Power Outages: A Matter of Reliability or Flexibility?

Power Outages: A Matter of Reliability or Flexibility?

A massive power outage hit the National Interconnected System1 of Mexico last December 28th, leaving close to 10.3 million users without electricity supply for two hours. While this is not the first time an event of such nature occurs2, this blackout left many unanswered questions behind, being the most relevant the following: Are renewables the ones to blame?

Let’s start with the basics! Power outages consist of a short or long-term electric supply interruption in a determined grid section. These failures are caused by different factors, being faults in transmission and distribution infrastructure the most common3. Depending on the extent of the damage, power outages can affect a single house, a city, or an entire region. This particular blackout affected 19% of CFE Basic Supply users, and consisted of the following events:

➡️ 14:28 hrs: CENACE4 announces an imbalance between generation and demand caused the loss of 7,500MW within the system. Immediately, the grid automatic protection systems were activated.

➡️ 14:29 hrs: CFE announces the interruption of supply toward 10.3 million users due to low frequency in the SIN, caused by the disconnection of 16 power generation facilities.

➡️ 15:30 hrs: CFE announces a 45% service reestablishment of the affected users.

➡️ 15:55 hrs: CFE announces a 94% service reestablishment.

➡️ 16:12 hrs: CFE announces the complete reestablishment of the electrical supply.

CFE set up a joint press conference with CENACE immediately after the event to explain the cause of this problem. According to the utility, a fire in the municipality of Padilla in Tamaulipas caused two 400 kV transmission lines to exit operation5, and thus, an imbalance between generation and demand at a nation-wide level.

What does this generation/demand imbalance means?

As electricity cannot be stored, it must be generated and consumed simultaneously. Hence, the TSO6 in question must forecast the overall demand of the system and determine which generators will meet this requirement. The Northeast control region positions itself as the third region with the largest demand in the country (about 56 TWh/year), as well as a significant installed capacity (19.6 GW), including 2.2 GW of solar and wind capacity.

This control region usually behaves as an “exporter”, as it supplies energy to neighboring areas such as the West, Central, and East regions (In fact, these four control regions represent 75% of the overall demand in Mexico!). Hence, if a transmission line of such capacity is not working, an excess generation is created on one side causing reliability issues measured by the frequency in the system. As a result, local demand in neighboring regions is limited to what is generated locally, as well as the exchanges that can take place between other available transmission lines, causing an excess in demand as well.

The unexpected interruption of this key transmission line caused the curtailment of 9,262 MW, coming from 16 power plants, out of which 6,671 MW belong to conventional generation technologies (mostly thermal and CCGTs), and 2,591 MW from intermittent assets (solar and wind).

If this event took place in the Northeast control region, why did it lead to a generalized blackout?

Let’s remember that the SEN is composed by three main subsystems:

  • The National Interconnected System7 (going from Puerto Libertad, Sonora to Cozumel)
  • Baja California Isolated System
  • Baja California Sur Isolated System

This means the SIN shares about 110,000 km in transmission infrastructure with 30 states. During this specific event, the disconnection of the transmission line between Lajas and Güémez led to major instability in the SIN. As a result, cascading events occurred leading to the shutdown of several power plants and the disconnection of several GW of demand in the whole system. This response, known as a rolling blackout, is a last-resort measure used by electric utilities to avoid a total blackout of the system. However, interruptions in electric supply took place in Oaxaca, Querétaro, Guanajuato, Quintana Roo, Chiapas, State of Mexico, and Mexico City, among other states.

Is renewable integration the cause of power outages in electrical systems?

On Tuesday 29th, one day after this contingency, CFE and CENACE (after a further investigation) gave a second press conference in order to go through the main events that caused the blackout. According to Carlos Meléndez, newly instated Director General of CENACE, the sequence of events took place as follows:

  1. Exit in operation of two 400kV transmission lines caused by a fire
  2. Entrance of the grid protection system that interrupted electrical supply in Nuevo León
  3. The SIN was experiencing medium level demand conditions due to winter
  4. A historical integration of 28.13% of renewables within the system

In conclusion, the combination of a high renewable penetration, accompanied by the exit in operation of two 400kV lines led to major instability in the SIN. This announcement generated much controversy, as CFE stated the participation share of renewables within the system must be revised.

While its true that renewable integration poses a major challenge for TSOs, it has nothing to do with the origin of such contingencies. However, systems undergoing an energy transition must be flexible enough to cope with the intricacies of having a diversified energy matrix.

What is a ‘flexible’ power system?

According to the International Energy Agency8, flexibility is the ability to respond in a timely manner to variations in electricity supply and demand. This variability can take place when renewable generation not resulted as what was forecasted, when consumption levels change due to an unexpected weather event, or when the transmission network experiences a failure as was experienced in Mexico.

Large-scale integration of renewable generation in power systems comes with two key challenges: variability and uncertainty. Renewables are intermittent, i.e. they are only available when the sun is shining or the wind is blowing. The biggest challenge for TSOs comes in the late afternoon when solar generation falls, and must be replaced by other power generation technologies (mostly thermal).

Globally, countries are transforming their energy systems to integrate more renewables while maintaining a reliable and secure supply. For instance, renewable energy accounted for almost half of Great Britain’s electricity generation during the first three months of 2020 (with no blackouts!). While Mexico is still at an early stage of this transition, the pathway to follow is not very different: investing in a flexible power system is key.

These investments can be implemented along the value chain. Some examples are the following:

⚡️ Conventional Power Plants:

Thermal power plants, also known as “peakers”, play a relevant role in varying power output at the moments when the system is under stress (peak demand hours). Investments to promote flexibility vary from optimizing operational practices (with data collection and real-time monitoring), to retrofitting existent assets.

⚡️ Renewable Power Plants:

There are three main services a power system needs to perform flexibly: load balancing, frequency response, and voltage response. To date, renewables alone can provide positive and negative balancing energy, and therefore reduce the need of must-run conventional power plants. When paired with BESS9, providing frequency and voltage response is possible too! For example, renewable sources can regulate reactive power (and therefore, voltage response) even when they are not giving real power, and by curtailing or storing power output renewables can also perform frequency control. 

⚡️ Distributed Energy Resources:

These refer to distributed generation, distributed battery storage systems and EVs. While the advantages are toward individuals, by being aggregated these can provide flexibility services by reducing the load of the overall system. While these technologies belong to the generation segment, their benefits are seen on the demand response side.

⚡️ Electricity Network Assets:

According to the IEA, electricity networks enable system flexibility by allowing a broader set of flexible hardware resources to be shared across different geographical regions. Today, significant flexibility resources are still being underutilized due to transmission and interconnection bottlenecks. This issue becomes more relevant in Mexico, a country where investment efforts have focused on the generation side, while neglecting the modernization of T&D infrastructure.

While everyday technology is getting more accessible, the combination between long-term policy-making, and a strong regulatory framework that promotes flexibility practices is crucial. In more advanced wholesale markets, several strategies have emerged to cope with these challenges:

  • Taking advantage of the Capacity Market: A well-designed Capacity Market can send the right signal and incentivize flexible generation by rewarding generators when they provide the right amount of capacity at the right time (the system’s critical hours).
  • Ancillary Services for Renewables: Once again, this is all about optimization! As thermal generators are rewarded for providing available capacity when the system needs it the most, renewable generators could also be rewarded for their capabilities of providing positive and negative balancing.
  • Better short-term planning: Increased efforts in forecasting demand from load centers and controllable demand resources is crucial

In the Mexican case, the T&D infrastructure is experiencing a lack of investment that should have taken place since the Energy Reform was instated. In the meantime, we expect this event has raised some concerns to avoid further contingencies that could be addressed on the next edition of the PRODESEN (to be published next April!).

Mexico holds international commitments to reach 30% clean energy generation by the end of 2021, 35% by 2024, and 50% by 2050. In addition, the country faces a steady demand growth in the coming years. Given the continuous dropping costs of renewables and BESS systems, this long-term scenario would not be possible without investing in flexibility. While this administration places their bets on reliability, it is time to come around and realize that reliability and flexibility are two sides of the same equation.

[1] SIN, per its acronym in Spanish

[2] Only in 2019, three power outages took place in the Yucatan Peninsula.

[3] Only very rarely are the power plants themselves at fault since these systems are built to withstand minor disasters and have various backup facilities that kick in when the main system goes offline for some reason.

[4] National Center for Electricity Control, the system ISO (CENACE, per its acronym in Spanish)

[5] According to Noe Peña, Director of CFE Transmisión, this instability also generated the exit in operation of another three transmission lines.

[6] Transmission System Operator, which in Mexico is CENACE

[7] SIN, per its acronym in Spanish

[8] Source: https://www.iea.org/reports/introduction-to-system-integration-of-renewables

[9] Battery Energy Storage System