Episode 75: The Energy Grid with Kristina Skierka (Power for All)

Episode Intro Notes

Outline 

• What is an electric grid?

• How does the electric grid work?

• What does the U.S. grid look like?

• How do the conditions of electrical grids vary around the world?

• What are some limitations of a typical electric grid?

• What trends are emerging to help improve grid sustainability and resiliency?

• Interview with: Kristina Skierka, CEO at Power for All

What is an electric grid?

• So let’s start out at a high level. Once electricity is generated, that electricity needs to get to the end user. The United States Energy Information Administration, or the EIA, states that “the grid” is simply the system that connects energy producers to energy consumers. These grids can range in size and in complexity and contain the substations, transformers, and power lines that energize our homes, businesses, and everyday lives.

• As you can imagine, these grids are complex and interconnected. They can be set up in many different ways depending on how they are being used, but typically there are four key sections to these systems: generation, transmission, distribution, and consumer use. We’ll get to each of these in just a minute.

• Fun side-fact: While living “off the grid” is a slang term these days for being generally disconnected, the term got its origins in the late 1970s to mean “not connected to or served by publicly or privately managed utilities” like electricity and water. If you’re listening to this episode, odds are you’re not off the grid in either sense!

How does an electric grid work?

• So let’s shed some light on how these grids actually work with a quick walkthrough of those four key sections of the grid.

• Let’s start with generation. It is here where the systems work to convert primary energy sources like coal, wind, or nuclear, into electrical energy. This process is completed by use of a generator, hence the name of this phase, generation. There is a lot that goes on within these respective power sources so we won’t get into too many details here, however the key step is that primary energy sources convert mechanical energy into electrical energy, what we call electricity.

• The system of transporting this electrical energy is what we often refer to as the grid itself, so that makes this next step, transmission, super critical. Electrical transmission, in short, is the process of delivering generated electricity to the distributor. We’ll talk about distribution next but let’s talk transmission some more. It typically takes place over long distances by the power lines that we often see running through our communities. This step is really important to the process as power sources are typically located further away from populated areas like cities, due to the lack of land availability and size of these operations. So this transportation of energy is needed to get the electricity to the end user.

• During transmission, electricity leaves the power source through a transmission station. This is where the energy is “stepped up” by a transformer, meaning the voltage of the electricity is increased. A transformer is a critical part of the electric grid as the change in voltage helps the generated electricity travel long distances efficiently with minimal losses of the power generated. Transformers do not generate electricity, they simply transfer power from various currents and increase or decrease the voltage to allow for transmission. 

• There are three types of power lines that are used within this process. Overhead lines, underground lines, and subtransmission lines. Overhead lines are often high voltage lines and are responsible for long distance transmission of electricity. The voltage here needs to be really high to support long distance travel. Similarly underground lines can be used to transport long distances, or even underwater. They are used when above ground lines aren’t possible or preferable. The last line type, subtransmission, carries lower voltages of electricity to distribution stations. 

• So that brings us to our next phase of the grid - distribution. Once electricity gets close to the final destination by the power line, the distribution phase starts when the high voltage electricity that has traveled from the power source is “stepped down” to a lower voltage that can be used safely at a power substation. These substations connect to a smaller distribution network that distributes the electricity at a safe voltage to all of the users that are on the grid system. These substations are located all throughout the grid system to get electricity to consumers.

• And now, the last phase of the grid, consumer use. This is likely the phase that you are most familiar with in this whole system. This final step happens when the electricity reaches its end users and is used to power our lives by turning on our lights, charging our phones or electric cars, or keeping your drinks cold in the fridge. This consumer use phase is a key point in the grid system as the demand for electricity varies by location and can fluctuate at different times of the year or during the day. With the differences and variation in consumer use, electricity generators have to actively manage this demand, which is not easy!

What does the US grid look like?

• In the United States, there are millions of miles of high and low voltage lines with distribution transformers connecting the system across the nation. In the continental US, there are two major interconnections of the grid as we know it. They each operate independently, but can transfer power between each grid. East of the Rocky Mountains and north of Texas is served by the “Eastern Interconnection” and everything to the west of the Rocky Mountains is served by the “Western Interconnection”. These two grids are also connected to the Canadian power grid. This interconnection allows for increased reliability as there are many routes for the power to flow and allows for various generators and power stations to supply electricity. 

• The one exception to these two grid systems in the US is for the majority of Texas. Texas is the only US state that runs its own grid: the “Electric Reliability Council of Texas” (ERCOT), which the state opted to do back in the 1960s to avoid federal regulations and work in a deregulated energy market. While this can be beneficial as consumers have more choice on who they want to buy their energy from, it is also extremely difficult to import electricity from the two other power grids into or out of the state.   

• There are many organizations that are involved in keeping the grid working, as there is no single owner of this system in the US. There are investor-owned utilities, publicly-owned utilities, cooperatives, independent energy producers, and the federal government all involved with the production and distribution of energy. In addition, there are independent system operators, regional transmission organizations and reliability coordinators who ensure that operations run smoothly, especially in case of emergency. And to ensure that this system is run as fair as possible for all the entities, the power markets in the US and many other countries are regulated by the government at all levels: local, state, and federal. 

• For example, in the US the Federal Energy Regulatory Commission (FERC) is tasked with ensuring “reliable, safe, secure, and economically efficient energy for consumers at a reasonable cost” here in the US. This independent government agency regulates the interstate transmission of energy sources like oil, electricity, and natural gas and uses regulations, markets, and collaboration to achieve this mission. 

• Across the continent, the NERC, the North American Electric Reliability Corporation, is a nonprofit international regulatory body that helps to enforce grid reliability and security standards in the US, Canada, and Mexico.

• Further, most states also have state energy offices or utilities commissions that oversee energy policies, programs, and financial incentives in addition to these international and federal offices. We’ll link in the intro notes to the page on the Federal Energy Management Program website that has the details for respective energy offices and organizations within each U.S. state if you’re interested in learning more about how your specific state interacts with the energy system.

How do the conditions of electrical grids vary around the world?

• Some countries have developed fairly reliable grids, while other grids are currently having trouble meeting the needs of their populations. In parts of the world, just having access to electricity via a grid system is a luxury. 

• A recent study by the International Electricity Agency (IEA) found that the number of people across the world who live without electricity approached 775 million in 2022. While this is a decrease from the nearly 1.2 billion people who were living without electricity in 2010, this progress has not been quick or equitable across the world. As fuel prices rise, those in the developing world are seeing access to reliable and affordable energy stalling. Further, as populations in many countries continue to grow, access to electricity has slowed, resulting in big gaps across each country. 

• In Ethiopia for example, the IEA found that the population growth is currently outpacing new connections to the grid system as many of the projects that were planned have been put on hold due to lingering impacts of the COVID-19 pandemic. The utilities in this area don’t have the funds to complete energy access projects that were in the works or to fund new projects.

• In fact, in 2020, the top 20 least-electrified countries in the world were all located within the continent of Africa where there is a large gap in energy access between the rural and more urban areas within the continent. While 80% of the people within urban areas in Africa had access to electricity in 2020, only 30% of rural populations had the same access. 

• Further, the World Energy Outlook of 2022 Report found that with current global policies there will still be 660 million people across the globe who will live without energy access in 2030. And 85% of those people will live in sub-saharan Africa. There is a lot more investment needed in these areas to expand access to electricity from a grid system, though there are other ways to expand access to electricity beyond typical grids that we’ll discuss in a bit.

• For those countries with access to a working grid system, there are a few key factors that contribute to the variation in grid conditions around the world including: the age and condition of the infrastructure, geographic factors, and political and economic factors.

• In markets like Australia, the European Union, and Japan, the utilities business is much less regulated than here in the US. In Japan for example, the country was historically divided into two regions, and thus has two different grid systems. What makes Japan an interesting case study is not just that there are two different grid systems, but that they are actually running at two different main frequencies. This causes a lot of issues and limitations when transferring and shifting electricity from one grid to another. If there is a power outage in one half of the country for instance, it can be difficult to share electricity with the other half.

• In India, where the population and economy are fast growing, the country's grid is facing some difficulty meeting the growing demand. The power market in India is the third-largest market in the world and day time demand is quite high as India’s residents live, work, and go to school. Additionally increases in temperature caused by heat waves often put additional strain on India’s energy infrastructure, which largely relies on coal as a main energy source. The shortages of coal, coupled with increased demand, unfortunately results in consistent blackouts across the country.  

What are some limitations of a typical electric grid?

• As you can tell, the grid is super complex and intertwined. There are a lot of points within this system where things may go wrong, especially since consumer use is really a key driver of how the grid is managed. So let’s explore some of the limitations of these systems that we rely on in our everyday lives. Later in this episode we’ll talk about emerging technologies and methods to help improve grid sustainability and resiliency.

• Let’s start with a key concern for many grids around the world - the age of these systems. Electricity and the grid systems as we know them have been around for a long time and because of this, aging infrastructure is becoming a bigger problem. A 2022 Reuters special report mentions that while the US is making some great strides with growth in wind and solar power, this progress cannot continue to be successful if there is not a “massive overhaul” of our outdated electric infrastructure. The article goes as far as to call the current US grid “creaky” and “decrepit,” which aren’t great words to use for something that we rely on to live! Some key experts in the space say that more than $2 trillion is needed to make these improvements.

• So how old is the U.S. grid infrastructure? A 2015 U.S. Department of Energy report stated that 70% of power transformers were 25 years of age or older, 60% of circuit breakers were 30 years or older, and 70% of transmission lines were 25 years or older. This study was completed 8 years ago meaning these key components of the grid have only gotten older! Other sources note that the average age of a power line in the United States is over 40 years old.

• One key effort to improve the reliability and the strength of energy transmission is grid modernization - or improving the physical framework of the grid. This could include updates to old wire systems and installing more modern technologies. 

• However, the Conservation Law Foundation notes that much of the modernizing that needs to be done is around changing current policies for utilities. As mentioned earlier, grids are shared resources of both privately owned and public assets; it's often difficult to define who is responsible for what upgrades and how they should be done. There are so many players within these systems coordination is nearly impossible. This adds to the difficulty in upgrading this critical infrastructure. 

• Policy changes may be the key here as it appears that the federal government doesn’t have the ability to enforce modernization of infrastructure. Within our current policy structure, no one group has the power or responsibility to maintain the grid. An additional challenge here is that some state and regional regulators often have political incentive to not approve these changes as they’re typically costly. As an example, in just 3 months last year in the U.S., there were 549 policy and deployment actions to help modernize our electric grid with over $12 billion proposed as an investment. However, federal regulators only approved about $479 million (or 4%). 

• Another key limitation of the grids complexity is that they are prone to outages and disruptions, also called blackouts.

• Here in the U.S., blackouts and power interruptions are becoming more and more common, in part because of the “creaky” grid. A 2021 study from the EIA showed that in 2020, the average American energy customer experienced over 8 hours of electric power disruptions - the most since the EIA began record keeping in 2013. 

• There are many potential explanations for why these blackouts may occur. However, in addition to the age of our grid, another common cause is that there has been an increase in extreme weather events that threaten the reliability of the system. In 2020, the U.S. Department of Energy conducted research on the reasons for power loss. That research found that 96% of power loss was due to severe weather or natural disasters. 

• Unfortunately, these events are becoming more frequent as a result of climate change. In fact, research from Climate Central showed that in the US the average annual number of weather-related major power outages (over 50,000 people losing power)  increased by 78% between 2011 and 2021. 

• We see extreme climate in action every year in the U.S. during hurricane season. However in 2021, we saw the potential impact of extreme weather on the grid. The  unexpected winter storm in Texas made national news because all of the power sources in the state faced difficulty performing in the extreme cold temperatures causing major grid failure. Equipment froze and the extreme weather conditions made it difficult to manage, causing half of the state’s natural gas supply to be shut down, affecting 4.5 million households in the state and causing 57 deaths. 

• Additionally, as we noted, the majority of the state of Texas functions on its own unregulated grid, and was not able to supplement from other parts of the U.S. Within their state power grid there are over 550 electricity generators, over 60 transmission companies and over 130 electric providers, further complicating any efforts to cooperate and restore power. This complex structure and difficulty with equipment coupled with the disconnection from the rest of the country exacerbated the power losses to Texans in 2021.

• To keep up with the changing climate, disaster preparedness needs to step up, but we also need to begin thinking about improvements to the current infrastructure. The reality is that at the same time the grid infrastructure is getting older, climate events are happening more frequently. These statistics highlight the need to update our grid infrastructure to work for our current climate if we want to be able to meet demand and increase grid resilience.

• A third limitation on the grid is load shedding.

• As mentioned, consumer use is a critical part of the grid system. Demand for electricity ultimately drives the entire system. There are times where demand for electricity exceeds the current supply. When this happens utilities can temporarily stop the delivery of electricity to certain parts of the grid system to prevent overloads and potential longer and more extensive outages. This is called load shedding.

• While this isn’t as common in the U.S, it is a tactic used frequently in many countries to maintain grid integrity.

• In South Africa for example, load shedding schedules are a way of life for many of the residents as the nation's power utility, Eskom, has had difficulty in providing consistent electricity since 2007. In the country, load shedding in the form of rolling blackouts often occurs on both a predictable and unpredictable schedule due to failures within the aging coal plants making it impossible to meet the demands of the population. In 2021, there were a total of 1165 hours (48 days!) of darkness within the country.

• And lastly, there is an alarming increase of attacks to the grids through both physical and cyber terrorism methods

• In the U.S. in particular, there have been high levels of these cyber and physical attacks to our power infrastructure causing alarm to federal regulators. From January to August of 2022, utilities in the U.S. reported at least 101 incidents they believe to be intentional attacks, vandalism, robberies, or threats on the utility system. The past three years have been the most active for reported grid attacks in the past 10 years. While the details and the motivations for many of these attacks are not public, the trend is fairly alarming and agencies are looking to strengthen grid systems and infrastructure in our growing digital environment. As more devices become interconnected through the internet, remote access, and networked sensors, there could be new potential vulnerabilities hackers could have access to that could be used to interrupt the grid system. 

What trends are emerging to help improve grid sustainability and resiliency?

• So with all of these potential limitations, what can we do in addition to policy changes to improve our grid? A 2022 article from the Natural Resource Defense Council, or the NRDC, underscores that overall in the U.S. we need to invest in a grid that is resilient, especially to climate change. Specifically, grid systems need to have the ability to adapt and respond to changes while also making progress on the clean energy transition. 

• In the U.S., as a part of the bipartisan Infrastructure bill, the Grid Deployment Office is in the early stages of distributing $10.5 billion from the “Grid Resilience and Innovation Partnerships Program,” GRIP. The goal of the program is to accelerate projects that will help increase the reliability of our current grid infrastructure and increase the consistency and affordability of clean energy.

• While there are many ways the grid can be improved, let’s look at a few technologies and trends that can help grid systems across the globe become more resilient, starting with smart grid technologies. As we have mentioned throughout this episode, the current grid as we know it was built many decades ago, and while it has been improved over time, it is still struggling to meet current demand and is limited in capacity. Many engineers have noted that we need new improvements to make the grid “smart” so that energy generation is automated and better managed as our energy needs become more and more complex.

• The U.S. Department of Energy defines a smart grid as “interconnected generation and loads enabled with remote monitoring and controls capabilities.” In short, this means that smart grid technologies are used to monitor, control, and optimize the grid, mainly through technologies like improved hardware sensors, communication lines, and software applications that can help manage the grid in real time through two way communication between the utility and the end consumer. A few benefits the DOE mentions for smart grid technologies include: more efficient electricity transmission, faster power loss restoration, lower operational costs for utilities and consumers, and better integration of renewable energy into the grid.

• Unfortunately, building out a smarter grid will take lots of money and a lot of technology upgrades, so this won’t be an easy or quick transition. However, we are slowly seeing some of these technologies receive approval and funding, and come online. Grants for smart grid technologies are a key part of the GRIP program with $3 Billion of grants available in 2022 for this purpose. The hope is that these grants will help increase the flexibility, efficiency, and reliability of the system overall by increasing capacity, lessening the impact of natural disasters, and facilitating more advanced energy management programs. We will see who receives the first round of grants and how they are deployed, but hopefully these grant dollars result in improved infrastructure that can take our current grid system into the future.

• Another tactic to help improve grid flexibility is demand side management programs. These programs are a strategy that can be used by electricity utilities to help control the demand for electricity by providing incentives for consumers to reduce energy use during peak demand times. You may have even seen this within your own utility company where they may fluctuate rates depending on the demand or during peak times of day, all in an effort to help the company shift consumption and mitigate stress on the grid system by allowing companies to schedule and plan energy usage. Other utilities may encourage their customers to install energy efficient technologies like thermostats or energy sensors to track demand and shift usage as needed. These demand side management techniques help to reduce the risk of unexpected increases in demand that can cause an unexpected outage, in turn making the grid efficient and dependable. 

• We can also improve the reliability of our grid through the use of distributed energy resources (DER), also called embedded or local generation. DERs are smaller-scale energy generation and storage technologies that can be located at or near the point of use for consumers. Technologies for DERs could include the use of on-site solar, energy storage like batteries, or even the use of microgrids to help support the larger grid and allow for increased power sources during times of increased demand. These distributed energy resources are becoming more affordable and efficient, and can soon play an increasingly important role in the grid.

• For example, microgrids are usually a combination of back up generators and renewable sources like solar panels or smaller scale wind turbines. These smaller systems are located right at the source of consumption, rather than hundreds of miles away, eliminating the need for long transmission lines as these microgrids generate electricity on site. These systems can kick in when there are grid outages or when demand is high by using software to control the various flows of electricity. The size and cost of these smaller systems varies greatly, but can be a complement to an existing grid system.

• Energy storage is a key component of distributed energy systems. If you’re interested in learning more about energy storage, check out Episode 57, where we went in depth on this topic. Energy storage technologies are a key topic in the field that are being studied as a way to provide backup power or even power that can be transported when needed. In addition, as our grid begins to incorporate more renewables, like solar and wind, these often fluctuate in availability more than fossil fuel based power sources. As a result, batteries and energy storage will begin to be critical to providing continuous supplies of electricity. 

• For example, solar energy storage systems charge batteries during the day while the sun is out, but releases that power for use at night or on darker rainy days. Battery storage can be used not just for those rainy days, but can help the grid overall by helping to shift demand when the grids see an increase in consumption or when energy is at its most expensive. The use of these batteries can also increase resilience as they can be used as an emergency backup in the event of a power outage. 

Interview with: Kristina Skierka, CEO and Founder at Power for All

• Kristina Skierka is the CEO of Power for All, a global campaign to accelerate the end of energy poverty. She manages an international team that has built a coalition of more than 300 partners and launched initiatives to accelerate the adoption of decentralized renewable energy in numerous countries including Nigeria, Zimbabwe, Sierra Leone, India, Ethiopia, and Uganda. Kristina has over 20 years of experience in the energy sector.

• With a global reputation for her work to advance clean technologies, Kristina is regularly cited as an expert on distributed energy, renewables and sustainability, and has been featured in The New York Times, Greentech Media, Forbes, and The Huffington Post. Kristina was named Energy Foundation’s Senior Fellow in 2009, a finalist for both the 2015 Clean Energy Ministerial's C3E award and the 2016 Climate Solutions Accelerator. Kristina has been named one of The African Power & Energy Elites for 2020 by ESI Africa.

• Kristina is based in San Francisco, California.