hemispheric smart grid for 21st century

8/6/2019 Hemispheric Smart Grid for 21st Century

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S o m e o n e : F i r S t L a S t n a m e

How we collectively produce anddeliver energy, while coping withthe catastrophic threat o climatechange, will de ne our century. Thechallenges aced by the internation-al community are monumental and

multi- aceted. They include stabilizing greenhouse gasemissions, enhancing energy security through reduc-ing the risk o economic disruption and nuclear weap-ons proli eration, and eliminating the lack o accessto energy or over 3 billion people. An estimated $ 0trillion in capital investment willbe needed or energy in rastruc-ture by the year 030, according tothe International Energy Agency (IEA). More speci cally, to meet theimmense challenge o climate change to energy policy,there must be dramatic changes in the historic trendso energy and electricity supply and use.

Our hemisphere can play a key role in addressing

that global challenge by building a smart, sustain-able, resilient, and secure power grid that stretchesacross the Americas.

The electric power sector has already assumednew prominence in the trans ormation o global ener-gy production and delivery. It is a undamental driv-er o economic growth and poverty reduction; a key sector or reducing greenhouse gas emissions throughexpanded renewable power; a strategic replacement

or petroleum as the transport sector makes the longodyssey rom liquid uels to electricity; and an essen-

tial network whose robustness andresilience will need to be preservedin the ace o malicious disruptionor extreme weather events.

Building on these essentialswill require a combination o innovative technology and enlightened public policy. But the ingredients ora smart grid network lie in the huge diversity o thesupply base in di erent regions.

gIts Time to Start Thinking about a Hemispheric

Smart-Power Grid or the st Century.

TURN ON The

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by David Jhirad and Alan Poole


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110 a q f a l l 2 0 0 9 a m e r i c a s q u a r t e r l y . o rg

The U.S. power system is dominated by ossiluels (coal and natural gas) that are responsible or

about 70 percent o its electricity generation. Renew-able sources, including conventional hydropower,provide about 0 percent and nuclear power suppliesthe remainder. The Canadian system, in contrast, isdominated by hydro, together with a relatively largeshare o nuclear power. Less than a quarter o power

output is rom ossil uels.Latin America lies in between. On average, less

than 40 percent o energy generation is supplied romossil uels. This is due primarily to the large share o

hydro, with small contributions rom other renewablesources and rom nuclear power. However, there arelarge regional disparities. Mexico and the Caribbeanare even more reliant on ossil uels than the UnitedStates. In sharp contrast, less than 0 percent o Bra-zils power output comes rom ossil uels, while gen-eration in Colombia, Venezuela and the Guyanas isalso dominated by hydro [ see table 1 ].

In the U.S. and Canada, more than 70 percento the electricity generated rom ossil uels comes

rom coal. In Latin America roughly 5 percent o electricity generation is rom coal, while most o therest is rom natural gas. Indeed, the share o naturalgas or the U.S. and Latin America is similar 0 per-cent versus 8 percent.

The U.S. and Canada have dominated power sector

expansion in the hemisphere and were responsibleor over two-thirds o growth between 990 and 006.

Today they are responsible or about our- ths o thepower generated. But over the next two decades andbeyond, the economic development o Latin Americawill result in a higher electricity growth rate. Depend-ing on the vigor o economic growth, Latin Americamay account or between 50 percent and 60 percent ormore o the growth in total hemispheric power require-ments. As a consequence, how Latin America evolveswill be just as important, i not more important, thanthe per ormance o the U.S. and Canada combined.

Wind, Sun and Water:Moving Toward a Low-CarbonPower Grid in the AmericasThere are su icient renewable resources o wind,solar and hydro to drive toward a low- to zero-carbonpower grid in the Americas. The main candidates inthe shorter term are hydro and wind energy. Thereare substantial undeveloped conventional hydroresources in Latin America and, to a lesser extent, inCanada. [see table 2]

a: Caribbean inCludes Puerto riCo and Cuba; b: northern tier inCludes Colomb ia, Venezuela and the Guyanas; C: Central andes inCludes boliVia , Peru

and eCuador; d: southern Cone inClud es arGentina, Chile, uruG uay, and ParaGuay. e: twh, or terawatt hour, is a unit of enerGy. sourCe: based ondatabase of the enerGy information administration o f the u.s. dePartment of enerGy.

ToTal Share of GeneraTiontw f t n c h o r

Ca a a 595 23% 16% 59% 1.9%

U it Stat s 4,065 71% 19% 7% 2.7%Lati Am ica & Ca ibb a 1,187 38% 3% 56% 2.9%

Mexico 236 79% 4% 13% 3.7%

Caribbean a 77 96% 0% 3% 0.8%

Central America 36 37% 0% 52% 11.2%

Northern Tier of South America b 163 24% 0% 75% 0.4%

Central Andes c 45 36% 0% 64% 0.7%

Brazil 412 9% 3% 84% 4.2%

Southern Cone d 218 40% 3% 56% 1.1%

h s 5,846 59% 16% 22% 2.7%

eleCtriCity Generation in theameriCan hemisPhere - 2006

theenvironment

Dr. David Jhirad is the special advisor on energyand climate change at the Rocke eller Foundation.

He served as deputy assistant secretary o energy inthe Clinton Administration and as vice president o science and research at the World Resources Institute.

Alan Poole is an independent energy consultant based in Washington DC and Rio de Janeiro, Brazil.

He has been working with issues o energy e fciencyand non- ossil energy supply or more than 35 years.

TABLE 1


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Turn on h Ligh David Jhirad and Alan Poole

Evaluations o wind-power potential are much lessdeveloped than those or hydro, and the gap betweentheoretical and practical potentials is greater. Many countries do not have systematic evaluations o windpotential at all. The areas with high-quality resourc-es are much smaller than those with more mediocrewind speeds. However, it is important to ocus onhigher quality wind resources to keep the cost per

megawatt hour (MWh) lower: say areas with averagewind speeds above 5.7 miles per hour (7 meters persecond) at a height o 64 eet (50 meters)known asClass 4 (good)or above 6.8 mph (7.5 m/s)Class 5.The extractable power rom wind increases with thecube o the speed.

High-quality wind resources can be ound insites throughout the hemisphere and their combinedpotential rivals or exceeds that o hydro. Exploitingjust 5 percent o the United States land-based poten-tial above Class 4 would generate more than , 50 tera-watt hours (TWh)/year (a quarter o total projectedU.S. generation needs in 030). Canadian land-basedpotential may be double that o the United States. InLatin America there are also signi cant potentials,

or example:

Th Isthmus f T hua t p c i S uth M xichas a ss p t tial f v 100 TWh ab vClass 4 (tw -thi s ab v Class 5). Pa ts f th th c ast f C l mbia aV zu la a c astal P u hav xc ll t, ifu qua ti , wi s u c s.

B azil has ab ut 600 TWh f ss p t tialab v Class 5 a 1,900 TWh ab v Class 4sp a i iv s a as f m th ast ts uth B azil. A ti a may hav th b st s u c s f allth

ss p t tial f a as i Pata ia with av awi sp s ab v 19.7 mph (8.8 m/s)Class 7

sup bp bably xc s 2,000 TWh.

Wind power can there ore make a very signi cantcontribution to the expansion o electricity supply inthe hemisphere, taking up where hydro le t o .

While clearly more expensive than traditionalhydro or conventional gas or coal- red capacity, windcosts have come down substantially in recent years.In good sites, generation costs are likely to be in therange o $55$70 per MWh (though costs are highertoday in Latin America due to the incipient market).Factoring in carbon credits equivalent to $ 5$ 0 pertonne o CO 2 (tCO2 ), about $ 3$ 7/MWh or a coalplant, wind can become quite competitive with coalcapacityespecially in Latin America, where ther-mal generating plants on average operate at 50 per-

cent below capacity.Thus, wind energy is an emerging game chang-

er among renewable options or the next two orthree decades. Geothermal and biomass, while com-mercial and quite competitive in some places, havelimited overall potential without technological break-throughs (such as hot dry rocks or geothermal andgasi cation o biomass). The costs o solar photovolta-ics, solar thermal-electric and various orms o oceanenergy need to come down substantially or them tobe viable options or bulk power supply.

The Pivotal Role of NaturalGas in the HemisphereSubstantial new reserves o natural gas rom shale or-mations have been discovered in the U.S., and naturalgas utilization is expected to expand signi cantly inthe U.S. and Canada. According to a recent Navigantstudy, domestic shale gas reserves can meet U.S. natu-ral gas demand or the next 00 years. The study pre-dicted that annual production rom the seven-largestU.S. shale basins could exceed 0,950 bill ion cubic

eet (bc ) and even reach 4, 35 bc within 0 years.

remaininG exPloitablehydro Potential in twh

Low HigH

Canada 178 281

u.s. 13 72

latin ameriCa 945 1,273

HemispHere 1,136 1,626

T g c s ssu s 60 c t t t t c ct t c u t t b v , t

c s 50 c t. i t U.S. t t s t s g v b t .

TABLE 1

TABLE 2


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Natural gas repowering o coal power stations inthese countries o ers a strategic opportunity to signi -icantly reduce carbon emissions or each unit o elec-tricity generated. Furthermore, natural gas power unitsare superior to coal when used to complement power

rom variable, renewable resources such as wind andhydro. Though we have not discussed the implicationso these new discoveries or a hemispheric grid, it isclear that natural gas will be a game-changing and stra-tegic resource or the remainder o this century.

The Need for New Grid InfrastructureThe accelerated development o renewables on any-thing like this scale implies substantial new grid in ra-structure or more long-distance transmission. Anobvious reason is that hydro, wind and geothermalare quite site-speci c and can be ar rom main centerso consumption. Solar is more distributed, but evenso is ound more abundantly and more continually throughout the year (important or central stations) incertain airly limited areas. This motive has already ledto some important long-distance lines, as or examplethe line connecting Churchill Falls in Labrador, Can-

ada, to the northeastern U.S., the Paci c transmissionline (between the Colombia River hydro complex andsouthern Cali ornia) and the new ,500 mile ( ,375 kilo-meter) lines rom the Madeira hydro complex to cen-ters o consumption in southeastern Brazil.

Another reason or long-distance transmissionarises rom the large potential or complementarity among variable resources like hydro, wind and solarenergy on the supply side as well as the variations o consumer demand. The variability o supply shouldbe considered under di erent time scales: very short(minutes and hours), seasonal and annual (e.g., dry

versus wet years).One way to mitigate this variability is to link

power generating plants with di erent patterns o variation. For example, when the river fow in onebasin is low, it may be high in another. Exploitingcomplementarity is traditional in the planning o hydro-dominated systems such as Brazils. That coun-trys national gridextending the equivalent o Lis-bon to Moscowis unique in the hemisphere and isperhaps o more general interest to most other coun-tries than the much-talked-about bio uels program.

The key point is that bulk electric power will move

back and orth rom North to South, and East to West.Power would not be transmitted rom Patagonia allthe way to Quebec in a hemispheric grid.

The same principle can be applied to wind power.It is generally recognized that by linking plants over awider area the average variation o output is reduced.Most attention has been paid to smoothing (and pre-dicting) short-term variations ( or example, less than

4 hours), but seasonal variability can be reduced aswell. This is especially true i mixed hydro-wind sys-tems are considered. Complementarity o naturalhydro and wind output has been observed in many places, such as Argentina, northeastern Brazil, Colom-bia, Central America and Southern Mexico, and Cana-da. In addition, there are bene ts on the demand side,allowing the exploitation o East-West di erences inthe timing o peak load.

Along these lines, a 006 Canadian analysis o Sus-tainable Energy Science and Technology observed thathydro systems might be more e ectively deployedwithin a smarter electricity system: one which usesstorage and grid connectivity jointly to enable moree icient integration o diverse sources o electric-

ConCepTUal TranSmiSSion plan ToaCCommodaTe 400Gw of wind enerGy(a 2007)

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poTenTial SoUrCeSof wind powerw p d s t t 50[200300=good,8001600=SUPerB]


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ity, including other orms o renewable energy. It is

worth noting that north o the James Bay hydro com-plex in Quebec and Churchill Falls in Labrador thereare excellent wind resources that are not so ar romexisting transmission lines and could complementthe seasonal variation o hydro.

The need to greatly expand the grid network isnot only driven by the expansion o renewable sourc-es o energy. The expansion o nuclear power is alsoa motivation. One reason is size: not only are indi-

vidual nuclear plants usually larger than their coal ornatural gas counterparts, there is a greater tendency to cluster plants at speci c sites. Future expansion islikely to rein orce this tendency: probably almost allnew nuclear plants in the United States will be builtat existing nuclear sites. The act that nuclear sites are

or all practical purposes permanent is another actorleading to clustering.

Smart National GridDevelopment in the United StatesThe U.S. provides an important example o the movetoward a smart national grid, both or local distribu-tion, as well as or long-distance transmission. Presi-

dent Barack Obamas administration is committed to

economic recovery and in rastructure improvement,is supportive o increased investment in science andtechnology, and is determined to address the chal-lenge o climate change.

Making the transition to a carbon- ree energy sys-tem is the oundation that will help achieve thosegoals, and a smart national power grid is an essentialbuilding block in this transition.

A new power grid provides the in rastructure nec-essary to move the U.S. to an economy with drastical-ly reduced carbon dependence. As personal transportbecomes more electri ied, as mass-transit systemsspread and as alternative and renewable sources o power become a larger part o the U.S. electricity pro-

le, a new backbone grid network with smart griddistribution components becomes an absolute neces-sity. The recent $787 billion stimulus package allo-cates $ billion in loans and loan guarantees to theelectricity transmission system.

The national backboneor national gridis thebuilding and expansion o the high voltage transmis-sion grid. The smart grid re ers to improvements tothe distribution system, which has to be linked to the


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other components o a new energy system will sim-ply not get implemented. However, the U.S. should

not lose sight o the advantages o wider interconnec-tions and exchanges both to the North, with Canadaand to the South.

Implementing aHemispheric Grid: Next StepsWith the diversity o energy supplies and obviouseconomy o scale and seasons, a hemispheric energy grid make sense. The question is how it will overcomebarriers o border, diplomacy, nationalism, and his-tory. Fortunately there is an incipient network that isbeginning to transcend many o these obstacles.

A hemispheric transmission backbone network islikely to be built in segments, so that individual unitsare economically justi able. This is possible becausethere are potential opportunities up-and-down thehemisphere as well as back-and- orth. In some cases, itmay be necessary to have the clear goal o dramatical-ly greater interconnection to build a transmission lineor segment. In other cases one could allow or morecapacity than an isolated business as usual analysis,building in headroom as proposed by the Canadian

Academy o Engineering this year.

transmission system and the sources o powergeneration on one end, and to consumers onthe other. The U.S. needs to modernize andexpand both distribution and transmissionsystems to allow the grid to use new sourceso low or zero carbon power rom wherever itis located. Already, projects representing sig-ni cant wind generation capacity are waitingto get underway, dependent on the ability tohook into a more robust uture grid. The cur-rent U.S. grid simply cannot handle a signi -cant amount o new generating capacity romwind, solar and other sources.

A new grid has the potential to providemuch more resiliency, robustness, redun-dancy, and security to the U.S. electric powersystem. The U.S. power in rastructure hasbecome more vulnerable to the increased

requency o extreme weather events andthe prospect o terror attacks or sabotage.The power blackouts in the Northeast sever-al years ago, traced to a cascading series o transmis-sion shutdowns triggered by a downed tree branch in

the Midwest, remains a stark reminder o the ragil-ity, obsolescence and vulnerability o the U.S. powerin rastructure, as well as o communications andother systems that depend on reliable power.

The need or massive new capacity to move largequantities o power rom new and o ten remote plac-es to population centers where there is large andincreasing demand trumps virtually everything else.Steven Chu, President Obamas secretary o energy,stated in his con rmation hearing that the power gridis very crucial to domestic energy strategy, and thatthe key challenge is the siting o transmission lines,including across state boundaries.

A major obstacle is that the current balkanizedregulatory system in the U.S., which is divided among50 state public utility commissions, o ers ew incen-tives or utilities and transmission companies toinvest in a smart national grid.

The creation o a new smart national power gridis a necessary part o other initiatives that will helptrans orm U.S. in rastructure and the economy. With-out the capacity, resilience, security, and reliability o a smart grid in rastructure, there is great risk that the

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on the Brazil/Paraguay border and Churchill Falls inLabrador) are excluded. In Central America, a pioneerin electric power integration, trade has declined sig-ni cantly since the 980s as a share o generation.

O ten, the construction o generating capacity that targets a oreign market is viewed with local sus-picion. One sees this now with hydro plants beingplanned in Peru to integrate with Brazil. There is, aswell, a lack o con dence, especially in Latin America,that contracts will be respected. For example, Braziland Chile have depended on Bolivia and Argentina,respectively, or natura l gas supplies and have su -

ered rom unilateral breaches o contract. In the U.S.,as discussed earlier, there are major unresolved issuesregarding transmission line planning, siting and costallocation among states and regions.

A hemispheric grid based on renewables and natu-ral gas builds relationships characterized by symme-try and interdependence. Commercial relationshipsare exchanges and not just one-way lows. As theelectric power sector in the Americas takes on thenew climate and security challenges o the twenty-

rst century, political leaders can orge new strategic

and economic paths to prosperity, sustainability andresilience. A smart resilient grid spanning the Ameri-cas o ers major leadership opportunities and multi-

aceted bene its or the hemisphere in addressingglobal challenges o climate mitigation, climate resil-ience, economic development, private capital mobili-zation, and energy security. A success ul model couldinspire international power grids between Europeand North A rica, and among the nations o Southand Central Asia.

There is a pivotal role or private investment andmultilateral banks, and or government partnershipsalong lines discussed at the Summit o the Americasin April 009 in Port-o -Spain, and or entities such asOLADE (Organizacin Latinoamericana de Energa).Global and hemispheric leaders can begin to orge pol-icy incentives to address the nexus o climate change,economic development and poverty reduction in allmajor orums such as the G8, the G8 plus ve and theG 0. There can be no more important vision on theroad to and rom Copenhagen.

fOR SOURCE CITaTIONS SEE: WWW.americasquarterly.org/JHiraD

An example o the irst approach would be aninterconnection between two large hydro plants inSouth America: Belo Monte ( ,000 MW, to be builton the Xing River just south o the Amazon River)and Guri, 0,000 MW on the Caron River (tributary o the Orinoco River) in Venezuela. This interconnectionwould cross the Equator and hence exploit the hugepotential or complementarity due to the hydrolog-ic diversity which exists between the Northern andSouthern Hemispheres inside the tropics. Consideringthe large degree o complementarity, the poles or theinterconnection are not that ar apartabout ,900miles (3,000 kilometers) passing through Manaus. 3

Obviously, the interconnection would link not only the individual plants, but the wider electrical systemso which they are part. In the case o Brazil the predom-inant infuence is the Paran basin. The Venezuelansystem linked to Guri is much smaller today, but couldbe augmented by ties with existing capacity and largenew potential in the Guyanas and Colombia.

An example o creating headroom would be theinterconnections being planned between Central

America and Mexico on the one hand and Colombia on

the other. The new tie with Mexico is small (only about00 MW o capacity) and motivated by short-term reli-

ability objectives. The line rom Colombia is being laidunder sea due to the di culties o the Darien Isthmusand is to have about 300 MW o capacity. In betweenthese proposed new lines is the interconnected systemo Central America (Sistema de Interconexin Elctricapara America Central - SIEPAC), one o the ew attemptsuntil now in the Americas to create a multinationalgrid in rastructure and accompanying market.

Why not rethink these three components in termso the dimensions or signi cant exchanges betweenColombia and Mexiconot only the small Cen-tral American marketand ultimately between theNorthern and Southern Hemispheres? Central Amer-ica is clearly a crucial l ink or any hemispheric grid.Fortunately, there are strong complementarities closeto home or example between the wind resources o southern Mexico and the hydro o the Isthmus.

Despite its potential bene itis, there are many obstacles to realizing this strategy. Internationalpower trade in the hemisphere is very l imited over-all, especially i a couple o exceptional cases (Itaip

hemispheric smart grid for 21st century

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