At the Reuters Global Commodities Summit in Houston this week, Stefaan Sercu, chief executive of GDF Suez Energy Marketing NA Inc. shared is bleak opinion that Power Generators in the US are facing a market which has all but eliminated the opportunity for new investment.
At the conference and elsewhere the blame is place on falling natural gas prices on one side and increased government mandate and regulation on the other. In the mandate category it us usually renewable energy portfolio requirements which top the complaint list.
Just who is supposed to pay for the care and feeding of the transmission networks largely built by our great grandparents is always, like religion and politics, just one of those problems not discussed in good company. Heaven forbid we face up to the glaring truth that a simple care and feeding will no longer cut it – the electricity system in the US has become our weak link, our most vulnerable asset. A simple google search on the vulnerabilities of the system; from run-of-the-mill natural disasters (forget more superstorms) and various bad people like terrorists will keep you awake at night.
We can’t afford to fix it is the common refrain – just look down most main streets around East Coast towns and you will see the decades old wooden poles groaning under the accumulated weight of technology. The rats nest of wires and the growing bend in the pole (that we all try not to see) is our system. That is what our way of life depends upon.
Sercu is correct, why should private companies take on the risk of these investments? These companies exist in world of system division created on a set of 1970’s era political and technical fault lines. Remember local and long distance?
Whether we prefer cheap natural gas with emissions much less than coal or we believe that the climate is actually changing and we really should do something about it – transmission, distribution, ie: the system – it needs to be there, no matter what – given the age and ragged state of the US electrical system today – the only entity capable of taking on that type of meta-risk is …. Government.