The U.S. energy infrastructure needs not just substantial investment for the future but also considerable rethinking about its role and functions in order to be positioned to deal with a rapidly changing energy landscape and evolving threats from cyber attack and climate change.
That was the message from William F. Hederman, Jr., Department of Energy (DOE) deputy director for energy systems and integration and senior advisor to the secretary, who delivered the keynote address to the Electric Power Conference and Exhibition in Rosemont, Ill., on April 21.
Hederman spoke on the day that the DOE is releasing the first installment of the Obama administration’s first Quadrennial Energy Review (QER). He discussed the goals and background of this first-ever comprehensive study of the nation’s energy infrastructure, which identifies the threats, risks, and opportunities for U.S. energy and climate security, with the goal of enabling the federal government to translate policy goals into a set of integrated actions.
The QER, available on the DOE web site, is the result of a Jan. 9, 2014, directive from President Obama as part of his Climate Action Plan.
Hederman said the overarching goal of the QER was to find ways for the administration to “do fewer things at cross purposes and more things that support each other” with respect to energy policy. It came about in part because of a suggestion from now–Energy Secretary Ernest Moniz and White House Director of the Office of Science and Technology John Holdren, who recommended a comprehensive integrated assessment of energy policy while on the President’s Council of Advisors for Science and Technology.
The QER involves more than 20 federal agencies—though the DOE provided much of the staffing and analysis—and will be released in several installments. The first addresses infrastructure for energy transmission, storage, and distribution. The intent, Hederman said was “not to collect dust” but to provide action-oriented recommendations.
Infrastructure was the first subject, Hederman said, because everything else depends on it, and it will need to change as the power sector changes. “The traditional model of making money by selling electricity is unlikely to be the only way going forward,” he said.
That means enhanced focus on a range of challenges: Resilience, reliability, safety, energy security, climate change, and cyberattacks. In looking at all this, Hederman said, “the importance of regional variations came up time and again.”
“We cannot ever think in terms of one-size-fits all solutions.”
Regulatory reform is one of the goals. At the same time, there is “a trend toward reducing GHG emissions,” Hederman said, “We recognize the need for multiple business models.”
Dependence on infrastructure to move energy resources—both electricity and fuels—has grown dramatically even as threats to that infrastructure have expanded and demands on it have shifted substantially. The growth in gas production has had “a profound affect on coal,” he noted, which has had ripple effects on coal transport. That in turn caused challenges to rail transport—of both coal and crude oil. This is a subject the DOE previously spent little time on, meaning the regulatory structure has become antiquated.
Meanwhile, the boom in oil and gas production has meant a rapid shift from import to export, something existing infrastructure was not built to support.
“We are very much supportive of pipelines,” Hederman said, “but they can’t be built as quickly as the volume changes.”
Yet the problems go beyond pipelines and railways.
The QER found that “our waterborne infrastructure is in the worst state of any infrastructure the energy industry relies on,” Hederman said. Likewise, the strategic petroleum reserve—established during 1970s and 1980s energy crises—needs attention and does not work well.
In addressing challenges to the electric grid, Hederman noted that a lot of work is necessary to enhance resiliency. Distributed generation, and especially energy storage will be important. “That is a technology that could totally change the game.” That said, while the DOE is supporting a lot of research and development in energy storage in search of more creative solutions, Hederman noted that “everyone is hopeful, but we’re not there yet. But that is clearly the magic bullet” for the future grid.
Hederman also said that the DOE and the Department of Homeland Security are working very closely with industry to stay informed about cyber threats to energy infrastructure. “The threat is quite serious and it involves nation states as well as other very sophisticated malicious people.” In addition, he said, “the physical activity has picked up,” and they “seem to be more sophisticated than they have been in the past.”
On environmental issues, Hederman noted that climate change was the most important such aspect the QER addressed. However, the most notable finding on greenhouse gas emissions was not related to power plants but rather to those from natural gas transmission and distribution infrastructure. “There is a lot of room for improvement,” he said.
—Thomas W. Overton, JD is a POWER associate editor (@thomas_overton, @POWERmagazine).