The Coming Electricity Crisis…

From Puerto Octay, overlooking Llanquihue Lake in southern Chile, the setting for Gaspar Antillo’s film Nobody Knows I’m Here, I try to examine the mind of my friend and colleague, Germán Toro Ghio.

‘In the divine vineyard, you choose your own path is a beautiful metaphor.’

As we make our way along the journey of life, some of us choose to travel in the fast lane in vehicles with sleek engines and plush seats, while some of us prefer slower speeds and budget-friendly tolls on scenic routes. Some of us endure crowded buses with loud music or navigate challenging terrains, facing harsh weather conditions and wildlife.

Germán’s stories feature individuals who have chosen unconventional paths in the journey of life: some of them use elevators, rappel down cliffs, or fly in contraptions. His explorations endlessly take his viewers on exciting adventures, from the unease of a Moscow hotel to the excitement of jungle escapades in Nicaragua, from brilliantly-lit worlds pulsing with electricity to dark worlds immersed in infinite blackouts.

Finally, Germán tantalizes us with an eclectic mix in his creative pot, leaving us eager for more of his daily works. His narratives enrich and untangle the most complex history by shedding light on experiences beyond the battlefields and palaces.

Juan Forch

  *JUAN FORCH IS A POLITICAL SCIENTIST, FILMMAKER, WRITER, PUBLICIST AND THE CO-CREATOR OF THE INFLUENTIAL "NO" POLITICAL CAMPAIGN, A SIGNIFICANT MILESTONE IN THE HISTORY OF POLITICAL COMMUNICATION. HIS UNIQUE CREATIONS HAVE INSPIRED AN OSCAR-NOMINATED FILM BY PABLO LARRAÍN FEATURING GAEL GARCÍA BERNAL, SOLIDIFYING HIS LEGACY AS A POLITICAL MARKETING MASTERMIND.

Notes from the editor: 

On this Good Friday, amidst the ongoing discussions among politicians regarding a possible conflict in developing nations, it is profoundly disheartening to observe how our avarice and inflexibility have obscured our discernment and diminished our empathy towards each other. 

On the 13th of this month, a popular blog published a thought-provoking article titled “How imminent is a worldwide electrical outage?”  The article highlighted the growing demand for power and the concerning deficit in energy supply faced by the United States.  In just a short time, the post has been read over 120,000 times and has sparked an enormous debate on Energy Central, with many experts weighing in with their opinions and sharing interesting facts on the topic.  

This article has also led to other debates and discussions on the issue, further highlighting the importance of the subject.  Today, the editorial board of WSJ published an article discussing the crisis in the electrical sector, adding to the ongoing conversation and bringing more attention to the matter. 

The growing potential for a widespread blackout is becoming more alarming as the pressure on the power grid intensifies. 

Many will claim this is madness; however, reality begs to differ. 

The International Energy Agency (IEA) issued a warning in their 2021 Electricity Market Report about a significant increase in global electricity consumption.  This warning came eight months before the Soviet gas squeeze left Europe in a serious supply restriction crisis and caused severe damage to the economy.  Last week, the Washington Post also issued a similar warning. 

It is imperative that the market notice this warning and examine its requirements to provide the necessary adaptations to accommodate the increasing prevalence of renewable energy sources.  Regulatory frameworks must be updated and adjusted to the current surge in energy demand to facilitate a seamless transition to emerging technologies.  Achieving a successful market transition requires a delicate balance between sustainability, reliability, and affordability.

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“CERAWeek 2024 was a whirlwind of innovation, collaboration, and a renewed sense of urgency around the energy transition. I am excited to see the vision of the AES Corporation on the importance of Artificial Intelligence for the energy transition.  

From AI-powered grids seamlessly integrating renewables to AI applications to optimizing energy storage and distribution, the innovation in how we work using AI will revolutionize the energy landscape.

Renewables’ exponential growth will be the fuel of the future. Scaling green solutions to meet global energy demands will be pivotal, and I am extremely proud that in 2023, The AES Corporation doubled the green capacity constructed compared to 2022, completing 3.5 GW of renewable projects. 

Artificial intelligence will enable us to accelerate the future and unlock the full potential of clean energy.

CERAWeek highlighted the importance of collaboration between governments, businesses, and innovators to accelerate progress; it was fabulous to meet with so many colleagues working to accelerate an energy transition, which encourages me that we are ready for a global response to the change of climate change. 

Together, we will accelerate the energy future by harnessing the power of renewables and AI and leveraging the talent and dedication of the AES Corporation people, said Bernerd Da Santos, AES Executive Vice President—President of Global Renewables / Green Hydrogen and CEO of AES Clean Energy.

The looming threat of The Coming Electricity Crisis….

Artificial-intelligence data centers and climate rules are pushing the power grid to what could become a breaking point…

  THE WALL STREET JOURNAL'S EDITORIAL TEAM ON MARCH 28, 2024, ADJUSTED BY GERMÁN & CO.

President Biden and the press keep raising alarms about a climate crisis that his policies can’t do much about. Yet in the meantime they’re ignoring how government climate policies are contributing to a looming electric-grid crisis that is more urgent and could be avoided.

For years about an electric-power shortage. And now grid regulators and utilities are ramping up warnings. Projections for U.S. electricity demand growth over the next five years have doubled from a year ago. The major culprits: New artificial-intelligence data centers, federally subsidized manufacturing plants, and the government-driven electric-vehicle transition.

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Georgia Power recently increased 17-fold its winter power demand forecast by 2031, citing growth in new industries such as EV and battery factories. AEP Ohio says new data centers and Intel’s $20 billion planned chip plant will increase strain on the grid. Chip factories and data centers can consume 100 times more power than a typical industrial business.

PJM Interconnection, which operates the wholesale power market across 13 Midwest and Northeast states, this year doubled its 15-year annual forecast for demand growth. Its projected power demand in the region for 2029 has increased by about 10 gigawatts—about twice as much as New York City uses on a typical day.

Don’t expect the power to come from New York, which is marching toward a power shortage as it shuts down nuclear and fossil-fuel power in favor of wind and solar. A new Micron chip factory in upstate New York is expected to require as much power by the 2040s as the states of New Hampshire and Vermont combined.

Electricity demand to power data centers is projected to increase by 13% to 15% compounded annually through 2030. Yet a shortage of power is already delaying new data centers by two to six years, according to commercial-real estate firm CBRE Group. It is also driving Big Tech companies into the energy business.

Amazon this month struck a $650 million deal to buy a data center in Pennsylvania powered by an on-site 2.5 gigawatt nuclear plant.

Data centers—like manufacturing plants—require reliable power around the clock year-round, which wind and solar don’t provide. Businesses can’t afford to wait for batteries to become cost-effective. Building transmission lines to connect distant renewables to the grid typically takes 10 to 12 years.

Because of these challenges, Obama Energy Secretary Ernest Moniz last week predicted that utilities will ultimately have to rely more on gas, coal and nuclear plants to support surging demand. “We’re not going to build 100 gigawatts of new renewables in a few years,” he said. No kidding.

The problem is that utilities are rapidly retiring fossil-fuel and nuclear plants. “We are subtracting dispatchable [fossil fuel] resources at a pace that’s not sustainable, and we can’t build dispatchable resources to replace the dispatchable resources we’re shutting down,” Federal Energy Regulatory Commissioner Mark Christie warned this month.

About 20 gigawatts of fossil-fuel power are scheduled to retire over the next two years—enough to power 15 million homes—including a large natural-gas plant in Massachusetts that serves as a crucial source of electricity in cold snaps. PJM’s external market monitor last week warned that up to 30% of the region’s installed capacity is at risk of retiring by 2030.

Some plants are nearing the end of their useful life-spans, but an onslaught of costly regulation is the bigger cause. A soon-to-be-finalized Environmental Protection Agency rule would require natural-gas plants to install expensive and unproven carbon capture technology.

The PJM report cites “the role of states and the federal government in subsidizing resources and in environmental regulation.” It added: “The simple fact is that the sources of new capacity that could fully replace the retiring capacity have not been clearly identified.”

Meantime, the Inflation Reduction Act’s huge renewable subsidies make it harder for fossil-fuel and nuclear plants to compete in wholesale power markets. The cost of producing power from solar and wind is roughly the same as from natural gas. But IRA tax credits can offset up to 50% of the cost of renewable operators.

Baseload plants can’t turn a profit operating only when needed to back up renewables, so they are closing. This was the main culprit for Texas’s week-long power outage in February 2021 and the eastern U.S.’s rolling blackouts during Christmas 2022.

The media will discover this problem eventually, though not this year if it might call into question Mr. Biden’s climate agenda. Perhaps they’ll notice when more blackouts arrive.