Wednesday, January 6, 2010

Power Shortages, then and now

Today I’d like to chat, for just a minute, about the reliability of power supply, given the bitter cold that is covering both the United States and Europe. My Grandfather worked for the British National Coal Board in the telephone exchange at one of the mines at Ashington, in Northumberland. One of the ways in which he was paid was through regular deliveries of coal, which was dumped on the street outside the house once a month. Since he had been shot and gassed in the First World War, one of my chores, whenever I was there, was to load that coal from the street (where it formed a pile on the sidewalk) into the “coal hole,” and then wash down the steet, and holystone the edges of the steps. From the coal bin it was taken, a bucket at a time, into the house to feed the range, which sat in the living room downstairs. That fire also heated the oven, and the hot water with which, when I was very young, we were bathed in front of the fire. The range was the sole source of heat for the house. But with the regular delivery of coal, even if the power went off, the house would stay warm.

When we bought our current house, one of the things we made sure of was, even the house was all-electric, that there was a fireplace, and when we added on to the house we added a tile stove from Germany, that burns wood we obtain locally (though it can also burn coal). Thus when the power goes out (as it has for periods of time in winter and summer) we can keep the house warm enough to prevent things freezing. (We also used to use candles for light, but now have a variety of lights that can be either shaken or wound up that provide light, as well as the occasional flashlight). I was thinking of that situation this week, as the headlines in the UK worry about the supply of natural gas during the cold spell.

It is the problem that heating with natural gas and electricity have, over other fuels, in that the typical home owner has no storage capacity, and where natural gas is used for power generation neither does the power plant. Thus both are critically dependant on their being enough gas coming down the pipe to supply the fuel, when it is needed. However, to quote an example that I have used before from the book “Cape Wind” by Wendy Williams and Robert Whitcomb, that shows the increasing vulnerability of places such as New England as the balance that exists between available supply and demand narrows. The event occurred in mid January 2004 when there was a sudden cold spell that lasted over a week, and the story is told from the point of view of the Independent System Operator (ISO) that manages the supply for some 14 million folk, and is located in Holyoke, MA.

On January 14th the ISO had assurances that up to 10,000 megawatts would be available from gas-fired power plants as they anticipated demand rising to around 23,000 to 25,000 megawatts, as the temperature was anticipated to drop to minus ten degrees. But by 8:30 am on the first morning of the crisis, this began to change:
A trickle of phone calls began coming in to the Holyoke headquarters, all with pretty much the same bad news. Plant operators who relied on natural gas as their fuel reported that although their plants were in working order, there was no gas available for them to buy. It had all been taken by the companies responsible for providing gas for home heating.

By afternoon the trickle of “no gas” calls became a flood. . . . .During this all-time winter peak, when electricity was essential for the very survival of many New Englanders, roughly 7,200 megawatts of gas-fired generation was now unavailable. . . . .because they couldn’t find enough natural gas to buy.”
In the end crisis was averted by some load shedding, including closing the schools, but it illustrates the coming vulnerabilities that we face as our historic assumption that there will be enough power when we need it, suddenly starts to be significantly challenged. However, in this case, action was taken, and things no longer look as grim.

But this dependence on flows of gas through pipelines that can only accommodate a certain volume flow rate, means that in periods such as this where there is a sustained cold spell where both power atations and domestic users are increasing demand, it is possible that the supply cannot reach the volumes needed. In this case depending on LNG supplies is not a viable answer, since they, in turn, rely on the passage of tankers that can take days if not weeks to bring gas to a terminal where it can be reconverted and fed into the pipeline.

As with the case in New England, the initial cut-off’s of supply in the UK will be allocated to industrial users.
National Grid warned this week that the gas grid was close to running short of supplies.

Icis Heren, the gas consultancy, reckons that some industrial customers could be cut off within days if the cold weather continues.

“It is pretty tight. At one point on Monday, we were on a knife edge,” said Louise Boddy, managing director of Icis Heren. The exceptional cold, about 6C below the seasonal norm, has pushed gas demand up and is exposing Britain’s new dependency on imports of fuel.
And the situation is apparently not going to get better in the short term:
Much of the UK was blanketed in heavy snow this morning as the extreme weather headed south and forecasters warned that the country was on course for its coldest winter in 30 years.

The Met Office issued an alert warning that nearly half a metre of snow was due to fall in some areas, while freezing conditions spread after having brought chaos to the north of England and Scotland today.

Tony Waters, the Met Office chief forecaster, said: "This is expected to cause disruption to transport networks and could lead to problems with power supplies."
Unfortunately too few in the UK still have that pile of coal in the back shed to provide warmth, when the main power goes off.

Oh, and the Cape Wind project has just run into another roadblock as the National Park Service is considering the area for designation as a National Historic Site.


  1. Nice to be in Sydney where you can survive without heating in a pinch. It is hard to believe that people in colder places are so sanguine about the risk of freezing to death. Surely this is going to become a major political issue after the current brutal northern hemisphere winter.

  2. The complacency comes, I suspect, because folk don't think that it will happen to them. When power fails, there is an assumption that it will be back on again before there is a problem. Having now been in situations (fortunately in the summer) where power was out much longer, and dealing with having to store meat from a freezer (as but a minor example of the problems) I no longer have that state of mind, hence the precautions - which we had to use so far only a couple of times - but relying on "someone else" to take care of the problem is unfortunately way too common. But there is also a good argument for being in Sydney.

  3. Don't worry! Anthropogenic Global Warming is coming to save us all.

    More seriously, the issue is the need for surplus (i.e. under-used) supply capacity & storage -- and who pays for it?

    The issue of having enough capacity to meet demand may be most dramatic in an AGW snowstorm. But it also affects regular oil supplies.

    The price of oil would be much more volatile if much-maligned Saudi Arabia did not have several million barrels per day shut-in capacity. The capital cost of providing that rarely-used shut-in capacity was probably in the Tens of Billions $. Not only does that huge investment yield no return, it is subject to deterioration & corrosion and needs continued maintenance expenditures.

    Is it reasonable for Saudi Arabia alone to bear the cost of providing western oil importers with some flexibility in the oil supply chain? What is Plan B for those importers if the Saudi's decide to lay down their self-imposed burden?

  4. Keeping spare capacity of various sorts would be more common if people were allowed to charge what the market will bear in an emergency. However keeping stuff off the market in the hope of making a killing in rare circumstances is hoarding and people hate that. And charging a high price in an emergency is gouging and people hate that even more. So government doesn't allow these things. Having made that decision, government becomes responsible for preparing for emergencies and they should take that role very seriously. As is sometimes said: capitalism could be a good system, it's hard to know it's never been tried, even in America.

  5. Kinuachdrach:
    The Saudi's actually have carried out large scale development of their major fields, and by producing more slowly, and allowing the wells to "rest" periodically (which amazingly can coincide with periods where the price of oil is low) they have been able to achieve higher levels of ultimate oil recovery from the fields than they would with a faster production schedule. So it is not completely altruistic, and by keeping the oil in the ground they get to benefit from the higher prices later.

    There has been some significant storage of oil in tankers over the past year, hoping to benefit from the increasing prices, but one of the problems I was trying to get at was of those who rely on gas coming down a pipe for their supply, and the assumption that when needed, that supply is available. As my example from New England and the current experience in the UK show those assumptions are not always warranted. Unfortunately this knowledge is only acquired at the very last minute, when it is usually too late to find an alternative supply.