In Brief: The Coming Electricity Crisis
Artificial-intelligence data centers and climate rules are pushing the power grid to what could become a breaking point.
Climate change is the trump card for the Left, the only justification needed to ram unpopular and/or expensive policies down our throats. There are also always consequences down stream. The result of things like Joe Biden’s effective mandate for electric cars and big rigs is going to be crippling demand on the nation’s power grid. The Wall Street Journal editorial board explains:
President Biden and the press keep raising alarms about a climate crisis that his policies can’t do much about. Yet in the meantime they’re ignoring how government climate policies are contributing to a looming electric-grid crisis that is more urgent and could be avoided.
These pages have been warning for years about an electric-power shortage. And now grid regulators and utilities are ramping up warnings. Projections for U.S. electricity demand growth over the next five years have doubled from a year ago. The major culprits: New artificial-intelligence data centers, federally subsidized manufacturing plants, and the government-driven electric-vehicle transition.
The editors present some numbers to illustrate the looming shortfall, which is led by massive demand increases in Georgia, New York, and numerous Midwest states. “Electricity demand to power data centers is projected to increase by 13% to 15% compounded annually through 2030.”
Because of these challenges, Obama Energy Secretary Ernest Moniz last week predicted that utilities will ultimately have to rely more on gas, coal and nuclear plants to support surging demand. “We’re not going to build 100 gigawatts of new renewables in a few years,” he said. No kidding.
The problem is that utilities are rapidly retiring fossil-fuel and nuclear plants. “We are subtracting dispatchable [fossil fuel] resources at a pace that’s not sustainable, and we can’t build dispatchable resources to replace the dispatchable resources we’re shutting down,” Federal Energy Regulatory Commissioner Mark Christie warned this month.
About 20 gigawatts of fossil-fuel power are scheduled to retire over the next two years — enough to power 15 million homes — including a large natural-gas plant in Massachusetts that serves as a crucial source of electricity in cold snaps.
The cause, the Journal says, is “costly regulation.” The editors conclude:
Meantime, the Inflation Reduction Act’s huge renewable subsidies make it harder for fossil-fuel and nuclear plants to compete in wholesale power markets. The cost of producing power from solar and wind is roughly the same as from natural gas. But IRA tax credits can offset up to 50% of the cost of renewable operators.
Baseload plants can’t turn a profit operating only when needed to back up renewables, so they are closing. This was the main culprit for Texas’s week-long power outage in February 2021 and the eastern U.S.‘s rolling blackouts during Christmas 2022.
The media will discover this problem eventually, though not this year if it might call into question Mr. Biden’s climate agenda. Perhaps they’ll notice when more blackouts arrive.
