University of Michigan researchers prepared a new study purporting climate change is likely to increase U.S. electricity costs over the next century. The suggestion is it will cost billions of dollars more than economists have previously forecast.

Electricity costs in the U.S. are expected to increase more steeply than economists have previously forecast due to power grid upgrades necessary to absorb future peak electricity demand. The change in peak intensity varies by region. Regions represent load balancing authorities, which regulators use to examine grid reliability. This map shows the percentage change in the intensity of peak electricity load under a “business as usual” carbon emissions scenario. The largest peak demand increases appear in the south and west. Image credit: University of Michigan. Click image for the largest view.

The study shows how higher temperatures will raise not just the average annual electricity demand, but more importantly, the peak demand. To avoid brownouts and absorb these surges, utilities will need to spend between $70 billion and $180 billion in grid upgrades – power plants and futuristic energy storage systems for which ratepayers would ultimately foot the bill.

Catherine Hausman, assistant professor at U-M’s Gerald R. Ford School of Public Policy said, “If you look at your own bill across the year, you’ll probably see that your usage is highest in the summer, when you’re running the air conditioning. Climate change researchers know that when we look out over the next 100 years, things will get warmer and, on a per-person basis, use of air conditioning will rise. The question we asked was ‘On the hottest day of the year, when people are maxing out on that, can the grid handle it?’ We build the grid for the hottest hour of the year.”

Hausman and colleagues urge electric grid planners to keep their calculations in mind as they draft 20-year procurement plans. They also have a message for policymakers.

“This means that climate change adaptation is going to be more expensive than we thought. And so mitigation efforts become more valuable – more worthwhile – because they can prevent these costs,” said Hausman, who is co-author of the study that appears in the Proceedings of the National Academy of Sciences. “Our findings should inform the cost-benefit calculations of climate change policy.”

The need varies by region. The researchers examined separately each of 166 load-balancing authorities. These are regions that regulators use when they’re examining the grid’s reliability.

To generate their cost figures, the researchers calculated the mathematical relationship between air temperature and electricity in each region. Then they plugged that into simulations that took into account climate models and two different carbon emissions scenarios identified by the Intergovernmental Panel on Climate Change.

One scenario represents “business as usual,” under which carbon emissions would continue to increase. The other is a scenario under which we stabilize emissions. Under both scenarios, if the nation were to experience temperatures like the ones predicted 100 years from now with today’s infrastructure, the grid would be overtaxed.

In the stabilization scenario, demand on an average day would climb 3 percent, and on a peak day, 7 percent. They calculate a 152 percent change in the number of days experiencing the 95th percentile or above of demand. Absorbing this would require an investment of $70 billion.

Under business-as-usual, demand on a peak usage day would spike by 18 percent, and the number of days in the 95th percentile or above would go up by 395 percent. Preparing for this would cost $180 billion.

What exactly would that money pay for? Electricity storage technologies such as grid scale batteries could work, but they’re still in the research phase. Advances in batteries or the use of electric vehicles for storage could smooth the peaks.

The study also nods to “time varying pricing,” which gives customers incentives to reduce their use at peak times. Solar power and wind power could help a bit, but not enough without better energy storage options. The sun and wind aren’t always on at peak demand times. Given the current state of technology, if the projected climate of 2117 were to occur tomorrow, Hausman said we’d need to build more fossil fuel plants to jump in on the highest demand days.

The researchers caution that this isn’t a “prediction” for several reasons. Yes, increasing temperatures may spur greater adoption of air conditioners, and as a result, greater temperature impacts, but they could also hasten development of more efficient air conditioners.

“We’re not trying to say this is the future scenario,” Hausman said. “We’re saying, ‘If the future climate were here now, what would need to happen to the grid to adapt to that warmer world?'”

One of the problems with posting at the leading edge of technological change is the topics get posted before any replication or usually no third party expert review. Today’s topic hasn’t seen any oversight other than the peer review for publication.

The issues taken as foregone conclusions hinges on climate change. With billions of dollars in the business now and jobs on the line there is little chance that real science will reassert some discipline. Only a few days ago more misrepresentation was found and narrowly reported.

But there is good reason to think that the grid will need to increase capacity even as conservation and efficiency reduce demand. There will be more folks using more power and that alone justifies the Michigan team’s math for replication.

There are lots of more valid issues to factor in than climate change. Some may well have far more impact than climate change. Imagine 100 million cars with 250 mile ranges charging up. Can you imagine draining them in the middle of the afternoon before heading home from work? Just saying. Might want to think these things through with some common sense a well as serious real science.


5 Comments so far

  1. Kaiser Derden on February 9, 2017 9:21 AM

    total nonsense since temperatures at most will go up 1 degree THE AVERAGE will go up 1 degree which means at worst you could have to cool your house down from for example 88 instead of 86 … nonsense on stilts … all of the increases will come from more users and guess what, more users means the investments required will be spread over more people and it assumes 0 improvements in the efficiency of the infrastructure … again nonsense …
    oh and the predicted temperature increases haven’t happened for the last 20 years …

  2. Matthew Musson on February 12, 2017 7:25 AM

    Meanwhile – the price of electricity has gone down across the country and up to 15% in Texas, due to the abundance of natural gas from fracking.

  3. Jagdish Dhall on February 12, 2017 10:56 PM

    Climate is as liable to change as weather, only in longer term. We should and will adjust to it.
    Much more urgent is pollution due to chemicals like sulfur and suspended particles, the real smoke. We can and should change technology to safeguard our health from these problems.

  4. Matthew Musson on February 13, 2017 8:22 AM


    FYI – New York City mandated a conversion from Fuel Oil in their boilers to Natural Gas. Scientific American reported that the air quality was so much better that it is literally saving lives.

  5. Beston Machinery on July 20, 2017 2:02 AM

    We should protect our environment. We can not just cared about our convenience.

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