Five reasons why Wisconsin avoided deadly rolling blackouts, and how to prevent it in the future.
Here in Wisconsin, we are a hearty bunch. When temperatures drop below zero, some brave Packer fans at Lambeau inevitably shed their shirts, and masses of ice fishermen and women gather on the lakes to drop lines. Even in Madison, winter commuting by bicycle is a time-honored tradition. We do winter well.
But when the polar vortex gripped much of the nation in mid-February, taxing the electric grid and essentially crippling the state of Texas and stunning other parts of the south, we were vulnerable, too. Those who control the power flow in the 15-state region that includes Wisconsin also ordered rolling blackouts (forced outages) in areas as far north as central Illinois.
Our region’s outages were relatively minor and short-lived compared to Texas, where more than one-third of the state’s 12 million homes were without power for several days or more. It turns out it was almost much worse. A report from the Texas grid operator shows the Lone Star State was four minutes and 37 seconds away from total grid failure, which could have caused major infrastructure damage with the potential to knock out power for months.
If the pandemic didn’t offer shades of an apocalypse, the proximity to widespread electric infrastructure failure sure does.
This storm combined extreme cold with subsequent snow and ice that lasted for days. In Texas, the wind turbines were the first to fail when ice accumulated on the blades, days before the storm’s full effect. Some natural gas facilities dropped off next due to lack of cold-weather technology and supply issues, as more gas was diverted for home heating. Even southern coal plants, which are historically reliable, faced operating challenges in this storm. At the same time, the extreme cold drove up demand for electricity, Texas’ number one source of heat, pushing the electric grid to its breaking point.
Texas’ grid operator and state regulators hiked up the wholesale price charged to utilities to the maximum ($9,000 per megawatt hour, or $9 per kilowatt hour) in an effort to incentivize generation and cut back on demand, but it wasn’t enough. As the power went out across the state, people struggled to stay warm, sometimes in their cars. According to news reports, as many as 86 people died from storm-related causes, including carbon monoxide poisoning, hypothermia, and car crashes. When the cold finally lifted, many utilities and consumers were strapped with exorbitant bills they cannot pay.
John Carr, Dairyland Power Cooperative’s vice president of power supply, watched closely as the events unfolded down south. When asked if he was worried about what was happening and how it may affect us here, he didn’t hesitate: “Absolutely,” he said. “Who wouldn’t be?”
But we were largely spared from the impact of the near-collapse of part of the country’s electrical grid. Wisconsin utilities issued alerts to conserve power, but there were no unplanned outages.
No rolling blackouts.
No grid failures.
Here are five reasons why.
#1 – We’re prepared for cold weather events.
This is not our first rodeo. While extreme cold is unusual down south, it’s normal here. What some call a “polar vortex,” we just call winter. And power generators are prepared, too. While southern states prepare for electricity demand to peak in the hot summer, we prepare for cold winters, and generators have technology in place to deal with the icing and freezing that happened down south.
Dairyland Power Cooperative, a generation and transmission cooperative that provides wholesale energy for 24 electric distribution cooperatives and 17 municipal utilities in Wisconsin, Minnesota, Iowa, and Illinois, practices winter weather preparedness all year long.
As a result, according to Carr, Dairyland’s generation plants performed “very well” throughout the cold weather event. “They were available. They were operating. We didn’t run into any significant issues with keeping those resources online and producing power,” he said. “We’re proud of the performance and all of the people that contributed to the preparation—plant maintenance and operations crews, our field workers, our lineworkers. These are the events that we prepare for, and I think their work shined through.”
No amount of preparation can prevent natural gas supply challenges, but Dairyland has plants with dual-fuel capacity, meaning they are able to switch to fuel oil and remain in operation, even during the coldest days when power plants compete with home heating for the natural gas supply. There are only so many pipelines, and home heating is prioritized for the natural gas supply over power generation.
Still, as the natural gas supply tightens, it means higher power costs for power produced from natural gas-fired power plants. These costs are passed on to co-ops and ultimately their members depending on the terms of wholesale power purchase contracts. Wisconsin homes still rely primarily on natural gas for heat, unlike Texas and parts of the south that have transitioned to mainly electric heat as prices have dropped.
Since winter weather crippled the south, could we withstand extreme heat here in the north? Would our infrastructure be able to hold up? Most likely, yes, Carr says, because in the summer we don’t have to compete with home heating for natural gas supply to generate electricity, so resources are more available.
#2 – We are part of a regional grid.
Wisconsin’s electricity generation and transmission grid is managed by the Midcontinent Independent System Operator (MISO), which serves all or some of 15 states and the Canadian province of Manitoba, including southwest Texas to the Gulf of Mexico. This partnership provides stability in the grid, especially since the north and south typically don’t have peak demand for power at the same time of the year.
Texas operates its own grid, managed by the Electric Reliability Council of Texas (ERCOT), which by design is generally isolated from the rest of the country. Texas lawmakers favoring local control have historically opposed regional transmission operations, which made it even more challenging to ensure reliable power during this lengthy and expansive cold weather event.
The importance of a regional partnership was made clear in February because when the available power supply on the grid hits a certain low level, many generation facilities in Texas shut down automatically to avoid critical damage to infrastructure. This created almost a domino effect in Texas, where generation dropped off, and they were left without options to bring in resources since the regional grids were fulfilling their own needs due to the widespread cold.
To complicate matters in Texas, widespread power loss affected gas lines, which need electricity to push the gas through. Quite simply, in some areas there was no electricity to supply gas, and there was no gas to produce electricity.
Soon the water supply was compromised due to power failures and residents were ordered to boil water, which is hard to do if your stove is electric and your power is out. More dominos.
MISO, with access to generation from its full region, including parts of Michigan where power was plentiful, was not only able to manage transmission between the northern and southern states with some relatively brief blackouts, but also worked with the regional groups to the east and west, when possible, to get power to those who needed it.
“By all accounts, the February 2021 Arctic Weather event was among the most extreme weather events that has occurred,” MISO told Wisconsin Energy Cooperative News in a written statement. “Multiple days in sub-freezing temperatures and double-digit snowfall topped with significant ice accumulation in the South Region created significant challenges across all generation/fuel types as well as transmission lines. … MISO’s procedures operated as designed, limiting the controlled outages in the MISO footprint to a handful of local events and a regional event lasting approximately two hours…While the arctic winter weather events were unprecedented, they, like other major storm events, are real-life examples of the significance of resiliency and what is at stake.”
#3 – More coal, less wind.
No one wants to hear it, but coal is largely why power kept flowing during the cold spell here in Wisconsin and across the MISO territory, where coal and natural gas accounted for 75 percent of demand during the peak days. This was after all possible generation from wind, solar, hydro, and nuclear was maxed out.
In the weeks leading up to the polar vortex, ERCOT’s power supply was made up of 25 percent wind generation, as Texas is the nation’s number one producer of wind energy. From February 9–18, it dropped to 8 percent. MISO’s data is similar.
Dairyland Power continues to add renewable energy to its portfolio, including with the Tatanka Ridge Wind Farm in South Dakota (top), which came online earlier this year. However, baseload generation from the J.P. Madgett coal-fired plant in Alma was still instrumental in keeping power flowing this February.
In fact, Dairyland’s John P. Madgett (JPM) coal-fired power plant in Alma broke gross daily generation records twice during the cold spell, on February 8 and again on February 17. All of Dairyland’s three baseload units (JPM, G-3, and a share of the Weston #4 plant) ran at peak output for multiple days. For a stretch of days when we needed it most, coal was king.
“The sun doesn’t always shine; the wind doesn’t always blow. Natural gas requires a steady supply. Coal is dependable because it is on hand,” Carr said. “The industry has retired a lot of coal-fired plants in the past five years, so during this event, the remaining plants were working harder to meet demand. MISO, the upper Midwest, Dairyland, we were all leaning very heavily on the coal units during that very cold stretch.”
#4 – No “retail choice.”
Texas and 17 other states offer “retail choice,” or what some call “customer choice,” which means consumers choose who they get their retail power from, the same way you can choose your internet or cable/satellite TV provider. The idea is that more competition and less regulation drives down cost, but that has not proven to be the case. Especially this time. Wisconsin is not a retail choice state.
Power generators, such as Dairyland, offer up their power to MISO for a specific price per MWh. MISO accepts offers utilizing the lowest-cost resources first until they meet their forecasted energy needs. Generators have incentive to keep their price low, or they may miss out on selling power. But during the extreme cold ERCOT’s prices were inflated to the maximum of $9,000/MWh in the hopes of increasing supply and lowering demand to protect the grid, up from about $20.79 per MWh in the weeks before the storm.
MISO’s price cap is $3,500/MWh, but it didn’t come near the max. When ERCOT was charging $9,000/MWh on February 16, MISO’s price was $252.40, still higher than normal, but nearly not enough to cause utilities to fold.
In Texas, two generation and transmission cooperatives were hit especially hard. Brazos Electric Power Cooperative, the state’s oldest and largest power cooperative, a robust company with an A to A+ credit rating, filed for bankruptcy protection in the days following the storm, citing $2.1 billion in “disputed” debt due to the wholesale power costs.
Rayburn Electric, a north Texas co-op that serves 225,000 customers, said its weekly power costs also soared. Residential customers who typically pay $150 per month now have bills topping $3,000 for February.
The February cold crisis exposed a more significant problem with “customer choice” for those who chose wholesale rate plans. Some customers selected companies like Griddy Power, which doesn’t generate power, but essentially serves as a middleman, buying wholesale power from the ERCOT market and selling to customers at cost, plus $9.99 per month. Following the February storm, some consumers reported their bills skyrocketed to as much as $17,000 for just a few days. ERCOT then suspended Griddy from participating in the market, and Griddy also filed for bankruptcy protection.
“These customers are left to the mercy of the market,” said Mike Wade, president and CEO of Central Wisconsin Electric Cooperative. “Our members have some exposure to the market and higher-than-average fuel prices, but not to the extent of customers in Texas who have chosen a full market rate.”
“Deregulation is the cause of the situation with high bills in Texas,” said Robert Cornell, manager of Washington Island Electric Cooperative. While Wisconsin co-op members have built-in protections due to conservative management by leadership and boards, Cornell says severe weather events still lead to losses at the utility or to increases in rates or fees, but nothing like they are facing down south. In this case, everything really is bigger in Texas.
#5 – Cooperative model.
According to Dairyland’s Carr, the cooperative model drives the ability to provide safe, reliable, and affordable power.
“This is where the cooperative business model shines,” he said, reflecting on the synergy created among members and co-ops that leads to the thoughtful planning that protected our power supply during this extreme event. “Our members (distribution cooperatives) and their members, in turn, have a voice. We encourage them to be involved, get engaged, and to be part of the process, and they do. That’s what sets us apart and makes us successful.”
Could it Happen Here?
One thing is certain, what happened in Texas and much of the nation is evidence of the challenges the power industry is facing as we move toward a more carbon-free future.
“This is a significant time, a time of transition in this industry,” said Carr. “We are moving away from coal and relying more on renewable energy—wind, solar, battery storage—as well as natural gas. They will be filling more of that demand in the future, and in our view, that’s a good thing, but it’s also more reason to make sure that our forward actions are done in a thoughtful, planned, deliberate way.”
Going forward, the Texas power crisis has helped shed light on how to best plan for a future with reliable power as we transition to more renewable energy, including:
- Improved storage—Currently, once power is generated, it has to be used. For the most part, commercial storage is still not a viable option, but it is in the works. Washington Island’s Cornell said they looked into power storage and found the amount needed to power the island for 10 minutes would cost $1 million. Wisconsin’s first “large-scale solar-plus-storage” facility under construction in Kenosha County will offer enough power backup to last…four hours. Some Texas customers were without power for weeks. “Storage is something we are looking into ourselves,” said Carr. “I think the technology shows promise, and like wind and solar, the price will come down over time.”
- Investments in transmission—With the transition to more renewable energy, more high-voltage transmission lines are critical to increasing reliability, particularly to ensure generation in wind-rich areas can reach other parts of the region.
- Continued investments in natural gas to support intermittent renewable resources, which means to make sure the power stays on when wind and solar can’t keep up. Natural gas plants must be able to quickly ramp up or down to accommodate renewable energy as it happens, and “dual use” plants allow for fuel oil as a backup when the natural gas supply is needed for home heating.
- Cautious, conservative plans and realistic expectations of wind and solar as technology evolves.
Without a thoughtful, planned, deliberate approach, could what happened in Texas happen here?
“I want to say no, but I am reminded of the saying, ‘Never say never’,” Carr said. “We prepare for events like this. We plan for it. We’re used to it. But never say never.”