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Florida Senator Introduces Legislation That Addresses Utility Sector Supply Chain Challenges

August 4, 2022

by Paul Ciampoli
APPA News Director
August 4, 2022

U.S. Sen. Marco Rubio, R-Fla., recently introduced legislation that would establish an energy grid product manufacturing loan program at the U.S. Department of Energy to expand domestic production as a way in which to address ongoing electric utility sector supply chain challenges.

The new loan program would be fully paid for by the rescission of unused appropriations, as recommended by the Government Accountability Office.

The program would finance $8 billion in loan guarantees for the re-equipping, expansion, or establishment of domestic energy grid product and component manufacturing facilities in the United States. 

“Due to international supply chain backlogs, electric utilities in the U.S. are struggling to receive ordered electric grid products in a timely manner, especially transformers,” Rubio’s office said in an Aug. 2 news release related to the legislation. “These delays are resulting in dangerously low stockpiles for new developments and replacement equipment, which threaten preparedness throughout the country, but especially in a state like Florida where hurricanes can severely disrupt the electric grid,” the news release said.

The Florida Municipal Electric Association (FMEA) “has been diligently working this issue since March and applauds Sen. Rubio for his efforts to address the significant issues we have been raising with our federal and state officials,” said Amy Zubaly, Executive Director of FMEA.

A group of federal lawmakers from Florida on June 10 sent a letter to the Federal Emergency Management Agency that highlighted “the dangerous supply chain shortages affecting Florida’s electric cooperatives and municipalities.”

APPA Moves To Address Supply Chain Challenges

The American Public Power Association (APPA) is taking a number of actions to address ongoing supply chain challenges.

APPA recently rolled out an additional feature to its eReliability Tracker that is available to all public power utilities and allows for voluntary equipment sharing by matching systems with the same distribution voltages.

In a speech in June at APPA’s National Conference in Nashville, Tenn., Ditto urged member utilities to share their supply chain challenges with APPA so that the trade group can relay details on these challenges to federal partners and discuss how critical burdens on the sector can be alleviated.

In May, APPA convened a supply chain summit that included participation from public power utility officials who discussed their supply chain challenges and mitigation strategies.

APPA also recently finalized a new supply chain issue brief. APPA members can download the issue brief here.

Berkeley Lab Study Looks At Battery Storage And Net Billing

August 4, 2022

by Peter Maloney
APPA News
August 4, 2022

Using battery storage to manage solar self consumption is not efficient from the perspective of an individual consumer or the wholesale power grid, according to a new study from Lawrence Berkeley National Laboratory 

The Berkeley Lab study, Private vs. public value of U.S. residential battery storage operated for solar self-consumption, set out to quantify the value of using residential battery storage to maximize solar self-consumption from the individual solar customer and the larger power system standpoint.

The impetus of the study is the growing popularity of net billing schemes that are being put in place to replace net metering schemes that are being phased out in many states.

Net energy metering (NEM), in which residential solar exports to the grid are credited against consumption at full retail electricity price, has been the dominant compensation structure, but it has raised several concerns, including the potential for cost-shifting from solar to non-solar customers.

As the use of net metering dwindles, net billing has become the de-facto NEM successor in many states, the study said. Net billing allows customers to offset consumption with contemporaneous solar generation, but any surplus generation exported to the grid is credited at a grid export rate below the full retail electricity price, often tied to a utility’s avoided costs.

Currently, some variation of net billing has been adopted in 10 states and has been proposed in at least five others.

Using metered data from 1,800 residential customers across six utilities, the study found that batteries operated solely for self-consumption provided “customer bill savings up to $20–30 per kWh of storage capacity annually, but virtually no grid value.”

Even though net billing may save customers money on their electricity bills, it is still inefficient overall for individual customers, the Berkeley researchers found.

Nonetheless, they said, private bill savings may be enough to drive adoption when combined with the resilience value from backup power or other revenue streams.

Compared with market-based dispatch, self-consumption dispatch will likely become more severe over time, insofar as increased renewable energy penetration leads to more volatile wholesale prices, the study found.

“Storage used for solar self-consumption yields virtually no value to the bulk power system in terms of reduced wholesale energy costs,” primarily because of a misalignment between the temporal profiles of storage dispatch and wholesale energy prices, the researchers aid.

Even in “a future with high solar penetration, where wholesale prices resemble the proverbial “duck curve”, the energy value of storage dispatched for solar self-consumption remains highly suboptimal,” they added.

Storage used for solar self-consumption also yields virtually no value in terms of reduced peak-related costs, such as those related to generation, transmission, and distribution system capacity, the study found, because almost all solar generation on peak-load days is used to directly serve onsite customer load, resulting in little surplus solar energy available to fuel storage discharge during peak-load hours later in the day. As a result, battery storage largely sits idle on those days, barring some other incentive to operate for system-peak reduction purposes.

Alternatively, incentivizing storage customers to respond to market prices, particularly on peak days, would enhance both private and public value. “Compensating customers for operating storage in response to market prices can create a win-win, providing benefits to the power system while offering commensurate financial returns to PV+ storage adopters (or their aggregators) that exceed what they would receive from simply maximizing solar self-consumption,” the study’s authors wrote.

The authors noted, however, that outcome is conditional on customers being allowed to discharge storage to the grid. Unrestricted market response would significantly increase exports, which could impose stress on the local distribution network under certain conditions, but a significant portion of the potential market value could be achieved without significantly increasing exports, by relying on pricing or programmatic incentives that target storage discharge during narrow peak demand periods, the study concluded.

Easton Utilities Awarded $3.5 Million To Close County’s Broadband Gap

August 3, 2022

by Peter Maloney
APPA News
August 3, 2022

Maryland public power utility Easton Utilities has been awarded a $3.5 million grant to finish building out broadband infrastructure in Talbot County, Md.

The Maryland Department of Housing and Community Development awarded the grant in response to a solicitation to which Easton Utilities responded to earlier this year.

The grant is being used to extend broadband to the remaining unserved locations in Talbot County, specifically in the western part of the county including parts of St. Michaels, Bozman, McDaniel, Neavitt, Sherwood, Tilghman, and Wittman, as well as several other isolated areas in Easton and Oxford.

The grant will enable Easton Utilities to extend broadband service to the remaining 8 percent of the Talbot County population that do not yet have broadband service, Easton Utilities spokeswoman Kelly Simonsen said.

When the Connect Talbot project is completed, expected in 2026, it will provide broadband service to some unserved 3,600 locations throughout the county.

“Throughout this initiative, we have focused on securing funding to ensure all residents without access to broadband service will have the opportunity to obtain high-speed internet if desired,” Hugh Grunden, president and CEO of Easton Utilities, said in a statement.

In 2017, the Maryland General Assembly established the Task Force on Rural Internet, Broadband, Wireless and Cellular Service to help address broadband inequities on Maryland’s Eastern Shore and in other rural parts of the state. Gov. Larry Hogan appointed Easton Utilities’ Grunden to serve on the task force.

Around the same time, the Talbot County Council issued a solicitation to help close the gap on broadband access. In December 2018, the U.S. Department of Agriculture (USDA) announced its ReConnect Program with $600 million in funding for broadband. Easton Utilities applied and in July 2020, USDA awarded Easton Utilities a $13.1 million grant to fund the extension of broadband into underserved portions of Talbot County.

An additional $13 million of funding for the project came from a combination of funding from the Federal Communications Commission (FCC), the State of Maryland, and Talbot County.

The state of Maryland contributed about $6.2 million. Talbot County contributed $3 million in matching funds and in March the county contributed another $1.75 million to the project, which eliminated funds that were originally slated to come from the project’s newly served customers. Easton Utilities is contributing a total of $4.25 million to the Connect Talbot project.

Easton Utilities has offered cable service to customers in its greater Easton metropolitan service territory since 1984 and began offering broadband service in 1998. Easton created Easton Velocity in 2016 with the merger of Easton Cable and Easton Online. Easton Velocity now serves 4,600 cable customers, more than 9,000 internet customers, and 1,600 digital voice customers. 

In addition to providing the basis for internet service to an underserved community, the Connect Talbot project will also allow for Easton Velocity to offer services to new subscribers.

Separately, Easton Utilities is converting its current subscriber base in Easton to fiber optic cable, using $5 million of the Town of Easton’s American Rescue Plan funds and $10 million of its own funds to bolster the backbone of its broadband service and bring fiber optic cable from the curb to customers’ houses.

Public Power Communities Recognized For Reliability, Safety Efforts By State Association

August 3, 2022

by Paul Ciampoli
APPA News Director
August 3, 2022

The Municipal Electric Systems of Oklahoma (MESO) has recognized public power members from Oklahoma and adjoining states for safety and reliability efforts.

Oklahoma’s Fairview Utilities Authority earned first place in MESO’s annual Electric Operations and Reliability Competition in the category for cities under 10,000 population and was cited for achieving the highest reported level of service reliability for public power cities in Oklahoma. The utility delivered an Average System Availability Index of 99.9988 percent in 2021.

Additionally, the utility had a perfect safety record for 2021. The utility’s personnel went a year without a reportable lost work time incident, either “days away from work,” “restricted light duty,” or “medical treatment” cases in 4,232-man-hours.

The City of Miami and Miami Electric in Oklahoma earned MESO’s Outstanding Achievement in the annual Electric Safety Competition in Oklahoma in the category for cities with over 10,000 population.

Miami employees delivered an exceptional safety record in 2021, MESO said. The utility’s personnel went the year with one reportable incident, resulting in no lost work time, either “days away from work,” “restricted light duty,” or “medical treatment” cases in 20,322-man-hours.

Coffeyville Municipal Light & Power in Kansas earned MESO’s Outstanding Achievement in the association’s annual Electric Operations and Reliability Competition. The utility was recognized in the category for cities with over 10,000 population and cited for achieving the second-highest reported level of service reliability for cities within MESO’s four-state member region. The utility delivered an Average System Availability Index of 99.9983 percent in 2021.

Oklahoma’s Prague Power, the city’s electric utility, earned Outstanding Achievement in MESO’s Operations and Reliability Competition in the category for cities under 10,000 population. The utility delivered an Average System Availability Index of 99.9933 percent in 2021. Additionally, Prague Power was recognized for having a perfect safety record for 2021 working without a reportable lost work time incident, either “days away from work,” “restricted light duty,” or “medical treatment” cases.

Tahlequah Public Works Authority (TPWA), serving the citizens of Tahlequah, Okla., earned First Place in MESO’s Electric Operations and Reliability Competition in the category for cities with a population over 10,000. TPWA achieved the highest reported level of service reliability for cities within Oklahoma with an Average System Availability Index of 99.994 percent in 2021.

The Town of Olustee in Oklahoma earned First Place in MESO’s Electric Operations and Reliability Competition in the Town Category with an Average System Availability Index of 99.9995 percent in 2021. Additionally, Olustee was recognized for having a perfect safety record for 2021. The Town’s employees working a year (or 7,251-man-hours) without a reportable lost work time incident, either “days away from work,” “restricted light duty,” or “medical treatment” case.

The City of Marlow, Okla., was recognized for Outstanding Achievement in MESO’s annual Electric Operations and Reliability Competition. The utility was recognized in the category for cities under 10,000 population and delivering an Average System Availability Index of 99.9964 percent in 2021.

Other cities that were recognized by MESO were: Siloam Springs, Arkansas: Reliability – 1st, over 10,000, four-state region; Tecumseh, Okla. – Outstanding Achievement; Duncan, Okla.: Reliability – Outstanding Achievement; and Comanche, Okla: Safety – First Place.

New York Issues Solicitation To Purchase At Least 2,000 MW Of Offshore RECs

August 3, 2022

by Peter Maloney
APPA News
August 3, 2022

New York Gov. Kathy Hochul recently announced the issuance of the third in a series of solicitations aimed increasing offshore wind production in the state.

The solicitation, administered by the New York State Energy Research and Development Authority (NYSERDA), seeks to purchase a minimum of 2,000 megawatts (MW) of offshore renewable energy credits (ORECs).

If the responses to the solicitation justify procurement of a larger quantity of ORECs, NYSERDA said it may procure through the solicitation up to the remaining capacity authorized by the state’s Offshore Wind Orders.

New York’s Climate Leadership and Community Protection Act sets a goal of developing 9,000 MW of offshore wind by 2035. New York has a pipeline of five offshore wind projects totaling over 4,300 MW under active development.

Offshore wind projects under way in New York include the 924-MW Sunrise Wind project, the 816-MW Empire Wind project, the 1,260-MW Empire Wind 2 project, the 1,230-MW Beacon Wind project, and the 130-MW South Fork Wind Farm being developed by Long Island Power Authority (LIPA).

New York State is aiming to become a hub of offshore wind energy by establishing ecosystems for workforce development, manufacturing, and operations and maintenance to support the offshore wind projects in the region.

Proposals in response to the solicitation are due on Dec. 22. A webinar will be held on Aug. 23. Solicitation award announcements are expected in early 2023.

APPA’s Ditto Says Infrastructure Law Offers Huge Opportunity for Public Power

August 1, 2022

by Paul Ciampoli
APPA News Director
August 1, 2022

The Infrastructure Investment and Jobs Act (IIJA) provides a huge opportunity for public power utilities, and the American Public Power Association (APPA) is working hard to ensure that its members are able to take full advantage of funding opportunities flowing from the ILJA, said Joy Ditto, President and CEO of APPA on July 25.

Ditto made her comments at an event held by Environmental and Energy Study Institute and the House and Senate Renewable Energy and Energy Efficiency (REEE) Caucuses in Washington, D.C., while participating on a panel that focused on the IIIJA.

“The IIJA is a huge opportunity for public power and, I would venture to say, the entire sector,” she said.

The law helps public power utilities and, in particular, many smaller public power utilities, “to really build on what they’ve already done and to meet” clean energy needs and address climate change.

“There is, however, some concern with some of these smaller entities about how they manage even accessing some of these funds because they are small businesses basically,” Ditto said.

Therefore, a lot of APPA’s current focus is “enabling our members to interface with the federal government, giving them resources to access the funds as they become available” and to make sure that as funds become available public power utilities are eligible.

As the legislation was being crafted, APPA worked hard to define public power. “Even though we’re affiliated with municipalities in many cases and all our utilities are public, in some cases we look more like a rural electric cooperative in terms of our service territory…so we have to define ourselves very specifically. We want to make sure those definitions hold as funds are made available and that’s some of our work that we do at APPA as well.”

Ditto noted that public power utilities are closely tied to what their community needs are. “We can be very nimble, and we can deploy resources that have an immediate impact on the communities that we serve.”

Public power already has a proven track record in this regard, she pointed out, citing community solar and small wind energy projects as examples.

“We’ve done this already, but now as we accept some of these funds, we can be even more innovative. We can take advantage of newer technologies or build on those existing technologies to really meet the needs of our communities and we look forward to doing that,’ she said.

When asked to discuss her vision for public power in 2030, Ditto underscored the ongoing need for the electric sector to focus on affordable and reliable energy. APPA and public power communities “recognize sometimes this clean energy transition is going to be more expensive. It’s why the IIJA is so important because it helps defray some of that expense,” Ditto said.

Public power’s concern is that “if we see reliability suffer, we might have to take a step back from driving toward” a clear energy future “because people will start to get a little bit worried about what that means, so we have to keep those things front of mind” as the transition continues with new technologies.

By 2030, Ditto envisions public power having effectively managed the transition “and that we’ve moved forward to enable some of these new technologies – maybe we’re farther along with hydrogen. We have additional hydropower technologies we are looking at. We have things like small modular reactors.”

But the power sector can’t discard baseload power as part of the future energy mix, she said. “We need to have some type of electricity that you can produce 24, seven,” throughout the year. “That has to be there or else we’re going to have reliability concerns.”

She said that “we need to enhance that reliability, particularly on the green side.

Click here for resources and opportunities for public power tied to the IIJA curated by APPA.

Public Power Would Gain Access to Direct Payment of Tax Credits under Energy, Climate Deal

August 1, 2022

by Paul Ciampoli
APPA News Director
August 1, 2022

Public power utilities, rural electric cooperatives, the Tennessee Valley Authority, state and local governments, and other tax-exempt entities would have access to refundable direct payment tax credits under an energy and climate agreement announced on July 27.

The agreement was unveiled by Senate Committee on Energy and Natural Resources Committee Chairman Joe Manchin (D-WV) and Senate Majority Leader Charles Schumer (D-NY).

The climate and energy provisions will be included in budget reconciliation legislation. Senate Majority Leader Chuck Schumer (D-NY) hopes to begin debate of the measure on the Senate floor as early as this Wednesday, but key details remain to be ironed out. It is also unclear whether the measure will have the support of all 50 Democrats that will be needed to pass the bill and send it to the House for consideration.

Provisions of particular interest to public power include:

Tax Provisions

Internal Revenue Code (IRC) Section 45 – Electricity Produced from Certain Renewable Resources

Base credit of 0.5 cents per kWh, for wind, solar and geothermal construction of which begins after 2021 and through 2024. Credit is increased to 2.5 cents per kWh for facilities:

IRC Section 48 – Energy Credit (ITC)

Base credit of 6% for projects after 2021 and through 2024. The credit is expanded to include energy storage, qualified biogas, microgrid controllers.

Credit is increased to 30 percent for facilities:

The credit is increased for:

Clean Electric Production Credit and IRC Section 48D – Clean Energy Investment Credit

IRC Section 6417 – Elective Payment of Applicable Credits

Other tax provisions include the creation of a production tax credit for existing nuclear power facilities equal to up to 1.5 cents per kWh. The credit is reduced as the sale price of such electricity increases.

The agreement also calls for the creation of a new production and investment tax credits for clean hydrogen and will allow corporate taxpayers to transfer energy tax credits to another taxpayer in exchange for cash.

The agreement also imposes a tax equal to 15 percent of a corporation’s adjusted financial statement income. Financial statement income generally includes all interest and, so, this minimum tax would apply to other tax-exempt bond interest.

Funding

On the funding side, the deal calls for $1 billion in additional funding to the Rural Electrification and Telephone Fund for electric storage project loans. Up to 50 percent of such loans can be forgiven for projects meeting terms and conditions set by the Department of Agriculture.

It also includes $1 billion for loans and grants to promote underutilized renewable technologies in rural areas.

The agreement also includes $3.6 billion to authorize an additional $40 billion under the Department of Energy (DOE) loan office to support projects that support technology innovations to avoid, reduce, utilize, or sequester air pollutants or anthropogenic emissions of greenhouse gases.

Other funding elements in the agreement include:

The text of the bill and a variety of summaries can be found here.

Nuclear Regulatory Commission Directs Staff To Issue Final Rule Certifying NuScale SMR Design

July 31, 2022

by Paul Ciampoli
APPA News Director
July 31, 2022

The U.S. Nuclear Regulatory Commission has directed its staff to issue a final rule that certifies NuScale’s small modular reactor (SMR) design for use in the U.S., the NRC said on July 29.

The certification’s effective date is 30 days after the NRC publishes the rule in the Federal Register.

NRC certification means the design meets the agency’s applicable safety requirements.

An application for a nuclear power plant combined license that references a certified design will not need to address any of the issues resolved by the design certification rule. Instead, the combined license application and the NRC’s safety review would address any remaining safety and environmental issues for the proposed nuclear power plant, the NRC said.

The design certification approves the NuScale reactor’s “design control document,” which is incorporated by reference in the final rule.

NuScale submitted an application to the NRC on Dec. 31, 2016, to certify the company’s SMR design for use in the United States. The NRC staff met its schedule goals for completing its technical review.

The design uses natural, “passive” processes such as convection and gravity in its operating systems and safety features, while producing up to approximately 600 megawatts (MW) of electricity.

The SMR’s 12 modules, each producing 50 MW, are all submerged in a safety-related pool built below ground level.

Carbon Free Power Project, LLC (CFPP), a wholly owned subsidiary of Utah Associated Municipal Power Systems, continues to advance the development and deployment of its first-of-a-kind SMR nuclear plant at the U.S. Department of Energy’s Idaho National Laboratory near Idaho Falls, Idaho. 

CFPP successfully and safely completed field investigation activities at the site in January 2022, a major milestone for the project.  

The CFPP will deploy a NuScale power plant that is based on NuScale’s SMR technology.  

In May 2021, NuScale Power and Washington State’s Grant County Public Utility District announced the signing of a memorandum of understanding to evaluate the deployment of NuScale’s SMR technology in Central Washington State.

Canada’s Ontario Power Generation (OPG) and the Tennessee Valley Authority (TVA) will jointly work to help develop small modular reactors (SMRs), TVA announced earlier this year.

The agreement allows TVA and OPG to coordinate their explorations into the design, licensing, construction and operation of small modular reactors.

The Heart of Public Power

July 30, 2022

by Joy Ditto
APPA President and CEO
July 30, 2022

I just came back from visiting the heartland, literally and figuratively.  I made my way to Madison, South Dakota, for the Heartland Consumers Power District meeting.  Heartland was established in 1969 and is a joint action agency serving 29 cities in South Dakota, Minnesota, Iowa, and Nebraska. I had been to South Dakota previously, including last year during a family trip to Mount Rushmore and the Crazy Horse monument. Note that my kids asked me if I was going back to those monuments when I mentioned the location of my trip – they loved them so much! But I had never been to Madison, which is about 45 minutes from Sioux Falls.  What a cute town! It has a quaint, historic downtown and a beautiful lake community. 

Upon arriving at the meeting on a crisp Tuesday morning — a nice change from the humid summer temps I had been experiencing in the former swampland of Northern Virginia/Washington, D.C. — I noticed that there was some great signage touting “Heartland Energy.”  My sleuthing skills took over and I quickly verified that a new brand was going to be unveiled for the group. As was described by Ann Hyland, chief communications officer, and Russ Olson, president and CEO, after doing a thorough job vetting the look and feel of the brand and the direction of the organization, the Board of Directors chose a name that included the term “energy” to convey action and forward movement while also depicting the literal delivery of energy the group provides to its member communities and keeping the term “Heartland.”

Heartland Energy has an incredible reputation among policymakers in South Dakota, as evidenced by participation in/attendance at their event by Governor Kristi Noem, staff members from the offices of both the state’s U.S. senators, state representatives, and commissioners from the Public Utility Commission (even though public power utilities are not directly regulated by the PUC), and the state economic development office. This is no fluke. Russ and his team focus on these relationships. These policymakers also recognize the tremendous value Heartland has provided South Dakota and the other states it serves through affordable and reliable electric rates and a major focus on economic development.

Heartland is one of about 60 joint action agencies across the country that aim to do the same thing for their member communities. The joint action model, which was pushed by many public power leaders, first in the 1950s and ‘60s and continuing into today, is so powerful because it pools the resources of small and medium communities to enable solutions they likely would not be able to achieve on their own. It marries the on-the-ground, specific community attributes that public power utilities embody with the economies of scale that can enable these communities to optimize their power supply, transmission access, and economic development priorities. The joint action model also allows communities to address other, more recent, challenges like managing supply chains, cybersecurity, and sharing line workers. 

In short, what Heartland Energy and other joint action agencies do is expand and strengthen the heart of public power so that it can beat in places it might not have otherwise: in state legislatures and governors’ offices, in regional transmission organizations’ planning committees, on the member representative committees of reliability groups, and in state economic development discussions. That public power heart beats strongly and loudly to the benefit of the customers they serve – families, the elderly, students, small-, medium-, and large businesses, and non-profit groups.

Heartland Energy CEO Russ Olson and APPA CEO Joy Ditto in Madison, South Dakota
Joy Ditto and Heartland Energy CEO Russ Olson in Madison, SD.

NERC Report Sees Weather, Cyber, Inverter Based Resource Threats To Reliability

July 29, 2022

by Peter Maloney
APPA News
July 29, 2022

Grid operators were able to maintain electric system reliability in 2021 with one notable exception, the February extreme cold weather event that affected Texas and parts of south-central United States, according to a new report from the North American Electric Reliability Corp. (NERC).

The cold weather event resulted in the largest controlled load shed event in U.S. history and the nation’s third largest load loss event, according to NERC’s 2022 State of Reliability report.

The February cold weather event, among other things, confirmed that interdependencies between the electricity and natural gas industries are a major new reliability risk that must be explicitly managed, NERC said in its report.

Last year also saw the rise of reliability threats from cyber attacks from nation-state adversaries and organized cyber criminals, who demonstrated they have “the ability and willingness to disrupt critical infrastructure,” NERC said.

Cyber-attacks “routinely targeted the digital supply chain and reports of suspicious cyber incidents (including vulnerability exposure, phishing, malware, denial of service, and other cyber-related reports) increased significantly in 2021,” the report found.

The NERC report also noted that there were several widespread solar photovoltaic loss events in 2021, two in Texas and four in California. Although reliability was maintained, those events highlighted the importance and urgency of expanding and accelerating ERO Enterprise and industry efforts to address them, the report said.

ERO Enterprise comprises NERC and the six North American regional electric reliability entities.

Conversely there are diminished levels of flexible generation, such as fuel-assured, weatherized, and dispatchable resources, in many parts of the nation, increasing the risk of energy shortfalls. “No longer is the peak demand period the only clear risk period; instead, risks can emerge when weather-dependent generation is impacted by abnormal atmospheric conditions or when extreme conditions disrupt fuel supplies,” the NERC report said.

Overall, the events of the past year have led the ERO Enterprise to begin reassessing how best to measure the overall reliability performance objectives for the industry, NERC said.

The report noted that NERC also has begun to address several of the growing threats. The ERO Enterprise, for instance, is implementing the recommendations in a report on the February cold weather event done by staff at NERC, the ERO Enterprise and the Federal Energy Regulatory Commission.

When implemented, those actions will provide bulk electric system (BES) “planners and operators with additional tools to avoid a recurrence of BES reliability threats arising from extreme cold weather events and address energy availability standards development for long-term planning and operational planning/operations time frames,” NERC said.

Regarding electric-gas interdependency, NERC said its “forward-looking Reliability Assessment Program continues to emphasize the risk of increased reliance on natural gas generation,” and the ERO Enterprise is “actively encouraging registered entities to conduct studies to model plausible and extreme natural gas disruptions” set forth in its March 2020 reliability guideline.

NERC also said it is drafting supply chain requirements and guidance to reduce vulnerabilities and better protect industry systems and infrastructure.

And to address the intermittency of inverter based resources, NERC said the ERO Enterprise and industry are implementing recommendations set forth in reports on the solar power loss events in Texas and California.

In a recent episode of the American Public Power Association’s Public Power Now podcast, Jim Robb, President and CEO of NERC, detailed NERC’s 2022 summer reliability assessment and discussed supply chain challenges facing the power sector.