CEO’s Message – June 2022
Power Supply and Summer Energy Demand: Should We Be Concerned?
If you’ve been paying attention to energy-industry news recently, you might have heard that the North American Electric Reliability Corporation (NERC) and Midcontinent Independent System Operator (MISO) reports each warned that parts of the country are at risk of energy shortfalls this summer. This included warnings that “the risk of rolling blackouts is elevated” in the MISO market, which includes Minnesota.
I want to address this topic and give you some additional background on what Stearns Electric and our wholesale power provider, Great River Energy (GRE) are doing to limit the possibility of rotating outages.
WHAT IS MISO?
The Midcontinent Independent System Operator (MISO) is responsible for operating the power grid across 15 states and the Canadian province of Manitoba. MISO’s main responsibility and mission is grid stability, which means matching the power supply to the energy demand.
MISO is split into three sections: North, Central and South. GRE, and therefore Stearns Electric, is located in the North region. Neighboring utilities such as Xcel Energy and Minnesota Power are part of MISO North as well. Any electricity generated within the MISO market by one of these generating facilities is pooled together and distributed back out to all consumers across the market.
MISO IN THE NEWS
Recent reports from NERC and MISO warn that the constrained supply of natural gas, which is necessary for power generation, and the hot weather much of the country is predicted to face this summer, elevates the potential for temporary, controlled power outages.
WHAT ARE TEMPORARY CONTROLLED OUTAGES?
In emergency situations, when the demand for electricity exceeds the power generation capacity in our market, MISO responds. First, additional power supply resources are instructed to operate, including GRE’s peaking facilities; next, MISO imports energy from other regions of the country as it can; and third, MISO calls for voluntary load reductions to manage the electric system.
As a last resort, temporary controlled outages (a.k.a. rolling blackouts or rotating outages) are used to manage the power grid. When instructed by MISO, GRE will order temporary rotating outages for portions of its service territory to help curb energy load and rebalance the power grid.
COULD ROTATING OUTAGES HAPPEN IN GRE’S TERRITORY?
Yes, there is potential for rotating outages. Although GRE has enough generating capacity to meet the demands of its members, plus a cushion, any emergency measures deployed to maintain reliability by MISO North will be applied over the entire region by all energy generation facilities in the region, regardless of which utility serves a geographic area or the capacity position of those utilities.
COULD ROTATING OUTAGES HAPPEN FOR STEARNS ELECTRIC MEMBERS?
It is unlikely that Stearns Electric members would be affected. If our power grid and system is operating as it should, the members of Stearns Electric should not experience rotating outages, even in an energy emergency.
However, if there was an unexpected major event impacting a generation facility or transmission power line, then our members could be impacted.
WILL I BE ASKED TO DO ANYTHING TO HELP?
Likely before any rotating outages would be ordered, Stearns Electric and other members of GRE would call on you, our member-consumers, to conserve as much energy as possible by initiating an emergency conservation request.
This means we might ask you to turn your thermostat up by a few degrees, delay use of large appliances until off-peak times or turn off your lights. Stearns Electric members enrolled in a load management program would also be controlled during an emergency conservation event. In a peak emergency event, scarcity pricing would be in effect and therefore, conserving as much energy as possible will be extremely important across the MISO market.
WHAT IS GRE DOING TO MEET THE INCREASING ENERGY DEMAND?
GRE has a fleet of dispatchable resources that allow it to generate or receive additional energy when needed. These include additional market purchases and peaking plants, which are built to operate on both natural gas and diesel fuel.
Additionally, GRE and its member cooperatives have approximately 350 megawatts of demand response capability that can be dispatched to reduce stress on the electric grid. These demand response programs provide valuable flexibility and may be called on more often during peak periods this summer.
We hope to not have to implement these emergency measures this summer, but please know that MISO, GRE and Stearns Electric have a plan and will keep you as updated as we can. Following us on our Facebook page is the best source for real-time updates if an emergency conservation request has been made. If a MISO Market energy emergency is declared, more information will be available on GRE’s website, greatriverenergy.com.
Robin C. Doege
June 27, 2022
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