On “The Future of Electric Power in the United States”
Last week, the report “The Future of Electric Power in the United States” provided recommendations to the U.S. Department of Energy, Congress and others. Comments included:
"While growth in electricity demand has been flat in recent decades, the future will probably not be like the past ... electric vehicles, the digital economy, and energy efficiency technologies— illustrate the kinds of changes that could shape future electricity demand.
"The United States has been underinvesting in the innovation needed for future electric system performance. Massive new private and public investments are needed in innovation, especially for more cutting-edge technologies on which the future grid will depend.
"Reliability risks to the grid are expected to be exacerbated as the grid relies more heavily on 5G and subsequent generations of cellular technology, and on Internet-of-Things (IoT) technologies … the system remains under constant threat of attack by adversaries and failure from natural events and human error.
"Driven largely by policy choices that have placed much greater emphasis on markets and competition, and the sometimes divergent interests of federal, state, regional and local authorities, it has become ever more challenging to answer the simple question: "who is in charge of planning, developing and ensuring the integrity of the future power system?"
Note: The 365-page report was compiled by The US National Academy of Sciences
OUR TAKE
Regarding increased demand and historical underinvestment: Innovators (start-ups and legacy players) and investors will change the electric power landscape by developing or adopting new technologies (i.e., carbon capture, wind, solar, hydrogen, nuclear, geothermal, energy storage, systems management) and new business models.
Regarding reliability risks: Cyber-attacks are a leading risk that challenges businesses, governments, and consumers. The increasing complexity of electric grid infrastructures will likely increase their risk as well.
Regarding the lack of central planning: The recent events in Texas highlight some of the challenges associated with "market-driven" approaches.