ENERGY
The United States of America is built on energy. Primarily produced by fossil fuels. The transportation area, cars, trucks, airplane, ships, etc. are propelled by gasoline, jet fuel, diesel oil, bunker fuel, propane, etc., all fossil fuels. Transportation is 90% reliant on fossil fuels. About 60% of the Electricity is produced by fossil fuels. Quoting Denny Ervin: “Economies and standards of living hinge on having an adequate, economic, and reliable energy source—attributes that are non-negotiable for an optimal energy infrastructure. Our current trajectory risks creating inadequate, unaffordable, and unreliable energy supplies, which would devastate the U.S. economy and standard of living”.
Mr. Ervin has hit the nail on the head
Electricity Generation
The US generated 4.18Trillion Kilowatt hours in 2023. A trillion Kilowatt-hour are called Petawatt hour. That means that it is 4.18 followed by 15 zeros. Because billing is usually done in kilo watts hours-, it would be 4.18 Tera kilowatt-hours or as it is expressed in the graph, 4.18 trillion kilowatt hours. These vast numbers are here to stay. Primer: Kilo is a thousand; Mega is a million; Giga is a billion; Tera is trillion and Peta is a quadrillion.
The primary source was thermals (natural gas, coal and petroleum) at 60%, Nuclear added 18.6 %. The renewables came in at 21.4 %. Within that renewables list is Wind and solar and they are the rising sources. They came sourced at 14.1% They are non-dispatchable, meaning that their generation is a wild card function of the weather.
Artificial Intelligence Creates Demand For Electricity
Power generation in 2023 was slightly lower than the 2022 generation. Why? Due to higher price of electricity and use of power saving devices like LED bulbs. But the demand is forecasted to increase soon and require a lot of additional generating sources, and transmission lines to carry the increase. This increase is attributed to data center growth. There are an estimated 2700 data centers in the US. Data centers are the backbone of the digital world. They host the internet from not only the US but a big share of the World’s internet. It is in data centers where the Clouds store data for businesses and websites are housed. A large new power demand is forecasted for the Artificial Intelligence (AI). DataCenterDynamics says that data center power consumption in the US is set to reach 35GW by the end of the decade, almost double its 2022 level.
Goldman Sachs posted on 13 May 2024, “AI is showing ‘very positive’ signs of eventually boosting GDP and productivity”. That feeling seems to be universal. The posting says: “Some of the academic literature and economic studies that have looked at the increase in productivity that we’ve seen following AI adoption, in a few specific cases, supports our view that large productivity gains are possible. The average increase in productivity is about 25%. Case studies of companies that have adopted AI imply similarly large efficiency gains. And so, you know, there’s a lot of reasons to be optimistic. It will just take a little bit more time to see these productivity gains realized.”
That is an incredible gain. The nation must do what it takes to accomplish that goal.
Techopedia predicts that the US gain the most:
Techopedia offers why the US will dominate.
“The US leads the way, reflecting its size, private and public investment in research and development, and the talent nurtured by its higher education system”.
Techopedia offers why the US will dominate.
There are impediments to AI success.
The major impediment is the Energy Transition from thermal sources to renewable sources.
There are 3 major actors in this transition. First is the Administration putting up big subsidies to make solar cells and wind turbines installations to assure Crony Capitalist will make money. Second is the EPA that writes regulations that force the demise of reliable thermal sources, particularly coal based. And lastly are the States that write laws, that are ill thought-out, declarations of what sources are allowed, what percentage and the time line. See here and here. This triple bogey is not escaping notice. The grid operators have been telling everyone that their systems are headed for collapse. FERC has been telling the same story. But the Governmental bodies believe themselves to know more about the grids than the grid operators. The companies that are planning to spend vast sums of money to bring AI online seem to be aware of this huge pothole in the road to delivery. They need electricity that is reliable, and they need it now. That can only come from thermal sources. The WSJ front page on October 1, 2024 posted “AI fever abates in stocks’ latest quarter.” The stock market sees that AI is not unfolding as was forecast. You can bet that China is going to provide the power to their AI plans.
The Daily Caller posts: “‘Inevitable And Foreseeable’: Grid Operators Beg Court To Nix EPA Rules To Save Electricity System From Collapse”:
“The Biden-Harris administration says that its stringent power plant rules won’t harm long-term power reliability, but four grid operators stated the exact opposite in a legal brief filed Friday.
The Environmental Protection Agency (EPA) finalized its aggressive emissions rules for America’s power plants in April, saying at the time that the regulations would “improve public health without disrupting the delivery of reliable electricity.” However, four major regional grid operators argued the exact opposite in an amicus brief filed in support of red states’ legal challenge against the rule, stating explicitly that the rules will jeopardize Americans’ ability to reliably secure sufficient amounts of power if they are enforced as is”
Specifically, the EPA’s rules will mandate existing coal plants to harness 90% of their emissions by 2032 if they want to stay open past 2039, and they will also require new natural gas-fired plants to do the same in order to stay open past 2039, according to the agency. The EPA is essentially requiring power plants to meet those emissions cuts using carbon capture and sequestration (CCS) technology, which the four grid operators contend is too expensive and unproven to be mandated on such a tight timeline.”
The EPA is setting up rules that require the operators to use unproven systems (CCS). Coal plants in operation now provide low cost energy. They provide dispatchable electricity. They have a distinct advantage in that they usually have several months of coal stored at their site. Gas units normally do not have a storage that could be used if there is an interruption in the supply line. Nuclear sourced electricity has many months, perhaps as long as a year on plant fuel
The Energy Bad Boys posted:” PJM, MISO, SPP, and ERCOT Join the Legal Fight Against EPA’s Carbon Rules”.
“The four— PJM, the Midcontinent Independent Systems Operator (MISO), Southwest Power Pool (SPP), and the Electric Reliability Council of Texas (ERCOT)— stretch from New Jersey to parts of New Mexico and serve more than 156 million Americans in their respective service territories.
“The rules on carbon dioxide emissions are not the only regulations threatening the viability of the existing thermal fleet. Under the Biden-Harris administration, the EPA has written or updated regulations like the Ozone Transport Rule, the Coal Combustion and Residual Rule, and the Mercury and Air Toxics Standards, all of which are designed to place enough straws on the backs of reliable coal-fired power plants to compel their owners to shut them down”.
AI builders Must Have Reliable Energy Sources
Here are some appeals for reliability:
Larry Fink, Chairman and CEO of Black Rock Investment Management Corporation said no to renewables. Fink spoke at the World Economic Forman that AI will be big and profitable. He wants the suppliers for his operations to use only dispatchable energy sources because they are reliable sources of power 24/7.
Dominion CEO Robert Blue said: “We’re going to continue to be a big builder of renewables. We’re building a big offshore wind farm. We’re building a lot of solar. We’re adding a lot of storage. … But we also recognize that we’re going to need some more natural gas in order to keep the lights on.” In addition to developing more natural gas plants to balance power grids from expansions of intermittent renewables, rising demands are also delaying some retirement of coal plants.
Dominion wants to build a 1,000-megawatt natural gas plant in Chesterfield County, where a coal plant closed last year, stating that the addition is critically important for reliability. Significant costs for these increased power demands — including transmission infrastructures — will be passed on to household and business consumers.
“Alphabet, Microsoft, and Amazon, three of the largest AI data center users, have previously criticized a proposal by utility company Georgia Power to expand natural gas use at the expense of hurting their renewable energy programs. The problem is that those centers require huge amounts of reliable electricity to operate, and no nearly adequate hydrocarbon replacement exists. As former Microsoft vice president Brian Janous observes, whereas “No data center wants to be tied to the need for new fossil resources, that’s the problem… You can’t throw this much [data-center] capacity at the system and not have some degree of fossil resources to support it.”
Amazon states that their data centers are powered by renewable energy. This seems improbable as the industry knows that renewable energy is not dispatchable. They are using a ploy that is provided to make companies feel good about themselves while using fossil fuels. Its called RECs. The RECs provide certified proof that you’re using renewable energy from the grid without installing solar panels or other renewable energy systems at your home or business
Amazon invests in renewable energy projects that generate electricity, which is then fed into the grid. They then purchase or are allocated an equivalent amount of energy from the grid for their use. This is often done through renewable energy certificates (RECs), which represent proof that 1 megawatt-hour (MWh) of electricity was generated from an eligible renewable energy resource.
Meanwhile, the Biden Administration, largely through the perversely titled “Inflation Reduction Act” (IRA), is providing massive and unsustainable economic incentives to move the electric generation market towards virtually exclusive reliance upon renewable energies (wind and solar in particular) plus batteries. However, such forms of electric energy pose inherent problems; especially to the ultra-high electric energy “purity” requirements of AI/data centers. Data centers and AI generally require nine-nines reliability and quality metrics such as voltage, frequency, harmonics, etc.
Summary
The US electricity generation is forecast to have a large new demand to power data centers.
Major grid operators are going to court to cancel EPA rules. They said this must be done or their girds will collapse.
Data center owners/operators recognize that their systems must have dispatchable, reliable electricity. Renewables are not dispatchable.
Next part will examine the non dispatchable wind and solar .
cbdakota.
Climate Change Sanity 