The grid’s new nemesis: Winter 2024

Your guide to the political forces shaping the energy transformation
Jan 12, 2024 View in browser
 
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By Rebekah Alvey

Steam rises from the Consolidated Edison power plant on Jan. 5, 2018, in New York City.

Steam rises from the Consolidated Edison power plant on Jan. 5, 2018, in New York City. | John Moore/Getty Images

Programming note: We’ll be off Monday for Martin Luther King Jr. Day but will be back in your inboxes Tuesday.

Bitterly cold weather blanketing the Great Plains is moving east — testing an energy grid that almost collapsed into crisis during Winter Storm Elliott just over a year ago.

The Christmas 2022 “bomb cyclone” of freezing temperatures and high-velocity winds seized natural gas utilities and gas-burning power generators along the Eastern Seaboard. Gas flows out of Appalachia plummeted. On Dec. 24, nearly 18 percent of power plant capacity in the eastern half of the country was out of service.

New York City came within a day of seeing gas cut off for millions of homes and businesses.

Elliott exposed a dangerous misalignment of the natural gas and electricity markets during an extreme weather emergency, Peter Behr reports. Communications broke down. Power generators failed despite assurances they could be fired up when energy was needed the most.

And it shined a light on a persistent failure by Congress, regulators and top energy executives to address the issues — even as electric utilities increasingly rely on gas.

“There isn’t a clear path forward,” said Jim Robb, chief executive of the North American Electric Reliability Corp., which oversees the bulk power grid along with the Federal Energy Regulatory Commission.

New Yorkers and their utility got lucky that December. Consolidated Edison drew on stored natural gas. Temperatures tipped upward just enough to avoid a total collapse. As a result, the effect of Elliott’s deep freeze on the eastern grid that stretches from the Rockies to the Atlantic Ocean passed almost unnoticed for the general public.

Elliott was the fifth winter storm in 11 years causing widespread power outages that jeopardized grid operations, including Winter Storm Uri in 2021, which was blamed for at least 240 deaths and billions of dollars in property losses in Texas.

The major bone of contention is familiar: Who should be regulated? For more than a decade, natural gas executives have resisted talk of mandatory reliability rules for producers and pipelines that sell gas into the vast U.S. electricity markets. Power companies operate in an entirely different universe. After the 2003 Northeast blackout that shut off power to 50 million people in the U.S. and Canada, Congress passed mandatory electric grid reliability standards.

To do the same for gas, Congress would have to act; and with every new meltdown on Capitol Hill, a serious fix seems a more distant possibility.

Susan Tierney, senior adviser for the Analysis Group, noted the oil and gas-heavy makeup of energy committees in Congress. "It doesn’t surprise me," she said, “that it’s hard at times to gather broad bipartisan support for taking action that the gas industry doesn’t want.”

 

It's Friday — thank you for tuning in to POLITICO's Power Switch. I'm your host, Rebekah Alvey. Power Switch is brought to you by the journalists behind E&E News and POLITICO Energy. Send your tips, comments, questions to ralvey@eenews.net.

 

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Today in POLITICO Energy’s podcast: James Bikales breaks down how the Biden administration thinks it can make the transition to electric vehicles without China.

Power Centers

Sen. Tom Carper (D-Del.).

Senate Environment and Public Works Chair Tom Carper (D-Del.) is taking a leading role in urging the Treasury Department to revise hydrogen tax guidance. | Francis Chung/POLITICO

Hydrogen revisited
Senate Democrats say they expect the Biden administration to walk back parts of a proposed hydrogen tax credit rule, writes Nico Portuondo. In late December, the Treasury Department released anticipated guidance on how companies can get rebates on clean hydrogen production through the Inflation Reduction Act.

The guidance was met with backlash from hydrogen companies, which called some clean energy sourcing requirements too strict.

Senate Environment and Public Works Chair Tom Carper (D-Del.) and Energy and Natural Resources Chair Joe Manchin (D-W.Va.) said this week the rule will likely be modified.

EPA on the clock
The Environmental Protection Agency is rushing to finalize regulations and distribute funding made available through climate and infrastructure packages passed by Congress and signed by President Joe Biden, writes Kevin Bogardus. Rules on air quality, drinking water, climate pollution and wetlands protection are still in flux.

Like other federal agencies, EPA is working to cement policies during an election year that could end with President Donald Trump returning to the White House.

More EV barriers
The House approved a resolution Thursday to undo a Federal Highway Administration waiver from domestic sourcing requirements for electric vehicle chargers, writes Kelsey Brugger. The move is an attack on Biden administration EV transition goals, and the White House has already threatened to veto the measure.

S.J. Res. 38 from Sen. Marco Rubio (R-Fla.) already passed the Senate 50-48 with the support of some Democrats, including Manchin. Two House Democrats supported the resolution while two Republicans opposed it. Critics of the resolution say it would eliminate other domestic sourcing mandates and create fewer American-made charging stations.

In Other News

Sharks still under attack: Shark mortality rates have increased slightly over the past 10 years despite regulations against finning and other protections, according to a recent study.

Global drought and hunger: Nearly a quarter of people on Earth are facing drought and food insecurity due to climate change, conflict and global food supply chains, according to a recent U.N. report.

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A flare burns off methane and other hydrocarbons as oil pump jacks operate.

A flare burns off methane and other hydrocarbons as oil pump jacks operate in the Permian Basin in Midland, Texas. | David Goldman/AP

EPA has released a proposed rule to implement a fee on excess methane emissions from oil and gas operations. The guidance clarifies how and what may be penalized for leaky oil and gas sources under the Inflation Reduction Act.

China’s longest-serving climate envoy is stepping down from the role for health reasons, putting the country’s future relationship with the U.S. on climate goals into question.

Electric vehicle chargers are not developing fast enough to keep up with the number of car sales, according to the Alliance for Automotive Innovation. The automotive trade group also found that while sales are growing, EVs still make up only a small slice of all vehicles on the road.

That's it for today, folks. Thanks for reading and have a great weekend!

 

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