Maguire: Wildfires are a threat to the US power sector in multiple ways.

Wildfire season in the American West was seen as a major threat for years. It was mostly viewed as a danger to homes, trees and utility infrastructure. As smoke from fires blankets vast swathes of the nation, it's becoming a challenge for the power sector.

The U.S. grid has changed. The U.S. grid is changing.

Smoke from wildfires interferes with all of these.

Smoke is unlikely to derail America’s renewable-energy growth, but it is a source of operational insecurity that can reduce solar production, 'complicate grid management', and add stress to transmission system at a time when electricity demand is on the rise.

Here are five reasons why wildfires continue to affect the U.S. electricity system.

1. SMOKE BLOCK

Sunlight is the fuel for a solar-powered power system.

Smoke from wildfires reduces solar radiation that reaches photovoltaic cells by scattering it and absorbing it before the sunlight reaches the earth.

The Colorado State University researchers found that the daily average solar resources around major fires in California during 2020's intense wildfire season fell from 11% to 17% for global horizontal irradiance, which conventional solar panels depend on, and direct normal irradiance dropped by 32% to 40%.

Close to active fires, the impacts can be greater. In heavily affected areas, monthly average reductions for DNI and GHI reached up to 61%.

According to the National Interagency Fire Center, utility-scale solar power is now a major source of electricity in states like California, Texas and Arizona, where there are several wildfires currently burning.

Smoke is a weather variable that can reduce power production in entire regions as the grid depends more on solar output.

2. BAD TIMING

Solar losses arrive when grids are least able to afford them.

Large fires are more likely to occur in periods of extreme heat and drought, as well as when electricity demand is high. These same conditions lead to increased air conditioning use, which drives power consumption towards seasonal peaks.

Smoke can also suppress solar production, just as heatwaves are increasing demand.

This can create a double-hit for grid operators, as there is less renewable energy available at times when electricity demand is highest.

In the past, planners of power plants were concerned about clouds that reduced solar output. They must increasingly take into account dense smoke plumes which can persist over large geographical areas for several days, if not weeks.

3. FLYING BLINDS

Grid operators need more than just power. They need reliable power.

Wildfire smoke is capable of rapidly changing solar output across hundreds of miles. This makes solar forecasting difficult, and forces system operators to purchase?additional reserve to maintain reliability.

Smoke-related losses have been found to influence reserve requirements, electricity market outcomes and reserve requirements in a study by the National Laboratory of the Rockies.

As renewable penetration increases, the problem becomes more acute.

The weather is not a factor when it comes to fossil fuel generators. The output of solar panels is affected by environmental factors. Smoke adds an additional layer of uncertainty to forecasts, which previously relied on cloud cover and temperature.

Wildfire season is becoming more of a grid management challenge than a simple environmental one.

4. TRANSMISSION OVERLOAD

Impacts are not restricted to the power generation industry.

According to research, wildfire smoke and heat can cause airborne combustion particles that reduce the air insulation properties around high-voltage transmission cables.

These conditions can lead to more flashovers, faults, and automatic line trips.

Intense heat can cause conductor sag, which can reduce operational margins.

The U.S. Energy Transition relies heavily on the expansion of transmission systems in order to move renewable energy from remote production areas to urban demand centres.

Smoky air can affect electricity production as well as the infrastructure required to deliver it.

5. Not just the Wild West

The most significant shift in the economy is likely to be geographical.

Wildfire smoke is now a continent-wide phenomenon.

Canadian fires have spread smoke over the Midwest, Northeast, and Mid-Atlantic. Western U.S. Fires also affect areas hundreds, if not thousands, of miles away from the flames.

The good news, however, is that the long-range smoke appears to have only a modest impact on average annual solar resources.

Researchers found that outside areas near active fires, average reductions in photovoltaic-relevant GHI generally remain below 5%, even during major smoke years.

The findings do contain an important caveat. Smoke doesn't need to be a major problem to cause operational issues.

The design of electricity systems is based on managing peak periods and extreme events. It is more important to have a few days with a significantly reduced solar output in a heat wave than it is to make a small difference in the annual generation figures.

Wildfire smoke is not likely to stop America's long term solar buildout, which is good news for those who support renewable energy.

Researchers have found that photovoltaics resources are relatively stable in most parts of the country, even during extreme fire seasons.

Smoke is another climate-driven problem for grid operators who are already struggling with rising demand, frequent heatwaves and a generation fleet that is increasingly dependent on weather.

As?electricity markets have learned to manage risks from clouds, wind speeds and temperatures, they will soon be forced to include smoke in their summer power planning.

Wildfire season, in a grid powered increasingly by sunlight, is both an environmental and an energy story.

These are the opinions of the columnist, who is also an author. This column is great! Open Interest (ROI) is your new essential source of global financial commentary. Follow ROI on LinkedIn, X and X. Listen to the Morning Bid podcast daily on Apple, Spotify or the app. Subscribe to the Morning Bid podcast and hear journalists discussing the latest news in finance and markets 7 days a weeks.

(source: Reuters)