FERC’s resilience order may suggest reliability tweaks, rather than novel solutions
The Federal Energy Regulatory Commission has asked stakeholders to identify risks to grid resilience and propose solutions. Stakeholders may be tempted to frame resilience as a brand new problem requiring new market and regulatory responses. But could pre-existing reliability mechanisms get us most of the way there?
In a January 8 order, the Federal Energy Regulatory Commission soundly rejected the notion that, to keep the lights on in regions served by bulk power markets, it was necessary to compensate power plants capable of housing 3-month fuel stores. In closing the docket directed by the Department of Energy’s Notice of Proposed Rulemaking (NOPR), however, FERC opened a “national conversation” about grid resilience. Regional Transmission Organizations (RTOs) have 60 days to respond to questions posed by FERC, followed by 30 days of “reply” comments from other stakeholders.
This docket seems to suggest, at first blush, that system operators should pursue resilience as its own novel concept.
In the new proceeding, FERC proposed that resilience means the “ability to withstand and reduce the magnitude and/or duration of disruptive events, which includes the capability to anticipate, absorb, adapt to, and/or rapidly recover from such an event.”
Resilience is a term commonly used in climate adaptation discussions to describe the ability of a community, industry, or ecosystem to adapt to changing temperatures, precipitation patterns, extreme weather events and sea level rise.The concept has deep roots in multiple disciplines. In engineering, resilience is — as FERC proposes — the capacity of a steady-state system to return to equilibrium after a disturbance. Another more dynamic definition — what some scholars call ecological resilience — references how much outside force a system can take before it changes structure and begins to follow a different, stable set of rules. Drawing on both concepts, economic resilience describes the capacity of an economy to recover or recreate itself after a shock, in ways that mitigate aggregate losses and negative distributional impacts.