Alternative Energy Grid Faces Logistical Challenges

 

Takeaway

  • Existing energy storage technology can’t hold a charge long enough to meet demand at peak times
  • Rapid increases in electricity generation are straining transmission lines in several parts of the country
  • Other challenges include lengthy construction times and an antiquated centralized utility system

Even if alternative energy becomes more economically viable and less politically divisive, a variety of logistical challenges must still be addressed before it can gain a foothold in the U.S. electric grid. Existing energy storage technology can’t hold a charge long enough to meet demand at peak times. Rapid increases in electricity generation are straining transmission lines in several parts of the country. Lengthy construction times and an antiquated centralized utility system are also barriers to widespread adoption.

At a series of recent forums at The University of Texas at Austin, energy experts discussed these problems as well as some approaches that could help solve them.

Energy Storage

Developing more reliable methods for storing wind and solar energy is a top priority in the effort to establish renewable energy as a central component of the power grid. While conventional fuels such as coal and oil are stored in plants for extended periods of time and can generate electricity on demand, the sun and wind can generate power only intermittently, making it more difficult to store and efficiently distribute.

“I don’t think wind and solar will be major contributors to our electric grid until we get a storage technology in place,” said Dale Klein, associate vice chancellor for research at the university, at the UT Energy Forum in February. “If I were energy czar right now, I would invest a lot of R&D in storage capabilities for intermittent sources like solar.”

For instance, new types of batteries can store an electrical charge generated by wind turbines for several hours. Other types of systems based on compressed air and hydroelectric pumps can store electricity for even longer. But these advancements may not be enough to meet demand at peak times.

“Solar and renewable wind and other resources will contribute to meet a major portion of demand for electricity,” said Parviz Adib, founder of Pionergy consulting firm, at the Austin Electricity Conference in April. “But of course, we may not have enough to meet all of our demand, and therefore we have to rely on other resources such as nuclear or green core technologies. That will happen over time.”

However, inefficiencies in the existing grid — made worse by volatile fluctuations in demand — may be a more significant issue than the intermittent availability of renewable sources.

“When we talk about the impact of wind energy on our current infrastructure, in particular our fossil-fuel generation in this case, there are a lot of inefficiencies in the system,” said Colin Meehan, a clean energy analyst at the Environmental Defense Fund, at the April conference. “So I worry a little bit that we’re maybe addressing the wrong issue when we talk solely about renewable energy. The completely unpredictable change in demand, as opposed to weather patterns and wind energy output, is obviously a huge issue that we need to deal with.”

Construction Lag Time

Investing in nuclear power is one way to prepare for potential shortfalls in a renewable energy grid, but there is disagreement over whether the investment would be worth the risk at this point. It takes at least 10 years to plan and build a nuclear power plant, and a lot can change in that time frame: Costs could rise, regulations could change, and the makeup of the entire energy grid could evolve in unpredictable ways.

“It’s not something we can just suddenly turn a switch and say, ‘We don’t have the shale gas, so we’d better do nuclear.’ It would take us awhile,” says Sheridan Titman, finance professor at the McCombs School of Business.

Titman says it might be too early to invest heavily in nuclear just yet, but it would be wise to monitor the situation closely.

“Let’s wait another two years and see how things are playing out, and if in two years there’s any sign that we’re running out of shale gas, then maybe we should start” building nuclear plants, he says. “And of course we should always be planning to build a nuclear plant, even if we don’t actually build it, just so we know what to do and it doesn’t take us 15 years to figure out.”

Centralized Utilities and Transmission

The U.S. energy grid is built on a centralized utility model that is rapidly becoming antiquated. Many developing countries, including China, are installing grids that are more localized and better suited to meeting the energy needs of individual communities. This type of system is better able to adapt to growth and new energy technologies, said Fred Beach, a research fellow at UT’s Center for International Energy and Environmental Policy, at the February energy forum.

A movement toward generating electricity on a smaller scale would be a step in the right direction, he said: “It’s possible to generate power within an area about the size of a neighborhood block.”

Wind farms and other renewable energy generation sites tend to be located in remote, sparsely populated locations (such as West Texas). This requires hundreds of miles of transmission lines to deliver electricity to customers. If wind power becomes a more substantial part of the grid, the transmission network will need to be built up even further. Adib said that although it may be costly to make the upgrades, it would be a mistake to delay them.

“In Texas, it’s better to build transmission line than [worry] about generation,” he said. “Now we are doing our best to attract generation. We have to be sure transmission will not stop.”

This article is the third part of "The Truth About Alternative Energy," an ongoing Texas Enterprise series.

 

Faculty in this Article

Sheridan Titman

Walter W. McAllister Centennial Chair in Financial Services McCombs School of Business

Sheridan Titman is a professor of finance at The University of Texas at Austin and a research associate of the National Bureau of Economic...

About The Author

Rob Heidrick

Writer, McCombs School of Business

Born and raised in Austin, writer Rob Heidrick has spent several years as a contributor and editor at local magazines and community newspapers. He...

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