How much power do consumers wield in driving the conversation on sustainability in the electric power sector? During today's OnPoint, Anda Ray, vice president for environment and the chief sustainability officer at the Electric Power Research Institute, discusses challenges and opportunities in the sector as utilities reshape their business models. She also discusses EPRI's recent work on the energy-water nexus.
Monica Trauzzi: Hello and welcome to OnPoint. I'm Monica Trauzzi and joining me today is Anda Ray, vice president for environment and the chief sustainability officer at the Electric Power Research Institute. Anda, thanks for coming on the show.
Anda Ray: Thank you very much, Monica.
Monica Trauzzi: Anda, EPRI has been doing a lot of work recently on the energy-water nexus. How would you qualify the water intensity of carbon capture and storage technology, and could water use ultimately have an impact on the technologies for future use?
Anda Ray: So let me come back to the water-energy nexus, and there's really three areas that you want to look at. You want to look at water sustainability, you want to look at water management, and you want to look at water quality or water quality trading. So let me just talk about each of those very briefly. So under water sustainability, you want to look at the availability of the water in a particular watershed. So things like drought, population growth, industrial use can really impact the amount of water that's available. EPRI's looked at providing a model that looks out to, say, 2030, 2040 that looks at both the water available on the surface, watersheds, as well as under the ground, and looks at all the different demands on that water so that power systems, when they retrofit, can identify their risks. Now, let's look at water management from a power system, and this is where you were talking about carbon capture. But what's even more intensive than that is actually the ability to cool those steam-electric plants, right? And so over 90 percent use water to cool, so they have this huge withdrawal to cool it even though a lot of it is put back. Cooling towers, actually, are consumptive 'cause they evaporate. So one of the things, technologies to look for is how do power systems use less water? Thermal cooling siphoning, which is looking at a hybrid of both water and air cooled. The unfortunate thing is that those are things you really need to start out. Retrofitting a plant with a hybrid system of air and water is really not cost-effective. It'd be like taking your 1985 car and retrofitting it to be a hybrid. You don't, you'll just go out and buy a Prius or a Volt. But the most exciting thing, I think, is the water quality and water quality trading when you're looking at the energy-water nexus. And a lot of the proposed rules, the effluent limit guidelines, look at nitrates and nitrites, which really don't come from the energy industry as much; 90 percent come from elsewhere. And so looking at how do water quality trading, how can that become part of the permitting process? And that's something else that EPRI's looking at in the Ohio River Basin, is to get the data for verification and tracking so it can be.
Monica Trauzzi: So let's talk a bit about the sustainability side of what you do. Before joining EPRI, you worked at the Tennessee Valley Authority, and TVA last year announced the closure of eight coal-fired power plants. How significant was that move in the broader conversation on coal's place in the electric utility industry, and do you expect this to be the trend that we see moving forward among utilities?
Anda Ray: So I think there's a lot of words thrown about when we talk about plant closures and environmentally responsible and sustainability. So let me at least kind of levelize the playing field a little bit with, what does sustainability mean? People throw it around, they try to wash things they do and make it look by just throwing the word "sustainability" onto it. So I kind of go back to the Brundtland Commission back in the 1980s, and it's meeting the needs of today's generation without compromising the ability of future generations to meet theirs. And that shows up in three different places, and I'm going to come back to your coal plants; I'm not going to let it go, but it shows up in three places. One is meeting the needs. It has to meet a social need, it has to be environmentally responsible, and it has to be economically viable. And you can't let that balance of those three become undone.
So when you look at coal plant closures, many of them are done because it's now economic. To do some of the retrofits to be environmentally responsible is not economically viable and good for the public. And so ... you see a movement in the power industry where that sustainability of being able to balance all three of those will continue to move forward and cause different types of actions from utilities.
Monica Trauzzi: A lack of clarity on climate policy has fueled uncertainty within the industry, and now with the Obama administration moving forward on its New Source Performance Standards for new and ...
Anda Ray: Existing.
Monica Trauzzi: ... existing that we'll be seeing in June power plants, is that sort of leveling the playing field a little more for utilities, and is it providing that clarity?
Anda Ray: So any type of regulation or, hopefully, legislation, is aimed at providing public benefits. And so when we talk about levelizing the playing field, it automatically assumes that there was an unlevel playing field before. And I have to go back to, electricity is probably the single most characteristic and product that has changed the quality of life in this country. And as it has progressed and improved that quality of life, we've also realized that there need to be a continued improvement in that area: reducing the emissions for the environmentally responsible, still providing cost-effective, so I can't just put on all kinds of controls or stop producing or make everything solar, or make everything wind. You need a diversity in your generation mix. So to say that the NSPS, the New Source Performance Standard for existing or for new coal plants or for new gas plants, or the next step would be new refineries, next step would be looking at the CAFE rules, so this is an ongoing evolution and a process in which we try to make our world a better place with the tools that we have. So I don't think it's a matter of levelizing the playing field. I think it's a matter of making continuous improvement in the way that we use this really wonderful product of electricity to better our lives.
Monica Trauzzi: How powerful is the consumer right now in driving the sustainability conversation in the utility sector?
Anda Ray: In my opinion, I'm seeing a transformation of the power system. You normally, in the United States, we're used to central stations because it was economic at the time. We see these large transmission systems because it's economic and reliable, and then you have it down to the distribution and it's gone to the consumer. Well, now all of a sudden, we see a two-way power flow. Why? Because the consumer wants to have cleaner energy, they want to be in more control, but at the same time, they want to keep all the positive characteristics that they had with the integrated power with the large, integrated power system. So what the consumer is helping to drive is, "I want the best of both worlds, so what are you all going to do about it?" And one of the things that EPRI is looking at is, how do you characterize an integrated power system and get the benefits and the value of the best of both worlds, both the part that's being driven at the remote, distributed part, and keeping the best of the best from the centralized part?
Monica Trauzzi: Right. Distributed generation is a really critical part of the conversation right now. How should utilities be approaching the challenge that DG is posing?
Anda Ray: Be a team player. This isn't about "us vs. them" or "them vs. us." This is about that the public will benefit by having an integrated system where you look at the value to the consumer. The consumer wants to have the same power quality that they've had with a central station type of delivery. So for instance, one thing people don't consider is that when their air conditioner pops on, they've seen their lights slightly dim a little bit. Well, that's an inrush of current into the house to get that motor started running. Distributed generation isn't usually sized to handle that kind of a peak power. And so people will be very surprised if they disconnect from the grid and something that they've taken for granted all these years all of a sudden doesn't work. They aren't able to use their air conditioners and have them come, cycle on and off. So what we've got with the utilities is a way for them to say that they need to work together, for the distributed generation and the solar people, it's not a "them or us." They've got to work together.
Monica Trauzzi: So when we talk about the evolution of the utility business model, what do you identify as the key challenges moving forward?
Anda Ray: Changing the system and the way we operate the integrated, I'm sorry, the way we operated the current system was base-load generation. There was a little bit of peaking generation. Well now, you're going to have these plants -- nuclear, base-load, coal-fired plants -- that now are going to have to cycle to be able to follow the distributed generation or the renewable resources; sometimes there's large wind as well. But so now you have a system which is going to have to cycle, and those cycling increases the maintenance cost, because now it's like turning your water on and off and on and off, and you'll have more wear and tear. So I think that's one of the things from their perspective. The other perspective is changing this mindset that their current business model might need to change. Electricity's getting cleaner. Maybe electrification is the way, is another strategy for emissions reduction for air. As we use that cleaner electricity that they have now made with their emissions controls and more central station renewables and even more distributed gen renewables, and electrify those sectors which are still carbon- or fossil-based burning, for instance, non-road vehicles, off-road vehicles, vehicles themselves. There's a real opportunity there to get even cleaner air using a cleaner electric system.
Monica Trauzzi: All right. Very interesting. We'll end it there. Thank you so much for coming on the show.
Anda Ray: Thank you very much. It's been a pleasure, Monica.
Monica Trauzzi: And thanks for watching. We'll see you back here tomorrow. Wonderful.
Anda Ray: Thank you.
Monica Trauzzi: Thank you.