programs, they?get compensated by utilities ?for reducing energy?consumption?during emergency events like extreme heat and natural disasters.?Enel X?acts as the go-between partner for utilities and?energy?users,?coordinating?these efforts at scale?with advanced software.?This is something businesses can and should take advantage of today – it’s a win-win for their bottom line and the grid.???

Plugging in Locally??

Another way to alleviate pressure from the grid – and cut energy costs – is to tap into locally stored energy. On-site energy storage and?generation?can both?help businesses stay online and?contribute to overall grid reliability?during extreme weather events.?Then, during times of normal operation, the technology that controls these on-site assets can ensure they charge when electricity prices are low and discharge when prices are high, so customers avoid paying a premium. We need to further incentivize sharing these local resources with the grid to?open up?new revenue streams for businesses?and support additional power supply that will help address ongoing?reliability and?resiliency issues.??

Adopting?Smart EVs?

Electric vehicles?(EVs)?have a?significant?role?to play in supporting grid reliability?– especially for businesses with fleet vehicles.?As the number of EVs increase?across the country?and we grow EV infrastructure,?we can leverage?chargers?en?masse?as flexible energy resources in times of need.?States like California?tap into networks of smart charging stations ,?like Enel?X’s?JuiceBox,?to?address demand and?help avoid blackouts.?Electrifying fleets helps businesses cut their carbon footprint and add more distributed energy support to the grid.?

All of?these flexible energy solutions?build on each other’s value and?are interconnected.?Figuratively,?they all play a part in improving our energy system.?Literally, they form a?digital?network?that can be leveraged at scale.?As we digitize energy resources, we must also optimize the way we interact with these resources.??

State Policy Limitations??

One of the biggest obstacles to?fully capitalizing?on?demand-side energy management, which runs through?all of?these solutions,?is existing?policy.?States like California and Texas have?limited?the?potential contribution?of?demand?response?and customer-sited?energy storage?to?grid reliability,?either through budget or participation caps or undervaluation.?In the face of more and more heatwaves and natural disasters?to come,?states must?prioritize?resolving barriers to?maximizing the value of?distributed energy resources.??

In Texas,?the budget of these emergency?demand?response services?is capped, despite peak electricity demand growing year-over-year?in the state.?While many other states rely on energy imports at times of peak demand, ERCOT is limited to local generation and demand response resources?— reinforcing the importance of raising the cap on local demand response.??

We’ve seen some progress in California, which recently increased the amount of emergency?demand?response from 2 to 3% of the all-time system peak demand.?Added capacity from battery storage ?in California is another step in the right direction for the state’s grid reliability, but?the state is not yet able to utilize the full capabilities of behind-the-meter DERs?within?the state’s?Resource Adequacy framework .?Streamlining market access for demand response and customer batteries is extremely important given the?greater-than-expected?depletion of?hydro generation?resources ?this summer?due to drought.???

The Urgent Need for Action?

To handle the growing?challenges?of climate change,?states must better prepare for extreme weather by?revolutionizing the way we manage energy supply and demand. Long-term planning for these events?is?essential,?and?it needs to start now.?At the same time, energy consumers cannot sit idly by – rethinking our relationship with energy is an economic, environmental and societal imperative.??