NERC warns of summer load on Eastern Interconnection

By the OGJ Online Staff

HOUSTON, May 15 -- The North American Reliability Council is forecasting US generation supply will be adequate this summer in most parts of the country, but transmission overloading could lead to system emergencies in some areas.

US peak electricity demand is expected to increase 3.6% this summer, compared to last year, NERC forecast Tuesday in its annual summer assessment. NERC noted last summer's demand was affected by relatively cool temperatures in parts of the country. Higher natural gas prices may result in reduced output at plants that are unable to recover costs, NERC said, but fuel supplies, inventories, and deliveries also are expected to be adequate.

In 2000, heavy north-to-south power transfers occurred at the Tennessee Valley Authority interface spurred by extremely high temperatures in the South and cooler than normal temperatures in the North. As a result, NERC said the Eastern Interconnection interface was loaded "well beyond its calculated transfer capability"

The nonprofit organization which engages in planning of the bulk power system said it has formed a special task force to analyze and report on the simultaneous transfer capability of the transmission interface before summer.

Early indications, based on transmission reservations for summer 2001, suggest the interface will experience heavy flows again this summer, which will lead to a number of transactions being interrupted and potential emergencies, NERC said.

The interrupted business deals resulted in lost business for the merchants and a need to replace the transaction with higher priced power for the buyers, and in some cases, interruption of interruptible customers, NERC general counsel David Cook said in testimony Tuesday before the Senate Committee on Energy and Natural Resources.

"What do not show up are the transactions that merchants or marketers decided not to engage in because of the likelihood they would be interrupted," he said.

In addition, Cook said, "We have seen entities improperly leaning on the Interconnection, causing unscheduled and unmanageable flows and potential voltage problems." He said some entities have made the economic judgment it is less costly to them to violate the rules than to follow them. But he said it would be a mistake to relax reliability rules to allow higher flows.

In the Southeastern Electric Reliability Council (SERC), which includes TVA, system operators are preparing for another hot summer. NERC said recent generation additions in the southern subregion have raised stability concerns and these concerns "could limit generation output under certain conditions."

Similarly, in the Southwest Power Pool studies show low regional available transfer capability and no significant transmission additions are planned for summer, NERC said. SPP experienced heavy transmission loading last summer caused by bulk transfers of power in and around the region. When responding to transmission loading relief procedures, NERC said SPP has found many of its regional interfaces restricted limiting the scheduling of power into and out of SPP.

New transformers being added to three of the four circuits on the Ontario-Michigan interface are projected to hold actual flow across the interface to its schedule, NERC said. The interface interrupted a number of transactions to avoid overloading the system "on many occasions in past summers," NERC said. Flows that typically loaded the interface are expected to be transferred to the East, it said.