WASHINGTON — Former NERC executive Brian Harrell, now assistant director of the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency, last week lamented the federal government’s tardy response to the security threat drones pose to utilities.
While many utilities are using drones in storm response and in monitoring vegetation growth along transmission lines, drones equipped with explosives could threaten utility operations.
“This is not an emerging threat. It was emerging five years ago,” Harrell told attendees of the NERC Reliability Leadership Summit on Thursday. “We’re clearly cognizant of the fact that you do not own the airspace above your generating facilities, the airspace above … your transmission substations. And right now, the laws are such that the federal government isn’t being as helpful as it should be.”
Last July, Yemen’s Houthi movement claimed it had used a drone to attack a Saudi Aramco refinery in Riyadh. The company acknowledged a fire at the plant but attributed it to “an operational incident.” In August, explosive-carrying drones were used in an attack during a speech by Venezuelan President Nicolás Maduro.
Harrell, who formerly served as director of the Electricity Information Sharing and Analysis Center (E-ISAC) and director of NERC’s Critical Infrastructure Protection Programs, said the federal government has only limited authority over drones but that DHS is preparing a report on security issues posed by the devices.
“I have strongly advocated that whatever recommendations come out of this report must impact, must touch, the private sector,” he said.
A former security director for Duke Energy, Harrell also cautioned utilities on purchasing drones for their own use.
“If you are using foreign-manufactured drones at your facilities, you potentially are incurring risk. So be very, very mindful of that. … Data loss and prevention is [a real threat].”
In 2017, a leaked memo from Homeland Security’s Immigration and Customs Enforcement bureau (ICE) alleged that Chinese drone-maker DJI was “providing U.S. critical infrastructure and law enforcement data to the Chinese government.” DJI, which has been estimated to hold a 70% global market share, responded that the report was based on “clearly false and misleading claims from an unidentified source.”
Harrell said China is “the most active strategic competitor for cyber espionage against the U.S. government, our corporations and our allies. They are stealers of information. Whereas Russia is a … nuisance in one sense, China is actually taking data for their own use.”
WASHINGTON — Physicist Mark P. Mills gave the NERC Reliability Leadership Summit a blistering and entertaining critique of green tech punditry, saying forecasts of a rapid shift away from hydrocarbons are delusional.
Mills, senior fellow at the conservative think tank the Manhattan Institute, said the big challenge for green technology is the scale of hydrocarbon use — 80% of world energy — and its superior energy density.
“If all of the hydrocarbons that we consume were actually in the form of oil … and we divide them up into barrels, those barrels would go from here in D.C. to [Los Angeles],” he said in a keynote speech. “And the barrels would grow in height at the rate we consume it by one Washington Monument every week. That by itself demonstrates how fatuous it is to talk about ‘moon shots’ to change a system like this. Putting a few people on the moon a few times is an amazing engineering achievement. [But] it’s not a transformation of anything. Transforming and changing how society uses energy is like putting all of humanity on the moon — permanently.”
Mills said those who predict Moore’s Law-scale performance improvements in renewables are making a “category error” in conflating energy technology with digital technology. He cited as an example an International Monetary Fund working paper, “Riding the Energy Transition,” on the potential of electric vehicles to cut oil consumption, which stated “Smartphone substitution seemed no more imminent in the early 2000s than large-scale energy substitution seems today.”
“The biggest energy revolution in terms of how we use energy is unequivocally what we’ve done in computing. Nothing like this has every happened in the history of humanity,” Mills said. “If today’s iPhone had 1980s energy efficiency, that iPhone would be taking the electricity of a Manhattan office building. If a single data center operated at 1980 energy efficiency, one data center would require the entire output of the U.S. on the grid.
“But analogizing information-producing technology with energy-producing technology is a fundamental category error. It’s much worse than comparing apples to oranges. It’s even worse than comparing apples to ball bearings. The difference in the physics between information-producing and energy-producing is deeply profound. If energy systems could scale like computing systems, a single postage-stamp size solar array could power the Empire State Building.”
“That … will … never … happen,” he said, pausing for emphasis with every word. “It happens in comic books. It’s science fiction.”
Mills said the aspirational targets of green tech supporters is based on the notion that wind, solar and battery technologies can make 10-fold gains in efficacy.
“The last few decades, we have seen 10-fold gains in the fundamental efficacy of wind, solar and batteries. But another 10-fold [improvement] is not going to happen. Solar technologies are now approaching underlying physics limits.”
Wind turbines are also closing in on Betz’s law, which states that no turbine can capture more than about 60% of the kinetic energy in wind. “The best wind turbines are now pushing 45% efficiency. … It’s a hell of an achievement,” Mills said. “There’s no 10x left. We’re done.”
Batteries have more headroom for improvements but still face fundamental limits, Mills said.
“There is 1,500% more energy available in a pound of oil than in the best pound of battery chemistry. That’s a big gap. There’s no physics known to close that gap. If you want hydrocarbon class energy density, you would invent oil.
“Now the electrochemistry of batteries is going to get a lot better. There’s a lot of cool stuff on the horizon.”
But the cheapest batteries are currently six times the cost per kilowatt of natural gas generation, Mills said. Even if they reach the “aspirational goal” of two to three times gas-fired generation, batteries won’t be able to replace gas-fired generation on cost.
Mills said there is actually more room for efficiency improvements in shale gas extraction, which he called “under-engineered” despite improvements in horizontal drilling and fracking. Mills has put his money where his mouth is: He is a strategic partner with energy-tech venture fund Cottonwood Venture Partners, whose portfolio consists entirely of companies serving the oil and gas industries.
He did not say whether he still holds to the views of the Greening Earth Society, a now-defunct petroleum industry-backed organization that opposed EPA’s regulation of CO2 as a pollutant, insisting it was “one of nature’s most fundamental building blocks.” Mills was among the group’s scientific advisers.
Mills said policymakers concerned about climate change should support funding of basic science that can result in breakthroughs rather than looking for incremental improvements to existing technologies. “You didn’t get the car by subsidizing the railroads,” he said.
“The world has spent $2.5 trillion in 20 years on nonhydrocarbon energy forms. And the world has reduced its use of hydrocarbons as a percentage of consumption by 1.5 percentage points. And we use 150% more hydrocarbon than 20 years ago.
“My policy recommendation is … take most of the money that we’re using to subsidize yesterday’s stuff — and I mean wind turbines, yesterday’s batteries — and put half of it back in the Treasury for deficit reduction and the other half give to basic science, because that would be a 10-fold increase for basic research.”
WASHINGTON — After 12 years as the FERC-delegated Electric Reliability Organization, it’s time for NERC to reconsider its approach, General Counsel Charles Berardesco told the Compliance and Certification Committee (CCC) last week.
“The way the grid operates is dramatically different from the way we thought about it. … We have to look at the changing nature of the industry and think about being more proactive about those changes,” he said. “So, does everything go to a standard? … Is there another approach? Are assessments enough? Is it enough for NERC to just raise its hand and say, ‘Whoa! Here’s the issue. You should be worrying about this’? Do we need to do something in between?”
About 50 committee members and NERC staff attended the March 12 meeting at Edison Electric Institute (EEI) headquarters on Pennsylvania Avenue. (See related story, NERC Survey Highlights Alignment, Transparency Concerns.)
In addition to the routine “blocking and tackling” of consistently implementing its risk-based Compliance Monitoring and Enforcement Program (CMEP), Berardesco said, “We need to continue to enhance our expertise on assessing the grid’s overall reliability. We need to continue to build better data streams and build analytic capabilities inside of NERC [with] the industry.”
Berardesco noted that NERC’s Regional Entities will be reduced from seven to six effective July 1 when the Florida Reliability Coordinating Council (FRCC) is scheduled to be merged into SERC Reliability.
“Those regions, for the first time, will be about the same size and the same scope. We also have some new leadership in the regions. So, I think it’s an opportunity, a moment in time, to think about roles and responsibilities in a different way at the ERO to ensure we’re actually using our resources most effectively and efficiently and focusing our efforts on reliability, not just process,” he said. “I think what it means is thinking about the ERO as one organization, not seven different entities. And that’s a lot of the work that’s going to be going on in the next couple years at NERC.”
Delivering an update on the Reliability Issues Steering Committee (RISC), RISC member Patti Metro also called for a re-evaluation, saying the committee is planning to “streamline and fine tune” its activities.
“We are under the impression it’s time to step back and [review the effectiveness] and efficiencies when it comes to RISC,” said Metro, senior grid operations and reliability director of the National Rural Electric Cooperative Association. “Is it time to step back and say, ‘How much value is that exercise [providing? Should we be] continuing to do that type of report?’”
Self-reports accounted for more than three-quarters of noncompliance with NERC rules in 2018. | NERC
She noted that NERC’s Reliability Leadership Summit, held March 14, “is very similar to the technical conference that the FERC does every summer. We hear the same topics, the same conversations, a lot of the same speakers speak in both of those events. And so, our [question] is, should we regroup, and do we have to continue doing that type of event?” (See related story, Changing Grid Calls for New Models, Mindset, Officials Say.)
The RISC will present a report on its plans at the NERC Board of Trustees’ August meeting.
Berardesco said he had one message for members to take back to their companies.
“Security is a lot more important than compliance. We [NERC] can never do anything bad enough to you as would happen if there’s an actual breach in security. … NERC is not your problem. Security is your problem, and I would just urge all of you to think about that in the context of how you interrelate with NERC. The sharing of information, which is so critical to making this system work better, should not be withheld because you’re worried about a compliance risk.”
EEI Security Chief Warns Against Complacency
Scott Aaronson, EEI’s vice president of security and preparedness, also warned against becoming complacent with achieving compliance. “If I put a 10-foot fence around everything … the adversary just brings a 12-foot ladder,” he said. “So, let’s not pretend that standards themselves equate to security.”
“If we’re not preparing for failure, we’re going to fail. That is a sign, I like to believe, of maturity in this sector: That we are willing to talk about — not just all the things we are doing to prevent bad things from happening — but our effectiveness at response and recovery when the bad things come.
“Not if, but when: cyber, physical, storms, acts of war, acts of God. Zombie apocalypse. [We] don’t care why: The power’s out. What are we going to do about it?”
“We have a sense of urgency, both here at EEI and through the [Electricity Subsector Coordinating Council] to do more, do more, do more. Because we know that a war used to be started with a ballistic [missile] being fired downrange. It is far more likely today that a war is going to be started with strokes of a keyboard and attacks on critical infrastructure,” he said. “We know we’re a target.”
Serious critical infrastructure protection violations have dropped since peaking in 2014-16. | NERC
Subcommittees to Merge
CCC Chair Jennifer Flandermeyer, of Kansas City Power and Light, said members are moving forward with plans to eliminate the Compliance Processes and Procedures Subcommittee (CPPS) and merge its functions into the ERO Monitoring Subcommittee (EROMS).
“There are a number of reasons for [the merger] but primarily because the workloads tend to complement each other,” Flandermeyer said. “The expertise needed for both of those subcommittees is similar, if not the same, and what CPPS was seeing in their work was feeding the ERO Monitoring Subcommittee, and what EROMS was seeing was actually providing input that was helpful to CPPS. So, there was a natural synergy there.”
EROMS Chair Ted Hobson, of Florida cooperative JEA, will serve as chair until the FRCC seat is dissolved. Lisa Milanes of CAISO will be the vice chair.
“Our expectation is that we would have an approved scope document [for the combined committee] that’s operational before the June [CCC] meeting,” said CPPS Chair Matt Goldberg, of ISO-NE.
[Editor’s Note: An earlier version of this article incorrectly described NRECA’s Patti Metro as the chair of the Reliability Issues Steering Committee (RISC). The RISC chair is Nelson Peeler, chief transmission officer for Duke Energy.]
The Public Utility Commission of Texas last week formally approved Rayburn Country Electric Cooperative’s request to move 96 MW, or about 12% of its load, and associated transmission facilities from SPP into the ERCOT system. The commission set an integration date of Jan. 1, 2020, during its March 13 open meeting (Docket 48400).
At the same time, the PUC denied Rayburn and Lone Star Transmission’s request to transfer ownership of a 10-mile, 138-kV transmission line and associated rights from Rayburn to Lone Star.
ERCOT’s integration of Rayburn Country Electric Cooperative | ERCOT
Rayburn owns and operates 367 miles of transmission lines in Texas, 207 miles of which are in ERCOT. The cooperative will integrate 130 miles of 138-kV lines into ERCOT, with a remaining 30-mile 138-kV circuit staying in SPP.
The co-op late last year reached an unopposed settlement with commission staff, Oncor and Texas Industrial Energy Consumers that approved the transfer. The agreement also denied the Lone Star purchase of the transmission line.
Southwestern Electric Power Co. has served Rayburn’s SPP load through a power supply agreement with the co-op since the 1990s. The contract with SWEPCO will terminate at the end of 2019.
ERCOT has estimated it will cost $31.7 million to integrate Rayburn’s load with the other 88% (approximately 710 MW in 2017) that is already part of the grid operator’s system. Rayburn will make annual hold-harmless payments of $4.5 million for five years to ERCOT wholesale transmission customers through a wholesale transmission service credit rider.
PUC to Intervene in FERC Dockets
Left to right: Texas PUC Commissioners Shelly Botkin, Chair DeAnn Walker and Arthur D’Andrea.
Following an executive session, the commission agreed to intervene in four FERC dockets:
ER19-1124 and ER19-1125, both related to MISO’s Tariff modifications expanding, modifying and clarifying the identification and cost allocation of transmission facilities providing regional and local economic benefits within the RTO’s footprint.
ER19-1156, which adds to MISO’s Tariff a cost allocation methodology for the RTO’s share of certain interregional economic projects with PJM or SPP.
The Louisiana Public Service Commission’s complaint against Entergy and its operating companies that alleges the company’s joint account sales of energy to third-party power marketers and other nonmembers of the Entergy System Agreement from Entergy Arkansas’ Grand Gulf Retained Share violated the agreement (EL19-50).
SPP staff last week told stakeholders that it will have to make decisions on potential interregional projects in the 2019/20 coordinated system plan (CSP) with MISO without knowing the results of MISO’s final approval process.
Timing differences between the RTOs’ approval processes may result in SPP’s final CSP portfolio including an interregional project that assumes some level of cost sharing with MISO that is not eventually approved, SPP Interregional Coordinator Adam Bell said during the Seams Steering Committee’s Wednesday conference call.
MISO, SPP coordinated system plan calendar | SPP
Bell said developing a single final portfolio that is the most optimal and cost-efficient for SPP keeps open potential cost sharing with MISO.
The RTOs’ staff and stakeholders last month recommended conducting a CSP that will study six possible sites for interregional transmission projects. Should the MISO-SPP Joint Planning Committee approve the proposal, the RTOs will begin working on the CSP’s scope. (See MISO, SPP Seek Coordinated Plan in 2019.)
M2M Payments Above $1M 3rd Straight Month
SPP recorded its third straight month of more than $1 million in market-to-market (M2M) payments in January, pushing distributions in its favor to $55.2 million.
January’s market-to-market update | SPP
Permanent and temporary flowgates on the SPP-MISO seam were binding for 181 and 310 hours, respectively. That resulted in a $1.5 million distribution from MISO to SPP.
The two RTOs began the M2M process in March 2015. Distributions have flowed in SPP’s direction 22 of the last 28 months.
WASHINGTON — NERC stakeholders continue to complain of inconsistent oversight between regions and want the Electric Reliability Organization to provide faster and more transparent enforcement, according to the results of the biennial ERO Enterprise Effectiveness Survey.
Ted Hobson, chief compliance officer for Florida cooperative JEA, briefed the Compliance and Certification Committee (CCC) on the results at its March 12 meeting at Edison Electric Institute headquarters. (See related story, NERC Compliance and Certification Committee Briefs.) Hobson, who said the results were not statistically different from the prior survey, focused on the “free form” comments by stakeholders.
Hobson said stakeholders were generally positive about NERC’s risk-based Compliance Monitoring Enforcement Program (CMEP) but that some continue to complain of inconsistencies among Regional Entities.
“The approach and implementation of internal control evaluations seems to vary across regions,” said Hobson, the chair of the CCC’s ERO Monitoring Subcommittee (EROMS). “Our observation there was: Some regions are doing it; they’re doing it fairly well and with some detail. And some regions, frankly, weren’t even implementing it.”
The CCC will recommend that NERC continue its collaboration with the committee’s Alignment Working Group to resolve inconsistencies and expand outreach on alignment issues to small registered entities and trade groups. “We’ve had this since … the very first survey [in 2015], this whole issue of consistency,” Hobson said.
Patti Metro, of the National Rural Electric Cooperative Association, expressed frustration with what she saw as a disconnect between the comments and NERC’s efforts to improve the alignment among REs.
“I don’t know if it’s because they don’t get the message from the people in their own organization that attend those meetings, because we communicate those things,” she said.
Hobson said some stakeholders also expressed a lack of confidence in audit teams, particularly those conducting critical infrastructure protection (CIP) reviews.
“Commenters expressed that CIP auditors were providing their interpretations of the standards, and the implication is they seem to vary across regions,” he said. “The picture we get from the comments is that the [operations and procedures] audits generally are well organized; well formatted; pretty consistent. We know what to expect. The CIP audits, not so much. They vary too much across regions, and even in the same region, different audits.”
One recurrent theme was that REs take too long to approve mitigation plans, confirm their completion and issue fines, particularly for low-risk issues.
Another was a desire for more transparency regarding enforcement activities, with respondents complaining that “not enough details are provided to entities to fully understand their violations,” Hobson said.
There is also frustration that third-party tools such as Open Access Technology International (OATI) and MKInsight audit software “are cumbersome and not easily usable for registered entities, especially during an audit or violation mitigation process,” Hobson said. Utilities use OATI’s webPortal to submit data to NERC.
“People think they’re more gauged to being useful to the region than they are the entities,” he added. “I think that’s true, but I think we are addressing that.”
There also were complaints that the Organization Registration and Certification process places a “high administrative burden” on small entities that is disproportionate to the low risk they pose to the bulk power system, Hobson said.
Hobson also discussed the CMEP technology tool project, an effort begun in 2014 to standardize the business processes of NERC and the REs on a single platform.
“People expect a lot from this new tool. So, we really need to work hard to get it right,” he said. “I think we’re doing that but there’s a lot riding on this.”
The first release of the software is set for September, NERC told the CCC. The organization has begun “conference room pilots” to get initial feedback from regional subject matter experts.
‘Positive’ Tone
After Hobson’s briefing, the CCC approved a motion to communicate the survey results to the Enterprise-wide Risk Committee (EWRC).
Hobson acknowledged his briefing focused on the criticisms surfaced in the survey. “If you actually read the whole report in total, you’ll find that it’s got a positive tone to it. We do recognize the improvements and the good changes that have occurred,” he said. “By definition, comments are going to be on the negative side. People that are happy with things simply don’t answer.”
Ken McIntyre, NERC’s director of regulatory programs, said the criticisms were not new. “A lot of it we’re already working on or aware of,” he said. “None of this is a blind spot for us.”
WASHINGTON — After 12 years as the FERC-delegated Electric Reliability Organization, it’s time for NERC to reconsider its approach, General Counsel Charles Berardesco told the Compliance and Certification Committee (CCC) last week.
“The way the grid operates is dramatically different from the way we thought about it. … We have to look at the changing nature of the industry and think about being more proactive about those changes,” he said. “So, does everything go to a standard? … Is there another approach? Are assessments enough? Is it enough for NERC to just raise its hand and say, ‘Whoa! Here’s the issue. You should be worrying about this’? Do we need to do something in between?”
About 50 committee members and NERC staff attended the March 12 meeting at Edison Electric Institute (EEI) headquarters on Pennsylvania Avenue. (See related story, NERC Survey Highlights Alignment, Transparency Concerns.)
In addition to the routine “blocking and tackling” of consistently implementing its risk-based Compliance Monitoring and Enforcement Program (CMEP), Berardesco said, “We need to continue to enhance our expertise on assessing the grid’s overall reliability. We need to continue to build better data streams and build analytic capabilities inside of NERC [with] the industry.”
Berardesco noted that NERC’s Regional Entities will be reduced from seven to six effective July 1 when the Florida Reliability Coordinating Council (FRCC) is scheduled to be merged into SERC Reliability.
“Those regions, for the first time, will be about the same size and the same scope. We also have some new leadership in the regions. So, I think it’s an opportunity, a moment in time, to think about roles and responsibilities in a different way at the ERO to ensure we’re actually using our resources most effectively and efficiently and focusing our efforts on reliability, not just process,” he said. “I think what it means is thinking about the ERO as one organization, not seven different entities. And that’s a lot of the work that’s going to be going on in the next couple years at NERC.”
Patti Metro, chair of NERC’s Reliability Issues Steering Committee (RISC), also called for a re-evaluation, saying her committee is planning to “streamline and fine tune” its activities.
“We are under the impression it’s time to step back and [review the effectiveness] and efficiencies when it comes to RISC,” said Metro, senior grid operations and reliability director of the National Rural Electric Cooperative Association. “Is it time to step back and say, ‘How much value is that exercise [providing? Should we be] continuing to do that type of report?’”
Self-reports accounted for more than three-quarters of noncompliance with NERC rules in 2018. | NERC
She noted that NERC’s Reliability Leadership Summit, held March 14, “is very similar to the technical conference that the FERC does every summer. We hear the same topics, the same conversations, a lot of the same speakers speak in both of those events. And so, our [question] is, should we regroup, and do we have to continue doing that type of event?” (See related story, Changing Grid Calls for New Models, Mindset, Officials Say.)
The RISC will present a report on its plans at the NERC Board of Trustees’ August meeting.
Berardesco said he had one message for members to take back to their companies.
“Security is a lot more important than compliance. We [NERC] can never do anything bad enough to you as would happen if there’s an actual breach in security. … NERC is not your problem. Security is your problem, and I would just urge all of you to think about that in the context of how you interrelate with NERC. The sharing of information, which is so critical to making this system work better, should not be withheld because you’re worried about a compliance risk.”
EEI Security Chief Warns Against Complacency
Scott Aaronson, EEI’s vice president of security and preparedness, also warned against becoming complacent with achieving compliance. “If I put a 10-foot fence around everything … the adversary just brings a 12-foot ladder,” he said. “So, let’s not pretend that standards themselves equate to security.”
“If we’re not preparing for failure, we’re going to fail. That is a sign, I like to believe, of maturity in this sector: That we are willing to talk about — not just all the things we are doing to prevent bad things from happening — but our effectiveness at response and recovery when the bad things come.
“Not if, but when: cyber, physical, storms, acts of war, acts of God. Zombie apocalypse. [We] don’t care why: The power’s out. What are we going to do about it?”
“We have a sense of urgency, both here at EEI and through the [Electricity Subsector Coordinating Council] to do more, do more, do more. Because we know that a war used to be started with a ballistic [missile] being fired downrange. It is far more likely today that a war is going to be started with strokes of a keyboard and attacks on critical infrastructure,” he said. “We know we’re a target.”
Serious critical infrastructure protection violations have dropped since peaking in 2014-16. | NERC
Subcommittees to Merge
CCC Chair Jennifer Flandermeyer, of Kansas City Power and Light, said members are moving forward with plans to eliminate the Compliance Processes and Procedures Subcommittee (CPPS) and merge its functions into the ERO Monitoring Subcommittee (EROMS).
“There are a number of reasons for [the merger] but primarily because the workloads tend to complement each other,” Flandermeyer said. “The expertise needed for both of those subcommittees is similar, if not the same, and what CPPS was seeing in their work was feeding the ERO Monitoring Subcommittee, and what EROMS was seeing was actually providing input that was helpful to CPPS. So, there was a natural synergy there.”
EROMS Chair Ted Hobson, of Florida cooperative JEA, will serve as chair until the FRCC seat is dissolved. Lisa Milanes of CAISO will be the vice chair.
“Our expectation is that we would have an approved scope document [for the combined committee] that’s operational before the June [CCC] meeting,” said CPPS Chair Matt Goldberg, of ISO-NE.
WASHINGTON — Physicist Mark P. Mills gave the NERC Reliability Leadership Summit a blistering and entertaining critique of green tech punditry, saying forecasts of a rapid shift away from hydrocarbons are delusional.
Mills, senior fellow at the conservative think tank the Manhattan Institute, said the big challenge for green technology is the scale of hydrocarbon use — 80% of world energy — and its superior energy density.
“If all of the hydrocarbons that we consume were actually in the form of oil … and we divide them up into barrels, those barrels would go from here in D.C. to [Los Angeles],” he said in a keynote speech. “And the barrels would grow in height at the rate we consume it by one Washington Monument every week. That by itself demonstrates how fatuous it is to talk about ‘moon shots’ to change a system like this. Putting a few people on the moon a few times is an amazing engineering achievement. [But] it’s not a transformation of anything. Transforming and changing how society uses energy is like putting all of humanity on the moon — permanently.”
Mills said those who predict Moore’s Law-scale performance improvements in renewables are making a “category error” in conflating energy technology with digital technology. He cited as an example an International Monetary Fund working paper, “Riding the Energy Transition,” on the potential of electric vehicles to cut oil consumption, which stated “Smartphone substitution seemed no more imminent in the early 2000s than large-scale energy substitution seems today.”
“The biggest energy revolution in terms of how we use energy is unequivocally what we’ve done in computing. Nothing like this has every happened in the history of humanity,” Mills said. “If today’s iPhone had 1980s energy efficiency, that iPhone would be taking the electricity of a Manhattan office building. If a single data center operated at 1980 energy efficiency, one data center would require the entire output of the U.S. on the grid.
“But analogizing information-producing technology with energy-producing technology is a fundamental category error. It’s much worse than comparing apples to oranges. It’s even worse than comparing apples to ball bearings. The difference in the physics between information-producing and energy-producing is deeply profound. If energy systems could scale like computing systems, a single postage-stamp size solar array could power the Empire State Building.”
“That … will … never … happen,” he said, pausing for emphasis with every word. “It happens in comic books. It’s science fiction.”
Mills said the aspirational targets of green tech supporters is based on the notion that wind, solar and battery technologies can make 10-fold gains in efficacy.
“The last few decades, we have seen 10-fold gains in the fundamental efficacy of wind, solar and batteries. But another 10-fold [improvement] is not going to happen. Solar technologies are now approaching underlying physics limits.”
Wind turbines are also closing in on Betz’s law, which states that no turbine can capture more than about 60% of the kinetic energy in wind. “The best wind turbines are now pushing 45% efficiency. … It’s a hell of an achievement,” Mills said. “There’s no 10x left. We’re done.”
Batteries have more headroom for improvements but still face fundamental limits, Mills said.
“There is 1,500% more energy available in a pound of oil than in the best pound of battery chemistry. That’s a big gap. There’s no physics known to close that gap. If you want hydrocarbon class energy density, you would invent oil.
“Now the electrochemistry of batteries is going to get a lot better. There’s a lot of cool stuff on the horizon.”
But the cheapest batteries are currently six times the cost per kilowatt of natural gas generation, Mills said. Even if they reach the “aspirational goal” of two to three times gas-fired generation, batteries won’t be able to replace gas-fired generation on cost.
Mills said there is actually more room for efficiency improvements in shale gas extraction, which he called “under-engineered” despite improvements in horizontal drilling and fracking. Mills has put his money where his mouth is: He is a strategic partner with energy-tech venture fund Cottonwood Venture Partners, whose portfolio consists entirely of companies serving the oil and gas industries.
He did not say whether he still holds to the views of the Greening Earth Society, a now-defunct petroleum industry-backed organization that opposed EPA’s regulation of CO2 as a pollutant, insisting it was “one of nature’s most fundamental building blocks.” Mills was among the group’s scientific advisers.
Mills said policymakers concerned about climate change should support funding of basic science that can result in breakthroughs rather looking for incremental improvements to existing technologies. “You didn’t get the car by subsidizing the railroads,” he said.
“The world has spent $2.5 trillion in 20 years on nonhydrocarbon energy forms. And the world has reduced its use of hydrocarbons as a percentage of consumption by 1.5 percentage points. And we use 150% more hydrocarbon than 20 years ago.
“My policy recommendation is … take most of the money that we’re using to subsidize yesterday’s stuff — and I mean wind turbines, yesterday’s batteries — and put half of it back in the Treasury for deficit reduction and the other half give to basic science, because that would be a 10-fold increase for basic research.”
WASHINGTON — Former NERC executive Brian Harrell, now assistant director of the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency, last week lamented the federal government’s tardy response to the security threat drones pose to utilities.
While many utilities are using drones in storm response and in monitoring vegetation growth along transmission lines, drones equipped with explosives could threaten utility operations.
“This is not an emerging threat. It was emerging five years ago,” Harrell told attendees of the NERC Reliability Leadership Summit on Thursday. “We’re clearly cognizant of the fact that you do not own the airspace above your generating facilities, the airspace above … your transmission substations. And right now, the laws are such that the federal government isn’t being as helpful as it should be.”
Last July, Yemen’s Houthi movement claimed it had used a drone to attack a Saudi Aramco refinery in Riyadh. The company acknowledged a fire at the plant but attributed it to “an operational incident.” In August, explosive-carrying drones were used in an attack during a speech by Venezuelan President Nicolás Maduro.
Harrell, who formerly served as director of the Electricity Information Sharing and Analysis Center (E-ISAC) and director of NERC’s Critical Infrastructure Protection Programs, said the federal government has only limited authority over drones but that DHS is preparing a report on security issues posed by the devices.
“I have strongly advocated that whatever recommendations come out of this report must impact, must touch, the private sector,” he said.
A former security director for Duke Energy, Harrell also cautioned utilities on purchasing drones for their own use.
“If you are using foreign-manufactured drones at your facilities, you potentially are incurring risk. So be very, very mindful of that. … Data loss and prevention is [a real threat].”
In 2017, a leaked memo from Homeland Security’s Immigration and Customs Enforcement bureau (ICE) alleged that Chinese drone-maker DJI was “providing U.S. critical infrastructure and law enforcement data to the Chinese government.” DJI, which has been estimated to hold a 70% global market share, responded that the report was based on “clearly false and misleading claims from an unidentified source.”
Harrell said China is “the most active strategic competitor for cyber espionage against the U.S. government, our corporations and our allies. They are stealers of information. Whereas Russia is a … nuisance in one sense, China is actually taking data for their own use.”
WASHINGTON — Assistant Energy Secretary Bruce Walker said Thursday that the Department of Energy is planning a megawatt-scale “Storage Launchpad” that he predicted will cut the cost of energy storage dramatically.
Walker told attendees of the NERC Reliability Summit that funding for the initiative, which will be assigned to one of DOE’s 17 National Laboratories, is included in President Trump’s proposed fiscal 2020 budget, which was released March 11.
“We are going to build a facility … where we can leverage our focus on chemistry. So we’re looking at aqueous, non-aqueous redox equation-type batteries, zinc manganese oxide,” Walker said. “We’ve made some significant breakthroughs already in that space. We believe we’re going to be able to drive the cost down to basically 20% of what it is today over the next five years.”
The budget proposes $5 million for the Storage Launchpad and $15 million “to accelerate the conversion of the National Wind Testing Facility site into an experimental microgrid capable of testing grid integration at the megawatt scale.” The budget would cut funding for DOE’s Office of Energy Efficiency & Renewable Energy by 70% and eliminate the Advanced Research Projects Agency-Energy. Congress rejected similar proposals last year.
Daniel Gabaldon, director and co-founder of Enovation Partners, a Chicago-based consulting firm that does the data analysis for Lazard’s levelized cost of storage report, expressed some skepticism that a $5 million investment could produce such a dramatic return in battery technology but said DOE’s investment would be “a really healthy development.”
Although Enovation doesn’t track the technologies cited by Walker for Lazard, Gabaldon said the prediction of an 80% reduction is in line with claims of early-stage companies pursuing alternatives to lithium-ion technology.
“We’ve seen very dramatic claims, and it would be certainly helpful for the suppliers, as well as potential buyers, to substantiate those claims,” he said in an interview. “Whether it comes to pass, who knows?”
Gabaldon said federal funding is essential for early-stage technologies. The commercial success of lithium-ion batteries for short-duration uses is “sort of shading the forest floor [and denying light to] young shoots of new technologies that — given the right kind of support — could transcend what lithium-ion can do, especially for longer-duration applications, which in the long run will be really essential,” he said.
Kelly Speakes-Backman, CEO of the Energy Storage Association, said “securing an 80% cost reduction on precommercial storage technologies could be possible in the next five years.”
“Investing $5 million in this effort, while modest, is welcomed by ESA,” she said in a statement. “Any investment in the energy storage industry translates into direct job growth here in the United States.”
Bloomberg New Energy Finance’s 2018 Outlook projects a 66% drop in lithium-ion battery pack prices by 2030, largely because of economies of scale.
Grid Resilience Model as a ‘Platform’
In other remarks, Walker told attendees of the NERC conference that DOE’s effort to develop a North American grid resilience model is progressing and that the department hopes to have a static model complete by October. DOE will then work with NERC, FERC, RTOs, DOE’s power marketing administrations and industry to transition it to a real-time model.
“We will continue [working] on this until such time that we’re able to make the real-time piece work and begin to automate the process with the critical infrastructure we’ve identified,” he said.
Walker said the model will be a “platform” on which DOE can test use of the research and development produced by the department’s National Labs.
One technology, he said, could leapfrog synchrophasors, which were introduced after the 2003 Northeast blackout. With sample rates of about 50 times a second, synchrophasors are too slow for “a system that’s as dynamically changing and integrating renewables and dealing with different levels of harmonics and transients like we’ve never seen in the past, with the threat vectors that we’re seeing,” Walker said.
He said the department is drawing on previously developed fiber optic sensing technologies, which sample about 1 million times a second. “We probably don’t need a million times a second, so what we’re going to try and figure out [is] exactly what we do need to be able to see the harmonics and transients that we’re actually seeing on the grid today.”
Walker also promoted the March 28 technical conference DOE and FERC are hosting “to discuss security practices to protect energy infrastructure.”
In January, Walker announced a $1 million Electricity Industry Technology and Practices Innovation Challenge seeking technologies to address vulnerabilities and threats, and mitigate energy sector interdependencies.
Walker said innovations in energy storage could change how the industry looks at reserve margins. “Reserve margins were put back when the system had fuel security and we anticipated two generators and two major transmission lines dropping off the system,” he said.
“That formula doesn’t work anymore because if I ever take out one of your [natural gas] pipelines, you’re going to lose thousands and thousands of megawatts of generation. And so, you’re automatically going to go into underfrequency load shed.
“We’ve got to do something about it. I know through our organization, which is very much focused on R&D, they look at me a little cross-eyed sometimes when I’m like, ‘We don’t have three years to solve this problem. We’ve got like three months.’”
