Limited Pipeline Capacity in North American Regions Raises Winter Fuel Concerns

(Reuters) - The United States has enough power generation to meet demand this winter, but extreme weather could challenge reliability in California and New England by putting fuel supplies at risk, the organization responsible for electric reliability said.

This is nothing new for California or New England, which have not seen much new gas infrastructure built in recent years as their power grids transition from mostly fossil-fired generation to cleaner sources of energy like renewables.

The North American Electric Reliability Corp (NERC) said in a report last week that reliability risks were elevated in both regions because they were still highly reliant on gas-fired generation but had limited gas infrastructure.

In New England, gas is used to heat most homes and businesses and fuel most power plants.

But the region lacks sufficient pipeline capacity to supply enough gas for both heat and power generation on the coldest days when demand peaks. So, many gas-fired plants switch to burning oil when temperatures drop.

ISO New England, the regional grid operator, has procedures in place to make sure generators have enough fuel to meet their power supply obligations.

NERC, however, warned that limited oil inventories during a severe winter event like January 2018 could lead to the loss of generation.

In January 2018, record-breaking cold and a snowstorm prevented some generators from quickly replenishing oil supplies.

"Absent abnormal extreme weather and/or supply logistic issues, our assessment ... is that the region is ready to meet our forecast electricity load and maintain system reliability," ISO New England spokeswoman Janine Saunders said.

California and parts of the U.S. Southwest, meanwhile, rely on gas-fired plants to supply over 60% of peak power demand.

The area, however, has limited gas storage, which NERC said could leave generators at risk of fuel supply curtailments or disruptions during extreme events.

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