PJM Forum Reveals Possible Gas/Electric Interoperability Solutions; Underscores Need For More Discussion

FERC commissioner says creative ideas are needed

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Jun 18, 2015, 03:04 ET

VALLEY FORGE, Pa., June 18, 2015 /PRNewswire/ -- Aligning the natural gas infrastructure with the electric transmission infrastructure may be a complex challenge, but it is solvable, according to Federal Energy Regulatory Commissioner Philip Moeller who spoke at PJM's Grid 2020 Focus on Gas/Electric Interoperability forum June 17.

"Creative ideas are welcome," Moeller told the audience. "We need desperately to keep the momentum going on these issues. Everything changes if we have a big problem, and we will all be blamed," Moeller warned.

The forum is one in a series of PJM events that provide members, stakeholders and policymakers with cutting-edge ideas, visions and technologies that will transform electricity. The focus on gas/electric interoperability is driven by the electric industry's growing reliance on gas-fired generation. The shift to natural gas-fired generation is occurring because of retiring coal plants, new environmental regulations and the low-cost natural gas from shale reserves.

Strains on gas supply during recent extreme winters in New England and PJM led to generator outages and sparked what eventually evolved into the Winter Reliability Program in ISO New England and recently, Capacity Performance in PJM.

"The polar vortex was a wakeup call for more flexibility. Despite the differences in the markets, gas and electric must work together to find more flexibility and reliability for consumers," said Terry Boston, president and CEO of PJM Interconnection in opening remarks.

Moeller, fellow guest speaker Gordon van Welie, president and CEO of ISO New England, and other panelists explored the root issues of the lack of flexibility with gas supply and the incentives for industry participants to solve them. Gas infrastructure in New England has not grown with the demand and more pipelines are needed, van Welie said. Gas pipeline developers want long-term commitments from generators to justify investment.

Experts representing the gas and electric industries, regulators and analysts spoke during three panel discussions focused on identifying the challenges on the gas pipeline side, the electric generation side and potential solutions. Among the challenges is that some gas-fired generators find it more economical to operate as a dual-fuel unit rather than secure a firm contract for gas supply.

The conference was webcast, and a recording will be posted to PJM's website in the coming weeks.

PJM Interconnection, founded in 1927, ensures the reliability of the high-voltage electric power system serving 61 million people in all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia. PJM coordinates and directs the operation of the region's transmission grid, which includes 62,556 miles of transmission lines; administers a competitive wholesale electricity market; and plans regional transmission expansion improvements to maintain grid reliability and relieve congestion. Visit PJM at www.pjm.com.