Varcoe: Why Alberta's power grid faced a crisis — and what's being done to fix it

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Two major events, two different causes – one big problem.

A lack of reliability.

A new report by Alberta’s electricity market watchdog delved into two incidents that jolted the province’s power market this year, highlighting how stress in the system – such as too much demand, not enough power, or a combination – can quickly turn into big trouble.

One was an emergency alert issued in the dead of winter, asking Albertans to conserve power in the middle of a bitter cold snap.

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The other, in April, came during relatively seasonal temperatures, but a shortage of supply briefly led to rolling outages, the first such event in 11 years.

“While both events involved stressed grid conditions, the driving factors were very different,” states the report by the Market Surveillance Administrator (MSA) released on Tuesday.

The study made seven different recommendations to the Alberta Electric System Operator (AESO) and generators to avoid a repeat of the events.

The province’s utilities minister says some recommendations are already being adopted.

And with more power generation coming online this year – and electricity power market reforms on the way – the issues identified are being tackled, Affordability and Utilities Minister Nathan Neudorf said in an interview.

“These significant events…Is that going to be a problem going into next winter or next summer? And I would confidently, at this point in time, say no,” Neudorf said.

The emergency alert issued on Jan. 13 caught the attention of much of the province as cell phones sounded off across Alberta. The alert asked Albertans to curtail energy use as -40C temperatures enveloped the province.

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The province’s grid was pushed to the limit by the extreme cold snap. Just two days earlier, it triggered record electricity consumption of 12,384 megawatts (MW).

On Jan. 13, the province faced a crunch as outages from several natural gas-fired generating plants affected supplies and wind generation was low during the day.

The MSA said there was a decline in supply adequacy starting on Jan. 12, “primarily due to unanticipated generation outages and wind and solar forecast error.”

Some natural gas-fired plant outages were scheduled in advance. However, other outages were unexpected and issues cropped up at two hydro assets, because of the cold.

Imports from other provinces and states were also limited due to severe weather affecting those jurisdictions.

“Leading up to Jan. 13, the AESO’s adequacy forecasts predicted tight but manageable conditions. Low wind generation was expected, but other supply sources were forecast by the AESO to be sufficient,” the report states.

“However, rising demand and unanticipated generation outages led to energy emergency alert notices.”

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The call for Albertans to reduce their use quickly worked, reducing demand by about 350 megawatts (MW) and preventing any outages.

The second event on April 5 led briefly to rotating power outages, but soaring demand wasn’t a factor, according to the MSA.

Instead, a lack of supply was the issue, including from gas-fired thermal facilities.

During the morning, “a series of outages in short succession compounded with existing outages to reduce the supply of thermal generation by approximately 4,000 MW,” the report states.

“Combined with approximately 400 MW less wind generation than anticipated, this led to emergency conditions” and brief outages.

“Thermal generator outages were the main factor behind the load shed event on April 5,” the MSA stated.

However, it also noted that “in the days leading up to the load shed, wind and solar forecasts (by the AESO) over-estimated generation by approximately 500 to 1,000 MW.”

Marie-France Samaroden, AESO’s vice-president of grid reliability operations, said the organization generally agrees with the report’s recommendations and has already made changes, such as those surrounding improved forecasting.

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Other parts of the recommendations will be factored into the ongoing redesign of Alberta’s energy-only market.

She noted the two events were quite different, with cold temperatures leading to the problems in January and the AESO did “everything we could with the tools” available to it.

“For April’s events, it had to do with our forecasting,” Samaroden said.

She said one source of generation wasn’t to blame for the two events.

“Rarely is it just one thing that doesn’t happen – it’s usually a number of things. And that’s what we saw play out both in January and in April,” she said.

Duane Reid-Carlson, CEO of electricity consulting firm EDC Associates Ltd, said with more renewables coming onto Alberta’s grid, the report points to the need for AESO to have improved tools to manage the system.

“It’s just the realities of the new generation mix, and the AESO is going to have to learn how to manage it better and adapt better and build better tools and monitoring systems,” he said.

The report provides solid information and highlights the need for more intertie capacity to other provinces and states, and that the government should enable more power storage projects, said Jason Wang, senior electricity analyst with the Pembina Institute.

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“It really reinforces why Alberta needs a diversity of assets,” he said.

“In Alberta’s cases this year – the grid alerts we saw this year – forced gas outages were the main reasons why we got into the grid alerts as deeply as we did.”

The report recommends the system operator ensure an effective commitment process from suppliers is developed as part of Alberta’s restructured energy market and the planned move to a day-ahead market, where generators commit their power on the previous day.

It says AESO should review its calculations for having a sufficient market supply cushion. Other recommendations include the AESO publish reports after such major events.

Neudorf said the reforms being introduced by the province will make a difference in managing future problems.

“Obviously, reliability is a major consideration for the grid now,” he said.

“It all points to not so much the day-to-day operations, but the long-term planning – how and where we invest.”

Chris Varcoe is a Calgary Herald columnist.

cvarcoe@postmedia.com

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