Winter 2017/2018 recap: Historic cold snap reinforces findings in Operational Fuel-Security Analysis
Wednesday, April 25, 2018 at 10:39AM
ISO New England in Industry News & Developments, natural gas, oil, renewable resources, system operations, wholesale prices, winter

Weather always plays a crucial role in how ISO New England operates the region's power grid, and that was certainly the case as New England faced a historic two-week cold snap in late December and early January that sent temperatures plunging and nearly pushed the bulk power system to the brink.

"The cold temperatures, together with winter storms and other complicating factors, led to some of the most challenging conditions our system operators have ever had to navigate," said Peter Brandien, ISO New England's vice president for system operations.

Keeping the lights on

Beginning on Dec. 26 and stretching until Jan. 8, the region endured a brutal stretch of cold weather. All major cities in New England had average temperatures below normal for at least 13 consecutive days, of which 10 days averaged more than 10°F below normal. Boston, for example, saw its most extreme cold wave in 100 years.

High demand for natural gas for heating caused natural gas pipeline constraints that resulted in high natural gas prices. As a consequence, the price of generators burning natural gas rose higher than the price of generators burning oil or coal, and so a significant portion of the region’s electricity was generated by power plants that use oil. During the two-week stretch, oil accounted for 27 percent of the generation in New England, compared to 0.29 percent in the previous 25 days.

All told, the region burned more than 2 million barrels of oil for electricity generation, more than double the amount burned in all of 2016. By the end of the cold snap, the region only had 19 percent of its maximum capacity of fuel oil available.

Fuel Delivery Logistics

As the region imports most generator fuel, getting timely delivery of fuel can pose a logistical challenge for New England generators.

Some particular challenges that arose during the cold snap were:

  • Heating customers had priority for oil and natural gas brought into the region
  • Sea and river ice delayed oil barges
  • Winter Storm Grayson delayed oil trucks
  • Truck drivers ran up against driving time restrictions, which had to be lifted by emergency governmental actions

In addition to the cold temperatures, the region was hit with multiple snow storms, including Winter Storm Grayson, which complicated the delivery of oil into the region. With oil inventories running low, and replenishment timelines unknown due to the storm conditions, ISO operators took the unprecedented step of posturing oil plants, which means that the ISO postponed the operations of these plants for later in the day or week, and used other generating resources instead to produce electricity as a means of conserving fuel. Many oil-fired power plants were also nearing their federal or state emissions limitations as the cold snap dragged on.

"ISO system operators generally manage contingencies that are hours away. But instead, these conditions forced them to manage contingencies that were days away as they tried to determine if oil plants would hit their emissions caps or run out of fuel before deliveries could be made," said Brandien.

For the fifth year in a row, a winter reliability program was in effect to help augment fuel adequacy in New England. Read the results of the 2017/2018 program.

The operating conditions seen during the cold snap highlighted challenges the region faces during the winter, as analyzed in the ISO's Operational Fuel-Security Analysis, a study assessing whether possible future resource combinations in the 2024-2025 timeframe would have enough fuel to ensure bulk power system reliability throughout an entire winter.

Spiking prices

The extreme cold weather sent prices on the natural gas pipeline dramatically higher, thus increasing prices significantly for electric generators who purchase gas on the spot market. Natural gas prices in Massachusetts, which had been averaging below $10 per MMBtu in the early weeks of December, went above $20 per MMBtu for much of the cold snap, reaching a peak of $78.35 per MMBtu on Jan. 5. Real-time electricity prices saw a corresponding spike, topping out at $287.85 on Jan. 5.

Overall, the region's wholesale energy market was valued at $992 million for the two-week period from Dec. 26 to Jan. 8, compared to $243 million during the same time period the prior year. 

For more information about the impact of the cold snap on the region's wholesale markets, read the ISO's December and January market reports.

Spiking emissions

Along with higher prices, the switch to burning oil also increased greenhouse gas emissions within the region. Carbon dioxide (CO2) emissions, for example, were below 100,000 short tons per day in the days leading up to the cold snap. Once the cold weather hit, and oil generation increased, the emissions grew to an average of over 220,000 short tons per day. 

 

Variable Renewable Generation

The variability of generation from wind and solar resources was on display during the cold snap. As the chart below shows, cloud and snow cover prevented solar panels in the region from reaching their seasonal potential, particularly during Winter Storm Grayson.

Note: Output derived from statistical sampling of actual meter readings. Winter irradiance potential reflects the energy that solar capacity could produce at this time of year with clear skies and no snow cover.

ISO system operators also observed variable generation from wind turbines in New England, as wind speeds changed during the two-week period. At times, transmission congestion also caused curtailments of some wind farms.

Otherwise Uneventful

Outside of the two-week cold snap, winter in the region was uneventful. The system operated reliably as temperatures began to return to normal seasonal averages. Overall the energy market in New England was valued at $2.6 billion, with approximately 38 percent of that coming during the cold snap. 

 

Article originally appeared on ISO Newswire (http://isonewswire.com/).
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