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E-M:/ News Release: Overhaul Grid System

News Release                                More Information:
Friday, August 15, 2003                                             Lana Pollack or David Gard

Action Urged On Energy Vulnerability
Leading group calls for overhaul of grid system
The Michigan Environmental Council (MEC), representing 65 Michigan organizations, today urged government officials to enact strong measures—including decentralizing the grid system—that would reduce the state’s vulnerability to massive power outages.

“While we don't yet know the exact cause of the recent blackout, we do know that the problem was able to spread so quickly and widely because of an antiquated electricity transmission system,” said Lana Pollack, MEC President. “The present system is unreliable and leaves us vulnerable to power disruptions, no matter what the cause.”

Pollack, and MEC energy expert David Gard, said the following actions need to be taken to reduce our vulnerability to power outages:

·    Modernize the electricity transmission grid and fix bottlenecks where they exist;

·    Reduce strain on the electricity grid though energy efficiency measures.  For example, reinstate higher efficiency air conditioner standards that were recently overturned by the Bush administration; and

·    Increase grid access for alternative power that is not as dependent on long-distance grid distribution, such as solar, wind and hydrogen fuel cells, and adopt new federal rules that allow such decentralized alternative power access to the electricity grid.
“Thomas Edison envisioned a robust electricity system made up of smaller, distributed generating stations,” said Gard. “We need to recapture Mr. Edison’s wisdom.”

Building more decentralization into our grid by moving toward smaller, more dispersed sources of power would improve reliability by limiting the impact of a disruption to any single source, Gard said.  Having relatively few large plants makes matters worse during a power outage. Each one can take thousands of Megawatts off the system when it trips offline.  

A more decentralized power grid can have important environmental co-benefits in addition to obvious drivers such as public safety and economic security, said Pollack. Among the benefits:

·    Greater efficiency from Combined Heating and Power (CHP), which uses waste heat from power generation for space heating and cooling. By contrast, large centralized power plants discharge waste heat into lakes and rivers.
·    Zero pollution from renewable power such as wind turbines, rooftop solar panels, and biomass combustion. In addition to being clean, these decentralized sources are not vulnerable to disruptions in fuel supply.

Policies That Promote A Decentralized Power System

Net metering: Allows owners of small generating systems to sell excess power back into the grid at market rates. This mechanism removes the financial barrier to build and operate these systems.
It is analgous to establishing a farmers market where people can sell excess produce to the benefit of the farmer and the consumer. There are currently two identical net metering bills before the Michigan House of Representatives (HB 4015 and HB4090).

Renewable Electricity Standard (RES): Requires public utilities to supply a portion of power from sources like wind, solar and biomass. This helps even the playing field for renewables, which must compete against heavily subsidized coal and nuclear power. The U.S. Senate included a RES provision in last year’s energy bill. Also, thirteen states including then Governor Bush’s Texas, have instituted RES.

Energy Efficiency

When overall demand for electricity approaches generating capacity, such as on a hot summer day, even minor disruptions can cause huge cascading shutdowns. This occurs because sensitive equipment automatically trips offline to avoid damage, much like a household circuit breaker opens when appliances draw too much power. Reducing demand makes this event less likely. Therefore, grid reliability can be improved by investing in more efficient buildings, equipment and appliances.  Energy efficiency also happens to be the most cost-effective way to reduce load on the grid.

Policies that promote Energy Efficiency:

System benefit charge: Michigan had this at one time and it should be reinstituted. It enables utilities to fund demand-side management programs for a negligible charge on electricity bills.

State revolving fund: Governor Granholm should establish a revolving fund to pay for efficiency projects throughout thousands of public facilities statewide. Financial returns on these projects tend to be high, so the fund would be kept solvent.

Pay-As-You-Save (PAYS): This novel funding mechanism taps market forces to pay for efficiency projects by linking investors to the high returns delivered by these improvements.

David Holtz
Communications & Development Director
Michigan Environmental Council
119 Pere Marquette Drive, Suite 2A
Lansing, MI  48912
517-487-9539 ext.12 
517-487-9541 fax