Coronavirus is laying waste to the global energy system – its biggest shock in at least 45 years, and the implications will be with us for decades. For Off-Grid.net that is something to celebrate!
For the tens of millions of working from home during the coronavirus pandemic, it may feel as though their energy use has soared as extra hours working on laptops, video calling and watching television add to their electricity bills.
But overall electricity demand has plunged by up to a fifth in OECD countries since governments lockdown at the end of March. The sharp decline reflects the closure of many businesses and industrial sites forced to shut because of the pandemic.
The flexibility of our grids is being tested, as demand spikes and cliffs put unprecedented stress on the system. Renewable energy sources, which do not require a supply chain for their fuel inputs, add stress to these systems due their variable nature. The higher the penetration of renewable energy systems in modern electricity networks, the more flexibility, storage capacity, and smart grid capacity is needed to manage sudden spikes in demand. Users are at a heightened risk of blackouts.
On the plus side, carbon emissions have fallen at an unprecedented rate due to the economic lockdown, possibly paving something of a clear path for a green energy transition. But such a transition requires commitment and a plan. The fossil fuel consumption decline and the parallel decrease in C02 emissions are only a temporary phenomenon. 2010, the year we recovered from the Great Recession, also saw highest year-to-year increase in CO2 on record. 2021-2022 may be not much different.
Renewables’ share of overall electricity generation reached a peak of 60.5 per cent in the UK at one stage last month, according to National Grid data.
Britain’s electricity system is not set up to cope with such high levels of renewable generation, said Paul Verrill, executive director at the energy consultancy EnAppSys, who added that the grid is “stable” at around 50 per cent renewables.
The grid was designed around large fossil fuel plants, whose big, heavy spinning turbines can help moderate volatility in the system giving engineers more time to keep it stable.
The International Energy Agency (IEA), one of the most accurate organizations at forecasting and analyzing the latest trends in global energy, released a report yesterday with a real-time view of COVID-19’s devastating impact across all major fuels. The IEA report includes estimates for how energy consumption and carbon dioxide (CO2) emissions trends are likely to evolve over the rest of 2020 with slashed demand for all fuels, in particular those oil derivatives used for transportation.
Large industrial power users, non-essential businesses, schools, and government buildings remain closed. In the past 100 days we have experienced a 6% decline in global energy demand, five times what was lost in the 2008 crisis. In absolute terms, this is equivalent to taking the entire energy market of India off the grid.
The report forecasts advanced economies will see demand fall 9% in the United States and by 11% in Europe. The IEA say each month of worldwide lockdown at the levels seen in early April reduces annual global energy demand by about 1.5% (it reduces GDP by a similar amount). Electricity demand has also severely been cut, in some cases up to 20% — the largest drop since the 1930’s Great Depression.
Large US shale companies – once an engine of American economic growth – are being hit by lower demand.
Power prices across the developed world are falling fast, in some places by as much as half. Renewables capacity is still expanding globally, with solar PV and wind becoming competitive with gas in many locations.
According to the report, market prices for electricity have dipped below zero in the United States and a number of countries in Europe – including Germany, Denmark, and France.
Electricity security is key a facet of the COVID crisis. The availability of uninterrupted electricity is a necessity for the continued functioning of supply chains, teleworking, and for powering the healthcare sector, including the fight against COVID.
Policy Makers, Pay Attention!
Policy makers will play a crucial role in how the world’s energy markets look after COVID-19. The design of stimulus packages will shape how our nations link the economic recovery with a pathway towards cleaner and cheaper energy sources. At the same time, regulators and utilities must also be wary of over-dependence on renewable energy sources in grids where flexibility is limited.
We can beat the Coronavirus without the lights on.
The fall in energy consumption poses a real challenge to a small group of engineers in Wokingham, near Reading in the south of England, who sit in front of large screens monitoring complex charts and data to keep electricity flowing around Britain by balancing supply and demand, second by second.
The team at the National Grid Electricity System Operator, the company charged with managing Britain’s grid, have been working to keep the system stable and avoid blackouts.
“It [such low demand] is basically unprecedented in the history of the current market structure, which is 20 years old,” says Tom Edwards, senior modeller at Cornwall Insight, an energy consultancy.
National Grid said it expected electricity demand over the early May bank holiday weekend to match the record low of 15 gigawatts hit for a short period during the Easter weekend, which was well beneath the 18GW to 19GW minimum levels recorded at the same time last year.
Such periods of low demand can create “significant operational risk”, National Grid admitted in papers to the energy market regulator Ofgem last month, although publicly the company presents a more confident face.
“We have a variety of tools and processes — and a lot of experience — to draw on to operate the grid in low-demand conditions and do not anticipate any issue continuing to reliably supply electricity,” National Grid said, although one senior director admitted it was “hard work for the guys in the control room” to manage record troughs.
Just as interruptions can cause outages, such as the widespread blackout last year, low demand leading to excess supply can destabilise the electricity system and, in an extreme situation, lead to power cuts.
This oversupply of generation can cause the frequency of the electricity system, the measure of stability, to rise. National Grid must keep the frequency within a band of 49.5 hertz to 50.5 hertz to ensure the grid is stable, although it has to surge or plunge some way outside those levels before customers or power plants are cut off. Just before the worst blackout in more than a decade in August last year, the frequency fell to 48.8 hertz.
The engineers at Wokingham try to control high-frequency problems using various techniques, such as paying wind farms to switch off or by exporting power to Europe via subsea cables known as “interconnectors”.
National Grid has also agreed a deal with French utility EDF to reduce output from its Sizewell B nuclear plant in Suffolk to help manage lower demand. It has also held discussions with smaller generators during the lockdown about switching off if required.
But National Grid has also warned it may for the first time have to issue a national plea to power stations to cut supply if problems of low demand persist. An insufficient response to that entreaty would result in an emergency order to switch off.
To make the Wokingham engineers’ job harder, Britain’s lockdown has coincided with record-breaking weather patterns ideal for renewable energy generation such as solar and wind, which have flooded the system with cheap electricity just as demand is low.
Mr Edwards warned that the current crisis could feed through into higher energy bills because it has pushed up the costs of managing the system.
“I’m not concerned about blackouts,” he said. “It could be very expensive to manage, though, because turning off all those wind farms, they are going to want compensation.”