Globe at night illuminated. Grid reliability is essential to keeping the lights on. iStock/Hayri Ur
Power demand in the U.S. is projected to increase in the coming years as the economy electrifies. That shift can help reduce emissions, but it also increases the pressure on the power grid and the risks that come with any interruption. To add to that challenge, intermittent energy sources like wind and solar are being rapidly deployed to replace dispatchable “always-available” sources like coal and gas, many of which are being forced to retire due to federal and state policies.
But the growing impact of resources that can only generate power under specific weather conditions has tremendous implications for the grid. It is critical that policymakers understand the real-world constraints that these resources face, how they work in combination with dispatchable resources, and why that makes dispatchable energy sources so critical to maintaining reliability.
Assessing the reliability and availability of a given resource is extremely complex and many methods exist. Two of the most important are effective load-carrying capacity (ELCCs) and capacity factors. Understanding these, and their limitations, is essential to grasping the challenges facing the grid.
Effective Load-Carrying Capacity (ELCC)s
ELCCs capture the ability of a generating resource to produce electricity when the grid is most likely to face electricity shortfalls. ELCCs are a percentage of the resource’s total capacity, meaning that if a 100 megawatt (MW) solar farm has an ELCC of 30 percent, then the grid can only expect that resource to contribute 30 MW towards reliability requirements.
This makes it extremely difficult to rapidly and reliably shift to a renewable-dominated grid, because you cannot replace the amount of power a plant could theoretically generate using nameplate capacity as the benchmark, you must assume its real-world contributions to reliability as well. Replacing conventional generation with renewables is simply not a one-for-one replacement. ELCCs are calculated by running probabilistic simulations to determine how much of a “perfect” resource would be needed to substitute for a real resource.
An example of the ELCC calculation done as a part of an ongoing RTO market reform is below. It shows the planning expectations of the grid operator based on the performance of specific resource types in a seasonal capacity.
| Energy Source | ELCC (Summer) | MW Needed to Reliably generate 100 MW (Summer) | ELCC (Winter) | MW Needed to Reliably generate 100 MW (Winter) |
| Nuclear | 98% | 102 MW | 96% | 104 MW |
| Natural Gas (Combined Cycle) | 97% | 103 MW | 76% | 132 MW |
| Offshore wind | 17% | 588 MW | 68% | 147 MW |
| Onshore wind | 9% | 1111 MW | 36% | 278 MW |
| Solar PV | 19% | 526 MW | 2% | 5000 MW |
Data courtesy of PJM Interconnection
The Role of Dispatchable Resources
When looking at ELCCs, dispatchable resources like natural gas contribute much more to reliability than wind or solar energy. While as yet uninstalled offshore wind is expected to approach a contribution to the system similar to natural gas in the winter, its reliability is not consistent year-round like natural gas or nuclear generators. Using ELCCs, 100 MW of solar energy in the summer would be comparable to 20 MW of natural gas generation; in the winter, 5,000 MW of solar energy would reliably generate the same amount as 132 MW of natural gas generation.
The graphic below illustrates this basic challenge.
Graphic courtesy of Vistra Corp, using data from the National Renewable Energy Laboratory
A single, modern natural gas plant that produces 1,000 MW of energy is enough to power 500,000 homes. Yet, to power the same number of homes from resources with lower capacity factors would require 9,000 MW of wind turbines, solar panels, and battery storage and 1,300 times the acreage. Wind, solar, and battery projects also require 10 times more capital investment than a modern natural gas plant to achieve similar reliability outcomes, before considering transmission costs.
One thing ELCCs do not fully account for is how long it takes a resource to come online or cycle off—the time it takes to “ramp” up or down and the scale at which that ramping can be done. Ramping is critical for reliably integrating renewable energy since sun and wind conditions can change rapidly. The more renewables that are connected to an electric grid, the more the grid needs to be able to ramp up quickly to replace the power when the interruptible resource stops producing energy—i.e. when the wind isn’t blowing or the sun isn’t shining.
Some resources, like nuclear power, have very high ELCCs but cannot ramp up or down quickly. That makes it hard for them to support wind and solar, since weather conditions change rapidly. Natural gas provides the unique attribute of short ramp times at lower cost, meaning that on a windy day, natural gas can take a back seat to cheap wind energy while remaining available in case it is needed on short notice—a frequent occurrence. Energy storage options like batteries are growing, but they remain expensive and are limited to roughly four hours of duration. While a useful tool, battery storage is not yet capable of providing power even overnight, let alone a longer reduction in output.
Capacity Factors
The second metric to consider is the capacity factor – a standardized and simpler way of measuring the actual versus theoretical output of electricity generators.
A plant’s capacity factor, or overall utilization rate, compares how much energy a plant actually generates to the theoretical maximum the plant could generate if it was running at continuous full power over a period of time. If a plant is always running, and has a capacity factor of 100, it can produce electricity at its maximum capacity, 100% of the time.
But this metric, while useful, does not account for some key factors. Even more than ELCCs, they do not account for ramping in any way. Capacity factors also look only at real utilization without providing any information as to why a particular resource is, or is not, being utilized.
Since natural gas-fired generators are better able to ramp up and down, they are generally the ones that grid operators will order not to come online during low demand or high renewables production. In contrast, a resource like wind generally produces whenever it is able but cannot produce without the right conditions. This is an important caveat of capacity factors—they do not make the distinction between operators who are asked to not produce and those who are unable to produce.
Nonetheless, capacity factors provide a valuable insight into the scale of energy sources needed to meet 21st century needs. When policymakers talk about massive offshore wind projects, for instance, it is vital to note that 1,000 megawatts of offshore wind does not equal 1,000 megawatts of a dispatchable resource. If policymakers pledge to retire an equivalent amount of coal or gas-fired resources, they are making a crucial error and pushing the nation further toward a reliability crisis.
| Energy Source | Capacity Factor (Average) |
| Nuclear | 92.6 |
| Natural Gas (Combined Cycle) | 56.7 |
| Offshore Wind | 39.0 |
| Onshore Wind | 36.0 |
| Solar PV | 24.8 |
Data Courtesy of the U.S. Energy Information Administration.
Key Takeaways
Warnings about reliability from experts are increasingly dire. In its Long-Term Reliability assessment, the North American Electric Reliability Commission (NERC) warns that “energy risks emerge when variable energy resources like wind and solar are not supported by flexible resources that include sufficient dispatchable, fuel-assured, and weather generation.”
Yet policymakers and regulators continue to introduce increasingly ambitious plans to retire these resources, even as polling shows that Americans want reliability put first. That makes understanding how reliability is quantified and measured more vital than ever.
