The electricity conundrum, present and future

Predicting electricity supply and demand is proving to be problematic.  Vox reports:

Demand for electricity is stagnant.

Thanks to a combination of greater energy efficiency, outsourcing of heavy industry, and customers generating their own power on site, demand for utility power has been flat for 10 years, and most forecasts expect it to stay that way … This historic shift has wreaked havoc in the utility industry in ways large and small, visible and obscure.

. . .

Utilities have been frantically adjusting to this new normal. The generation utilities that sell into wholesale electricity markets (also under pressure from falling power prices; thanks to natural gas and renewables, wholesale power prices are down 70 percent from 2007) have reacted by cutting costs and merging. The regulated utilities that administer local distribution grids have responded by increasing investments in those grids.

But these are temporary, limited responses, not enough to stay in business in the face of long-term decline in demand. Ultimately, deeper reforms will be necessary.

. . .

Only when the utility model fundamentally changes — when utilities begin to see themselves primarily as architects and managers of high-efficiency, low-emissions, multidirectional electricity systems rather than just investors in infrastructure growth — can utilities turn in earnest to the kind [of] planning they need to be doing.

There’s more at the link.

In one sense, this is good, I suppose.  We’re using more electrically powered things than ever, from smartphones to computers to TV’s to electric cars.  However, most of them have gotten much “smarter” at how much electricity they need and how economically they use it, so the explosion in devices has not increased the demand for power.  Kudos to the engineers involved.  (Frankly, I’m surprised.  I’d have thought the increasing number of electric devices, particularly electric cars and their charging stations, would have had the opposite effect.)

However, it’s also a real problem for all of us for the future.  Basically, new electricity generating plants are paid for by the profits made by electricity suppliers.  (Sure, they’ll usually take out loans or sell bonds to pay the construction costs, but they pay those off using future profits, so it amounts to the same thing.)  If they can’t be assured of ongoing profit (let alone profit increases), sufficient to both pay off old debts and incur (and pay off) new ones, how are they going to afford to replace older, less efficient plants – and those that are simply wearing out – with new ones?  The new technology of electricity generation is supposed to be more efficient and ecologically friendly, but it’s also expensive.

To make matters worse, “green” energy sources such as wind turbines, solar energy, etc. are subject to wind and weather.  If they can’t provide power because there’s no wind or too much cloud, there have to be “traditional” (and expensive) generating plants available to take up the slack.  Alternatively some form of storage (for example, Tesla’s Powerwall) to retain (and later use) power generated during windy and/or sunny periods will be needed.  Such storage has to be paid for by home and business owners, putting the cost burden on their shoulders rather than the generating utility’s.  That’s not going to be popular.

There’s also the issue of what happens when distributed generating systems are affected by disasters.  A hurricane will take down wind turbines, solar panels, etc. in the blink of an eye, and also disrupt power lines bringing in power from elsewhere.  A solar flare might affect such generating facilities, whether domestic, commercial or industrial, over an entire continent, particularly things like solar panels.  What happens if we get used to generating at least some of our power needs locally, only to find those facilities suddenly damaged or destroyed?  Will a distant utility have the reserve capacity to supply our needs, and even if it does, will the power distribution network still exist to get it to where it’s needed?  At present, that’s largely the case.  In future, with the disruption that stagnant or decreasing power demand is likely to cause in the industry, it can’t be guaranteed.

This issue has opened a very large can of worms.  Definitely food for thought.



  1. I don't know about where you live, but over here in the People's Democratic Republic of Maryland, electricity prices skyrocketed when deregulation happened. They quadrupled in three years, and haven't gone down. Their rate of growth has slowed down to a "mere" 10% increase year-on-year.

    I have an all-electric house, of course. And it's been snowing/sleeting for the past 24 hours, with another 3-5 inches of mixed ick expected today.

  2. have not noticed any savings in the electric bill. hope they are saving these 'extra' funds to maintain and upgrade the system.

  3. I met an engineer on a flight that said the limiting factor for the US was the power lines. They were at almost 100% of their ability to push power through the system. No one wants the larger high voltage lines in their back yards.


  4. The city-owned electric company in Anchorage has hiked rates three times in the last two years, to pay for a new power plant which went on line last summer. "Flat demand" doesn't seem to be a factor, here.

  5. We need to harden our power grids. One well placed EMP can shut it down now. The necessary means right now is within the reach of several hostile states, North Korea being in front.

  6. I also knew an engineer and the power grid is often ner its limits for capacity. And that was over 20 years ago, and remains. They keep it stable by managing the hell out of it to redistribute load to match generation. Every time a permanent plant goes down for maintenance it gets harder to do that. I've lived in the north east all my life and one thing that is a constant is the summer crunch, the load exceeds ot matches generation. Occasionally due to failures the load exceeds
    capacity and we get brown out or rolling power failures.

    Yes, the wires are getting taxes and very few new ones are being built due to nimby. The same nimbies that scream if they end up in the dark.

    I've not seen a reduction in the cost of power in the last 40 years.
    Only increases, more increases, and it got worst with a certain company that made it a tradable commodity.

    Sounds to me the utility upper echelon are not make the fat profit and they want more.


  7. LEDs and CFL’s have had a huge impact on energy use. They use about 20% of the power of a regular light.

    And lighting is about 10% of all us power, so huge savings.

  8. I have a hard time feeling pity for the companies. In the past, every time I tried cutting usage to save money, they'd up the price. Plus, they haven'y maintained their right-of-ways for 30 years To skim profits), so every time the wind blows, or the snow gets heavy, the power goes out.

  9. Electric cars are a big problem – not for generation but for the distribution network. Cars pull a lot of amps during charging, and having several in a single neighborhood can potentially overload the neighborhood's capacity. It's the difference between average demand and instantaneous demand, and Queueing Theory says that this is a hard problem to solve.

  10. It was back in the 1960s that we first started to see cordless power tools become common and affordable. Much of that was due to technological advances in the US space industry. The assumption is often that it was advances in battery technology that were responsible, but while that was certainly a factor, the major advances were in the size and efficiency of electric motors. And that could not help but roll over to corded power tools and other devices that incorporate electric motors.
    Electric power is a fungible resource, when generated it must be used or it's lost. Batteries are a poor and inefficient means of storing large amounts of power. So infrastructure must always be built to satisfy peak demand, not average draw. TVA actually went to the trouble of creating a lake on top of Raccoon Mountain near Chattanooga TN. During off peak hours they use the excess capacity to pump water up the mountain into the lake. During peak demand the pumps become generators feeding power back into the system. I've been told this arrangement provides the equivalent of one nuclear electrical generating reactor.

  11. "there have to be "traditional" (and expensive) generating plants available to take up the slack"

    There doesn't "have to be" other means of generating electricity, it's darn nice when there is but that is not mandatory.
    One could just do without when the weather is wrong….

    1. That would be the green way, especially as everything dealing with molten materials freeze solid periodically. You peasants don't need glassware!

  12. Nuclear energy is the cleanest, most stable and most efficient of all energy production sources. The U.S. was making good progress in this area until the communist agitprop "China Syndrome" produced by apostles of communism (Hollywood) and starring their useful idiots (Jane Fonda) stoked a fear in the minds of the ignorant.

    For quite a while France was a chief exporter of safe, clean nuclear-produced electricity to the rest of Europe until the neo-pagan earth-protectionists created a wave of opposition.

    Remember, more people died at the hands of a communist sympathizer in Chappaquiddick MA than did at 3 Mile Island.

  13. Hoover Dam electrical output will be shut down in a few years, due to falling water level. Las Vegas is drawing out too much water. That lake produces 1/3 of their power consumption. (it used to produce all of it) Should be an interesting test of the grid. I wonder if any attempt is being made to upgrade it for the change in anticipated power distribution?

    Hmm, a pretty stark choice, turn off the water taps, or turn off the lights.

  14. Flat demand??
    Only in states with shrinking population.

    That would be…where?

    Electricity provision now is where car-making was in the US in 1960: fat, stupid, and lazy.

    They've gotten so greedy and immobile that it's made people putting panels on their roof a wise investment, and those who add a battery bank have obviated most need for the utility in the first place.

    In electricity, like many other things, the ultimate answer for self-sufficiency and personal economy is going cordless.

    This is what it looks like when a utility cuts their own throat, and acts surprised that no one else rushes to their aid.

    Boo frickin' hoo.

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