Monday, December 10, 2018

Military not Waiting for Trump’s Resilience ‘Solution’

On Bases, as off, Distribution is Often Weak Link

By Rich Heidorn Jr.

A draft Department of Energy memo leaked in May that sought to justify coal and nuclear plant subsidies cited a 2008 Defense Science Board report that noting off-site generation supplies virtually all the electricity for the nation’s more than 500 military installations.

“Backup power at military installations is based on assumptions of a more resilient grid than exists and much shorter outages than may occur and is not sized to accommodate new homeland defense missions,” the report said.

But DOE’s 40-page memo failed to note the considerable efforts the military has made to improve the resilience of the installations’ power supplies in the 10 years since then — or that most Defense Department outages are the result of distribution lines or other facilities on its bases. And it makes no mention of climate change, which the military has identified as a concern since at least 1977. (See related stories, Military Sees Climate Change as Growing Threat and US Climate Report Spells out Coming Challenges to Industry.)

In fact, the military has been among the leaders in the federal government in seeking to make its facilities more resilient and in adding renewable power, energy storage and microgrids to its facilities. DOD is the largest single energy consumer in the U.S., spending $3.48 billion on installation energy in fiscal year 2017.

At the time of the 2008 Science Board report, the bases’ backup power was almost entirely diesel generators. Since then, the department has begun investing in microgrids and solar generation to allow their critical operations to continue operating during grid outages.

For example:

  • The Naval Construction Battalion Center in Gulfport, Miss., is leasing part of its land to developer for a 4.3-MW solar PV system. The developer is building a microgrid that connects the PV with diesel generators and energy storage to keep the base operating during blackouts. The project is part of an 11-project, 310-MW PV portfolio in a DOD partnership with Southern Co.
  • Otis Air National Guard Base on Cape Cod, Mass., is adding a microgrid that can keep it running for 120 hours using wind power, batteries and diesel generation. Reportedly the first wind-powered microgrid for DOD, it is expected to be fully operational in early 2019.

    The Otis Air National Guard base, in Cape Cod, Mass., is deploying the Defense Department’s first wind-powered microgrid. | EPA

  • Marine Corps Air Station Miramar near San Diego has a microgrid powered by landfill gas, solar energy, storage, diesel generation and natural gas that can power the installation for three weeks.

The military also has been increasingly turning to renewable generation. Nellis Air Force Base, Nev., for example, is the site of a 14-MW solar PV plant covering 140 acres that meets 25% of the base’s electricity needs.

Nellis Air Force Base is the site of a 14-MW solar PV site covering 140 acres that meets 25% of the base’s electricity needs. | U.S. Air Force

In the National Defense Authorization Act of 2010, Congress ordered DOD to produce 25% of facility energy from renewables by FY 2025. As of FY 2017, DOD was producing or procuring 8.74% of its total facility energy from renewables, below its intermediate goal of 10%.

The military has made more progress in its energy efficiency efforts, reducing its energy intensity (British thermal units per gross square foot of facility space) by almost 50% since FY 1975.

Defense Production Act

The DOE memo proposed payments to “fuel-secure” generators under the Defense Production Act, a Korean War-era law that allows the president to intervene in the economy to protect strategically important resources. In October, however, numerous news outlets reported that the White House had declined to act on DOE’s response following opposition from the National Security Council and National Economic Council. (See Chatterjee Dodges as DOE Spins on Coal Bailout.)

Then-Navy Secretary Ray Mabus with President Barack Obama in 2010 | The White House

In a commentary in August, former Navy Secretary Ray Mabus (2009-2017) said President Trump’s proposal “would do nothing to improve grid resilience.”

Mabus cited a Brattle Group study that estimated the cost of Trump’s plan at $34 billion over two years. “That money would either come from America’s ratepayers — showing up on the monthly bills of millions of households and businesses — or from a Pentagon budget that the military needs for the real business of national security. Invoking DPA authority to spend tens of billions of dollars [to] prop up failing companies without a valid strategic reason would set a dangerous precedent, potentially undermining support for the future use of that authority in a real emergency.”

Instead, Mabus called for investments “in new technologies like distributed generation, battery storage and microgrids. Those will help keep the lights on and the mission up and running at our bases, even if the grid goes down.”

Those technologies have been central to the military’s success in increasing its resilience over the past decade.

Four Sources of Risk

The 2008 Science Board report identified four sources of risk of grid outages: overloads, weather (natural disaster), sabotage/terrorism and cyberattacks, and fuel-supply interruptions.

It cited coal as an example of the last risk, noting that transportation routes that move coal from mines to generating plants “are sometimes remote and lacking in alternatives. Critical rail lines or bridges could be taken out by determined saboteurs. For example, in May 2005, 43 rail cars came off the tracks. The disruption to coal deliveries caused prices to spike and raised electricity prices by 6% nationally, according to the Bureau of Labor Statistics. The 100-mile length of rail line through Wyoming that carries the output of the Western coal belt to power plants is the most heavily traveled in the nation.”

Frank Rusco, GAO | GAO

Frank Rusco, who oversees the Government Accountability Office’s work on a variety of federal government energy programs, says a disruption of coal rail lines is “probably about as likely as you having a long-term disruption in a natural gas pipeline.”

“I’m not sure that there’s a problem that this is the answer to,” he said of the DOE proposal. “It’s not clear there is a fuel diversity problem currently, and DOE hasn’t produced a study that shows that conclusively. … It’s more of an assertion.”

The biggest challenge to the resilience of the military’s electric supplies is not fuel logistics but its own infrastructure.

Most Outages On-base

The military has been reporting outage data for their facilities since FY 2012, but until recently, the data were inconsistent and incomplete. DOD changed its reporting after a 2015 GAO report that the data were unreliable and ignored that most outages occur on department-owned facilities (GAO-15-749).

Between FY 2012 and 2014, the facilities reported 150 disruptions lasting eight hours or longer — 87% of which were outages of DOD-owned facilities.

“Our research indicates that DOD-owned infrastructure, which DOD controls, may play a larger role in disruptions than indicated by the energy reports, which only address external, commercial disruptions involving equipment over which DOD has little control,” GAO said.

For FY 2017, DOD reported about 1,205 utility outages that lasted eight hours or longer, 72% of which were electrical disruptions. Equipment failures were responsible for 43% of the outages, 35% were planned maintenance and 15% were caused by storms or other acts of nature.

Because DOD’s energy reports do not discuss specific examples of utility disruptions and their impacts on installation operations, GAO’s auditors collected additional information on disruptions from 18 installations inside and outside the continental U.S.

Brian Lepore, GAO’s director of defense capabilities and management, said DOD officials are making progress.

They “have taken the concerns seriously that were the grids to go down, or were they to lose access to assured power, there are going to be mission capability problems,” he said in an interview. “While our reports have identified things we think they should do to help enhance their progress … it’s also fair to say they that have genuinely been willing to implement the recommendations.”

Reporting on outages to DOD infrastructure is important “because it gives the department a better sense of where they need to invest their resources,” he added. “It is more than just sort of an accounting exercise.”

Alternatives to Diesel Generators

Solar panels at Marine Corps Air Ground Combat Center, Twentynine Palms, Calif. | U.S.Navy

In October 2016, the Massachusetts Institute of Technology’s Lincoln Laboratory published a study providing a methodology for comparing the cost-effectiveness of competing resilience options and concluded that the military could often obtain better resilience at a lower cost by using alternatives to the traditional reliance on backup diesel generators.

The study’s authors visited four installations where backup power sources were primarily small, building-scale diesel generators — the number ranging from 50 to more than 350 at a single installation.

“The reliability of these generators is typically below industry standards; the maintenance and failure rates of generators during start-up and operation is not always recorded,” said the study, which found that bases’ departments of public works were “often understaffed, leading to uneven testing and maintenance of the equipment despite their best efforts.”

The study found that other options could reduce life-cycle costs and increase resilience for critical mission operations. Among the ideas: larger distributed and centralized generation in combination with PV and uninterruptible power supplies for critical energy loads that cannot tolerate any unserved energy.

“The study found that often, critical energy loads were clustered at a limited number of electrical distribution feeders, providing an opportunity to increase resilience and lower costs by centralizing generation. Consolidating generation into a smaller number of 1-MW or larger diesel, natural gas or other cost-effective fuel source generators at the substation eliminates a large number of smaller generators at the building level. Centralizing generation also allows for revenue-generating opportunities with the local utility or participation in demand response, where these opportunities are available.”

Solar wall at Fort Drum, N.Y. | U.S. Army

The study found that while an on-base centralized energy solution can provide more resilience, bases should first consider improving the reliability of their existing electrical distribution system.

“Currently, a primary cause of outages on some military installations is the lack of reliability of the existing base electrical distribution system. … Critical missions will continue to experience outages if the reliability associated with the base’s electrical distribution system is not addressed. In some cases, a base receives a high level of reliability from the commercial electric system, only to see it degrade as the power makes its way onto the base and to the critical energy load.”

Batteries Still Costly

The analysis concluded that, at existing prices, large batteries (>1 MWh) sized for peak critical energy loads are not cost-effective for the military.

“The challenge with a renewable energy source plus energy storage system is that the energy storage system needs to be sized for the longest expected outage duration at the worst time of the year for solar production (and one that provides continuous power through nighttime operations). This could mean sizing batteries for multiple days, weeks, or months. This leads to a system design severely oversized for the critical energy load to ensure the remediation of outage risks. As battery prices continue to become competitive, however, the DOD could use the modeling and simulation tool to reassess energy storage as a cost-effective energy resilience option.”

Ariel Castillo

Among the authors of the Lincoln Lab study was Ariel Castillo, a Ph.D. engineer now on a Brookings LEGIS Congressional Fellowship who has been among the leaders of DOD’s resilience efforts since 2012.

“It’s a very valuable engineering tool,” said Castillo, who emphasized that he was not representing Congress or DOD in his comments.

Castillo said DOD officials are now working to integrate mission requirements with the tool. “It just so happened for those four bases that we reviewed that solution worked well but … you could go on to a base and your redundancy actually looks pretty good, but your distribution system may not be great.”

Funding Challenges

DOD generally uses congressional appropriations to fund small-scale distributed generation projects and partners with non-governmental third parties to develop large-scale projects, including renewables.

GAO reported in 2012 that DOD was not always getting the best terms in obtaining financing for energy security investments (GAO-12-401). Auditors also found inconsistent reporting on the results of investments, with only eight of 35 projects sampled having documented cost savings or reduced energy use (GAO-16-162).

In a 2016 study, GAO reported on complaints that energy security projects do not compete well against energy conservation efforts based on returns on investment (GAO-16-164).

A later study said better guidance was needed for analyzing costs and benefits (GAO-16-487). Some of the 17 projects GAO reviewed advanced DOD’s renewable energy and energy security goals by, for example, providing power during an outage on the commercial grid. “But project documentation was not always clear about how projects did so,” the report said. “The primary reason … is that DOD has not issued guidance on how to document projects’ contributions to its energy security objective.”

DOD concurred with GAO’s recommendations.

The military is increasingly privatizing its utilities as a solution to underinvestment. Since FY 2012, DOD has signed more than $2.9 billion in energy performance contracts. As of January 2017, it had privatized almost one-quarter of its 2,574 utility systems, according to a GAO report released in September (GAO-18-558).

GAO recommended DOD develop metrics to track the performance of privatization contracts, noting that while the military branches estimated cost savings when awarding contracts, they failed to determine whether the savings were being realized. DOD concurred.

Systems Engineering

Castillo said he sees resilience as “a product of systems engineering” and that solutions must be subject to rigorous  analyses such as the Lincoln Lab tool that consider both life cycle costs and mission requirements.

“I don’t think we can predict the threats the way we used to. If they are asymmetric … threats, I think resiliency is a good way to approach the problem. Because you don’t want your adversary to know how you will adapt and recover. But if they believe that you have vulnerabilities and all of the sudden you are adapting instantaneously, you’re outcompeting your adversary,” he said.

“I care about national security. I care about doing it the right way. I care about doing it in a way that protects the taxpayer at the same time.”

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