CHARLOTTE — Across the country, hundreds of renewable energy projects are set to go up in the next few years. There are logistical, regulatory, and infrastructure bottlenecks getting in the way, but a factory in Charlotte is hoping to help fix the problem.
According to a Berkley Labs study released last year, the U.S. had 2,000 gigawatts of energy capacity stuck in its interconnection backlog, mostly from solar, wind and battery storage projects
To put that in perspective, the current electricity capacity for all existing power plants in the United States is 1,250 GW. Only a quarter of those backlogged projects will likely get built after a roughly three-and-a-half-year wait for developers.
Deputy Secretary of Energy David Turk called it an issue that keeps him up at night.
While speaking at UNC’s recent Cleantech Summit, he said his department is working to streamline the application process for interconnection projects and incentivize transmission upgrades, without sacrificing the environmental and community protections that come with new power projects.
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“We need to live by our values, but we need to streamline,” he said. “There’s a federal government role, there’s a state government role, there’s a regulator role, there’s a utility role.”
Supply issues
Another issue is transformers.
You might be familiar with those green high-voltage boxes in your neighborhood. Their role is to take electricity from the power lines and transform it so it can be used in our homes and businesses.
Every power plant in the country has its own version of this at a much larger scale, using it to transform the power produced by coal, solar, natural gas, etc. into something that can be transported throughout the grid. The problem is the lead time to get this vital piece of equipment has increased four-fold in the past three years.
Siemens Energy is one of the global suppliers of transformers, and according to Richard Voorberg, the company’s North American president, the rapid rise in renewable projects, combined with pandemic supply chain disruptions led to a rapid increase in demand for transformers.
“You used to bring in these really large central power plants, now you’re bringing in a whole lot more smaller power plants,” he said. “And suddenly we’ve got a need to supply more transformers than we have capacity for.”
A piece of the solution in Charlotte
In February, Siemens Energy announced the company will build a new transformer factory on their Charlotte campus, adding 475 jobs and increasing the domestic supply of these much-needed transformers. Currently, 80 percent of transformers installed in the United States are made overseas.
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“That doesn’t speak well for resiliency or security,” Voorberg said.
The factory should break ground by fall 2024 and Voorberg expects transformer assembly will start in January 2026. After a few years of ramp up, he expects the factory will produce about 60 transformers a year, while also offering a service and refurbishment service that can help older transformers keep running.
Meanwhile in Raleigh, Siemens Energy is investing in another part of the energy transmission infrastructure. There, researchers will study more efficient ways of transporting electricity across long distances. That’s something intrinsically tied to renewable energy transmission as renewable projects tend to be sited in areas with lots of available land, outside of major population centers.
Voorberg said he doesn’t expect this research or the new factory to solve interconnection delays on their own, but he hopes it will be part of the solution.
“We’ve got to start somewhere, and this is a big step for us to do,” he said.
How’s the backlog in the Carolinas?
Relative to the rest of the country, the worst of the Carolinas’ interconnection delays seemed to have peaked a little earlier in the renewable energy transition.
Duke Energy built up a backlog of solar projects in the 2010s. After working with the utility and stakeholders, the North and South Carolina Public Utility Commissions passed rules to streamline the process.
“That process used to take about four years,” Duke Energy spokesman Bill Norton said. “We’ve cut that down to 20 months when additional network upgrades aren’t needed.”
Additionally, North and South Carolina were just awarded $2 million in Department of Energy funding to further improve the state permitting process by creating an online hub for developers, local governments, utilities and landowners to provide information on projects and respond to community concerns.
On the supply side, due to North Carolina law mandating Duke lay out its plan for achieving net-zero emissions by 2050 while meeting energy demand, Norton said the utility and NCPUC have established enough lead time on most of their projects to avoid significant backlogs.
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“We have a plan mapped out that will carry us to 2030, in terms of knowing what equipment is required, we’re already ordering that equipment, so we have it in place in advance,” he said.
Even so, Norton said the incoming Siemens Energy factory and an uptick in domestic transformer production should help streamline the process even further.
“Having a trusted partner that we’ve worked with for decades reinvesting in a local facility can only be good for North Carolina,” he said.
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