Energy experts and officials from New England and New York on Wednesday debated how the power sector can deliver clean, affordable electricity as society moves to a low-carbon and increasingly electrified economy.

All but one of the four panelists were affiliated with Columbia University’s Center on Global Energy Policy (CGEP), which hosted the webinar.

The exception was Peter Fox-Penner, founder and director of Boston University’s Institute of Sustainable Energy, who set up the discussion by summarizing his recent book, “Power after Carbon: Building a Clean, Resilient Grid,” published in May by Harvard University Press.

CGEP senior research scholar Melissa Lott moderated the panel and invited the audience to vote on questions, such as whether the lack of a coherent federal decarbonization policy is the biggest obstacle to progress in transitioning to a clean economy. (42% of respondents said “yes.”)

Following is some of what we heard at the meeting.

A Bigger Boat

“We’re going to need a power industry about half again as large as we have [by 2050], maybe as large as double if you take all of current uses,” Fox-Penner said. “If you account for the greater efficiency that electrification brings, and you apply it to every single BTU of energy use in the United States, you about double electricity use.”

Variable factors on power sector growth include how much electricity is used to produce hydrogen or for direct carbon extraction from the atmosphere, he said.

“We have a big job ahead of us, but that amount of growth in the size of the power grid in 30 years is very manageable,” Fox-Penner said. “The power industry in fact has grown that fast; during the 1940s and ’50s and ’60s, it grew almost exactly that fast, so we know we can do that. But it’s not easy, and it takes planning.”

Distributed energy resources alone will not be able to supply the power needed in the coming decades, he said.

“There are no surprises here; it’s going to come from resources of wind and solar PV,” Fox-Penner said. “I think advanced nuclear will play a role, and certainly current nuclear is playing a role, accounting for 20% of our supply. Gas with carbon capture and storage is coming along strongly.”

Many other resources will contribute less, he said, and then there are “important balancing resources such as large-scale, storage-flexible load and the grid itself, all of which are really far and away the most important and difficult part of achieving a decarbonized grid.”

Willingness to Sacrifice

“I start from the premise that the U.S. has achieved far less decarbonization than we’re capable of, given our financial, technical and natural resources,” said former FERC Commissioner Cheryl LaFleur, now a CGEP fellow and member of the ISO-NE Board of Directors.

LaFleur cited several big, systemic issues impeding progress.

“The first one … is the lack of a national consensus that climate change is a problem and thus the lack of a strategy or goal,” LaFleur said. “Quite simply, if you’re not trying to do something, it should be no surprise that you’re not getting maximum success.”

The second factor is disaggregated decision-making among the different federal agencies and state and local governments, all pursuing policies that are sometimes working at cross-purposes, she said.

“In particular, a lot of people have the say over what gets built, where it gets built and who pays for it,” LaFleur said. “Finally, I think there’s a mismatch between people’s expressed support for climate action and their willingness to do something about it, and I don’t mean just not using plastic straws, but allowing resources, whether they’re utility-scale renewables or transmission to connect renewables, to be built near them.”

One of the more difficult problems will be developing cost-effective, carbon-free resources to balance renewables, but even the so-called “easy” things like solar and wind are difficult to site and build, she said.

LaFleur quoted Fox-Penner’s book as recommending “improved cost allocation and interregional planning for transmission,” saying “those were the exact words in FERC Order 1000, which is nine years old … but has been very little utilized in practice, particularly in states agreeing on the allocation of costs for public policy resources and also the introduction of competitive transmission processes.”

Regarding planning among states, LaFleur said that if Congress wants to require regional planning, people should make use of regional planning structures that already exist and do some things well.

In a side panel on the webinar screen, energy analyst Matthew Wittenstein asked, “What is your view on CAISO’s proposed Extended Day-Ahead Market for the Western Interconnect? Is it an alternative to a Western RTO, a stepping stone to one or a detour?” (See CAISO Proposal Sets Course for EIM Day-ahead.)

“I don’t know if it’s a stepping stone or an alternative to an RTO, but I strongly believe that the best thing is to let them decide,” LaFleur said. “I’d love to see it develop from an imbalance market to a day-ahead or something stronger, but even if it stays at one of those stops, it’s still a big improvement on using resources over a broader geography, which is especially needed in the West.”

On a separate question as to whether she was worried about the differences between RTO and non-RTO regions when it comes to regional policy, LaFleur said, “Yes, every time FERC upped the ante and required another thing for the RTOs to change their tariff in a slightly different way, I worried we were creating more and more of a divide between the two different Americas, in the organized markets and in the bilateral markets.”

Don’t Wait; Act Now

CGEP scholar Richard Kauffman, chair of the New York State Energy Research and Development Authority and board chair of San Francisco-based Generate Capital, said he prefers market forces over regulatory fiat.

“By market forces, I’m not talking about FERC-like wholesale market structures, which are quite anachronistic to the power sector. I’m talking about market forces that exist elsewhere in the economy,” Kauffman said. “Our sector has been in a kind of bubble, away from forces affecting other sectors of the economy.”

Investment banker and project consultant Gary Krellenstein said that Kauffman correctly pointed out that the system capacity factor in New York is only 54%. “But given the physical constraints on usage, such as seasonality and weather, won’t using more renewables further decrease system capacity factor? More reliance on intermittent renewables implies a lower capacity factor and higher capital costs.”

Kauffman agreed that if the regulatory and utility business model doesn’t change, average capacity utilization will indeed go further down.

“We may not like flying, but the industry has moved from 50% to 90% average capacity utilization as a result of technology adoption, business model change and flexible pricing,” Kauffman said. “This has resulted in much lower costs for customers. The same lessons are true for the chemical and other manufacturing industries. We need to adopt these lessons to the regulatory utility sector, which has been protected by the golden cage of regulation.”

On the other hand, energy efficiency and demand response are not businesses, but activities forced on utilities by regulators, he said.

David R. Hill, CGEP fellow and a member of the NYISO Board of Directors, recommended avoiding making the same mistakes that led to stranded asset costs in some cases when regulators opened transmission development to competitive markets.

“I’m a skeptic of grand master plans, and I think it’s a mistake to hold our breath and wait for them, or to use the lack of one as the reason why we’re not doing things,” Hill said. “Instead, there are so many tools we already have and have available, some of which we haven’t tried to use here in terms of coming up with the least-cost, fastest, most effective way of solving some of the problems we’re talking about.”

Hill agreed with Kauffman on looking for market-based solutions.

“In the New York ISO, we’re trying to put forward a carbon-pricing initiative as a part of the ISO’s program, and of course we’re trying to slog through what it takes to get support for that to make it happen,” Hill said. “FERC is having its carbon pricing conference in September, and there’s a lot that could be done with existing authority. Waiting for Congress to pass laws or to do something else — we should not wait on that.”

Fox-Penner said he is “convinced that markets work much better if government does a certain amount of planning and a certain amount of adjudication of the markets.”

Hill said it would pay to go back to the fundamentals of why wholesale power markets were opened in the first place, which was to solve problems. The electricity market effort was not a complete success, but the industry can learn from experience and not make the same mistakes as transportation electrification gets underway, he said.

“The lack of innovation on the consumer side of the electric business is amazing,” Hill said. “We need to think about what are the models that can best bring about the innovation. … So much of what happens on the wholesale side now is walled off from consumers, leaving them unable to see it or participate in it.”