A Summer of Soaring Temperatures and Power Prices

August 29, 2011
Rachel Cleetus
Policy Director

Across wide swathes of America, this summer’s grueling heat had many of us sweltering. In the third week of July, for instance, temperatures were well into the 90’s and 100’s for much of the country. (Check out this incredible, sobering animation of the July heat wave from NOAA)

These heat waves are costly. And deadly — according to the National Weather Service, those few days of extreme heat in July may have resulted in as many as 64 deaths across 15 states. They also expose vulnerabilities in our current pattern of energy consumption.

Not surprisingly, many of us chose to cope with the heat by cranking up the air-conditioning – which quickly added up to a surge in power demand, stressing the electricity grid nationwide. During the heat wave that affected over 30 states in the third week of July, for example, power prices climbed across the Northeast, Mid-Atlantic and the Midwest. Grid alerts and energy conservation alerts were issued in the Midwest, which saw power usage reach record highs driven in large part by air-conditioning demand.

Data from the Energy Information Administration (EIA) in a July 25 report shows that power demand in four regional transmission organizations—the Midwest Independent System Operator (MISO), the PJM Interconnection (PJM), the ISO New England (ISO-NE) and the New York Independent System Operator (NYISO)—either set or narrowly missed all-time daily demand records during the period of July 20-22, 2011. EIA also reported that “Day-ahead, wholesale power prices for peak hours (mid to late afternoon) generally rose from $100 per megawatt hour (MWh) during the early part of the week to almost $350/MWh by the end of last week in parts of the east.” (See chart below)

Source: U.S. Energy Information Administration, Energy Today, July 25, 2011

But let’s not forget that there are many people who don’t have access to air conditioning or are more vulnerable to the effects of extreme heat. People who can’t afford air conditioning or who live in buildings that do not provide it. The elderly, young children and people with compromised health. People who have to work outdoors like farm laborers, traffic police and construction workers. Athletes who have to play sports outdoors.  Apart from the direct effects of extreme heat, hotter days are also associated with higher ozone pollution, which leads to significant health impacts such as breathing problems and exacerbation of asthma.

While no single extreme heat event can be linked to climate change, scientists predict that unchecked climate change is likely going to mean more, and more intense, heat waves across the United States. If recent experience is any guide, that’s going to add up to a lot of dollars, not to mention pain and suffering. Switching to more renewable forms of energy and increasing energy efficiency can help reduce the emissions that cause global warming. In the shorter term, these measures, combined with better integrated resource planning and investments in transmission, can also help diversify our energy mix, reduce risks of outages and make our energy system more robust. Do we really need another summer of scorchingly high temperatures and power prices before we take the sensible course of action?

Posted in: Climate Change, Energy

Tags: economics

About the author

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Rachel Cleetus is the policy director with the Climate and Energy program at the Union of Concerned Scientists. She leads the program’s efforts in designing effective and equitable policies to address climate change, and advocating for their implementation.