On Tuesday, the North American Reliability Corporation (NERC) released its 2024 Long-Term Reliability Assessment. This report examines the challenges the power grid will face over the next 10 years.
The top concerns raised by this year’s report include accelerating coal and natural gas plant retirements, escalating demand growth, and declining dispatchable resources (those that can be ramped up and down to meet demand at any time).
The report found that several regions of the United States and Canada are at elevated or high risk for resource adequacy shortfalls over the next decade.
Most notable among these is MISO, the Midcontinent Independent System Operator, which covers much of the Midwest. It was deemed “high risk”—a more concerning forecast than “elevated risk.” MISO is at risk of shortfalls by 2025 due largely to resource additions failing to keep up with the retirements of plants as demand grows. There simply aren’t enough new power plants coming online to offset retirements and rising demand.
The Southwest Power Pool (SPP), which covers the middle of the U.S., is at elevated risk by 2025 because of low wind at peak demand in winter and summer, as well as due to natural gas supply concerns.
By 2026, the New England grid faces elevated risk from demand growth and the limitations of its natural gas delivery infrastructure. PJM, the Pennsylvania-New Jersey-Maryland Interconnection, will also face elevated risk by 2026, because additions to the grid are failing to keep up with retirements and growth in demand, and because of fuel supply issues in the winter.
ERCOT, the Electric Reliability Council of Texas, is in the same boat and at elevated risk due, in large part, to the growth of dispatchable resources not keeping pace with demand and the growth of less reliable power sources, leaving the grid vulnerable especially in extreme weather.
By 2028, SERC East, the eastern portion of the Southeast Regional Council, will be at elevated risk from a combination of demand growth and the retirement of reliable generators. The risk will be heightened during extreme weather conditions when fuel issues and power plant performance will add to the risk exacerbated by the inability to receive emergency power transfers.
The Western Electricity Coordinating Council (WECC), covering California and part of Mexico, is also at elevated risk by 2028. This is due in large part to demand growth coinciding with generator retirements which could leave the area vulnerable during heat waves.
The recurring themes in this report are that generator retirements—fueled by bad policymaking like the final Clean Power Plan 2.0 rule—are coming at a time of increasing power demand and when many resources are being replaced with less reliable ones. As power demand from artificial intelligence and electrification rises, reliable capacity must be available to meet that demand. The last few decades of power policy have led to the exact opposite, pushing the closure of reliable plants and subsidizing wind and solar that are far less reliable. As demand rises, it’s more important than ever to approach power policy prudently and preserve market signals by resisting the urge to create subsidies and mandates.