Keeping the Lights on: Adapting the Electricity Grid to Climate Change

Our panelists discuss recent climate-related effects on the electricity grid, including defects of the current system and how the U.S. government and the private sector can better adapt the electricity grid to withstand climate change. 

GOODMAN: Welcome, everyone, to today’s Council on Foreign Relations Renewing America series, “Keeping the Light On: Adapting the U.S. Electricity Grid to Climate Change.”

I’m Sherri Goodman. I currently serve as the secretary general of the International Military Council on Climate Insecurity. I’m the founder of the CNA Military Advisory Board that characterized climate change as a threat multiplier some fifteen years ago now. I’m also a fellow at the Woodrow Wilson Center, and I’m very pleased to be here today with three great panelists for this discussion. This meeting is part of the Council’s Renewing America series, which is made possible by the generous support of the Bernard and Irene Schwartz Foundation.

I’m going to engage our panelists in discussion for the first half hour and then we will open it up for questions and try to get as many of you in as possible. So let me quickly introduce our three panelists and we’ll go right to the discussion.

So, in alphabetical order, we have Dr. Carolyn Kissane, and she’s the academic director of graduate programs in Global Affairs and Global Security, Conflict and Cybercrime at NYU Center for Global Affairs, and at NYU University she also directs the Energy, Climate Justice, and Sustainability Lab. She’s got many teaching awards. She’s been recognized for her leadership both in clean energy and climate and in teaching and throughout New York, and we’re very pleased to have Carolyn here with us.

Second, we have Connie Lau, who has had a most distinguished career as president and chief executive officer of Hawaiian Electric Industries, which is the parent company of HECO, Hawaiian Electric, which provides electricity to almost all the state of Hawaii. She serves in many other capacities. She’s also very involved with the—she chairs the National Infrastructure Advisory Council and is a member of the Electricity Subsector Coordinating Council, which connects the federal government with the electricity—electric utility industry. So she’s also deeply connected in this space and has quite a lot of leadership ability.

And last but, certainly, not least, my dear friend, longtime colleague Dan Poneman, who currently serves as the president and chief executive officer of Centrus Energy, a nuclear fuel supplier, and also previously served as deputy secretary of energy, many other positions in past administrations, and has written many excellent books, including a book on the existential threats of nuclear and climate change and energy, and really has so much deep experience and wisdom in this space.

OK. Let’s get right after it.

You know, so we’re here today talking about the electricity grid, which is something that probably a few years ago we would not have been talking about at the Council on Foreign Relations, let’s just say. So we know now that we have many challenges from the Texas, you know, freeze of last year to the wildfires to Colonial Pipeline.

We’ve got many threats, climate-fueled cyberattacks, potentially deliberate attacks, on our increasingly fragile and overcrowded national electric grid, which is really three grids. But Connie would probably say there’s the fourth one because Hawaii is not part of that national grid which includes the Western Interconnect, the Eastern Interconnect, and then Texas as its own interconnect. Well, I guess we have Alaska outside that as well.

So I’d like to start with asking each of you to share with us what you think are the key challenges with the electricity grid today, and why is this a matter of national concern in national security?

Carolyn, would you like to lead off, please?

KISSANE: Well, thank you so very much, Sherri. Thank you so very much for the warm introduction and many thanks to the Council on Foreign Relations for hosting today, and I am deeply honored and privileged to be doing this with Connie and Dan. It really is just so fantastic.

So, I mean, Sherri, you highlighted, right, you know, we—there’s so much uncertainty with regards to climate change and how we have looked at the past is not how we can look at the future. So I think when we’re thinking about the grid, which is the backbone of so much of our critical infrastructure in the United States, it’s really the backbone of national competitiveness and economic growth and so without a reliable resilient grid we have threats to that competitiveness.

And, you know, the U.S. and, I think, you pointed out, the grids that we have have withstood. I mean, they are such a testament to U.S. ingenuity and innovation and—but we are putting more demands on it. The demands are coming both from climate uncertainty, so the climate of today and the climate of tomorrow looks different than what we’ve seen in the past. But we’re also working towards net-zero, right. So we’re building in a lot more renewable energy technologies and it’s how prepared are we for all the changes that are taking place.

It’s also important to highlight the fact that this is—a lot of our infrastructure is older. It’s aging infrastructure. So how do we upgrade? How do we make the right investments so that we continue to have a resilient, reliable grid, and you pointed out Texas, which is, I think, for most of us is the most sort of recent memory of a grid failure, which, you know, almost 5 million people were without power for multiple days and I think it sort of shed light on the challenges of preparing for more extreme weather. In the case of Texas, this was extreme cold but in the case of California in 2020 it was extreme heat. But we’re also looking at flooding and so many other things. So I’m really excited to be part of this really important conversation.

Thank you.

GOODMAN: Well, and, Connie, over to you in a state that has over the last decade put a lot more renewables on its grid and you’ve been at the forefront of that. So perhaps you could address those challenges as well as the general.

LAU: Right. Happy to do so, Sherri, and also my thanks to the Council for putting this panel together, and so much fun to be with Dan again and to meet Carolyn on this panel.

You know, I think you really put it right, Sherri. You know, why are we meeting on this today? And when I think about our industry, we have always had to defend the grid, primarily against weather events, and, as we know, the weather events have gotten more and more severe.

Typically, they’ve been regional and so we’ve had regional mutual assistance groups and that’s worked extremely well to keep the grid up, where we all help one another. But as we saw, starting with Sandy, those weather events are getting more and more extreme. They’re getting bigger and bigger and they are beginning to strain the systems.

I think that the industry actually has done well in adapting to the extreme weather events. But as they grow bigger and bigger, it is very important to include other parties in the conversation. For example, Carolyn mentioned the wildfires in the West. You know, there’s so much more now that utilities cannot control just themselves and so we have to work very closely, for example, with the Department of the Interior on forestry and those management practices.

So that’s one of the reasons why, from a national security perspective, it becomes ever more important because also, as Carolyn said, oftentimes we refer to electricity as the most critical of the critical infrastructures. So everything else depends on the grid.

The other thing that’s happened—and you mentioned this, Sherri—is as we move more and more towards the clean energy transition, adding more renewables, the technologies around generation have changed significantly so that they are becoming much more distributed. We’ve moved away from the old central station generating plants and more and more to distributed energy and also many more generators.

So, for example, even in Hawaii, we have about ninety-thousand rooftop systems and so we’ve got ninety-thousand individual generators on our system and, you know, you need technologies to be able to control all of that.

The digitization that has been sweeping all industries is sweeping the electric utility industry as well, and so what’s really changed from the past, in my view, is not only have weather events become more extreme, but also now you have the complication of those cyber threats and those cyber threats don’t know any bounds.

They don’t know state boundaries. They don’t know regional boundaries. They could, potentially, hit the grid across the nation all at once, and you’ve seen it with some of the cyberattacks like Microsoft Exchange or SolarWinds where they’re looking at attacking platforms that are, you know, hundreds of thousands of users on those platforms.

So that’s what’s really, really different about the increase in the threat to the grid and the recognition that the grid has gotten more and more critical as more and more things have gone to be connected to the grid and as we have looked to electrify the entire economy to help with climate change.

GOODMAN: Well, thank you.

And Dan, you have such deep experience across all of these areas from cyber to nuclear and beyond, and perhaps you could share with us what keeps you up at night when thinking about the challenges to the grid today and about what the next failure or disruption might be.

PONEMAN: Well, first, Sherri, thank you to you for moderating the discussion and your leadership in our field and thanks to the Council for hosting this timely discussion, and I’m delighted to be back with Connie outside of the ESCC and to meet Carolyn through this session.

So it’s a little hard to enhance—I can’t enhance. Let me see if I can complement what Connie and Carolyn said. So when you think about what we just heard from Carolyn and Connie, and Connie said it very well, you’re facing broad systemic challenges and they’re getting worse. And I’m reminded—I’m sure he must have been a Council member—of Dean Acheson’s famous line he turned into the title of his book Present at the Creation, which was a quote from Pope Pius XIV or something: If he had been present at the Creation, he would have had some useful hints to the Creator.

We have a system, loosely put, that isn’t really a system. You mentioned there’s the Eastern and Western Interconnect. There’s ERCOT. There’s a bunch of balancing authorities. We’ve got six million lines of transmission and you have coordinating councils, you’ve got ISOs, you got RTOs, and to have a coherent systemic response facing the kinds of challenges that my colleagues have described, that is a tall order, indeed.

One other aspect. It’s not only that the threats are getting worse but many of the things that make our life better create a whole host of new vulnerabilities. A smart grid is a wonderful thing and it’s great to have all of the things—I remember when Sam Palmisano was first talking about you’ll be running your whole life off an iPhone. Well, every new functionality that we achieve through cyber means is a new threat edge to be exposed to possible disruptions.

So what keeps me up at night? I have to confess that I’m still obsessed by the things I worried about when I worked in government at the Department of Energy—and I think Connie alluded to this—basically, to paraphrase E.M. Forster, everything connects and everything connects especially to the electricity grid.

So what keeps me up at night, except when I want to think of it might be a good Hollywood screenplay, is one of those black sky events in which you, you know, lose electricity on a massive scale—hospital operating rooms shut down, communications shut down, financial transactions shut down. You would sow panic and havoc, you know, across the whole nation and, potentially, beyond, because I remember when we used to do those very hair-raising exercises in government. My conclusion was the bad guys propagate their malware literally at the speed of light and we call a meeting. And there was a time in which we had multiple national labs actually attacked in the same period of time that didn’t even know that each other were being attacked by the same virus.

So the question what keeps me up at night is when we—and it’s a when, in my view, not an if—inevitably face some kind of be it natural or human-driven breakdown of that dimension, and it doesn’t take that great of a leap of the imagination when we think back, you know, New York in 1965 and Ohio in 2003—this is not fanciful—will we be resilient and will we be able to both cope, will we be able to deflect the bad things happening and will we be able to be resilient and respond effectively when that moment inevitably comes? And, you know, I have to take my hat off to Connie and others who’ve worked so hard on this through the ESCC.

One last thing I’ll say as maybe a segue to your next set of questions, since so many of these critical infrastructures are owned privately and since the level of investment, even by federal budget terms, is so vast, I think we have to really think creatively about how to leverage public policy tools in a way that we incentivize the right kinds of investments in resilience so that when that black sky event occurs we will not be rocked back on our heels but we will be able to respond effectively.

LAU: To add on what Dan just said, so, you know, it’s really interesting because when, Dan, you and I first met on the ESCC—and every other year there’s this big exercise called GridX in our industry—when I first started, it used to just be the electric utility industry.

But over the years, you know, as Dan described, Carolyn has described, the grid has become sort of the connector for so many additional parties and there’s so many more participants in making sure that the U.S. has energy today that what I worry about is actually exactly the same thing that Dan talked about, that there are so many different players now that no one entity can control everything.

And so it’s really, really important for both the private sector and, you know, when you think that 70 (percent), 80 percent of the critical infrastructure in the nation is owned in private hands and state and local, you know, if you’re talking about federal policy you really have to now think much more holistically about how do you incent these private sector parties and state and local governments? How do you enable them to make the investments that Dan was talking about in order to make the grid much more resilient?

And if we don’t, we all have already talked about what the consequences of that are with the whole nation’s economy being dependent on that health and safety of people. It’s pretty serious if we can’t keep that grid up. So that’s my biggest concern, that we all have to figure out all these ways to connect different networks where you’re not getting together for the first time when an event is occurring but you actually are working together on a continual basis.

And, frankly, when you think about cyber, these cyberattacks are coming in constantly. Even as we sit here, I’m sure there’s somewhere that’s being attacked. And so we have to have continual communication and the ability to activate these networks almost instantly.

GOODMAN: OK. So that’s great, Connie and Dan and Carolyn. So we spent the first fifteen minutes kind of identifying some of the problems. Let’s talk about the—some of the solutions to grid resiliency. You’ve already talked about one of them, which is the improved coordination of this multi-hydra-headed system with various components, and that’s a piece of improving resiliency is having the communications across the sector.

Talk about how well that’s working but then also—and I’ll turn to Carolyn next so and you’ve been there at Ground Zero, you know, in New York from 9/11 to Superstorm Sandy getting ready, you know, preparing for the next kind of dangerous event of this type.

What are the—in addition to the coordinating systems, which we hope can move at the speed that the crisis requires—that’s one question. And then the other is what about the technologies and the new innovations coming onto it from micro grids and storage? How well is that working and what—how is that working, particularly in your New York region? Then we’ll give Connie a chance to talk about Hawaii.

KISSANE: Sure. Thank you. And yeah, Dan and Connie just outlined, you know, so many things and I’m kind of thinking maybe I won’t be sleeping that well tonight.

But, you know, in terms of thinking about New York, I mean, New York is also an interesting case for the rest of the country. We have very ambitious targets for what we want to do and create in terms of creating greater energy efficiency, how we want to decarbonize our grid, how we want to bring in many more renewables.

We are looking at nine gigawatts of offshore wind. you know, but I think it’s also we have—we’re also encountering some problems about prioritization and what that’s going to look like with how we also balance being prepared, meeting decarbonization goals but also being—having a reliable grid.

You know, we recently shut down Indian Point Power Plant, which, you know, I think nuclear is a very controversial subject when it comes to the grid. I would argue that it’s an important component in decarbonization and I think, you know, California—I’m going to move a little bit from New York now to California—but, you know, California is in a position to sort of reevaluate the decision to shut down the Diablo Canyon nuclear power plant.

And I think they would be wise—it may not be PG&E that keeps it open, but it would be wise to keep—to keep it open because I do think that where you have firm generation, taking it off before you have enough built-in renewables, before you have, you know, the transmission, I think one of my big areas that I spend a lot of time thinking about are transmission lines.

You know, as we build more renewable energy and more generation into our mix are we also building the required transmission lines to move that renewable energy to the population centers and to—so that the supply is meeting the demand. And I think there’s just a lot of challenges around any kind of new infrastructure build.

So here we’re talking about the grid and whether it be a power plant, whether it be even onshore wind, or, you know, a transmission line, it can be very controversial. It can take years to get the necessary approvals. So that, to me, is of concern when we’re thinking about solutions.

From someone who sits at a university, I am moved by the degree to which universities are investing time in researching this and, really, sort of thinking about different scenarios about how you build out a net-zero system, how do we go from, you know, where we are to, potentially, increasing electrification by 40 percent, even doubling our current electrification.

I think what, you know, Connie and Dan have outlined in terms of the, you know, Internet of Things, the connection to the grid on so many different fronts, so how do we balance all of the new technological innovations with both the infrastructure that we have as well as the infrastructure that we need and how do we prioritize the investments. So I’ll kind of leave it at that.

But as someone who was here not only on 9/11 but also in 2003 where we had a cascading blackout—a series of blackouts on the Northeast, was not necessarily weather related but, clearly, we saw the impacts of what that feels like. We were luckier than, for example, in Texas where it didn’t happen in the middle of the winter where it was, you know, below freezing.

But I do think we—you know, we have to be sort of preparing for the events that we didn’t necessarily think—the weather events that we didn’t anticipate that we would have in the past.

GOODMAN: Dan, talk to us about nuclear, both existing nuclear, new nuclear, and micro grids and distributed systems.

PONEMAN: Well, it’s a very important point that Carolyn just raised and let me just riff on that situation, just to show on the climate side why we have to worry so much about this.

According to the Energy Information Administration, in 2011, California got 53 percent of its electricity from clean sources, and then after seven and eight years of pushing very hard on wind and solar renewables with a great commitment to go green, they now obtain 53 percent of their power from clean sources because what’s getting knocked off the grid is nuclear and hydro.

So this is replicated across the world. We’ve invested $2 trillion in renewables and made tremendous strides in renewables. Unfortunately, we’re just having one form of clean energy displace another and the fossil keeps growing. So that’s point one.

Point two. In terms of resilience, nuclear has, like, an incredible role to play. When I was in DOE we suffered the 2014 Polar Vortex and I had screaming members of Congress from Minnesota and, thank goodness, you know, the nuclear plants kept running because we know what happens when the coal-fired plants and natural gas plants shut down. Hurricane Harvey in Texas a little later was the same story.

So if you care about the combination of resilience and always-on 7/24 reliable power and also clean, you have to be interested in nuclear. And I was part of this National Commission on Grid Resilience last year and we issued a report. I’m sure we can put it up. I don’t know how to do these things.

But and we said one thing you want to do is—and I also lived through the whole Superstorm Sandy thing—it would have been swell if we had had micro grids as a test bed for how these whole systems could interact. And it’s not just the power generation. It’s the, as Carolyn said, the transmission lines, it’s the distribution and how they are integrated, and if you need firm dispatchable power for really reliable needed base load, nuclear is the clean answer.

Batteries are not sufficient for the long-term needs. They’re not economic yet. And so I think there’s a real promise to find a way through nuclear investments that you’re going to—and I think there’s no dissent in terms of the Intergovernmental Panel on Climate Change, the International Energy Agency, the doubling we need to see of nuclear by 2050 to achieve net-zero. And I won’t even call it a cross benefit. I would say its essential aspect of that is the resilience that it brings with it.

So I think the last thing I’ll say on that, Sherri, is that you can think about these micro grids in a couple of different ways, one, from a straight national security perspective, going back to your DOD experience. For military bases that absolutely must run you need islanded micro grids that no matter what happens to the rest of the grid they keep on running.

And I would add to that, for example, the big supercomputers in the DOE system—I think both Secretary Dabbar and Secretary Koonin are on the line—those are also very good candidates, and I would note in the DOE lab system you have a great test bed at Idaho where they actually have lines up. I’m sure my colleagues have been out there.

But the second way to think about micro grids is not only as a set of islands but also as enhancements of the grid reliability on the macro grid. So, God forbid, something should happen on the macro grid, if you have a micro grid that’s isolated and has an ability to continue functioning and is looped to the macro grid, you have a backstop and that provides some safety and some insurance policy.

So those are the reasons why I think, you know, frankly, if we intend to meet either our climate goals or our resilience goals that nuclear reactors and particularly the advanced generation of nuclear reactors which can be built—you know, factory built and deployed in much smaller units have a lot of benefits to recommend them.

GOODMAN: Thank you so much, Dan.

And, Connie, last question before we open it up to the audience—to the membership here, which is you’ve been at the forefront there at Hawaiian Electric in integrating advanced climate risk analytics into how you operate your system there.

Can you explain how that works, why it’s important, and why having a more downscaled assessment of climate risk at the local level enables you to improve the resiliency of the grid?

LAU: So if you think about our islands they’re volcanic and so they come almost straight up out of the ocean, and so we actually have a number of microclimates around this state. You know, for example, the Big Island of Hawaii has thirteen separate microclimates. And so we have to be much better when you’re relying on things like renewables, the solar, where the—how the sun is hitting, whether it’s coming behind a mountain, what about the winds that are coming across the Pacific.

And so it’s been really important for us to work with some really state-of-the-art companies that have been developing technologies to do much better weather forecasting and also do it on a micro level, because most of the forecasting models are, you know, very large scale but for us we need that very specific forecasting.

And, you know, back on the DOD, of course, you know, Hawaii has the most stars outside of the Pentagon because of the Indo-Pacific Command here. So we are very, very focused on keeping the grid reliable.

And, Dan, you might remember we built one of our power plants on Schofield, on Army property, and now we have taken over the privatization of the distribution system. So that’s all moving towards making the DOD much more mission ready but also helping the community out in its goals to be resilient overall for the state.

So really, again, those partnerships, Sherri, are so important.

GOODMAN: Yeah. And I want to thank you, you know, on behalf of—I can’t officially speak for the Department of Defense but I know how thankful the military is since it does rely so heavily on power from the local community in most cases, particularly in Hawaii, but needs, obviously, to be operable 24/7 for critical military missions, that you’ve worked so closely with them.

And the performance standards the military has adopted in the last couple of years—you referenced them, Dan—of being able to operate two weeks for mission critical bases when the power goes down has led to these black start exercises which, in their own ways, become technology adopter innovators and draw in this innovative technology to improve advanced micro grids, smart grids, climate risk analytics, and other sets of tools, which I’m sure we’ll see more of.

OK. We’re now at 2:30 and I want to open it up to the membership for questions. So now I know Laura will give us the—call about how to—how to ask the questions, and over to you—over to you, Laura. I’ll remind you that this meeting is on the record. So we’re going to invite our members to join to the question and answer period now.

OPERATOR: (Gives queuing instructions.)

We’ll take the first question from Paul Dabbar.

Q: Connie, Secretary Poneman, good to see you.

I’m going to ask a somewhat legal question. Obviously, NEPA and court precedents of NEPA over three years, so decades, have now created ten-year reviews for ten miles of roads and, obviously, creating transmission lines and so on. In New York, for example, in the Hudson line, two governors tried unsuccessfully to get any siting done.

There’s long lists of other examples of the environmental impact statement. Honolulu Transit, you know, that’s quite hard to get done, to put it mildly. And I know CEQ tried to try to make it a bit easier and tried to mandate, you know, things to be at least reviewed in twelve months. Not to say it’s going to get approved or not.

Do you all think that some sort of NEPA review—sorry, reform law might be helpful or any other approvals—you know, changes so that we don’t have, you know, ten years for ten miles or things like that before people could actually try to see if something’s going to work or not?

LAU: So—

PONEMAN: Connie, do you want to go first?

LAU: (Laughs.) Actually, Dan, I was going to throw it over to you but—

PONEMAN: Oh.

LAU: But let me—why don’t I give it a slightly different perspective, Paul, because what we have found in Hawaii and, you know, you mentioned our rail system, but even H-3, our highway system, I don’t know, thirty years ago took fifteen years to build.

And so one of the things that we have found is that you’ve got these competing policy statements, you know, and this whole meeting has been about climate change and Hawaii was the first state to go to 100 percent renewable generation. But then we have limited landmass and it’s needed for things like affordable housing, making sure that we have a good water supply.

And so what I think is actually really, really important, Paul, is for policymakers to step up and make sure that when they’re thinking about, you know, their particular passion that they think very holistically and bring all these other competing policy issues onto the table so that they can be balanced up front and a policy designed that actually will try to balance as best we can but then allow things like the permitting to go forward.

And another piece that’s critical to that is the voice of the public. I don’t think any of us can do anything today in isolation. You have got to listen to the voice of the public and with—we all know with social media and everything that voice has gotten incredibly strong. So that’s kind of my comments on that, and I’ll let Dan talk about creating the policies.

PONEMAN: Well, thank you. Thank you, Secretary Dabbar and Connie.

I would just add it goes back to the experience I had in government where, as I said, the bad guys propagate at the speed of light and we would call a meeting. And, look, nobody’s going to outflank anybody on this call in terms of our dedication to the preservation and protection of the environment, full stop.

Sometimes it is assumed that, you know, longer is better, longer is more thorough. That’s not necessarily true. If we are facing an imminent danger, and I believe we are, I think it behooves us to act with some dispatch, and I think there’s probably no place in government that we could not do better. I know right now, for example, the Nuclear Regulatory Commission is undergoing a thorough internal review about how to expedite licensing without sacrificing safety.

So I think that there are ways to do things, like in all things, better, smarter, faster, that fully protect the mission that must be protected in terms of our, you know, responsibilities to the environment, but also acknowledge that the threat that we face is large, urgent, and potentially catastrophic and that we cannot, frankly, you know, take forever to start to put things in place.

So it’s not a super neat answer, Paul, but I think it’s kind of the reality. I think you can, and I—certainly, when I was at DOE tried to do that with the internal safety regulations that we did and to sort of scrape down and say what really makes things safer and better, and I think that same kind of mentality can help us get to a more efficient process. I think all processes are probably susceptible of significant improvement.

GOODMAN: Laura, do we have another question in the queue?

OPERATOR: We do. We’ll take the next question from Chloe Demrovsky.

Q: Hi, everyone. Chloe Demrovsky, president and CEO of Disaster Recovery Institute, and I also work with Carolyn over at NYU.

So I would say that—I would contend that sustainability and resilience goals are sometimes at tension—in tension with each other. So we talked about the drive towards denuclearization, which picked up steam after Fukushima, and then we’re talking about the importance of the grid. But if we move to electrify even more things like heating systems, cooking gas, cars, does that create even more of a reliance on the electric grid that during—that creates a single point of failure?

So I’m curious for your thoughts on this, and how do we resolve this tension? Thank you.

GOODMAN: Carolyn?

KISSANE: Thank you. Chloe, hi. Thank you so much for joining. Chloe is an amazing professor. So I just want to say that for the audience.

I think it’s really hard, Chloe. I think as we, you know—and I think we’re not just increasing electrification, we’re increasing—you know, we’re increasing the amount of renewables because we are—you know, we are on a path to net-zero and I think that kind of goes back to some of the comments that Dan made. You know, how do we sort of balance firm generation that exists, that we can kind of decarbonize?

Like, I mean, nuclear is already noncarbon emitting, but with natural gas I would put forward an idea which comes out of Princeton as well in terms of when we’re looking at electrification and much more increased electrification is that we are thinking about carbon capture or we’re thinking about ways that we don’t necessarily strand all of our fossil assets, natural gas, I think being an important one because that is newer than—for example, coal should be put to rest, in my opinion.

But I think there are some challenges as to how we do all of this while at the same time keeping resiliency and reliability in place. So you gave the example of Fukushima, right. I think, you know, you look at a country like Japan or even a country like Germany right now, which does not have its full nuclear load as part of its mix.

You know, Germany is probably half a year away from being completely offline with all of its nuclear but they have had to increase their natural gas and they have had to increase, you know, some of their fossil-based energies to support their system. They’re building—you know, they built Nord—they’ve been part of building Nord Stream 2. Counterfactuals, if they hadn’t shut down their nuclear, hadn’t made that decision, would they be building Nord Stream 2?

So I think, again, it’s like prioritization and how do we achieve these really robust, very important and necessary sustainability targets in addressing climate change but doing so in a way that doesn’t put us at a disadvantage in terms of reliability.

So I don’t think there’s any—and again, I would go back to Sherri’s initial point about that we don’t just have one grid. You know, we have three interconnections and then you—of course, you have Hawaii and Alaska, and you have geographical differences, you have operational differences, that all have to be taken into consideration.

So it looks different depending on where you’re at and I would just kind of leave it at that. And I’ll hand it over to Connie and Dan to finish.

PONEMAN: I see there’s so many questions.

LAU: (Laughs.) OK. I’ll give a short answer in this one, I think. Carolyn, your point about the regional differences is so important because, you know, zero emission looks radically different up in the Pacific Northwest, where you have the hydro assets or you still have nuclear assets that are in play.

What I’d say is that I think you have to make sure that you keep all the technologies on the table because of those regional differences. You don’t know which technologies are going to be the most efficient for what uses.

So take, for example, electrification of transportation. It’s likely that the most efficient for light vehicles or passenger vehicles is going to be electricity but for long-haul trucking that could very well be hydrogen. And so very important to keep all of those technologies in play and to just keep working towards identifying which ones are going to kind of be the winners for decarbonizing which part of the economy.

GOODMAN: Great. Thank you.

Laura, why don’t we go to the next question now?

OPERATOR: We’ll take the next question from Patrick Duddy.

Q: Good afternoon. I’m finding this really fascinating. I’m calling from Duke University but I’m a retired State Department officer and at one point handled the Office of Economic Policy for the Western Hemisphere at State.

My question is informational. What percentage, presently, of the U.S. grid or the three major grids depends on conventional generation and how much of that conventional generation is domestically sourced?

GOODMAN: Dan, over to you.

PONEMAN: I’ll take a crack at that. So it’s changed, you know. For years and years, in my relative youth, it was 50 percent coal, 20 percent gas, 20 percent nuclear, and 10 percent everything else, of which 7 percent was hydro. Now—and Connie’s probably more up to date, or Carolyn—I think coal is down to about 20 percent. Natural gas has picked up the slack.

Nuclear, even though it’s a smaller percentage of the installed base because its availability factor is so high, is still producing, like, 19 percent, almost 20 percent, and, of course, what’s really come up a lot to the point of 10 (percent) or 13 percent is intermittent sources such as wind and solar.

And as I’m thinking about it, well, you know, of course, we were fortunate, and again, with my former colleagues, Messrs. Koonin and Dabbar, we used to depend a lot when we—we haven’t burned oil for electricity in a meaningful degree for a long time. But I would say, as I’m thinking about the nuclear is domestic, the coal is domestic, the natural gas is domestic, and wind and solar, I think, is pretty much domestic. But I would stand to be corrected by my colleagues.

KISSANE: I would give you an A, Dan. I thought you really sort of hit the also historical in terms of where we are, and natural gas has displaced the coal, right, in terms of where coal used to be. But the majority of it is domestic. There is some, you know, exchange between Canada and the United States. But hydro, for example, like, in the Northeast we get hydropower, in fact—

PONEMAN: Right.

KISSANE: —from Quebec, but the majority, I would say, on the power electricity side is, in fact, domestic.

GOODMAN: So—

LAU: Yeah, and I would just agree.

GOODMAN: You disagree, Connie?

LAU: No, I agree.

GOODMAN: You agree. OK.

LAU: Yeah.

GOODMAN: Well, let me ask—so let me—that was an interesting question because it looked from the past to the present. But now let’s look to the future where one of the big challenges is how do we get more storage of the renewable sources.

So let me ask you all to predict, you know, five to ten years hence. Are we going to be able to have more storage of renewables to offset the current intermittency or are we looking at, essentially, providing—you know, continuing to provide, you know, base load power primarily through existing sources and the renewables primarily only on an intermittent basis?

PONEMAN: Well, I’ll—

LAU: So, Sherri—

PONEMAN: Sorry.

LAU: Go ahead, Dan.

PONEMAN: No, I’ll take a stab at that. This is something I think we all look at a lot. There’s a really interesting and very, very good book by a scholar named Varun Sivaram—he’s actually a senior advisor to Secretary Kerry now—called Taming the Sun, and he’s looked pretty closely at this. And there’s been a robust discussion, as you reflect in your question, about whether you can go to all renewables backstopped only by batteries and the short answer is no, at least not on the time frame or at a cost that anyone’s willing to, you know, support.

I might get this a bit wrong but I think you need on the order—if you wish to do that you need on the order of sixteen weeks’ worth of storage and we’ve got, like, forty-three minutes’ worth of storage right now, and the cost curves, you know, while they’ve been coming down ain’t coming down fast enough. And, of course, that’s before you even get to the question of you’re not talking about bridging a few hours. You’re not necessarily even talking about bridging a few days.

But there are long, you know, segments of time where there’s no wind. You’ve got seasonal shifts, and if you tried to actually satisfy that demand curve by just building so much solar and wind, it would be so expensive and then you’d have power you can’t use when you don’t need it and trying to ship it to other jurisdictions and we don’t have the transmission lines.

So the short—my sense is no. We’ll do more and, you know, I hope all these flow batteries and stuff like that that ARPA-E has funded end up wildly successful, but I would not bet the farm on that. And therefore, I think for the foreseeable future you are going to need flexible dispatchable power to max out—and Varun Sivaram’s book says so—if you want to max out on wind and solar you need to have that flexible and dispatchable power.

The one last thing just to say about that is you may have seen in the advanced reactor development program one of the two big demo awards was given to the company TerraPower, and their reactor, which is known as Natrium, runs 7/24 because that’s what reactors like to do if you want to optimize their economics. But when you don’t need to feed the grid with electrons they heat up salt and, therefore, the salt—molten salt serves as effective batteries, you know, -ish storage, and that can, in fact, enhance the complementarity of nuclear with renewables.

So that’s my sense of it.

GOODMAN: Thank you.

LAU: Sherri, the only thing I’d add to that—and Dan says it so well—is that I think what will happen is—you know, and we see it in Hawaii because we don’t have the benefit of nuclear or hydro or natural gas so we really are making this energy transition primarily on those intermittent renewables. So storage is really, really important to us.

But Dan’s right. I mean, you can’t completely make it on storage. You have to have some other kind of generation, particularly if you go back to the discussion we were just having about resilience and how important it is to keep the grid up.

But what I think will happen is that those units that provide that stability will become more and more like peaking units or emergency backup units, and trying to rely more on the pure renewables for most of the power.

GOODMAN: OK. Thank you. And let’s see, just to—you mentioned Varun Sivaram, who many of you know, very talented, and wrote his book Taming the Sun at the Council on Foreign Relations. It’s a CFR—

PONEMAN: Oh.

GOODMAN: It’s not a CFR book but he launched it when he was at CFR, I am told, and he now does work for Special Envoy Kerry as leading the First Movers effort.

OK. Laura, next question.

OPERATOR: We’ll take the next question from Steven Koonin.

Q: Oh, hi. Steve Koonin from New York University and former undersecretary in the Department of Energy. Great to see some familiar faces and to be listening to some new ones.

My comment—first of all, Dan is completely right about storage. I just finished convening with Chris Llewellyn Smith a National Academy-Royal Society workshop that looked at many different storage technologies, and it’s just not ready for primetime on the scale and time scale that’s being considered.

But my question is more the following. In that long list of threats and challenges to the grid and its resilience and reliability, nobody mentioned coronal mass ejection or, perhaps, even worse, electromagnetic pulse from some high-altitude nuclear weapon. And the last time I looked seriously when I was in the department—it was about eight or nine years ago—we were entirely unprepared, and a coronal mass ejection would have taken out the whole national transmission infrastructure, an electromagnetic pulse even worse, down to the endpoints of the grid.

So where are we with that threat, which I would regard at least as serious as the other threats that have been discussed?

GOODMAN: Thank you, Steve, for bringing that up, and I recall being part of some analyses we did at the Center—at CNA, Center for Naval Analysis, on that to support DOD over the years.

But, Dan, I know you’ve had a deep dive on that.

PONEMAN: Well, I had in the past, and I’m not current so I will—all I will say, and by the way, you have no idea the relief to have Steve Koonin validate my answer in batteries—I saw him out there—so that was reassuring.

But look, I remember very well, very well, when I was first in the job at Energy, and may he rest in peace, our first secretary of energy, Jim Schlesinger, came in and repeatedly with Fred Clay (sp) warned us about the EMP challenge. And they did that big commission, which I’m sure Steve Koonin remembers.

So I only didn’t mention it because of time, right? And in terms of solar events and that kind of thing, there was—I can’t remember—1897 or so. So I am in violent agreement with Dr. Koonin that these things could have devastating impact and, candidly speaking, when I was still at the Department of Energy we were not well prepared. We had just kind of been digesting that big commission report that came out in 2008 or ’09 or so.

And perhaps Connie from her, you know, more recent work at NIAC could pick up the baton here.

LAU: Sorry. Trying to unmute.

So exactly right, Dan. I remember those days when everybody was worried about EMP, and actually, since that time, EPRI, the Electric Power Research Institute, has done quite a bit of work in that area because, you know, the industry felt we needed to get to the bottom of it.

And so, frankly, you know, Steve, you don’t hear as much about it today, largely, because that work has been done. I’m not the expert in it but I know you can find that report online on the EPRI website.

GOODMAN: OK. Thank you. Let’s go. We have three more questions and six more minutes. Let’s see if we can get those in.

Laura?

OPERATOR: We’ll take the next question from Michael Camuñez.

Q: Good morning or afternoon, everybody. I’m Michael Camuñez. I’m the CEO of Monarch Global Strategies and independent director at Edison International, and a former assistant secretary of commerce in the Obama administration.

Dan, nice to see you again.

PONEMAN: Good to see you.

Q: The question I have is when we talk about smart—about grid resilience, we tend to focus on issues like the source of energy, the storage of the energy. I’d like to ask you all to comment and for your thoughts on the underlying hardware itself moving from an analog to a digital system and the—obviously, there are serious national security implications of being dependent on the hardware that is manufactured in places like China and other parts.

I’ve been surprised, frankly, that in all of the discussion about—with the Biden administration about supply chain resilience and nearshoring that there hasn’t been a higher premium put on the manufacturing capacity for the actual grid hardware that is needed in the United States, thinking about either incentivizing its manufacturing in the U.S. or in Mexico, where I happen to do a lot of work, where there is a strong electronics and other manufacturing base.

Just curious what you see or hear or think about that and what more you think needs to be done on that front.

LAU: Let me jump in, Michael, and I love your CEO, who’s a dear friend, Pedro Pizarro. And, you know, what we haven’t talked about if you want to think about grid resilience is a lot of very traditional ways, which is just hardening of the grid, and that’s really important as well, and there’s so many new technologies that are available to help harden those grids.

You know, what you bring up on the supply chain is very related to the cyber risks that we were talking about and the latent advanced persistent threats that those can introduce into our systems. And, frankly, the industry has been advocating, exactly as you brought up, for manufacturing of some of those critical, critical parts to be made within the United States.

I mean, we talk about restoring American manufacturing, and if you want to do that for any really important parts that’s just critical. I mean, for a long time the industry has looked at the large transformers that, you know, we have to source from outside of the United States. Maybe this is something that is similar to shipbuilding, that the U.S. just needs to develop certain capabilities for national security purposes and retain that, build that in—back into the country and retain it.

GOODMAN: OK. We’ve got three minutes and two questions. Maybe, Laura, we could take both questions and then give the panelists a last round.

OPERATOR: We’ll take the first of the two questions from Jennifer Sklarew and then we’ll take the next question from Joseph Bower.

Q: Hi. Jennifer Sklarew, assistant professor of energy and sustainability at George Mason University and a long, long time ago the Council’s energy security group rapporteur. It’s nice to see you, Dan and Sherri. Long time no see. It’s been great to hear the expert perspectives from all of you.

So I’m interested in the angle of the equity issues that are associated with both climate change and energy infrastructure siting, and so I’m wondering if you have any insights you can share on involving marginalized communities in these conversations, especially as the infrastructure bill and local initiatives are advancing.

I know we have this new energy and environmental justice director at DOE, and New York and Hawaii are both doing some great work on justice issues related to those, climate and siting. Thank you.

LAU: I’ll just say, you know, for Hawaii, we are definitely focused on those equity issues. You know, electricity is a public good. We need to distribute it to everyone. That includes all kinds of these new technologies including things like electric vehicle charging infrastructure, and so it’s really good to see this administration focusing on those marginalized communities as well. Too long they have not had access to some of these technologies and these are technologies that we know can improve people’s lives and so it’s important to get it out there.

PONEMAN: I would just add one line because I know we—

GOODMAN: The last—get the last question in here and then give Dan and Carolyn the last words here.

Q: Hi. Joe Bower. I’ve been a professor for fifty years at the Harvard Business School and the Kennedy School, and I sit on boards of companies. The thing that—you’ve done an amazing job today helping us understand the challenge of governance across all sectors, states, government, locality. I don’t see how any of the solutions we’re talking about can be developed without some resolution of governance.

How are we going to start? And the only—my only thought was that maybe you could emphasize the defense threat and get some kind of unity by treating this as a defense problem. But our governance today is broken.

GOODMAN: Dan, you’re up first.

PONEMAN: Yeah. I’ll be very brief because I know we’re out of time. And first, great to hear Jennifer.

Just one line to add to Connie’s excellent response. Jennifer, A, that’s, you know, very, very important. B, from a perspective of somebody in the nuclear industry, there’s huge opportunities to provide really good nuclear jobs for clean energy opportunities in these coal communities that have suffered, you know, such devastating losses in terms of job loss, in terms of health effects, and so forth. So just to foot stomp Connie’s point, I think you’re spot on.

To the final question, that’s a huge problem and what makes it even worse is what Connie said. Seventy percent of the assets are all in the private sector and what makes it perhaps even worse is we don’t live in, like, a Soviet-style state where we can tell everybody what to do.

So I’m glad you gave me the opportunity. I have always believed—and when I was in government I tried to advocate for this—that we need to find ways to leverage information so that it will drive the investments. What do I mean by that? Connie maybe remembers we got daylong clearances for all the CEOs to see what the threats were. Why? Because they have to defend investments to shareholders and to public utility commissions and they have to know what that threat is, point one.

Point two, instead of just saying do this, do that, if you can say insurance companies will require certain attestations about resilience as a factor in assessing of premiums, auditors—remember, Y2K got a lot of good work done because financial officers had to attest to being Y2K compliant.

So I think we need to be strategic and jujitsu the leverage that’s available by using public policy and credit rating agencies and things like that. They can drive these investments, at least what could begin to scale to the scale of the threat. But you’ve identified a huge problem that would justify a whole CFR session.

GOODMAN: I’m sorry. We’ve broken the CFR rule. It’s two minutes after 3:00 and I have to close it out because otherwise CFR won’t invite us back again.

So I want to thank all of the panelists and our membership for a really robust discussion. If we can be this good then we can improve grid resiliency for the future. I want to thank you all and have a good day. This session will be posted on the CFR website.

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