Planet Money - Green energy gridlock

Episode Date: May 24, 2023

Lyle Jack wants to build a wind farm on the Pine Ridge Reservation in South Dakota. But to make the project work, he has to connect that wind farm to the electric grid. Which is easier said than done. On today's show - how the green energy revolution may live, or die, by bureaucrats trying to untangle a mess of wires. This episode was produced by Willa Rubin. It was edited by Sally Helm, fact-checked by Sierra Juarez, and engineered by Katherine Silva. Jess Jiang is our acting executive producer.Help support Planet Money and get bonus episodes by subscribing to Planet Money+ in Apple Podcasts or at plus.npr.org/planetmoney.Learn more about sponsor message choices: podcastchoices.com/adchoicesNPR Privacy Policy

This is Planet Money, from NPR. There are so many ways to entertain yourself on a road trip. There's the guess the license plate game, where you try to spot all 50 states. There's the game where you guess what the hazardous materials placard on the side of a truck means. And then there's my favorite, the name the crop in that field game. Is that corn? No, it doesn't look like corn. I'm curious. This is the road trip game I was hoping to play with my friend Dan Charles a few

weeks back. We were driving through Nebraska on our way to report a story. Asparagus? I don't know. I wonder what sorghum looks like after you cut it. Dan, you may remember, was NPR's longtime agriculture reporter, which is why I was very excited to play the Guess the Crop game with him. No one better. But he was on to a whole new game. Oh, it's a power line. We're going under the power line. The Spot the Power Line game. 115 kilovolt line marching across the landscape. Dan, something has changed in your life recently.

I feel like you've started to look at the world in terms of wires and transformer boxes. When you start doing that, you can't stop. You look at that and say, hmm, I wonder what kilovolt rating that line is. It's the weirdest road trip I've ever been on. As we drove by and under wires, Dan was starting to sound a little out there. The wires are our salvation, Nick.

I gradually realized the thing Dan thinks we need saving from is climate change. The wires are the one hope we've got of getting energy that's clean. As we were driving through the high plains, Dan told me that he can see a world in which we no longer need to use fossil fuels to do all the things we like to do, to drive around town, to have hot showers and cold beer. Instead, we can do all those things with electricity. And the cool thing is we're already set up to do this.

You know, like practically every house in the country is already on the grid. It's got wires, you know, connected to it, carrying electricity. I'm sensing a but. But. Well, the electricity's got to be clean. Yeah, right now, a lot of electricity comes from burning gas and coal. But Dan was telling me you can also produce electricity cleanly, like with wind and solar. So if you could get clean power flowing through all these lines to power our cars and showers and fridges, that would mean a lot less carbon going out into the atmosphere and screwing things up.

This could really happen? It could happen. It's actually happening. I mean, there are solar projects going in every day. There are an incredible number of wind projects right now getting built in this part of the country. It is really windy out here. This is, in fact, why Dan brought me here. Because he had heard about a big wind project nearby in South Dakota on the Pine Ridge Reservation, which is one of thousands of green energy projects that right now want to connect with the electricity grid. But they have run into this obstacle,

and it's the same obstacle that wind and solar projects all across the country are running into. These projects, they cannot connect to the grid, which is bad, not just for the wind farmers, but for the future of humanity. You want to do the hello, welcome to Planet Money? Okay. Hello, and welcome to Planet Money. What do I say now? What's your name? Oh, hello and welcome to Planet Money. I'm Dan Troll. And I'm Nick Fountain. Today on the show, we are going to hear from those folks who are trying to build this big wind farm right here on the Pine Ridge Reservation. We are entering it right now, and we're going to hear from them about that big obstacle that they have run into.

It has a name. It's called the Interconnection Cube. Like, get in line, buddy. The Pine Ridge Reservation is in the southwest corner of South Dakota, right on the border with Nebraska, and it is home to the Oglala Lakota Nation. We got out of the car, and it hit us. Oh, I was expecting it to be windy, but man, this is freaking windy. I gotta kind of brace myself just to stand up here. You're a skinny guy.

Oh, Dan is flying away. This is where we met Lyle Jack. Long hair and a ponytail, glasses, the tint in the sunlight, bright red polo shirt. He is a big guy. Six foot two, at least. And you are not afraid of this wind?

No. If I see a funnel cloud form, then yeah, I'll get it. Growing up, Lyle flew kites in this wind. Ran like the wind. I used to run cross country. You know, I'll get it for you. Growing up, Lyle flew kites in this wind. Ran like the wind. I used to run cross country. You know, I was fast. So they used to call me Greyhound, and after that they shortened it to The Hound.

He doesn't run much anymore. His main thing now, and for the past 20 years, has been trying to build a big wind farm here for his tribe. Because that is, is like the perfect business for this part of the world. There is so much wind here. Yeah, the Saudi Arabia of wind, they call it. No. Exactly.

Lyle realized a while back that his tribe and many other tribes in this area could pay for so many things they need just by harvesting some of the wind. We asked Lyle for a tour and he said sure. We could go out to the site and I'll show you the area. Absolutely. He'll take us to the spot where they're going to put up the windmills.

Usually he drives a truck, but today he's got his wife's car. Actually, she's got my pickup. Which has vanity plates. It says LNH Jack. Yeah, Lyle and Harold Dean. Love to see it. I love a vanity license plate. We get in, drive for about an hour,

and Lyle tells us about all the hurdles he's faced trying to get this wind farm built. There was a lot to do. That's why it's taken 20 years. One of the biggest things, he convinced a majority of the tribes in South Dakota to join forces. And they created a company. The Oceti Sakowin Power Authority. They had to do it as a company and not as a group of tribal nations for a very interesting reason. So they could get

sued. Because tribes have something called sovereign immunity. Immunity from lawsuits. Which sounds nice, but companies aren't going to sign contracts with somebody they can't sue. Lyle tells us they needed some people to sign contracts with them. They had to find some

kind of corporate partner. They eventually found one. It's called Apex Clean Energy, and it's built lots of wind farms. They're actually the ones who identified the spot for the wind turbines we're headed towards. It's way far out up a gravel road. You're not used to driving on back roads, are you? You take me as a city slicker, you're're right we have to stop before we get to the exact spot the road out there is so muddy lyle doesn't think we'd make it although he's sure his truck would have these little cars can't handle this gravel we'd be sliding off of it i brought you guys out perfect time so you can see the wind for yourself feel it man this is a dance we're on a ridge looking out over miles of grass covered hills barely a house in sight turbines will be out by about northwest of here all through

this area out here and over oh really so they'll go way out into the distance they're going to be spaced out all in that direction you think and you put the turbines right where the wind is the highest speed. Exactly. But that's only half of the reason why they chose this spot. Turn around, look the other way, and there is a power line. Your favorite thing, Dan. That is right. They're beautiful.

Pairs of wooden poles carrying wires over the hills and out of sight. That's a 115 there. That is shorthand for 115 kilovolts. Oh, 115 kV. Yeah. In the world of high voltage electricity, I got to tell you, that is just a modest power line. But it's the biggest one the Pine Ridge Reservation's got. This is the transmission line they need to connect to, so their electricity can flow out to the rest of the country, to people who need it. So this is kind of the key to the whole project. Yes, it is.

There's another good site 250 miles north of here, on a different reservation. That one's also close to power lines. Those are even bigger. Yeah, those are actually 345 kilovolts. 345 kV, baby! So Lyle's company chose these two sites for two wind farm projects. And in 2017, they write up a formal request to connect their wind farms to the electricity grid. And this is where Lyle's dreams, really the world's dreams, crash into some limits, both physical and fiscal.

Right, and that's because Lyle's request ends up on the desk of this very methodical engineer. My name is David Kelly. I'm vice president of engineering at Southwest Power Pool. Could you just describe what Southwest Power Pool does? A lot of times we'll use the example of being the air traffic controllers of the transmission grid. For something that's basically a hodgepodge of equipment installed by a bunch of separate utilities, the grid is kind of a work of art. David and the folks at Southwest Power Pool, or SPP,

they have to make sure that exactly the same amount of electricity is flowing into the grid as everybody out there is taking out of it, second by second. Because if you don't have enough power on the grid, you get blackouts. If you have too much, wires melt. Also blackouts. Do you need nerves of steel like air traffic controllers? Is it as tense?

It can be, absolutely. It can be pretty hairy at times. David's basic job is to make sure the grid stays in perfect balance no matter what happens. Factories shutting down suddenly, storms rolling through and knocking down power lines, everyone tuning in to dancing with the stars at exactly the same moment. So all this is why David keeps such a tight watch over who gets connected to his beautiful, fragile grid. watch over who gets connected to his beautiful, fragile grid. He does not want a bunch of wind turbines connecting willy-nilly, flooding the grid with power, knocking it off balance. And yet so many people are knocking on David's door with fresh wind and solar projects,

like Lyle and his two wind farms. They all want to connect to the grid right now. When they turn in their requests, they basically have to get in line. And that long line is called the interconnection queue. Right now in our interconnection queue, we have just shy of 600 different projects. So these two projects that you mentioned, they are just two of, you know, just really hundreds of projects that are trying to be developed. So you're the gatekeeper? are trying to be developed. So you're the gatekeeper?

We are the gatekeeper, but only for evaluating whether or not the grid can reliably accommodate the new generator. I tell David, he sounds like the bouncer outside a really popular nightclub, you know, looking at a line that stretches down the block, trying to figure out, okay, who are we going to let inside? That's not a terrible example. So let me take that a little bit further, right? So every club has a fire code that they have to adhere to, right? They can only let so many people in the door. Otherwise, it could be dangerous. And to figure out for each project whether letting it in the door would be dangerous for the grid, SPP does a study.

What would it look like on the grid if we let this project in or that project in? The problem is it's been taking years to run these studies and tell people whether their wind or solar farm is allowed to connect to the grid. And it's not just SPP. There are other interconnection queues for other parts of the country. They're all overwhelmed. Thousands of projects are in limbo.

They usually have to wait years for an answer. There's a statistic that just floored me. The projects sitting in the country's interconnection queue right now represent more electrical generating capacity than all of the power plants that currently exist in the whole country. All of them. SPP knows this is a problem. And in an effort to speed things up, they now do their studies on a whole group of projects at once.

It's 50 or 100 at a time. And they look at what bad things could happen if all of them were connected to the grid, generating their full power. So we identify that there's a line that's overloaded, a transformer that's overloaded, a stability problem that occurs on the grid. And so we have to identify a fix. They figure out what equipment they would need to upgrade to make sure the grid is never in danger of crashing. And that's typically, you know, a new transmission line, rebuilding an existing line, adding a transformer, for example. And those costs are typically assigned to the generators that are seeking to interconnect to the grid. That last bit is super important. If you want to build a wind farm and it's going to require bigger wires to carry that electricity, you,

the developer, have to pay for those upgrades. Not the local utility, not the government. You do. To use that nightclub analogy, the bouncers are saying, we can't let you in right now. Fire code, you know. But if you really want in, you can pay to build an addition. Make the club bigger. Lyle and his partner in this project, Apex, they submit their request to connect to the grid. And then they wait for SPP to tell Lyle and his team how much it's going to cost.

One person on that team is Caroline Heron. She's a consultant in Washington, D.C. Lyle told us she's been kind of the glue holding this whole project together, talking to government agencies, talking to SPP, relaying stuff back to Lyle. It's been quite the experience. This has become my one major client in the past few years. This is your life now? That it is. That it is. Caroline knows that this number they're waiting on from SPP, it could make or break the project. She's heard stories about other wind farms getting huge cost estimates for connecting to the grid, like hundreds of millions of dollars. But she's hopeful that for them, that won't be a problem. They designed their projects

to be small enough that the existing power lines could handle anything the windmills would generate. Yeah, we knew we'd have to pay to actually physically interconnect. But the other transmission lines in the system, we didn't think we'd have to be updating any of that infrastructure. And the direct interconnection might be like a few million dollars? Exactly. Yep. Wow. Boy, were you wrong. As we found out, and as a lot of developers have found out. This cost estimate is the key fork in the road for so many green energy projects.

And if you get bad news, you might have to give up your wind farm dreams. After the break, Lyle and Caroline and a whole bunch of other people realize the country needs a better way to get new power lines built. The future of the world literally depends on it. Okay, so remember, Lyle's company, the Ochente Chicoe Power Authority, put in its request to connect to the grid in 2017. In late 2021, more than four years later, they're still waiting for that study that will tell them how much it costs to connect to the grid. And in January of 2022, Caroline Herron, Lyle's DC contact, learns that they're getting close to an answer. At that point, I was checking every day,

trying to see, did they drop the study? Did they drop the study? Did they drop the study? And there it was, opens it up, had to find our projects, and it was just a kick in the gut. That power line we'd looked at on the Pine Ridge Reservation, SPP says a lot of it would have to be rebuilt. The really big power line to the north, same deal. Transformers would have to be upgraded all the way down the line. Some of them are hundreds of miles away from Pine Ridge. The total price tag to connect to the grid for those two wind farms at those two spots? It was $426 million for one project and $449 million for the other project. I mean, it was just exorbitant. You could not, if that was the true cost, these projects would not be built. They'd been figuring building the wind farms would cost them $1.2 billion.

If just connecting them to the grid was going to cost another $875 million, it would jack up the cost of the project by 75%. At that price, they might just have to give up, drop out of line. But they want to hold on as long as they can. Because remember, SPP was studying the impact of a whole bunch of projects at once, including ones that would use the exact same wires and transformers as Lyle's project. If some of those other projects were to drop out, those wires wouldn't need to carry as much new power, so Lyle might not need to upgrade them at all. Connecting might suddenly get cheaper. Lyle and Caroline find themselves in this weird game of chicken with the other projects in line. It's like, who's going to drop out?

You drop out. No, you drop out. You drop out. Anyway, a few months later in August of 2022, the revised study comes out and some of the other projects have dropped out. Lyle's wind projects are now on the hook for upgrades costing about $230 million. A quarter of the previous number, which is better. But $48 million of that is due within 15 working days as a deposit. And they can't come up with the money that fast.

And we missed the deadline and had to give up our queue positions. They drop out of line. And then Lyle's partner, Apex Clean Energy, pulls out of the project. We thought the project was dead. And how were you feeling at that? I was feeling devastated, you know. Just like, oh shoot, we've got to start from scratch again. I don't know if I can do this anymore.

You spent nearly 20 years working on this project. Yeah, and it's been a rough ride. It's been a great ride, but it's been a rough one too. Hundreds, maybe thousands of other wind and solar projects can tell similar stories of waiting in line, then giving up. It seems like there's got to be a better system. Yeah, here are a few ideas we heard. One of them has to do with that fear of green energy projects overloading the grid.

And the idea that we've got to upgrade our power lines first to prevent that from ever happening. You could decide instead not to wait for the perfect system. You could just go ahead, connect those new wind farms to the grid and say, we'll manage any problems as they pop up. Like maybe every so often you'll have to tell some wind farm or gas burning power plant to throttle down its output. This is actually how the system works in the United Kingdom. Another big idea? Share the cost more widely. Treat the electrical grid like it's a public good. Everyone benefits from these upgrades, so everyone should help pay. Utilities could pay for it and pass along that cost to their customers, or the government could step in and build new power lines.

The taxpayers would fund that. The federal government is doing a few things already to make this process easier. Or the government can step in and build new power lines. The taxpayers would fund that. The federal government is doing a few things already to make this process easier. The agency in charge of the queue is writing some new rules, trying to make it move faster. And there are some important changes in that big spending bill that Congress just passed. Here comes the Inflation Reduction Act. The Inflation Reduction Act. Reduction Act. The Inflation Reduction Act.

It includes money for new electricity transmission projects and some money specifically for energy projects on reservations. And that might be bringing Lyle's wind projects back from the dead. Right now, he told us, they are starting to work with a new partner. And we're in negotiations right now and everything. How many dips and valleys have you gone through with this thing? Oh, hundreds. Sometimes it keeps me up at night. And then it gets so close.

I remember getting close now. We're like we are now. We're getting ready to develop. Lyle thinks this project is closer than ever before to happening. He's so hopeful that he's been working on it, even though it's not a paid job anymore. Brought it this far, you know, and for me to not see it through,

it's, I just can't do it. We're going to get there. You know, is it just the fact that you put all this time into this? It is, plus it's... Or is it the thing itself that you feel... It's the thing itself as well. You know, I want something good for our people. You know, I want something big for our people.

We're on the road again. On the road again. We left Pine Ridge. Dan headed north to Rapid City. I drove south the six hours to Denver. Hey, Siri, what does it mean when a truck says 1993 on the side?

I was pretty bored. To believe in this living is just a mean when a truck says 1993 on the side? I was pretty bored. Before this trip, I would have barely noticed the power lines, but now I see them everywhere I go. Are the wires over there our salvation? Maybe. I'm more convinced than I was three days ago, that's for sure. You saw the light, Nick. Saw the light. I mean, yeah, it is amazing.

This whole transformation. Maybe the most important transformation of my lifetime, it all hangs on those wires. Those beautiful, beautiful wires. This episode was produced by Willow Rubin. It was edited by Sally Helm. It was fact-checked by Sarah Juarez, engineered by Catherine Silva. Jess Chang is our acting executive producer. Special thanks to Joe Rand,

Chris Coulson, and Jacob Mays. I'm Nick Fountain. And I'm Dan Charles. This is NPR. Thanks for listening.