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Does Maryland Face A Looming Electricity Shortage?
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by John Howley | 2009

Blackouts! Brownouts! Collapse of the grid! The big coal utilities put on their scariest Halloween masks when telling us why we should pay for more high-voltage transmission projects like MAPP and PATH. They use in-house studies and industry-paid experts to show that the ever-growing “peak demand” for electricity means we have no choice. It’s really no surprise that the same companies who profit from building and operating interstate transmission lines would conclude that we need more of them. Maryland voters and public officials have good reason to be skeptical of their claims.

Blackouts! Brownouts! Collapse of the grid! The big coal utilities put on their scariest Halloween masks when telling us why we should pay for more high-voltage transmission projects like MAPP and PATH. They use in-house studies and industry-paid experts to show that the ever-growing “peak demand” for electricity means we have no choice.

It’s really no surprise that the same companies who profit from building and operating interstate transmission lines would conclude that we need more of them. Maryland voters and public officials have good reason to be skeptical of their claims.

 

“Peak Demand” Drives the Debate

Highways get congested during “peak demand”—rush hour. The power transmission system gets congested during peak demand—the hottest days of the summer, when everybody turns on their air conditioners. The utilities fire up local natural gas plants and import more power from coal-fired generators in the Ohio Valley. More power from dirty sources means more global-warming pollution.

Change has come to Maryland. In 2008, the Maryland Public Service Commission (PSC) ordered the state’s major utilities to develop plans to manage the future growth of peak demand. There are different names for it—“demand response” or “demand-side management”—but it all amounts to the same thing, reducing demand on the hottest days. These approaches are quicker, cheaper AND cleaner than new “coal-by-wire” transmission lines.

 

Falling Power Imports Mean New Transmission Isn’t Needed

Maryland relies on neighbors for almost one third of its electricity needs. Only three other states—New Jersey, Virginia and California—import more juice than the Old Line State. These imports are vital during periods of peak demand.

The falling trend of Maryland’s net imports of electricity provides little support for the nightmare vision of impending blackouts and brownouts. Maryland’s power imports fell from 24,715 GWh in 2003 to 20,505 in 2007. The severe economic recession of the past year has likely reduced imports further.

 

While past trends suggest Maryland doesn’t need more import capacity, it is projections of future “peak demand” that will decide the outcome.

 

Low-hanging Fruit

Maryland neglected demand-side management during the past decade. In the 1990s, these programs were common. Many people still have the old “gizmo” on their central air conditioner that let their utility to cycle off their system for a few minutes every hour in exchange for a monthly discount. These popular and effective programs mostly died with deregulation.

Because it has been so neglected, demand-side management is “low-hanging fruit.” According to the Maryland PSC, the utilities have promised to cut peak demand by an amount equal to the projected shortfall in supply.

BGE is Maryland’s biggest utility, accounting for about half of the electricity used in the state. According to what BGE reported to the PSC, this graph shows what could be achieved through demand-side management. The forecasts are based on variables like economic growth, population and weather. It is worth noting that these projections were made last fall, before the depth and length of the economic downturn were clear.

 

growth of peak demand. Indeed, under this forecast, BGE’s peak demand will be lower in 2022 than in 2008. This should be no surprise because demand-side management focuses directly on lowering usage in peak periods.

 

Feds Highlight Maryland’s Huge Demand-side Potential

A recent report from the Federal Energy Regulatory Commission (FERC) underscores the potential for Maryland to meet its future needs through demand-side management. According to FERC, Maryland can cut its projected peak demand by 32 percent in 2019 through demand-side management alone. New techniques target commercial and industrial users as well as residential customers and exploit recent advances in information technology.

 

Sources:  Federal Energy Regulatory Commission, A National Assessment of Demand Response Potential, June 2009. Maryland Public Service Commission, Ten-Year Plan (2008-20017) of Electric Companies in Maryland, March 2009.   n

 

John Howley is an energy economist and editor of MarylandEnergyReport.org.

 

 

 

> 2009 Table of Contents

   
   

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