Wednesday, April 02, 2014

Once More into the Frozen Breach with Energy Diversity

FERC-LogoIt may seem like an unseemly bit of crowing, but nuclear energy really did show its value during the polar vortex and subsequent winter deep freezes. We’ve talked about this in an ad hoc fashion, noting stories about the strain on the natural gas supply and even raising mild controversy about whether Beaver Valley shut down due to the cold – when in truth, it did shut down whatever the reason. Why split hairs?

But now there is a more systematic assessment of that period from the Federal Energy Regulatory Commission. FERC describes its role thusly: “[It is] an independent agency that regulates the interstate transmission of electricity, natural gas, and oil. FERC also reviews proposals to build liquefied natural gas terminals and interstate natural gas pipelines as well as licensing hydropower projects.” And there’s more! Read here for that. FERC’s authority over electricity transmission (and other of its activities) covers every manner of generator, so its work overlaps into the nuclear realm.

FERC’s assessment of the cold snap from the transmission perspective is therefore very interesting, despite it having no mention of nuclear energy at all. Here’s the takeaway:

Not many months ago staff described the market effects of the extraordinarily low natural gas prices. Staff does not expect the historic prices at the high end of the spectrum to become the norm. However, the range in prices has tested some of the market systems and procedures used by the RTOs [regional transmission organizations] and ISOs [independent system operators] and revealed difficulty in achieving efficient market results in stressed system conditions.

This could provide an opportunity to say mean things about natural gas, but why? It can take care of itself. The real key point is the argument for energy diversity, as both nuclear energy and wind (notably in Texas) were champs at keeping the heat on. Natural gas showed some definite strains.

Spot natural gas prices at major Northeast points broke all previous records during the January 22 event, propelled by more severe and widespread system constraints. At Transco Z6 Non-NY, prices spiked to $123/MMBtu, while prices at Transco Z6 NY and Transco Z5 reached $120/MMBtu. Those active in the natural gas spot market were at times exposed to these record high prices. Similarly, as discussed in detail later, customers purchasing in the RTO energy markets were exposed to dramatic price spikes driven by high natural gas prices.

FERC is fair, though. While learning that the transmission hubs were stressed past their breaking point is hair-raising, they didn’t break. If the past winter showed anything, it’s that it can still get mighty cold for extended periods and many people depend on natural gas for heating, diverting it from electricity generation use. A few warm winters forestalled this lesson, but now it can be considered learned.

During the cold weather events, the historically high peak demand combined with high levels of generation outages placed the regions near their capacity in meeting system demand. The RTOs and ISOs declared emergency conditions on several occasions and some implemented emergency procedures, including emergency demand response, voltage reduction, emergency energy purchases, and public appeals for conservation. They issued several maximum generation warnings and some maximum generation actions during the period. A maximum generation action means that all generation is to be made available and that generators may be asked to produce in the emergency range of their capacity, above normal operating limits.

That’s the hair-raising part. But this is worth stressing:

It is important to note that the RTOs and ISOs cut no firm load during this period.

Fair is fair, after all. Natural gas works require an ongoing flow of fuel while nuclear energy plants will run without issue until a refueling outage – and those don’t happen during the winter or summer months. FERC’s report is a positive nuclear story only by implication, but a very potent argument for energy diversity.

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It’s more a coincidence than anything else, but Bisconti Associates just released a poll that showed Americans highly engaged with the issue of energy diversity:

The survey shows that a near-consensus 94 percent of Americans believe it is "important to maintain a diversity of energy sources to supply our nation's electricity;" 75 percent believe it is very important to do so.

"Americans approach electricity from a very practical standpoint, and energy diversity equates with energy reliability," said Ann Bisconti, president of Bisconti Research Inc. Her firm conducted the national survey of public opinion with Quest Global Research from March 6-21.

94 percent! That vortex – may it never return - did a lot of good by focusing attention on energy diversity. Let’s see what the industry does with – and how it responds to - this information.

14 comments:

jimwg said...

This is one excellent piece!!!

Single flaw is that it'll never break out into the voting mass lay public for its enlightenment to do any good!

Keep up the good work!

James Greenidge
Queens NY


David Bradish said...

Thanks for the backhanded comment Jim. Always appreciate you telling us how much our posts don't matter.

Dan Williamson said...

I'm sure Jim's point it that you're preaching to the choir here. This blog doesn't seem to generate much contention or attract the unconverted. Perhaps you should be more visible to the public....holding press conferences and taking out full page ads in key periodicals and newspapers.

David Bradish said...

Yes, Jim continuously makes that point in nearly every one of our posts. NEI has an ad campaign going on that he may not be aware of and Exelon has one as well. Press conferences for both of these were also held and ads have been frequently placed in periodicals and newspapers for years. Ads, impressions and reaching the masses don't solve nuclear's problems though and complaining about NEI's outreach tactics certainly doesn't help.

What could help is having him start his own campaign like others have.

Anonymous said...

The cold and high winds actually killed a number of wind turbines in my area. One got ruined by high winds. Evidently the gearbox and related transmission parts were destroyed by over speed on the windmill. The braking system must have failed or itself burned out. The cold killed some turbines because their lube oil heaters failed and the oil froze up. Meanwhile, the two nuclear plants in the area kept chugging out the megawatts with nary a problem (or word of appreciation in the media).

jimwg said...

Nothing "backhanded" about this. The reality is less than .001% of Americans will ever know such an informative article exists regarding one major national survival issue. PR techniques matter. GM and Kellogg and even Greenpeace didn't get renown in the public by staying niche or doing Tupperware parties. That Arnie and Helen get far more media notice and regard than this far more deserving article tells something about marketing nuclear and getting one's word and facts across the masses where it counts. Hawking one's agency and product isn't all that hard these days when you have the ready resources and name and the manpower at hand. Stuffing my checks in my mouth wouldn't be enough to do the job, but I'd happily produce and launch lots informative nuclear education ads and promos in a heartbeat if I'd the chair for a week. Nuclear is hemorrhaging in the U.S. and it better wise up to the obvious but quick. Give the devils their due, but just what is it that Greenpeace and Arnie and Helen know and do about wooing the public trust that's beyond the nuclear community's keen to compete?

James Greenidge
Queens NY

Mark Flanagan said...

I'll insert myself into this tussle to note that FERC reports are not something that are going to penetrate the minds of anyone outside the energy-interested. But as I point out in the post, respondents to a poll are highly in favor of energy diversity, which benefits nuclear energy. You can say that the FERC report, however indirectly it percolates into the public consciousness, does get there.

Jim would like to see NEI take to the hustings to trumpet the wonders of nuclear energy. But frankly, while advertising campaigns can be useful (and NEI's Nuclear Matters campaign is pretty nicely thought out), they won't get you where you want to go by themselves. Government support, editorial backing, think tank and agency reports (like FERC's)have a far more consequential impact than advertising alone can do. Our blog posts pointing up the nuclear doings around us can be used to help make the case to our friends and acquaintances (and bring attention to non-obvious pro-nuclear documents like the FERC report).

The bottom line is, a lot of what NEI (and other similar organizations) does is invisible - not secret per se, just not directly seeable by advocates. But it's happening anyway and is often quite effective in sending the pro-nuclear message to those most able to do something useful with it.

Anonymous said...

What Arnie and Helen know and nuclear industry people don't (or don't appreciate) is that emotional arguments "sell" better than logical or scientific ones. Arnie and Helen have no logic or science on their side. Theirs is strictly an emotional appeal, and irrational fear is among the strongest of emotional responses. It is also extremely difficult to rebut an emotional appeal based on fear with a logical one based on reason and science, because Arnie and Helen will use that against us (i.e., you're "cold", or "don't care about the children"). What we need is a compassionate message that appeals both to logic and emotion, one that shows that nuclear energy can fill a crucial need that will provide comfort, security, environmental benefits, economic stability, and growth. It must be delivered not only with conviction but with passion. Engineers and scientists generally don't possess the morphe to pull that off easily. We need an articulate, charismatic advocate who can rebut the Fuddites in the public mind in an effective manner. Unfortunately, that ain't me. I try in my own way, but I can only reach a limited audience without the mass media appeal of the Gundersens and Caldicotts.

Mitch said...

>> The bottom line is, a lot of what NEI (and other similar organizations) does is invisible - not secret per se, just not directly seeable by advocates. <<

Well it sure is invisible because people on the street all say nuclear is evil for over 40 years! Did the BP Oil Gulf get their name and mojo back this way?

Rod Adams said...

@David

You wrote:

NEI has an ad campaign going on that he may not be aware of and Exelon has one as well.

There is some irony in that comment. If people like Jim and I, who look carefully for positive messages about nuclear energy, are not aware of an ad campaign, that should be an indication that the campaign is a bit too quiet.

Nukes have a well deserved reputation for being self-critical, learning from best practices, and having strong knowledge management programs. I recognize that NEI rank and file employees are hard working people, but why do you get defensive when we point out that your leaders need to provide you with more resources?

You create great content, but wouldn't your effort be more successful if the large corporations that you represent would pony up a little more money to spread the word?

Mark Flanagan made the following statement:

Government support, editorial backing, think tank and agency reports (like FERC's)have a far more consequential impact than advertising alone can do.

Sure, but how do you think you are going to get the attention of the editors and the think tanks if you don't do your part and tell your story as loudly as you can, using the "bullhorn" of paid advertising.

Here's a little secret for you - the mainstream (aka commercial) media makes its money by selling ads. If you expect them to support your business, you need to support theirs. I know that most engineers believe the myth that journalists work hard to find stories and always tell the truth, but that is not really the way the world works.

By the way, you were a little gentle on FERC about its complete avoidance of the 'N' word.

Rod Adams
Publisher, Atomic Insights

David Bradish said...

If people like Jim and I, who look carefully for positive messages about nuclear energy, are not aware of an ad campaign, that should be an indication that the campaign is a bit too quiet.

Or maybe that it's not targeted to you guys which it isn't. We have media guys who track this stuff for us and for the month of March the campaign has made nearly six million impressions. Ads are placed in E&E News, WSJ, Washington Post, Facebook, Google search, Twitter, LinkedIn and Politico, to name a few.

wouldn't your effort be more successful if the large corporations that you represent would pony up a little more money to spread the word?

You guys seem to think we have an unlimited budget and resources. If it were only that easy.

Mitch said...

>> We have media guys who track this stuff for us and for the month of March the campaign has made nearly six million impressions. <<

Not knocking anyone or how to spend money but if you ask anyone off the street in the U.S. if they heard or saw anything good about nukes, some people aren't going to like the answer. Sure those six million aren't in Pango-Pango?

Anonymous said...

I'll charitably assume Rod Adams is not deliberately misleading about how journalism works, but maybe just doesn't know.

Reporters don't sell ads, editors don't sell ads, and they don't base their stories on what does sell ads. Those things are handled by different departments in any real news organization.

A lot of time is spent on this blog killing the messenger. It's not the media's fault the industry is facing many challenges. I don't see the New York Times, MSNBC, etc. setting up fracking operations.

jimwg said...

This is not a killing the messenger issue. It's one of organizations and groups who have taken on the mantle of reporting and delving issues in the nuclear community taking up the banner and sword and correcting public nuclear misconceptions and countering outright FUD slander. The offices of 60 Minutes should've had phones ringing off the hook from such groups railing them about how willful obtuse they were regarding the facts of radiation and what happened at Fukushima and the image they portrayed of reactors as a whole. A phone call costs a dime. Light-years less most coffee budgets. I'm not even talking about full blown mass media nuclear public education which should've started long yesterday, just a lousy phone call to the media to say hey, you all misled people (because it was NO "mistake" or "ignorance") regarding nuclear mentions on your show! We got real nuclear pros on tap to use as consultants if you wish (instead of their regular token flunkies). If these nuclear advocacy groups indeed made such a call at least, we'd all be elated to hear of it!

James Greenidge
Queens NY