This is an excerpt of a white paper published at HARC on 5/21/2018…
Extreme Weather Events
Since 1980 the United States has experienced 219 separate billion-dollar-plus natural disaster weather events. The total cost of these 219 events is estimated to be $1.8 trillion dollars. This takes into account 2017, which is on record as being the most costly year for natural disasters, with a cumulative cost of over $300 billion dollars. The number and intensity of these weather events are causing growing concern across the globe as well.
The risks faced by the public and private sector related to climate include direct physical impacts on
investments, degradation of critical infrastructure, reduced availability of key inputs and resources, supply chain disruptions and changes in workforce availability and productivity. The Global Risks Report 2016, finds that two of the top three concerns for business over the next 10 years are failure of climate change mitigation and a failure to adapt to potential extreme weather events. The concern indicated as most crucial is a water crises. All of these issues point to increasing likelihood of investment in more resilient infrastructure in order to limit these risks. It is anticipated that these extreme weather events are likely to increase over time, particularly with the intensity of floods, droughts, and/or heat waves. A similar increase in intensity is also predicted with tornadoes, hailstorms and thunderstorm winds, but there is still some uncertainty as to what extent and where. These extreme storm events are intensifying disaster risk and will continue to have a significant impact on communities and infrastructure. Recovery often requires enormous resources, which underscores the growing need for new adaptive infrastructure to make critical facilities and communities are more resilient.
For this study, we explore whether the growing number and intensity of storm events have led to greater investment in more resilient power systems. A resilient power system is one that is built to lessen the likelihood of a power outage. These systems must manage and respond to power outage events to mitigate impacts, quickly recover when the power comes back on, and learn from the outage event to reduce the likelihood of future outages.
Our study period is from 2000 to 2016. During this timeframe, the United States experienced more than99,000 power outages, some small and some rather large. This includes ice storms that knock out power for a few thousand customers to Superstorm Sandy, which at the height of the blackout left approximately 5.7 million customers without power across New York, New Jersey, and Connecticut. Further, severe weather events, including hurricanes, extreme heat, and droughts between 2004 and 2013, resulted in over 25 significant power generation disruptions that led to curtailment of power generation and power outages across the US.
We test whether power outages as a result of natural disasters influence decisions by organizations and critical facilities to adopt methods to reduce the likelihood of potentially detrimental power disruptions. One way to test this assumption is by looking at the deployment of combined heat and power (CHP) applications across the United States. CHP is by no means the only approach to mitigate power outage risk at a site, but is one of the more likely options to be pursued.
Combined Heat and Power & Power Resilience
Combined heat and power (CHP) is being touted as a technology that can help with power reliability and resilience concerns. CHP produces power on-site, typically using natural gas which is highly reliable. This was demonstrated during Hurricane Sandy, where CHP systems performed very well in comparison to the grid and diesel back-up generators. We have seen anecdotal evidence that CHP is coming online to improve site resilience, and a handful of states have been pushing for rules to promote resilient CHP. In this study, we wanted to see if CHP is more generally being installed to improve site resilience.
Currently, there are 81 GW of CHP installed across the United States, and significant potential for much more. A 2016 DOE study demonstrated that there is 340 GW more of technical potential for CHP. There has been considerable effort at the federal level to push for more CHP in the near-term. Examples include the Energy Policy Act of 2005, Federal Interconnection Standards, 2008 Federal Investment Tax Credit for CHP, 2008 Accelerated Depreciation for CHP boiler Maximum Achievable Control Technology (MACT) in 2011, and President Obama’s Executive Order in 2012 that set a goal of 40 GW of new CHP by 2020.
There has also been considerable regulatory and financial assistance activity at the state, utility, and local level. This includes interconnection standards, as well as incentives, grants, rebates, and loans. Some of the more notable activity includes New Jersey’s Energy Resilience Bank which provides grants and loans to cover 100% of costs of resilient systems, The New York State Energy Research and Development Authority (NYSERDA) CHP Incentive Program, and California’s Self-Generation Incentive Program (SGIP) which funds systems of up to 3 MW. Some other state activities to promote CHP for resilience include legislation in Texas and Louisiana that requires all newly constructed state facilities or state facilities undergoing major renovation to assess opportunities for CHP. Similarly, Connecticut’s Microgrid Pilot Program has a central focus on the role of CHP. Missouri, Illinois, and Michigan also have various CHP-focused energy resilience planning efforts.