Grid Reliability

U.S. Secretary of Energy Rick Perry sent a memo to staff in April of this year seeking clarity and a review of, “how market-distorting policies are potentially threatening the reliability of the grid.” Many renewable energy advocates feared that this would be another attempt to undercut de-carbonization strategies, another way to intercede the widespread adoption of disruptive technologies, such as rooftop solar power. Perry also stated that he might intervene in states with strong renewable policies, states that advocate for “variable renewable energy.”

But the final version of the report released last week does not condemn renewables. In fact, it affirms that grid operators have said they are facing no difficulty in managing an increasingly diverse set of resources and the modernization of the electric power system. The report, which got lots of press, noted rightly that low, natural gas prices have been the primary driver in coal and nuclear plant retirements and cancellations. Contradicting prior claims made by the Secretary, wind and solar are indeed creating news jobs and are not a threat to grid reliability. The United States can safely operate the electric grid with high levels of renewables.

While generally pleased and relieved with the report’s findings, critics note that it fails to link climate change with grid vulnerability and reliability. It fails to report the huge societal benefits of renewables, nor the gross subsidies fossils and nuclear have received for years. But the fundamental truth is something that Perry could not wipe out… that diversifying a power portfolio – like an investment portfolio – increases reliability.